But Exactly Who Will Pay the Bills?

Source:  Putting a Cap on Day School Tuitions

The newest Avi Chai day school affordability proposal for "middle class" yeshiva/day school families, i.e. families in the top 10% of American earners, is to cap tuition as a percentage of income and require less paperwork and income verification.  The idea stems from a pilot program at a Solomon Schechter school.  Certainly for the yeshiva family paying far more and breaking their backs to do so, such a proposal sounds like a welcome proposal. I'm not so sure this has the potential to lay out well in Orthodox Schools with a preference for larger families and a day-school-or-bust mentality.

But I have to wonder, where is the created budget shortfall to come from?  After all, someone has to pay the bills and the basic current operating policy for Orthodox schools (even articulated at points in this long "discussion") is to continue raising tuition annually because someone will pay.  Some families will find additional jobs or income sources.  Some families will seek gifts from grandparents. Other families will curtail savings.  Other families will refinance the house.  Other families will dip into savings.  Other families might turn to credit cards.  The families that can make it work, do, and the schools continue with the annual raises because it works for them to an extent.  Therefore, we see tuition going up and up, but families that are already on tuition assistance generally are not expected to pay additional monies as tuition increases and number of children enrolled increases.

I simply can't see how extending this method of operation to families that are "making it work" is sound financial policy barring other ideas that raise tuition on families who are not "middle class".  The articles makes mention that a policy would result in "modestly" lower tuition in the short term, but the supports believe that this will be made up for in the long term (for schools with empty seats) through two means:

1.  Retaining larger families.
2.  Spurring enrollment of new families.

I certainly agree that a tuition cap of 15% of income will help retain larger families in the system.  In fact, I'd argue that such a policy might even spur a "baby boom" (perhaps even fueling the fire of the age-gap people, oy vey!).  If the 3rd child for the $200,000 family in the given example is free, why not enroll 4 children?  While I think it would be nice to see the families with 2 and 3 children who have imposed their own cap, have more children where desired, I don't see where tuition will increase in the long term here.  Perhaps someone can explain it to me?  The larger families aren't generally the full payers, rather the 2-3 kid families are the full payers and the ones to absorb the annual increases.  Perhaps I'm unaware of a new trend of larger families leaving day schools and yeshivot?  Maybe while my blog was in hiatus there was a mass exodus?

I imagine that those who believe in this policy really are putting their bets on #2:  spurring enrollment and filling "empty seats."  I'm not sure there is a consistent definition of an empty seats and my understanding from teachers and administrators is that not ever "empty" seat is equal.  In other words, an empty seat can be filled by a fantastic student whose only cost is another desk while at the same time another few students can tax the staff enough that the school fills the need to hire more staff.  Perhaps there are more potential families from the "middle class" payers and I grossly underestimate, but I'm doubtful.  Of those who are a natural fit for day school, but are not enrolled in day schools, is the decision financial or based on other factors?  Where it is based on other factors, what are those other factors and will a changed tuition structure for the "middle class" bring them back?

Let's hear from you my dear readers.