Wednesday, December 10, 2008

Educating Donation Free?

As noted here, on Orthonomics, and on Baltimore Jewish yesterday, one of the major problems that is and will continue to face the Jewish community is that the schools rely too heavily on donations to stay afloat. The obvious suggestion everyone has made is to decrease this reliance and make schools less vulnerable to market downturns which impact donations. The real question, however, is if this is actually possible.

It seems we don't really know. Yes, many schools have much wasteful spending and are poor at budgeting, and that must be fixed first. Tuition standards need to be established and kept to. Much can and must be done to make it as economically viable as possible... but once that is all done, if there still is an inability to cover costs, what can be done?

The real question is: Is it truly economically viable - in any Orthodox community - to support and maintain a school within its own budget? Does anyone know of a school whose revenues outside of donations exceed its expenses? If so, let's see it! If not... what must the approach be? Store away the donations in good years to make up the gap in other years, like the Yosef/Pharaoh analogy a commenter said yesterday? Is that realistic? What changes are possible within the frum community to make it possible to keep a school afloat on its own?


  1. No ,it is not- - and so to quote Rabbi Rosenhaus...Next question.

    thoughts to save money/increase funding?:

    ----keep community money in the community
    --fewer schools where possible
    --mandatory retirement
    --hold salaried fundraisers bring in less, you get less-you bring in more, you get more
    --play nice with parents and the community at large
    --play VERY nice with alumni

  2. Seriously consider the ideology espoused by your institution and the stance toward differing ones.

    Promoting a Torah only path is may leave you with a decidedly poorer set of alumni from which to raise money.

    Even given the above some will undoubtably not live that life and WILL be able to give support...only they probably won't if the ideology espused when they were in school painted their ultimate lifestyle as "wrong" or was looked down upon it in general.

    And that only deals with alumni - there are surely general donors who may/may not donate to an institution based on similiar feeelings.

  3. keep community money in the community

    Agreed. I think that that's easier the more responsible you're being with money.

    fewer schools where possible
    mandatory retirement


    hold salaried fundraisers bring in less, you get less-you bring in more, you get more

    Rather than accountable per se, I'd make their income staggered. Base of ___, bonus %'s based on money brought in (steadily decreasing the % as we get into large numbers).

    The best tzedakah organizations do this very effectively.

    play nice with parents and the community at large

    Agreed, though I think the better schools already do this mostly. The ones that realize they are servicing but also need the community at the same time are typically most successful.

    play VERY nice with alumni

    Mhm. (Just had a meeting last night for one of my alma maters. Underrated.)

  4. The second set... I'll agree it's more of a problem in communities where that's the case, but I guess I'm starting with places smart enough not to disenfranchise a big money base.

  5. Yeshivas need to do what successful colleges do - concentrate on making the Yeshiva experience pleasant so that Alumni feel connected and associate good time with their days in Yeshiva. Colleges spend a lot of effort, time and money on making the time spent there memorable. Yeshivas need to do the same, instead of just offering a place to learn and an environment where the Rabbis and the students are at odds. They need to organize more recreational and social gatherings, more small group events, etc. Dorms should have onegs for each floor, etc. I have spoken to yeshivas about this, but they are very resistant and just dont care. They view their mission as just teaching torah to the students, and not much more.

  6. Anon - Very interesting points. I definitely see a greater "loyalty" in places where people feel like they were a part of the school (rather than just attending it), and that will likely translate into more money down the road. I think it's harder to do that in elementary schools, though it is possible.

    I'll note that some places get the idea but misuse it - they wish to create a "culture" around the school, and to some extent it works, which might be the problem. The school ends up standing for certain things rather than creating memories, which translates into an aura but not necessarily support.

  7. Anon makes some great points considering how many people I know who could not stand their high school yeshiva education and certainly would not feel it necessary to give them a dime.

  8. This may sound cold but I'm not that concerned about high school's - they make their own beds and will have sleep in them...if things go badly there are many other ones across the spectrum and across the country that can fill the void.

    Elementary schools are a much bigger issue. It would not appear to me that one can simply send a child to a diff one should the need arise.

  9. G - Agreed to an extent. I'd estimate that people will feel more "loyalty" to high schools and therefore give them more money later on, even if they don't manage that money well. That would then be good money down the tubes.

  10. It is my understanding that NO private school, even the super duper rich ones, survive on tuition alone. They are all dependent on donations or endowments.

