WEB EXCLUSIVE: City, club officials discuss limitations, resolve

Special to the NEWS

B&G Club

Members of the Boys and Girls Club of San Benito are seen shooting pool. (File photo)

The Boys and Girls Club of San Benito convened with city officials Friday evening to address some of the club’s financial matters.

Boys and Girls Club Board of Directors President Tommy Ramirez, Jr. and Chief Professional Officer Mario Cervantes along with volunteer financial consultant Lolita Cervantes met with San Benito City Manager Manual Lara, Parks and Recreation Director Mike Jaramillo, City Attorney Ricardo Morado and City Commissioners Joe D. Gonzalez and Rene Villafranco with the objective of maintaining the Boys and Girls Club’s operations in the city. Citing reduced funding from sources such as United Way and Community Development Block Grant funds, monies allocated by the City of San Benito, Ramirez recently announced that the club would close in three months’ time, when emergency funds expire, without outside assistance.

Morado commenced the meeting by stressing that the city is limited in its capacity to offer the Boys and Girls Club aid.

According to Morado, and although acknowledging the club’s impact on the community and the urgency of its predicament, current state laws make it difficult to provide such aid. “There are serious limitations as to what the city can do directly,” Morado said. “The Texas constitution prohibits the city from making any gifts or donations to any entity, no matter how worthy or worthwhile their purpose.”

While the city cannot make direct donations, they are pooling resources to ask for sponsorships and partners. Lara said that he currently has people writing letters to solicit help from the business community, both on the local level and otherwise.

Ramirez, meanwhile, said the club’s finances have been stretched thin and hopes for expedited resolve. “We’ve laid everybody off, and [Mario Cervantes] is my only employee,” Ramirez said “We’re very frugal. Some toilets a while ago started malfunctioning, so we called a plumber to get some instructions on how to get them to work, and we got it done ourselves.”

Commissioner Gonzalez inquired as to what involvement, if any, has the Boys and Girls Club of America organization had in aiding the San Benito chapter. Ramirez said, “Of the millions and millions of dollars they are getting from the feds, from the NFL, from major league baseball, they [awarded] us $6000. And then they sent us an invoice saying we owe them $3000 for existing as a club.”

Another issue discussed was the club’s membership fees. Commissioner Villafranco mentioned that in a survey, the Boys and Girls Club of San Benito has one of the lowest annual membership costs of the Rio Grande Valley, suggesting a rate increment for club patrons.

On the one hand, Ramirez is reluctant to increase membership fees. “Times are hard,” he said, “and as soon as you do that, kids won’t come.” But on the other hand, the continuation of the Boys and Girls Club of San Benito may be at stake, and for that reason Ramirez said he is willing to consider an annual rate increase broken into two payments: “It’s kind of like a payment plan,” Ramirez said, where parents will not have to pay a large sum all at once.

Considering the worst-case scenario, Ramirez asked if city officials would consider creating a youth center should the club close its doors.

Want the whole story? Pick up a copy of the Oct. 26 edition of the San Benito News, or subscribe to our E-Edition by clicking here.

Permanent link to this article: https://www.sbnewspaper.com/2013/01/27/web-exclusive-city-club-officials-discuss-limitations-resolve/


Skip to comment form

    • Denny Crane, Jr. on January 28, 2013 at 12:20 pm
    • Reply

    @WeThePeople You say you agree with the many of the issues brought up here by Mr. Rodriguez and Reforming San Benito but, based on your comments, your beef appears to be directly with Mr. Tommy Ramirez and not the with the club in general.

    As you pointed out, the fact remains that the Boys and Girls Club Board of Directors (the Chamber of Commerce Board of Directors) is directly at fault here and bear the responsibility of keeping the agency in business.

    Mr. Tommy Ramirez’s (Mayor Joe Hernandez) constant hand-wringing is an excuse for the board of directors (city commission). It is not the City’s responsibility to bail them (Boys and Girls Club and Chamber of Commerce) out, again and again. Remember the Chamber of Commerce has been bailed out by the city before. Also, did you notice how the mayor has been very quiet since this situation surfaced. Mr. “Photo Opportunity” seems to be missing in action.

    A city the size of San Benito that can afford to pay two assistant city managers and one city manager can certainly afford to support such a great organization as the local Boys and Girls Club. The city conveniently supports one non-profit, the Chamber of Commerce, and defends itself against helping the club because they may get in trouble and do not have the funds. They seem to be already in trouble for blindly throwing taxpayer dollars at a chamber that doesn’t really exist.How about holding the City Commission accountable for these tax payer dollars. Who is receiving the money? How is it being spent? Who controls it? These are just common sense questions that apparently concern only a few citizens.

    Accountability is what is lacking in the City of San Benito and it will never happen until the voters demand it. Unfortunately, the voters repeatedly re-elect the same candidates who refuse to take responsibility or place blame upon others.

    Good Luck San Benito, you may get some streets repaired and re-elect the same candidates but the perception or image of San Benito by the rest of the valley will not change!

