Sunday, November 16, 2008

A Lot of Orthonomic Reading

Marvin Schick (Hat Tip: Joe Schick) is writing more about the tuition crisis in the most recent RJJ Journal. Mr. Schick starts off by writing "The starting point – the beginning of wisdom – is to recognize that there is a crisis, that what happens on Wall Street and at other key economic sectors has a direct bearing on yeshivas and day schools. Having blinders on is never a formula for intelligent planning and action. These days, having blinders on is reckless and worse." It seems to me that the train wreck schools are facing has been many years in the making. I'm not sure that the community has woken up quite yet, and neither is Mr. Schick.

One of the frugality blogs that I read recently had a post about being careful with not only your own money, but that of your employer as well. This advice of course is not new ethical advice, but the same mussar that we learn from chazal who implore us to be as careful with someone else's belongings as with our own. Like Mr. Schick, I am starting to find conferences regarding Jewish education that take place in 5-star venues (this year's Torah U'Mesorah 'Inaugural Presidents Conference, will be at the PGA resort in Palm Springs Garden, Flordia) to be in bad taste. Can someone book the conference, should it be a necessity, a Holiday Inn for 2009?

Mr. Schick makes some suggestions are cutting the 'small' expenses (he is a consistent advocate for staff):

-Energy saving [This one would be nice. My husband davened at a local school on the high holidays and my son kept asking him why the last one out of the empty classroom didn't turn off the lights, as is protocol in his school. My question was why the air conditioning was set at 65 degrees].
-Reduction in mailing costs [Amen! And I would add to that that not everything needs to be photocopied. Cutting down on printing cost would be no small savings. Our niece's school, I am told, has a full time employee who does nothing but run photocopies. In the public school I attended, teachers were limited to a certain number of photocopies per year. . . and they had to make them themselves. One of my teachers got into a bit of trouble with the photocopy machine and we learned of this rule].
-"Recognizing that successful fundraising is dependent on trust and direct contacts and not on a school sending a costly gift to thousands of names purchased from some outside source." [See my review of an article in Accounting Today about what fundraising in a down economy. Cultivating committed relationships is key].
-"Cut back on the costs associated with the annual dinner. The invitations can be more modest, the gifts given to the honorees and others who attend can be less costly and I believe that other savings can be instituted." [Rings true here. Should I tell you about a banquet that had a 12 piece band, a super-sized smorg followed by a 3 course meals and a dessert bar, and, oh yes, ice sculptures?].
-Seek new contributors (Mr. Schick adds, "fundraising that depends on expensive initial outlays is not the way to go)."

Mr. Schick really doles out the much needed mussar when he writes: "In the aggregate, our schools spend a million dollars or more on the annual Torah Umesorah convention that takes place after Pesach. Since many of them are behind in payroll, I wonder whether there is a halachic justification for such an expenditure when underpaid teachers are not being paid on time." I would add that one of the worst thing a school could do at this point is appear to be living it up, while staff is not receiving payment as due, on time, and in full. Staff retention will be important during tough economic times.

The Five Towns Jewish Times published an article on the 'Fundraising Crisis.' The downturn in the economy has resulted in a long overdue discussion about where to place priorities in fundraising. While bochurim in Israel pray for the parnasah of their supporters as kollel families sink deeper, a discussion about how to keep yeshivot up and running here in America is ensuing. Scholarship requests are up, fundraising is down, and debts are mounting. The author interviews a yeshiva executive and fundraiser who predicts that things will get worse and makes some suggestions including:

-larger class sizes
-no pay raises for staff for the upcoming years and perhaps for years to come
-moratorium on outside-the-community fundraising until the economic situation stabilizes


This is sad news: Major Fundraiser Can't write the Check. The funder of the Queens Gymnasia and other free Jewish schools is no longer able to foot the bill. I've noticed a lot of class warfare recently due to the elections, even amongst the frum community. Many seem to wish ill on the wealthy. Those who want to punish the "rich" should take a moment to think about what might be lost should markets worsen and taxes increase. 'Nuff said.


Have they no shame?: I'm sure no one would offer their Rabbi a ham and cheese sandwitch? But "The Rebbitzen's Husband" was offered help cheating on his taxes via money laundering techniques. Oy!


Jonathan Rosenblum has an article "Keep it Simple" (Hat Tip: Esther) where he recommends that to prepare children for the realities of life we should "Teach them to live simply without feeling deprived." Perhaps one of the the biggest obstacle being happy with your lot is getting over the need to conform which Mr. Rosenblum touches upon. Mr. Rosenblum mentions out-of-control weddings expenditures that eat Orthodox families alive. Mentioning aufrufs and sheva berachot that resemble mini-weddings and other indulgences are all fine suggestions of where cuts can be made. But, if you don't tackle the conformity issue (I happen to believe becomes more powerful the more 'right' you go), head on, you will run into a brick wall even where Torah sages such as Rav Aharon Leib Steinman "[stress] the necessity of getting away from [the] “everybody does it,” mentality [which is] no excuse to go into debt" because few are willing to break rank.

