LGBT Center Receives City Funds to Cut Interest Rates
By Ted Andersen
Sometimes a business has to spend money to make money. In the recent case of the San Francisco LGBT Community Center, however, it was borrow money to save money.
Aiming to reduce $300,000 from its annual budget, the Center has tried to negotiate with First Federal Bank to restructure its payments on the $3.15 million debt it carries on its initial construction loan. After about a year of bargaining, the bank offered a modification deal that would reduce the Center’s interest payments by $200,000 over five years. The Center has already paid $100,000 in interest to the bank this year.
However, to restructure the interest rate, First Federal Bank required a holding account of $157,500, money the Center did not have in its coffers. It then appealed to the Board of Supervisors, who voted an overwhelming 9-1 in mid-April to approve the reserves.
“We have just been treading water by paying interest,” said Supervisor Bevan Dufty, who co-sponsored the loan legislation. “It’s not a bailout to me … It’s a guarantee that helps us get a better rate.”
Even though the Center sought financial help from the city and will still owe the bank about $1 million over the next five years, it has weathered the recession better than a number of non-profits, ending the year with an operating loss of just 0.2 percent, or $5,600, next to revenues of $2.1 million, according to Executive Director Rebecca Rolfe. The Center asserts that it has not missed or been late with a scheduled loan payment and that the city loan was not bailout money.
“One of the things we want to be clear about is we are stronger than we ever have been before. We have over 700 people who volunteer with us. We serve 9,000 people a month,” she said. “We really feel like we’re in a position of being very solidly grounded and centered in the community, and I think that is for us the most important thing and what is enabling us to get through a difficult period for every non-profit.”
The Center already generates revenue from over a dozen rooms that people can rent by the hour for a meeting, event or press conference, along with other long-term tenants who rent office space. Nevertheless, Rolfe admits that the Center should bolster fundraising activities such as setting more space aside for commercial use, something that is currently limited but has the potential to generate over $100,000 each year.
“The one thing we have been exploring is the possibility of bringing in more commercial tenants. Right now, we are only zoned for commercial use on the first and second floor, so we are working with the city to try to change the zoning for the building so that we can have more possibility of bringing commercial tenants into other parts of the building, and we believe we can do that while still preserving the use that the community is currently making of the building.”
Dufty said there could also be the possibility of a restaurant. “We will be making a bunch of changes to make it more financially successful,” he said.
Located at 1800 Market St., the Center hosts over 3,000 programs annually, including youth meal nights, job services for the transgender community, HIV prevention, and connection to the critical safety net services offered by the Center and its collaborative partners. It also hosted a sold-out LGBT economic forum on April 24 that included high-profile speakers.
“It encourages economic opportunity with people looking to buy a home or open a business. And that is just one part of their services,” Dufty said.
The Center is the only LGBT organization that works throughout the entire community, Rolfe said. “It’s really our goal to connect people in the community to each other and to other resources and I think we are unique in that role.”
Though not unanimous, the Board of Supervisors’ vote was a strong boost of confidence for the organization. “There were questions raised about it,” Dufty said. “But I think the more that people talked to Rebecca, the more they understood what the Center was doing.”