|
TAXES
Gateway Heights operates as a 501(c)7 non-profit organization…not a 501(c)3. Yes…there is a big difference between that 7 and 3! But, do not fret, I will not go down the rabbit hole of explaining the various non-profit tax exemption statuses. But I will share these tidbits:
Note: Park Swim Club and Garden City Swim Club are 501(c)3 organizations. They do not own their land, rather allowed them to be acquired by the Municipality of Monroeville and leased back for 99 years. They do not pay property taxes. There are pros and cons to this, which I do not discuss in this Blog post. I am almost certain that every pool MUST have had a roller coaster on their property back in the day, right? And of course, each pool likely rented out their lodge for weddings and reunions in the off-season? How else could they have possibly raised the money needed to pay property taxes? OK, I must confess, this bit of information is neither cited-fact nor “educated speculation”…it is pure cynicism. Fact: Gateway Heights pays over $10K in property taxes across Local, County, State and School District each year. As noted above, it costs about $60K per year to run the organization and facility. We are truly a non-profit, break-even operation, so roughly 18% of our annual revenue/expenses go to property taxes. Anyway, many of the clubs listed above fell behind in taxes. As membership declined, so did revenue. Some bills must be paid ASAP…some, like taxes, can be deferred with penalties. Many clubs got so far behind with their taxes, they were unable to recover. Built in 1961, Eastmont Swim Club closed after the 1994 season. In the 1950s, the Eastmont community was booming with young families and children. The entire community was on board to build the pool. 200 families purchased $300 bonds to finance the construction. The pool was a booming success in the 1960s and into the 1970s. Here is a short excerpt from one of the articles that I read about Eastmont Swim Club. I encourage you to click on the hyperlinked text and read more. After the '60s waned, Phil Dodge, a former part-time township police officer, took over the reins of the volunteer board of directors in 1974. Dodge was the first to approach township commissioners - unsuccessfully about removing the swim club from the tax rolls. Dodge said the club might have been able to survive without the tax burden. ''We did not try to make a profit as much as we were trying to just break even,'' says Dodge. ''We were supplying something to the community.'' After 34-years of operation, the pool was drowning in unpaid taxes. At the time the property was to be sold or repurposed, over $70K in unpaid taxes had accrued.
In 2015, Gateway Heights found ourselves 2-years behind in property taxes, with a budget that wasn’t guaranteed to support paying the next year’s taxes. The organization had accrued nearly $9,000 in unpaid taxes. One of my first initiatives as President of GHC was to make it a priority to pay-off our back taxes. And quite honestly only way to do this quickly was to beg for money. I needed to convince a handful of people to make an investment in Gateway Heights. And the only way to convince someone to make a risky investment, was to make part of it myself. The construction of Gateway Heights Swim Club, was originally financed with bond-money, just like Eastmont. Our By Laws only permitted each member to hold one bond, one vote. We had some people willing to “donate” to the club but were concerned that the club might just be beyond the point of return. So we came up with a plan to “guarantee” donations. We reworked the By Laws (approved by the Bondholders at the Annual Membership Meeting on November 1, 2015) to allow the purchase of up to 10 stock certificates (bonds) with Board approval, along with the condition that no one member-family may have more than the equivalent of one vote, regardless of the number of shares they hold. Basically, if the pool were to not make it, we all were confident that the land could be sold for a price high enough to buy back all outstanding bonds, so in theory, we could “guarantee donations.” In reality, they were not really donations, but rather shares of stock purchases. Fact: When you find yourself drowning, you need to stop thrashing…just find a way to float until help arrives. (And don’t just stand there…go get help!) Now, I believe in “leading by example,” so together with my wife, we purchased nine additional bonds. The club was able to sell multiple bonds to a few others as well and with this approach we raised the money needed to pay off our back-taxes and bring the organization "out of the red!” Ironically, this decision came back to haunt me for awhile...as two weeks after buying our additional bonds, I was laid-off from my job! Fool for the pool? Or, maybe just a fool? Again, I will not get side-tracked with personal stories, but I was given the following advice by one of our Past Presidents, Tom Kimicata, who is strong in his Faith. He told me the following: Fact: The more you give, the more you get back. And he was right…and I will leave it at that from a personal note. But I will share with you that over the past three years of ending the season "in the black", Gateway Heights Club, Inc. has also started giving back, having held fundraisers for OTHER organizations! In 2019-2020, we raised $1,000 for Foundation for Angelman Syndrome Therapy (F.A.S.T.) and in 2021-2022, we raised an additional $1,000 for the Nicholas Schrank Scholarship Fund. We are trying to give back when and where we can. Taxes and finances in general, are one of the main pillars of keeping the organization going and growing. Comments are closed.
|
RSS Feed
