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Dec
11
2019
City of Yuma, Salvation Army reach settlement

Moving both parties one step closer to finalizing a settlement concerning the property that had long been used by The Salvation Army for operation of a local Boys and Girls Club, the Yuma City Council approved a settlement agreement during a special meeting on Tuesday.

Prior to 2003, the real property, located at 1100 S. 13th Ave., had been used for the operation of a local Boys and Girls Club, a program that serves impoverished and at-risk youth in the Yuma community. After issues arose with the finances of the local Boys and Girls Club, the City requested The Salvation Army take over providing similar youth services and deeded the property to the Salvation Army in 2003. The Salvation Army initially affiliated with the national Boys and Girls Club and continues to provide services to Yuma boys and girls.

For various reasons, in 2018 The Salvation Army decided it could no longer continue its affiliation with the Boys and Girls Club national organization and would instead provide the same services to Yuma boys and girls under its own banner. The City took legal action seeking to reacquire the property with the goal of preserving affiliation with the national Boys and Girls Club organization.

The Salvation Army maintained its own claims against the City and filed a counterclaim for the value of recent improvements The Salvation Army made to the property in the approximate amount of $1,729,000. Of that amount, The Salvation Army expended $827,522 in addition to the amounts raised from local community donors in connection with a capital fundraising campaign aimed at improving the facilities.

Over these last several months, not only have The City and The Salvation Army worked cooperatively to meet other community needs, the City and The Salvation Army also have come to understand each other’s positions and determined that settlement rather than continued litigation best served the community’s interests and a settlement was reached.

Under the terms of the settlement, the City will reacquire the property and reimburse The Salvation Army for a portion of the funds The Salvation Army expended on the improvements.

In the settlement, The Salvation Army compromised its counterclaim to $638,909 and will carry the acquisition cost on a 20-year note at a below-market interest rate of 3 percent. As a further gesture of goodwill, The Salvation Army agreed to an optional 18-month discounted buyout provision in the amount of $550,000. Should the City exercise the early buyout option, the note will be interest-only and any principal paid prior to the exercise of the buyout will be credited against the discounted $550,000 amount.

“We’re glad to have this matter behind us. We look forward to continue serving boys and girls, and all of the people of Yuma to the best of our ability in the future,” said Salvation Army Capt. Jeff Breazeale.

“From the beginning, our interest was to make sure the longstanding service to boys and girls in the Yuma community would continue at this location,” said Mayor Douglas Nicholls. “Both parties desire a seamless transition of the property’s reacquisition so the youth programs operating there continue uninterrupted.”

Upon adoption of a separate ordinance authorizing the reacquisition of the property, the City will acquire a facility that has had more than $1,500,000 in recent capital improvements. The ordinance was introduced at the Dec. 4 regular City Council meeting, and will come before City Council for adoption at the Dec. 18 regular City Council meeting.

Mayor Nicholls is working with a local nonprofit to run the Boys and Girls Club program at the facility. Community leaders intend to seek the necessary funding to pay the property acquisition cost.

Following the City Charter’s 30-day waiting period for all ordinances, the parties will execute and complete the settlement process and dismiss the lawsuit.

 

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