ATWATER -- Challenger Learning Center officials say the center could close its doors if it doesn't reach an agreement with Merced County regarding a significant increase in rent.
Officials held a news conference Friday morning to warn about the center's possible shutdown if its lease cost rises. Merced County wants to raise fees from $1 a year to $350,000, according to David Olsen, president of the CLC Foundation's board of directors. Additionally, the county plans to stop making payments that were established under an agreement approved by the county's Board of Supervisors and the center in 2003.
The center, which hosts about 20,000 children a year from Sacramento to Kern counties, has paid $1 a year to the county since it began to operate 15 years ago. In return, the center has paid for the maintenance, operations and improvements of the two buildings where it's housed at Castle Commerce Center, Olsen said.
Both entities are still in negotiations regarding the proposed increase, but Olsen said the number that has been presented is about $350,000 a year, in addition to some $20,000 to $30,000 in community maintenance fees. "Going from a dollar to $350,000 is not manageable," he said.
It takes about $300,000 a year to run the two buildings, he said. Having to pay more would make it impossible for the center to survive. "That's just not possible and that would necessitate us shutting down," he said. "We've been operating for 15 years and it has not cost the county anything. They don't contribute to our operations."
Officials also say that under the agreement established in 2003, the county had agreed to make payments to Challenger through 2017 for improvements made to buildings that were released back to the county.
The county pays Challenger around $12,500 a month for a total of about $150,000 a year, Olsen said.
However, Merced County made its last payment June 1, he said. Over the past 15 years, the center has invested about $4.5 million in the buildings, Olsen said. To help pay for those investments, the center took out a $1.6 million federal loan.
The county's monthly payments were used to pay back that loan, Olsen said.
Challenger officials hope to propose an elimination of the lease increase, Olsen said, in exchange for doing without the payments. The organization will figure out a way to replace the money it received from the county to continue to make the loan payments, Olsen said. "We are willing to take a look at that," he said. "It might keep us in operation for another year."
But Merced County officials say they have been trying to establish a lease with Challenger for a while now. "It's not related to the county's budget," said Mark Hendrickson, director of commerce, aviation and economic development for the county. "This has been a goal of the county, to have a lease with Challenger dating back as far as 2006."
The county and the center are working to reach an agreement, he said. The same rules that pertain to all tenants at Castle would apply to Challenger, Hendrickson said. The plan is to initiate a lease July 1.
Amanda M. Hartman, operations administrator for Challenger, said she hopes county officials will reconsider their plans. "We can't be a revenue source for them," she said.
Meanwhile, Merced County Supervisor Linn Davis said the county can't continue to support Challenger. Also, he said, the county can't continue to make payments for a facility it owns. "It's not for the taxpayers to keep the nonprofit in operation. Do you think we should continue to subsidize that entity?"
Still, both entities say they are willing to work together in the negotiations. Hendrickson said they hope to continue to see the positive progress that's been made day by day. "We want to keep this positive," he said.
Merced County Supervisor Hub Walsh agreed.
"Hopefully we will work out a solution that's workable for everybody," he said. "I know that we are looking at options and alternatives and I'm hopeful that we'll find solutions."
Thomas Tanioka, education director at Challenger, said the center offers many educational opportunities for students. It gets them engaged in activities that "they would never imagine," he said.
It would be a loss if the center went away, he said. "The museum has become the best science museum in the Central Valley, and it really bothers me that we might have to close our doors."
Both entities plan to meet Monday to continue negotiations.
Reporter Yesenia Amaro can be reached at (209) 388-6507 or firstname.lastname@example.org.