I would add that if you want your children to live simply without feeling deprived, it is best to "break rank" voluntarily, rather than be pushed into breaking rank because funds have dried up. Being in charge is a positive feeling. Being backed into a corner is a negative feeling.


The Hedyot said...

You might find this useful: The Average Living Wage Calculator - Give it a location, and it will tell you what the average expenses are for that area, for different family sizes.

ProfK said...

Living in a world where tele-conferencing and other instant and real time communication is possible what justification is there for having mega=conventions at all, given the economic climate? Sharing information and concerns is an important element in most professions, but it can be done with far less expenditure, even if they were to pick a Motel 6 for the venue, by utilizing today's technology.

Anonymous said...

Most of these dinners and other expensive fundraising attempts are done out of sheer inertia - this is how it's always been done. However, that doesn't mean is made sense in the past either! So many of our organizations are run by well-intentioned people that don't know ANYTHING about budgetting, bookkeeping, or how to run an organization.

I recall in college when I was active in Jewish groups on campus someone telling me "we raised $X through mishloach manot!" to which I replied, "No, you raised $X - advertising costs - expenses for the materials to put together the mishloach manot." All I got back was a confused look. I see the same thing with these dinners and mailings - all you hear back is we raised $X without any mentioned of how much the event cost.

No thought at all goes into whether more money, net, could be raised without all these expenses.

As for our yeshivas, this may sound morbid but I'm actually looking forward to some of them failing and/or parents being forced to pull their children out and send elsewhere or to public schools. I think our yeshiva system has gotten bloated and is rife with abuse of employees and parents who are trying to pay the bills. It's about time something shook up the system so that things can maybe become more fair to all involved.

Chana German said...

Profk raises a great point. There isn't even a need to use a Motel 6 - the conference can be fully online using web conferencing technology. This saves on the cost of the lecturers (you don't have to pay travel and lodging expenses), and the travelling expenses for conferences goers who can login from home or school. In the same vein, schools can use web/video conferencing to "beam in" guest lecturers for PD days. Or schools can band together to hire a facilitator for PD days, so that the cost per school is lower.

Chana German
The Lookstein Center

Anonymous said...

I was wondering if you had heard of the idea by Rabbi L. Kelemen- he mentioned in a recent speech the idea of floating a bond to pay for Jewish day school education (in the same way that municipalities float bonds to pay for long term investments)- this way parents could pay off the cost of tuition long term- say, over a 25 year period, instead of having to pay it all in a compressed 12 year period.

Lion of Zion said...

i think this is one of schick's better essays. (on the other hand, i thought he missed the point in his article on sex abuse last week's jewish). my son's school just sent home a form requesting an email address to they can eliminate mailings.

regarding teleconferences: i think these are silly. at most of the ones that i've been present at, most people are doing something else and the conference is just the background.

if the conference is important, i think face to face is the best way to go. if it's not important, it doesn't even merit a teleconference. so the real question is whether all these conferences are justified. do they actually produce anything worthwhile to begin with and not whether or not they should be virtual.


"this way parents could pay off the cost of tuition long term- say, over a 25 year period, instead of having to pay it all in a compressed 12 year period"

how is this different than taking out a loan or second mortgage?

The Rebbetzin's Husband said...

Thanks for the link!

Anonymous said...

As someone who works in Change Management in the corporate world it never ceases to amaze me how the Yeshivos and other NfP's are so blind to what is going on and always seem to be behind the 8 ball.
They need to see what the corporate world is doing and borrow the best practices.To borrow from what the corporate world is currently doing.

1.Identify the percentage of annual budget that will be decreased for 2009. It will need to be big, 25-35%. This will be accomplished by cutting office staff, teaching staff, nice to haves and other non-essentials (conferences, extra curricular activities etc). The cuts will have to mirror the expected losses incurred by lower tuition collections and fund raising.
2. Stop passing on non-essential costs to parents. Instead of a petting zoo @ $12 a head, next year might be the year to forgo the petting zoo for a dvd about animals.
3.In general,cutting back on parent requests for money for extras. The focus should be on tuition and covering the budget before any extras at all.
4. Schools/NfP's pooling resources. This has been suggested before. Without going into this at length, the reason this is not done more often is because of the fear of one school defaulting on their portion of the costs and the liability falling on the other schools. Schools and not for profits need to reconsider this option and pool non-risky resources and potentially, staff. In addition, offices, phone lines and others could be shared.
5. Cutting office expenditures. This needs to be a directive, "Cut 25%!".
6. Engaging all of the staff to look for creative ways to save money. Why should this responsibility just rest on the administration and not the rest of the staff?
7. Now is the time to tell the staff that there will be no raises next year. Don't wait until the annual raise conversation time for that conversation to happen. Let people make the long term decisions they need to make now.

