La Casa’s Bankruptcy Breakdown

As supporters praise La Casa de la Raza as an anchor of the Eastside and Santa Barbara’s greater Latino community for the past 45 years, its recent Chapter 11 filing with the U.S. Bankruptcy Court has exposed more of its financial troubles. Though some claims remain in dispute, La Casa owes roughly $133,000 to the IRS, more than $2,000 in state taxes, and unpaid payroll taxes and penalties topping $5,000, according to court documents. Also listed as a creditor, realtor Miguel Avila said he loaned La Casa $10,000 “about a year ago” and remains confident that the community center will work through its fiscal problems and pay him back in full. Combined, boardmembers Marisela Marquez, Saul Serrano, and Raquel Lopez have loaned La Casa nearly $30,000, which remains outstanding. La Casa owes smaller sums to accounting firm MacFarlane, Faletti & Co., Southern California Edison, The Gas Company, Cox, and T-Mobile.

The biggest creditor is original cofounder Tom Castelo’s MLG Leasing, Inc., which purchased La Casa’s loan on its 26,000-square-foot multipurpose building for $525,000 last September. Around the same time, La Casa did manage to reinstate its lapsed nonprofit status, enabling it to claim partial exemption from property taxes and to recover past overpayments. However, only about 15 percent of the property is exempt from taxation, as La Casa rents space to area businesses. Partial reimbursements for 2012 and 2013 are being processed presently, and “we’re looking to get those refunds out the door soon,” said Ed Price of the county’s Auditor-Controller’s office.