  11. Greg - Okay. Is that a function of Jewish schools, or private schools in general?

    So how do we make those donations/endowments stay for the hard times?

  12. How do the Catholics do it?

  13. How do the Catholics do it?

    Presumably, aside from tuition (which is very low), they are receiving monies collected at the collection plates and from the tithes of people in the diocese.

    I don't think we can implement that. First of all, we don't have one hierarchical structure, like the Catholics do. Secondly, the Church requires that the tithe go to the church. Any additional charity you give (Salvation Army, Red Cross, etc.) is outside of that. We don't require that our ma'aser go to any particular communal (or any) institution. We are free to give our ma'aser to a shul, yeshiva, hatzoloh, a food pantry or even the neighbor down the street who is having a hard time with the bills. We don't have the means to enforce the giving of ma'aser to one particular place.

    The Wolf

  14. Wolf - Quite a good guess. The first one we found online had tuition barely over $2,000 a student, and got about the same per student from the church. The rest of their budget they got through fundraisers. What was interesting was their cost per student of $5,300, which is waaay lower than in any frum school. I'd bet that some of the extra is necessary (say, Kosher food), but much is better budgeting by the Catholic schools.

    And, as noted, we can't really implement that, though we can start to do things in similar ways: Umbrella foundations like the Jewish Federation could control the purses while overseeing how schools spend their money. Assuming that this can be kept very small in terms of bureaucracy, it can help all around. It would also allow the people who analyze budgets to be doing so across the board, helping each school implement the good ideas in other schools.

  15. Im the anon from above -

    I tried not to say that many yeshivas manage to leave people pissed off and very frustrated, and present the point in a more neutral light. However, I do agree that many Yeshivas not only dont make pleasant memories but they make lots of bad ones.

    Re the catholic schools: I would bet that they benefit from lots of cheaper/free labor (Nuns and other church people that don't get a real salary for working in the school, plus they dont have to pay Rabbeim AND teachers).

    Also, they typically own the property they are on for a much longer period. Yeshivas are burdened by mortgages and expansion costs.

  16. I worked with someone who had his son in a Catholic school. Registration was $150 and tuition $3000. With a break if you are part of their church. I laughed when I heard this. I am in my first year of tuition in a real school (not preschool) and registration fees are around $500 and tuition close to $8000 (in a yeshiva school in the lower grades) plus fees.

  17. First, rather than divide schools by exact sect & hashkafa, share a building and some administrative staff to cut administrative overhead of every community having different schools for each slightly different approach. Hey, you can keep the kids on different floors so they don't mingle too much - but you can get away with 1 secretary and 1 janitor rather than 3 in 3 different buildings.

    Next, play fair on tuition. If your real per student cost is $5,600 (a realistic number in NJ), but the rebbe's get 50% of for their kids, and the administrative staff gets to go free, and 40% of the parents are getting a discount (that they really need) - then your "proposed" tuition of $9,500 per student is a lie. In reality, the difference between $5,600 and $9,500 is tzedakah, both halachically (I'm helping another student go) and LEGALLY, meaning I can take it off my taxes!!!! But only if the yeshiva is willing to be honest and classify it as such (base tuition $xxxx, required donation $xxxx). That helps me save money and potentially be able to pay more for one of my other kids' yeshiva's.

    With the economic downturn, I fear that the current community education structures are not sustainable. G-d forbid, we're going to see schools falling behind on bills and salaries, and G-d forbid not make it. The community needs to start thinking about how it can combine and cut back in a major way immediately. Plan for the emergency, because it's coming.

  18. The community needs to start thinking about how it can combine and cut back in a major way immediately. Plan for the emergency, because it's coming.


  19. The only real solution is endowments, where a percentage of income every year is intentionally put away, invested, or even buying property or local businesses or something else that can be used to create income over time.

    However, too late for our current crop of institutions.

  20. Akiva, your comment on actual tuition vs. required amount (including donation) is perceptive. I don't know if it would work vis a vis the IRS since if a donation is *mandatory*, it's not deductible. I've asked that question regarding such extras as the mandatory "fundraising" dinner. Any tax experts among us?

  21. My non-blogging husband adds his comments:

    Remember that the schools get money from sources other than tuition and
    "required donations" (i.e. voluntary donations from grandparents & other
    donors, grants, etc.). You would have to calculate the actual cost of
    providing the education, which might be as much as (or more than) than
    actual "tuition".

