Building Lease,Losing Contracts Doomed Centro Latino

Board members this week told the Record that they did everything they could to keep things going at Centro Latino, which closed its operations suddenly last week, but were simply not able to make things work in the end – despite a promising move from its long-time Broadway headquarters this summer to a smaller space.

“The door isn’t closed  and we haven’t dissolved yet,” said Board Vice Chair Anthony Galluccio. “We knew we couldn’t pay the employees, so we had to lay them off. It’s not over, but the money isn’t there…If someone were to write us a check tomorrow, then things would be different, but I don’t see that.”

Galluccio explained that he has been on the Board about six years, and that most of the Board members have been there a long time. Everyone is a volunteer and no one was brought in to shut the place down.

He indicated in the interview that many factors have contributed to the downfall of the organization over the last four years, but that a recent action by the landlord of the Broadway building, Mastrocola Realty, was the final blow.

“People who know the non-profit world know Centro was already struggling for the last four years,” he said. “We have been in court several times recently with the landlord. More recently, the landlord took us to Superior Court and tried to lien our receivables. That was kind of the final blow. We were able to get out of that situation, but the action was not just against Centro, but also against Bunker Hill (Community College) as our contractual partner. My guess is Bunker Hill got really uncomfortable with that.”

He said that on Sept. 1, Centro got notice from Bunker Hill that it was canceling its partnership with the organization for ESL classes – the bread and butter of Centro.

Centro had signed a five year lease in 2011 with the landlord for a rent that, at the time was doable, but a year later became problematic when the organization lost key contracts. That led to more troubles with the Broadway headquarters.

“The lease and the space were an albatross for us,” he said. “Our goal was to move out of that huge space. Cataldo was very good to us in giving us a lease in their old building and I give them all the credit in the world. We had to pay the old landlord going forward until January, as well as pay for our lease in the Cataldo building. We thought that even though it was daunting, we could pull it off and get to January and be able to fight another day and expand our fee programs. We didn’t have a new executive director because we didn’t have the money…We’ve done furloughs, reduced work hours, and done minimal layoffs. We thought that by doing all of that, we could survive until January.”

However, Galluccio said things became clearer two weeks ago that it wasn’t going to happen.

“It became clear that we were putting our ability to pay our employees in jeopardy,” he said. “Centro still had credibility in the community. We thought if we tried to keep it open and couldn’t pay employees and vendors, we could lose any credibility we had. It’s not like we came on the Board to close Centro. We were all in the fight. We were up at Superior Court with ‘Save Centro’ T-shirts two months ago.”

The key moment for Centro, however, did not come recently, but rather in 2012 when, under former Executive Director Juan Vega, the organization lost a large amount of its contracts suddenly.

“We lost probably more than 50 percent of our ESL contracts roughly around 2012,” said Galluccio. “The agency never really recovered from that in many ways. We worked very hard to reduce administrative costs and cutting staff. That was the first big, big hit.”

He said they really had no idea why the contracts were revoked. It was something they thought was temporary at first, but ended up being permanent.

“We didn’t really know how catastrophic it was and thought we could get them reinstated,” he said. “We never really heard why. That isn’t really uncommon. It think the theory was we could have gotten some of them back and that didn’t happen.”

The Record attempted to contact Vega – who now works for the state – but he was not immediately available.

This week, Galluccio said one piece of good news has been that Bunker Hill has stepped up to accommodate the ESL classes and to hire teachers – many that are former Centro employees.

“Centro was a trusted name and getting the clients transitioned and the teachers and program is a huge thing,” he said. “That’s really good news because Bunker Hill is there and has space, particularly since 80 percent of our ESL students are from Chelsea.”

He said Roca may also agree to absorb the young parent program that was at Centro.

Still on uncertain ground, however, is the immigration and citizenship classes.

City Manager Tom Ambrosino said the City is helping to transition that piece right now.

“We’ve met with some providers and potentially the Collaborative could step in,” he said. “The City’s role is to maintain the immigration program – the classes to help people become citizens. We support the goal and want to maintain it in the City.”

The public health piece of Centro’s mission – which in the past centered a great deal on helping those with AIDS – is also still in the balance.

Galluccio said they would continue to work on those two final pieces.

In the grand scheme, he said closing down last week was the right move, though it was a hard decision to make.

“It was a hard decision, but it was the right decision,” he said. “We haven’t dissolved. We’ve been in trouble for two years and there’s no Santa Claus in this story…These contracts didn’t make money. It’s not like another non-profit could absorb us and all our debt and not put themselves in jeopardy. We tried to raise money, but the reality is when you’re in trouble and have debt, you don’t have a great story to tell. We were just always in court, always behind and always operating with narrow margins. It was just hard to turn the corner.”

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