YMCA to close Camp Cha-La-Kee as part of bankruptcy process

HUNTSVILLE, Ala. (WHNT) — The Heart of the Valley YMCA is set to shutter the doors of an overnight camp it’s had since the late 1950s as it navigates the bankruptcy process.

This news came during a bankruptcy hearing Monday at the U.S. District Courthouse in Huntsville. Back in August, the Heart of the Valley YMCA filed for Chapter 11 bankruptcy, as a result of financial issues tied to $15.5 million in mortgage debt.

The Heart of the Valley YMCA said its three main facilities in Madison County will continue to operate, however, it has made the “very difficult decision” to close Camp Cha-La-Kee in Guntersville. According to the YMCA, the camp has been a part of the YMCA family since 1957.

During the hearing, an attorney for the YMCA said the “Y” plans to sell the camp, and some other real estate owned by the YMCA, as it hopes to recover from its financial issues.

According to Interim YMCA CEO, Jeff Collen, the camp has been losing money in recent years.

The 61-acre camp is located on the shores of Lake Guntersville. According to the YMCA’s attorney, the YMCA will have to work through some “restrictions” with the Tennessee Valley Authority (TVA) before it can sell the camp, in hopes of getting the largest possible value in a sale.

According to Collen, the TVA gave over the property to the YMCA, however, the TVA has restrictions on the property, including that it currently remains a “recreational property” and could not be developed into individual lots for homes.

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During the hearing Monday, the YMCA agreed to pay monthly $35,000 payments to Redstone Federal Credit Union until they work on a long-term financial agreement. This will be reevaluated at the next court hearing set for Nov. 4.

The YMCA said it owes $15.5 million to Redstone Federal Credit Union, the remainder of a loan it took out in 2009, primarily to build the Hogan Family YMCA in Madison.

Collen tells News 19 that the YMCA plans to have a capital campaign to raise funds to pay down the debt, however, that plan is still in the early stages.

According to court records, the YMCA has approximately 7,028 membership agreements among members at the Hogan Family YMCA, Downtown Express YMCA, and the Southeast Family YMCA in South Huntsville. An attorney for the YMCA said that many of those agreements are family agreements, so the total membership of the YMCA is about 20,200 people.

YMCA officials tell News 19 that since filing for bankruptcy, there have been no changes to programs that are being offered, and no decline in membership.

The next hearing for the bankruptcy filing will be held on at 11 a.m., on Nov. 4 at the new Federal Courthouse on Gallatin Street.

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