YMCA facing financial crisis

When Tyrone Area YMCA Director Amy Hampton came on board in mid-March of this year, she knew that the financial situation at the venerable non-profit was tight. She knew that the economic climate in Tyrone would also make fundraising especially challenging. She hadn’t expected to discover roughly $60,000 in unpaid federal and state payroll taxes, dating back to 1999.
“I was aware that the Y was not in great shape, that there were internal problems and that the last director had been asked to leave,” she said. “About three weeks ago our accountant stopped by to welcome me. It was then that I learned of the problem.”
The problem is the YMCA never paid its share of the federal and state taxes for their employees. While the withholding tax for the approximately 40 employees was paid, the additional share owed by the organization was never paid. Nine quarters worth of taxes equaling nearly $45,400 in federal and about $15,000 in state liabilities.
Hampton said she immediately notified the Board of Directors, which is headed by John Harlow. Harlow, who was acting director from October 2001 until March of 2002, said that he first learned of the mismanagement at that time as well.
“We were trusting that we were given the right information,” he said, noting that the taxes were the responsibility of the director. “I guarantee this board never would have said, ‘Don’t pay your taxes.’”
Harlow noted that the YMCA accountant, John Ramsey CPA, had informed the previous director of the problem, but it never appeared on any of the director’s reports supplied to the board. Harlow noted that he did not view the audits supplied by Ramsey, either.
“I’ve been on the board for three and a half years and I’ve never seen an audit,” he said. “You would hope that that would be on the director’s report. We were told the taxes were being paid.”
Harlow also noted that at the time he was acting director, the YMCA’s bookkeeper was responsible for the taxes and he never saw anything in the organizations financial reports that indicated to him anything was amiss.
Hampton said that when she learned of the problem she checked the 2000 report and approached the bookkeeper. “I was told that there was a decision made not to pay the full amount since the Y did not have the money.” She said she was unaware of who made that decision and pointed out, “I’m not sure if it was mismanagement or outright deceit.
“Somewhere along the line someone had the idea that just because you are a nonprofit then you don’t have to operate like a business,” she continued. “I don’t know what decisions were made and by whom, but I know that poor decisions were made.”
Hampton said that she is “very active” in the day to day financial operations of the YMCA. She said as the staff, board and accountant continue to access the situation, there are still many unanswered questions and uncertainties concerning the future of the Tyrone Area YMCA.
In tomorrow’s edition of The Daily Herald, more on the current situation at the YMCA.