SEQUIM — An eventual reopening of the Sequim Aquatic Recreation Center, which will close Oct. 30, is contingent on the success of a proposal by the Olympic Peninsula YMCA to manage the facility.
Citing lack of funds, the board of the exercise center known as SARC voted during a special meeting Wednesday night to close the athletic center on the final business day of the month.
“This is a temporary suspension of operations, which means closing the facility” at 610 N. Fifth Ave., said Frank Pickering, SARC board chairman.
The potential YMCA partnership “is the one possibility that might work” to reopen SARC as soon as possible, Pickering said Thursday.
If YMCA and SARC are not able to come to terms and no other entity comes forward, SARC may remain closed permanently, he said.
“Absolutely. We have no money to run it,” Pickering said.
Scott Deschenes, SARC executive director, said Wednesday night that if the facility had continued to operate at current levels into November, it might have gone $20,000 into the red.
The four board members present — the fifth member, Melinda Griffith, was absent — voted unanimously for the closure after a public comment period.
About 110 people attended the meeting, with about eight speakers commenting on the issue.
Community comments are being taken now for a $36,000 feasibility study to gauge community interest in a proposal for the YMCA to take over management of SARC.
If the community responds warmly to the idea, a business plan will be produced and presented to the SARC board for its consideration.
“The process is going through,” said Kyle Cronk, YMCA executive director, after Wednesday’s meeting.
“We are moving full steam ahead.”
The city of Sequim, the YMCA, SARC, Clallam County, Olympic Medical Center and private donors are providing money for the study.
Residents who do not receive a phone call during the survey period, which ends Saturday, can provide feedback by visiting http://tinyurl.com/SARC-YMCASurvey.
“Once we get the information back, we definitely will bring a plan forward,” Cronk said.
Cronk said he will speak with the research firm Monday to glean preliminary information and “figure out what we can do.”
And once the final data is available, “we will analyze it as quickly as we can and come up with our business plan . . . and then get some sort of a proposal before the SARC board as fast as possible,” Cronk said.
That is expected to happen in mid-November, he said.
Outstanding passes
While annual and biannual passes purchased by SARC users that extend past Oct. 30 remain “liabilities” for SARC, there is currently no cash available at this time to refund the purchasers, Pickering said.
“At this point . . . we have suspended passes,” he said, “so they are not accumulating as of the end of the month.
“We are trying to put everything on hold until [YMCA] or anyone else can come forth with a proposal, certainly by the end of November.”
Out of money
The SARC board had said earlier this year that the facility would close by September 2016 because of a lack of funds, even with a cutback in hours that began Oct. 5.
But this month, “revenues collapsed,” Pickering said.
“People quit buying passes. The board — our hands are tied right now financially. That’s it.”
During October 2014, SARC sold about $100,000 worth of passes, Pickering said.
This October, SARC estimated a return of only about $30,000, he said.
“That is a total collapse, and we can’t keep going,” Pickering said.
He said he believes “people got spooked because they thought the facility might close, and they went elsewhere. It was a very big disappointment.”
SARC was formed as Clallam County Parks and Recreation District 1, a junior taxing district, in 1988. It has not collected taxes since 2003 and has operated on reserves.
SARC has experienced a net loss of income for several years and has tried on several occasions to get a fresh influx of cash through the creation of new taxes.
Voters rejected a proposed levy in February. In August, they rejected the proposed formation of a metropolitan park district to solely fund SARC.
“It is not the board that closed the facility,” Pickering said.
“It is the voters who turned down our levies.”
Layoffs
The 73 employees at SARC, including six on the management team and 67 part-time employees, were informed Thursday morning that they will be out of work come Oct. 30.
Deschenes said he wishes them the best and hopes “they can land on their feet.”
“We have been working with them to try and get them letters of recommendation” and helping with job leads, he said.
Options
Craig Miller, SARC attorney, during Wednesday’s meeting discussed possible outcomes for SARC.
Those outcomes include working with another public entity, nonprofit organization or for-profit organization, or even floating asking voters again for a tax levy.
The board also could sell its assets, with proceeds devoted to paying off debts.
SARC’s assets are the land and building on Fifth Avenue and any accounts receivable, Miller said.
If none of those options pans out and SARC comes to a point where “it is no longer possible to operate the facility, either in shutdown or in any mode,” the board will be left with two options, Miller said.
The first option is for the board to “transfer the facilities to any other municipal corporation” such as the “school district, the hospital district, the fire district” or even a local tribe, he said.
But the municipal corporation also would have to accept all debt owed by SARC, he said.
The second option “is a judicial dissolution of the district,” Miller said.
“That would occur, presumably, in a situation in which the district was not able to be operated further, and no municipal corporation or entity of another kind could be found who wished to take the asset.”
If a judge determined that the district is solvent — meaning it has the ability to pay its debts — then the court would order a “fire sale” of the assets by the sheriff, Miller said.
Currently, “it is very difficult at this point to determine if the district is or isn’t solvent,” he said.
That is because of a lack of recent appraisal of the land or building, he said.
If the court determines SARC to be insolvent, “the court has the authority to levy a special assessment against all of the property within the district in an amount sufficient to pay the debts of the district,” Miller said.
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Sequim-Dungeness Valley Editor Chris McDaniel can be reached at 360-681-2390, ext. 5052, or cmcdaniel@peninsuladailynews.com.