    • TwoCentsWorth on January 28, 2013 at 11:22 am
    • Reply

    Interesting to note that while the club’s by-laws call for fifteen (15) board members, the club presently has only five (5). So, what gives?

      • WeThePeople on January 28, 2013 at 9:30 pm
      • Reply

      Mr. Crane: My ‘beef’ is with the Board of Directors of the B/G Club with Mr. Ramirez being the guy in charge. The Chamber of Commerce as well. The leadership of both organizations has failed them. Period.
      The issue is not about the City, (even though they keep getting into the mix). While I realize that the City may have their own problems with all manner of issues with their City Manager, Mayor and Commission, the fact remains is that they are not responsible for these 2 organizations.

      • WeThePeople on January 28, 2013 at 9:33 pm
      • Reply

      So how could the Club auditor tell the IRS that their are in compliance with their by-laws on their tax returns?

        • Denny Crane, Jr. on January 29, 2013 at 1:09 pm
        • Reply

        The Club is a nonprofit and is tax-exempt so I doubt they will be audited.

        However, as any other nonprofit, they file the IRS form 990 linked in the comment above by Mr. Rodriguez. I read it and the IRS is not interested in the by-laws of a nonprofit. The only question regarding bylaws is How many VOTING members are on the board?

        My understanding from reading on IRS Form 990 is that it is required for the sole purpose to make the information available to the public….the form itself says on the top in large black letters….OPEN TO PUBLIC INSPECTION!

        While your question regarding the number of board members and the bylaws requirement is valid and deserves an answer, it is irrelevant in regards to the IRS.

          • WeThePeople on January 30, 2013 at 12:45 am
          • Reply

          Mr. Crane:
          Any nonprofit receiving Federal Community Development Block Grant funding MUST have an annual audit, and the IRS gets very concerned when auditors give any false or misleading information. According to IRS rules the board members are also liable for the well being of the agency. Filing a 990 is Federal Law as well, and not optional.
          After reading the IRS regulations, you might want to read a little on theSarbanes-Oxley Act of 2002 It is Federal law and is mandatory for ALL organizations, large and small, profit or nonprofit, and all MUST comply.

            • Denny Crane, Jr. on January 30, 2013 at 9:34 pm
            • Reply

            @WeThePeople……..Good point, the CDBG feds are not very pleased with the city right now!

            I never said IRS form 990 was optional. I know it is required! I was not aware that the annual audit was mandatory…can you provide me a link where you found that? I tried once reading Sarbanes-Oxley Act of 2002 but it put me to sleep. Maybe when I have some free time, I will look into it! I guess the other programs like NINOS and START center need to have annual audits also because they also receive CDBG funds. I think we are both on the same page but my main concern with the city is why they are willing to fund the chamber of commerce and not the boys and girls club.

            • WeThePeople on January 31, 2013 at 9:03 pm
            • Reply

            Mr. Crane:
            I am not sure if this is a local CDBG requirement or Federal, but all local recipients are required to have the audits, (according to my source who was a member of their review board…and they were adamant on that point). I am sure the agencies you mentioned probably have audits. I am concerned that the City is funding either or both organizations.
            If Mr. Jose Rodriguez’s information is accurate, it should be of great concern to everyone if the City continues to fund the Chamber since they are pretty much defunct and certainly do nothing for the community.
            BTW, he Sarbanes-Oxley Act was passed by the Feds during the Enron scandal era, and is supposed to bring more accountability to all organizations. Yes, it is a bit dry.

    • WeThePeople on January 28, 2013 at 9:43 am
    • Reply

    I agree with many of the issues brought up here by Mr. Rodriguez and Reforming San Benito, but the fact remains that the Boys and Girls Club Board of Directors is directly at fault here and bear the responsibility of keeping the agency in business. Remember, they must keep the club profitable to stay open.
    Mr. Tommy Ramirez’s constant hand-wringing is an excuse for the board of directors. They are not being responsible for their own club. Since he is the head of the organization that makes him the number one person that is liable. It is not the City’s responsibility to bail them out, again and again.

      • Reforming San Benito on January 28, 2013 at 10:50 am
      • Reply

      Agree, WeThePeople. I’m not advocating blindly giving money to the club so it can survive for another few months. It needs a new vision and a solid plan of action. Maybe completely new leadership. The city commission is taking the right steps in examining how the club operates and giving them ideas and structure going forward. It is up to the club’s BOD to institute changes, even if that means finding new people to oversee daily operations and fund-raising events.

      What troubles me is the city’s position from the outset, presenting all the reasons it cannot help financially. While the city is taking positive steps, dangling a carrot in the form of a financial pledge to keep open their doors long enough for a new plan to bear fruit, may just kick-start the reform that will make the club viable for the long-term.

  1. Per the SBNews, City Attorney Mr. Morado said. “The Texas Constitution prohibits the city from making any gifts or donations to any entity, no matter how worthy or worthwhile their purpose.”

