MOVE’s Circumstance & Emergency GoFundMe
Frequently Asked Questions
Regrettably, due to unforeseen financial hardships compounded by the loss of our charitable status, MOVE Adapted Fitness will be closing its doors in its current form on July 31, 2024. However, we are pleased to announce that our longterm supporter Neuromotion Physiotherapy and Rehabilitation will continue the operations starting August 1st, 2024, under MOVE Adapted Fitness @ Neuromotion. We feel Neuromotion’s vision, that individuals impacted by neurological conditions are cared for in a supportive environment by a specialized multidisciplinary rehabilitation team, aligns well with MOVE.
1. What is the path forward?
MOVE Adapted Fitness will be closed as of July 31, 2024, MOVE Adapted Fitness @ Neuromotion will open its doors to all MOVE members August 1, 2024. All memberships, desired appointments (both one on one and in the gym) will continue as is. The goal for this transition is to cause as little disruption to MOVEs members as possible. We understand that prices are of concern to most, Neuromotion believes in keeping prices inclusive and affordable in order to continue providing services to all that utilize MOVE. Further, Neuromotion has the economies of scale to be able to better match the fees with costs as opposed to MOVE which required additional funding. Please talk to MOVEs admin team and your therapists to start scheduling your appointments for August.
Our entire team including staff, board of directors, and volunteers are doing everything in their power to keep MOVE alive. Your support during this time is invaluable.
2. Why does MOVE need to close its doors?
Unfortunately MOVE is insolvent; this means its liabilities are greater than its assets and it doesn’t have sufficient cash flow to continue operations. The Q1 2024 Financial Statements(see below)outline the degree of insolvency, with liabilities exceeding assets by approximately $238k and a deficiency of revenue vs expenses in Q1 2024 of approximately -$22k. MOVE has been managing the cash flow shortfall in Q2 2024 by increasing fees, reducing costs and extending payables, particularly rent payments (rent payable close to $30k now). However, this situation cannot continue as creditors are unable to continue extending payments.
3. Why is MOVE facing this situation?
These circumstances stem from the breach of duty of our former Treasurer, who negligently failed to remit payroll taxes to the Canada Revenue Agency (CRA) between the years 2021-2024. This failure has resulted in a CRA payroll audit determining that MOVE owes $195,000 to the CRA in unremitted payroll taxes and penalties. MOVE has negotiated a temporary three-month payment plan with the CRA collections group for a nominal $500 per month. Formal proceedings will not commence until a collections officer is assigned to the case. The time frame for this is unknown.
Further, the former Treasurer also failed to file returns with the CRA to maintain MOVE’s charitable status. As a result, MOVE lost its charitable status which has severely limited MOVE’s ability to fundraise. In June 2024 the resignation of MOVE’s Executive Director (whose primary responsibility was to fundraise) and the inability to hire a replacement further eroded MOVE’s ability to raise funds.
4. What factors led to MOVEs financial crisis?
Although the unremitted payroll taxes are the largest liability, MOVE is insolvent irrespective of the CRA liability
Membership fees and 1-1 income are not enough to cover costs
There is too much overhead
Due to the loss of charity status, MOVE’s ability to fund the shortfall of fees vs costs has been severely diminished
In addition, the former Treasurer mismanaged cash flow resulting in a depletion of cash reserves
5. Can MOVE get charity status back?
In order for MOVE to regain charitable status, we would need to ensure all outstanding charitable filing requirements from 2021 onward are complete, and pay the unremitted payroll taxes.
Unfortunately due to the massive amount of the unremitted taxes MOVE is unable to cover that liability. Insurance may provide relief but that is a process that will take longer than MOVE’s current financial situation will allow.
6. Will MOVE have to declare bankruptcy?
Yes, since MOVE is insolvent it will need to declare bankruptcy to clear existing debts. Unfortunately, bankruptcy would not clear the CRA liability. If insurance does not cover this liability the Board of Directors will be personally responsible. Bankruptcy costs are substantial.
7. How will the money raised through the GoFundMe be used to address the emergency?
The funds will be used to facilitate the continuation of the gym facilities under Neuromotion. This will involve payment of bankruptcy fees to enable the clearing of debt and the winding down of MOVE. In addition, it will be used to purchase the equipment from MOVE to provide the equipment Neuromotion would require to continue operating the gym.
As part of the bankruptcy process, the bankruptcy trustee would need to sell the equipment to apply funds toward the outstanding debt. The bankruptcy trustee would try to achieve the maximum price possible, but this would likely be a distressed price given the nature of the sale and the special nature of the equipment.
Neuromotion is not able to purchase this equipment on their own. MOVE’s inability to pay Neuromotion rent (current rent payable of close to $30k) has limited Neuromotion’s cash flow. If the GoFundMe is not able to raise the funds to purchase the equipment, it will be sold to other buyers and Neuromotion will not be able to continue operating the gym.
We understand there is concern that, over the years, the MS Society and other organizations have donated equipment to MOVE, and therefore it should stay within those charitable organizations. However, in order to recoup any amount towards MOVEs debt, the bankruptcy trustee will have to sell the equipment.
8. How can we be assured that the funds will be used responsibly and effectively?
The mandate for the GoFundMe page is specific. To wind down MOVE and to enable Neuromotion to continue operating the gym. The funds will not be used for any other purposes.
9. What will happen if the GoFundMe is unsuccessful?
Funds raised will be applied to bankruptcy costs first and then to the purchase of the equipment. To the extent funds fall short of covering the bankruptcy costs the Board of Directors will seek other ways to fund the bankruptcy costs from outside MOVE and proceed with the bankruptcy. If funds cover the bankruptcy costs but fall short of the purchase price of the equipment the Board of Directors will work with Neuromotion to purchase as much of the equipment as possible. Regardless of the success of the GoFundMe, Neuromotion will be able to continue offering 1-1 sessions to former MOVE members.
10. Is there something members can do besides donate money?
Given the high cost of the bankruptcy process, if any members are able to volunteer their services, pro bono, to help MOVE through the process that would be a great help.
11.Are donations tax-deductible?
Unfortunately, proceeds raised through a GoFundMe page are not tax-deductible.
12. Will the programs MOVE offers continue? (Walking group, massage therapy through Camosun College, and online exercise classes)
The Board of Directors are working with community partners to try and fill the gaps through other organizations in order to continue these services. We hope to have updates on these programs in the coming weeks if they are still able to continue through other organizations that work to serve a similar population as MOVE.
13. Are any of MOVEs memberships refundable?
No, all paid services including any of MOVEs memberships will not be refundable, however they will be honored through Neuromotion.
14. Am I able to continue volunteering at Neuromotion? Will my volunteer hours at MOVE still be valid?
Yes, all volunteers can continue to volunteer under Neuromotion and any hours volunteered for MOVE will still be valid.