By Charles Malinchak
Morning Call (Allentown, Pennsylvania)
Copyright 2007 The Morning Call, Inc.
All Rights Reserved
PERKASIE, Pa. — Perkasie Community Ambulance entered into financial ruin Monday night after Borough Council denied the organization a loan that would have covered a fine due to the Internal Revenue Service.
Ambulance Squad Chief Lori Wychakinas said she would have to notify the IRS today of the denial, which would immediately set in motion seizure of their borough headquarters.
Council did not take a formal vote on the denial, but council President Eadie Burke said council was unable to give them the loan for $107,000 because the ambulance company had no collateral and it appears to be financially disorganized.
“We can’t give you a loan without collateral. That is the bottom line ... we can’t release taxpayer money without you having any means to pay it back,” Burke said.
Wychakinas said the squad would continue to operate, but now must find a new place to work from and continue trying to find the money to pay back debts.
In December 2005, council informally agreed to lend the squad money and continued to maintain that idea throughout 2006. However, part of the loan agreement was for the squad to develop a firm financial plan that was to include items such as seeking grants, hiring professionals to handle financial matters, conduct fund drives and to mo re aggressively collect past money owed. Wychakinas said she believed she followed those suggestions.
The loan was critical to the squad’s financial picture because it would have allowed it to get itself out of the IRS debt. Without the IRS debt, Wychakinas said, the organization would have been able to sell its building on S. Ninth Street.
Money from the sale of the building, she said, would have been used to repay the borough loan as well as the $126,000 mortgage on the building.
She said the sale of the building, which was recently valued at $325,000, would have gotten the squad out of debt.
With the IRS poised to seize the building, Wychakinas, the squad is left with no real assets to fall back on.
More than likely [the IRS] will begin the paperwork tomorrow... and they have been waiting patiently and said how urgent the decision [by council] was, she said.
The squad tumbled into financial turmoil in 1999 after member Bill Hill was charged and later convicted of embezzling at least $260,000 from the squad.
Councilman Rich Hendricks said the squad may want to look into a complete reorganization or bankruptcy.
A meeting to plot the squads next course is expected to happen later this month and would include the squads advisory board and Councilman Ray Conville.