If schools and NfP's get focused on 2009 now, they have a shot at making it. If not, some will definitely fail. Maybe that's not such a bad thing.

Anonymous said...

I participate in teleconferences frequently. There are some things they are good for, but a great many things they are not good for. They are fine for meetings of 2 or 3 parties who already know each other. Or for giving a speech or lecture to multiple parties who may ask infrequent questions. They are not very good for first meetings, nor for highly interactive discussions among multiple parties.

A great many conferences and conventions are for networking; for people in a field to meet each other, and find out what is going on at other venues. This is an important activity, but it doesn't have to be done every year. If your budget is swamped by the stock market crash, this might be a good year to skip.

You can also look for donors who had short positions this year.

Anonymous said...

By the way, is there any reason for the dinner part of fund raising dinners? If you just had a fund raising campaign the donations would be fully deductable. The cost of the dinner always seems to be four or five times what a comparable restaurant meal would cost. And they are not enjoyable. I suppose people feel shamed into contributing since their peers will see if they show up, but aren't we more mature than that? Perhaps this crisis can be put to some use in focusing fund raising on raising funds needed for worthy endevors. Not only would more of the money go to the school rather than hotels and caterers, but people would have more time to spend productively, and wouldn't need the extra outfit.

Orthonomics said...

Many schools require parents attend (and pay for) the banquet. I'm with you though: time to try something different.

Anonymous said...

Two organizations I am quite familiar with basically break even on the dinner, and make the money on the associated ad book. Why not just do the ad book, and send it out to the community without a dinner. If the school makes people come to the dinner, they can make them buy an ad just as easily.

By the way, if they make you do this as a condition of sending your kid to the school, you can't deduct any of it. In which case, rather than make the parents go to the dinner, they can just raise the tuition. Because no G-d fearing person would cheat on taxes.

DAG said...

Oversight, oversight, oversight. Money should NOT be given to any (American) Tzedaka that does not publish its 990's AND demonstrate that it has real Board oversight

Chana German said...

One school I am familiar with does very successful fundraisering using this model: dinner parties with 20-30 guests each. Someone lends their home for the evening (no cost for venue), hires a caterer (cost), and invites 5-6 interesting guests of honor (experts of some kind - possibly alumni, even parents of students, popular teachers). There is informal conversation, but no speeches by the guests. It's your chance to get to know the experts and their field. The price to attend ranges depending on where you sit (ie next to a guest of honor) but it can range from a little more than the cost of the meal to $500 per person.

Anonymous said...

The need for dinners (though I never go to any):

I've heard that R' Revel (first president of Yeshiva College) used to say that donors need a COD - Cavod on Delivery...

Anonymous said...

The Torah Umesorah Convention will be held at the Friar Tuck Inn - not exactly a 5-star venue. It serves a real purpose for the out-of-town teachers in particular, by allowing them to meet and network with others. Where on earth did anyone get the idea that the convention would be held in Palm Beach? ROFL!

Anonymous said...

According to Mr. Schick's article:

"A month from now, Torah Umesorah will hold an 'Inaugural Presidents Conference,' at a luxurious PGA resort in Palm Beach Gardens in Florida. The organization is urging day school leaders, particularly lay leaders, to participate in 'a weekend to cultivate relationships, share ideas and realize visions' and doubtlessly to have good food and a good time."

Mr. Schick was not referring to the convention as this blog erronerously stated, but to another TUm event.

Orthonomics said...

Correction has been made.
The point still remains the same: it is important to be sensitive to the klal and holding events in 5 star venues re: Jewish education while the average parent is really struggling to pay for a Jewish Education that is out of reach is not particularly in good taste.

The CEO of IKEA flys in economy class. The is an integral part of the corporate culture of frugality. True or not, many people feel that those at the "top" of the ladder in Jewish Education are not careful with the money of those struggling to pay the bills.

Anonymous said...

Rudy Giuliani writes in his book Leadership that when he wanted to lower the major crime rate in NY he started by focusing on smaller crimes like squeegee cleaners and similar smaller crimes. He was basing on research that had shown that building without any broken windows and looked to be in good repair were less likely to get graffiti.
I would say that yeshivos need to start similar programs. Yeshivos that are careful about paper use, phone lines, electric bills etc. are more likely to be properly focused on higher costing items such as salaries, fundraising etc.