The Huntsville YMCA wants to sell Camp Cha-La-Kee, its lakeside overnight camp, to offset some debt as it goes through bankruptcy proceedings, and a federal court will hear the case on Monday.

There is a “buyer who’s ready to purchase. But we have to go through the process that the court requires,” Interim CEO Jeff Collen told AL.com.

The nonprofit filed for bankruptcy in August after more than $15 million in loan repayments came due. The negotiation failed with the lender, Redstone Federal Credit Union, who froze the organization’s account. The nonprofit later regained access to that account after the court’s intervention, Collen said.

According to court documents, a buyer is willing to pay $1.75 million for the 62-acre Camp Cha-La-Kee beside Lake Guntersville in Marshall County, which has not been profitable for many years.

“I can say that over the last 10 years, the Y has lost over $900,000 at the camp,” Collen said.

This is not the first time Collen is leading a YMCA branch to sell properties to offset debt after the COVID-19 pandemic.

Following his retirement as Racine, Wisconsin YMCA CEO in 2020, Collen has been interim CEO at two different YMCA branches before his stint at the Heart of the Valley YMCA beginning in September 2023.

In St. Joseph, Missouri, Collen led the sale of two properties to offset debts, and in Jackson, Mississippi, he said he renegotiated a debt burden of $11 million to $1 million.

“I was in St. Joseph, Missouri, for about nine months,” Collen told AL.com, “In St. Joseph’s, we sold a building downtown that they weren’t using anymore and a camp that hadn’t been successful in a long, long time.”

The Heart of the Valley YMCA, in 2022, valued the lakeside property at $350,000, but after filing for bankruptcy in August, received two separate $1.75 million offers.

One offer was from one Shannon Provence; the nonprofit did not name who made the second offer, except that it came with some unnamed conditions.

The organization has decided to go with Provence’s offer. Provence told AL.com he could not comment for the story at this time.

Collen said he could not make further comments on the planned sale of the lakeside property, which is restricted for recreational use and must not be divided up for sale or lease, court documents say.

The YMCA wants the court to allow it to consider Provence’s offer and market it further to see if better offers would come in. It has tapped SVN AVAT Realty, LLC, and Andrew Agee will market the property sale.

Agee did not respond to a request for comments for this story.

The motion to sell Camp Cha-La-Kee “is still on the docket for Monday (10 a.m.),” Huntsville YMCA attorney Kevin Heard said in an email.

Collen said selling the camp is “important and really necessary” and hopes to “come up with a solution” with Redstone.

“I’m very hopeful that we’re close on that,” he said.

“The bank balloon payment on the banknote was not something that the Y could handle,” he said. “Fifteen and a half million dollars, and we were working with Redstone to negotiate the next loan schedule, so to speak. And, you know, at some point it just wasn’t working and all of a sudden, you know, we found our accounts frozen.”

“And, so we had no choice but to seek the court’s protection in order to be able to pay all our bills because this bankruptcy is not typical,” he said. “It is not an operational issue. The Y had plenty of money to keep paying its bills, but we just hadn’t come to an agreement for the next loan option moving forward.”

He said that YMCA branches have experienced membership slumps nationally.

“Across the state of Alabama, membership is still about right where we are, about 25-27 percent lower than what it was at the end of 2019, again, across this state and very similar across the country.”

But IRS records show that Huntsville YMCA has been recording losses long before the pandemic.

The nonprofit recorded more years with losses than other YMCA branches in Alabama between 2012 and 2022. It only reported two years in the green, 2012 and 2020. Birmingham YMCA had the best profit record recording one year in the negative.

Collen said he recognizes the need to be profitable.

“We need to have surpluses because we need to be able to take care of our facilities to provide the services; you know, a lot of times it doesn’t happen that way,” he said.

“It makes us have to reduce expenses, sometimes we don’t always take care of our facilities as best as we can because there’s not the funds to do that so we have a lot of deferred maintenance.”

Birmingham YMCA revenue between 2012 and 2022 includes an average of 13% from donations, while Huntsville had 9%, IRS records show. The rest of the revenue is mostly from program services.

“We’ve got to help raise money because we’re giving a lot of services away to people who can’t afford it,” Collen said.