    Secondly, it is far from clear that a "mandatory donation" that is
    attached to each tuition would qualify as tax-deductible. Even a
    mandatory "Dinner/Journal" obligation (which is per-family, not
    per-student) is a gray area. You might be stretching the envelope tax-wise
    with a per-student add-on.

  22. Ezzie, the Church doesn't have to pay its Nuns and Priests a salary (they get stipends dependent on need regardless of position/title and they have no children to take care of).

    I think our problem is that we have way too many schools and organizations (aside from the fact that many run their institutions poorly).

    We do not schools for 20-75 kids and we do not need a dozen organizations to solve each of the communities purported problems.

    And this is where this goes back to Kollel. The reason we have so many small schools and so many organizations is that we have so many Kollel members who are not qualified for the work force that NEED jobs that provide Kavod and money.

    I am almost at the point of saying that the primary function (too many)of our Mosdos IS job placement. PERIOD.

    Most of these Kollel men are NOT qualified to run a Mosad or to control a budget running into the Millions of Dollars. Yet, they have the atttitude that Bal Habatim on their Board can not be trusted (as the expression goes) to even choose the paper for the copy machines because they are not Daas Torah (I have seen Mosdos quote that in the name of Rav Gifter ZtL)

    An additional problem is that the people who are making decisions regarding the Mosad are reliant on the organization for their Parnassah. That means that the choice between doing the right, Torahdick thing and the wrong thing CAN be a decision between a comfortable job and the (complete) loss of Parnassah (and Kavod) for the decision maker.

    In my mind this means the people making the "Daas Torah" decisions regarding funding should be considered Nogeih Bdavar.

    I just can't understand why this Matzav surprises anyone. In essence, people are asking, who would have thought that putting Rabbis who are experts at the hypothetical application of Jewish law without any background in organizational, educational or financial management or theory wouldn't be able to run multi-million dollar educational and social institutions?

    the question should be WHY on earth did we think that they COULD?

  23. Anon - Re: Memories, I do think that most people have either positive or neutral, once a few years have passed. The point is it must be positive or there won't be donations.

    Good points re: Catholic schools.

    LB - Ouch...

    G - LOL

    Akiva - I don't know that the schools will share resources well, unfortunately. You'd end up with much divisiveness ("those kids break things"), and many would say you're hurting those people who rely on schools for jobs (though of course, this is part of the problem).

    The % discounts for Rebbeim/administration's kids is an interesting one. I'm assuming that it's part of the package when one takes a job there. (And it's pretax for the teachers.) I think that the tuition for those kids *should* be included in the cost of the other kids' tuition. It's other students who can't afford the tuition who cause the serious drain. Not sure how it works re: donations to a school in such a case, particularly if it's required. I know some schools have things like "Give or Get" which basically forces them to fundraise or make up the difference. It's interesting...

    Certainly a few schools will not make it.

  24. Endowments are too late, but worth keeping in mind for the future.

    Tesyaa - Certainly tuition should be based on how much it costs per student; I think the point is that tuition shouldn't be extra per student simply because others can't pay.

    DAG - Agreed that the job placement point is a big problem, and the lack of skills among many in comparison to their responsibilities is one as well. Hard to believe R' Gifter ever said any such thing.

    I doubt that most of the people reading this thread are "surprised". I think that it brings up an interesting question, however: Are the people running institutions aware that much of the mess is due to the current structure of yeshivos? Or do they think that this is the only realistic structure of a school and that the failing is one that must be dealt with in an economic downturn - it'll simply have to be ridden out as best as possible?

    If it's the former, there's hope for change. If it's the latter - and very reasonable people can think that, as no matter your beliefs on the matter it's certainly a large factor - then it won't get fixed, and the Jewish community will continue to be drained.

  25. Ezzie this is where Daas Torah works against them. They think the structure is fine (and almost Divine). This economic downturn is a Bitachon test (either engineered by G-d or by the Satan). The survivors wont learn.

    I have no way to verify Rav Gifter ZTL story, but the people telling it treated it like a Davar Yeduah.

  26. To clarify Ezz, my comments about people being surprised was directed at the community as a whole, not your readers

  27. DAG - I really can't believe the Rav Gifter line. Doesn't sound like him. (My father learned in Telshe.)

    Agreed that the structure can work against them if they believe that to be the case. By the same token, I don't think anyone is surprised; it's a matter of what they attribute it to: A down market or a bad system + a down market. Hopefully it's the latter.