    As I opined in my “Letter to the Editor” in the latest edition of the SBNews, the San Benito Chamber of Commerce, a registered separate nonprofit [501 (c) (6)] entity, receives a monthly “donation” in the amount of $4,479.16 from the City of San Benito. I refer to it as a donation because the City is not “contractually obligated” to support/fund the Chamber of Commerce.

    I would submit the following question: “Is the City’s funding of the Chamber of Commerce violative of the Texas Constitution that prohibits the city from making any gifts or donations to any entity, no matter how worthy or worthwhile their purpose?”

    Per the “Harlingen Area Chamber of Commerce” IRS Form 990, that chamber does not receive any contributions and grants or funding from the City of Harlingen. Their revenue is strictly from program service revenue and membership dues and assessment.

    Mr. Tommy Ramirez, Jr., B&G Club Board of Directors President, needs to face reality and accept the “foregone conclusion” that if the Club is to survive, it needs to increase membership fees comparable to other clubs in the Valley. Furthermore, those parents who use or employ the B&G Club as a babysitting service must take financial responsibility for the service provided.

    • Reforming San Benito on January 27, 2013 at 10:10 pm
    • Reply

    What I do not understand is the mixed messages we are getting out of city hall. At a previous meeting, CM Lara said the city received a message from HUD, who provides the CDBG funds that have been given by the city to the B&G Club each year. According to the CM, HUD has told him, if the club closes then the city would be responsible for federal HUD grant money that it gave to the club, implying that the city would have to repay HUD for the money it gave to an insolvent entity. However, in an article written the week before by the City Manager that appeared in the SBNews (1/18/13), the CM wrote, since 1995 “total investment to-date is $531,277.”

    What does that mean? The city will have to repay HUD $531,277 if the club fails in the next 120 days? A lesser amount? If the city hasn’t budgeted funds to help out the B&G Club and the children of this community, did it budget funds to repay HUD when it turns its’ back on the club and children? Strangely, I didn’t see that line item in this year’s fiscal budget.

    According to Attorney Morado, “There are serious limitations as to what the city can do directly,” Morado said. “The Texas constitution prohibits the city from making any gifts or donations to any entity, no matter how worthy or worthwhile their purpose.” However, Article 11 Section 3 of the constitution provides “…but this shall not be construed to in any way affect any obligation heretofore undertaken pursuant to law or to prevent a county, city, or other municipal corporation from investing its funds as authorized by law.”

    Now, I’m not a lawyer, but it would seem to me that the city could justify providing funds to the B&G Club under the ‘obligation heretofore undertaken’ clause, especially since the burden of having to repay funds to HUD may exceed greatly the burden of providing funds to the club.

    With the words of Attorney Morado in mind, let us look at what funding the city has provided over the past few years to another non-profit organization in this city, the Chamber of Commerce:

    Fiscal Years:
    2007-2008 — $60,000
    2008-2009 — $60,000
    2009-2010 — $53,750
    2010-2011 — $53,750
    2011-2012 — $53,750
    Total — $281,250

    Isn’t it amazing what the city CAN DO when it WANTS?! It is important to note that Attorney Morado was the city’s attorney when the 2011-2012 budget was passed, and he either said nothing then about city funds going to a non-profit or was ignored by this very City Manager, mayor and commission. Now that the citizens of this community need the city to take action to save a non-profit that largely benefits the children and families of this community, the mayor and four commissioners are turning their backs on the children and parents of this community. Why is that?

    Why has the city been so willing to help one but not the other? Is it because Mr. Padilla worked with City Manager Lara in Mathis, and highly recommended Mr. Lara for his position? Is this the reason the city has been pouring the above money into the Chamber, to keep Mr. Padilla employed until he left his roughly $42,000/year position to pursue the ministry? After all, it is the CM who prepares the budget for the commission to approve.

    What about the Boys and Girls Club? Does it not hold greater importance to this community in terms of benefits provided? It touches the lives of 1,000 children and their parents each year. Members of this community have come to rely on the Club to provide after school tutoring, activities and child care so that all involved can be productive members of this community – now, and in the future. Mr. Tommy Ramirez told the commission, if the city withdrawals its’ financial support, so, too, will the United Way; that will mean certain death to the club. Why is the city even flirting with denying its’ obligation as civic leaders?

    It is good that Commissioners Gonzalez and Villafranco have gotten involved with the committee to provide guidance to the B&G Club . It is good that CM Lara has provided people to write fundraising letters on behalf of the club. Partnering with the school district is necessary, as well, and a good initiative on both their parts. Their efforts remind me of a Chinese proverb, probably one that the mayor and CM picked up on their trip to China. “Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.”

    Teaching the club to fish is a necessary step in preserving it for future generations. But for the immediate present, the city needs to pledge that it will do whatever necessary – including providing as many greenback fish as needed – so that the children and parents of this community can eat for generations to come.

Leave a Reply

Your email address will not be published.