Jewish Day School and Yeshiva Affordability: A Leadership Challenge and Opportunity

Over the past several decades, we have seen an explosive proliferation of articles, posts, papers, think thanks and conferences on the topic of  Jewish day school and yeshiva costs and affordability. In fact, the writing of this blog was motivated in part by a recent article entitled “Opening the Books,” published in Mishpacha Magazine.

As we know, there are no magic silver bullets or arrows in our quiver that respond effectively to all of the affordability or sustainability challenges facing our day schools an yeshivot. To be sure, not every day school or yeshiva has the capacity, expertise, bandwidth or culture required to respond effectively to these daunting challenges. At best, what we see are a series of very disparate and select institutional fundraising triage strategies and tactics.

The spiralling increased costs for day school and yeshiva operations resulting in increased requests for scholarship assistance against a backdrop of a faltering economy are exacerbated by increased demands for the philanthropic dollar, the increased nature of Jewish poverty and competitive fundraising initiatives in order to thrive in a competitive Jewish educational environment.

There are many who posit that today, our Jewish day school and yeshiva communities are in a far better financial position than at any other time in our history. This reality may be true in spite of major increases in pupil enrollment, rising competitive teacher salaries and increases in general operating costs of our institutions.

Yes, we are seeing more leveraging of State funding, and more creative fundraising initiatives being undertaken by many of our schools. And yes, there are also more potential funding sources and resources than any other time in our history.  But, irrespective of these amazing opportunities, our communities are still feeling the tremendous stress and strains incurred in trying to keep our institutions financially strong and viable and on a healthy financial trajectory.

This reality has also given rise to a mindset where parents and supporters complain and are upset that “if my school is raising more dollars, why does my tuition go up? 

These sentiments are normal and natural. But the responses to these important questions are far more complex and detailed than the space of this blog will allow. In fact, any attempt to describe and explain this reality usually ends up in a rabbit hole – especially when responding with the argument that a school’s costs have also increased in scope and magnitude.

Where this conversation becomes a bit “sticky” is when we take a deeper dive into the growing disparity between senior administrative salaries and compensation versus those of teachers, faculty and staff. This indeed requires a more comprehensive conversation

As we scan our Jewish day school and yeshiva fundraising landscape, we see three camps – the haves and have-nots and the not yets.

The haves have embarked upon a series of well defined fundraising plans which have proven to produce amazing results. Although they represent a minority, they do take advantage of  innovative, creative and replicable fundraising initiatives and models; and, they are motivated by a cadre of lay and professional leadership who possess passion, knowledge a willingness to stretch their time and resources and those who understand and appreciate what it means to create a sense of urgency.

The have-nots are a classification for those schools which rely heavily on their day-to-day existence. – running from deficit to deficit and taxing  parents with tuition increases. They are not very planful in their fundraising approaches and are usually in the rears re debt and expenses. Ironically, they remain open, offer a dual curriculum to their families as they survive (underscore barely) with accumulated deficits. Finally, they are more reactive than proactive which throws the affordability balance completely out of kilter.

Finally, there are the not-yets. These are the schools which are trying desperately to improve and enhance their financial resource development condition, approach and capacity, but, lack the leadership, knowledge, experience or expertise. They fully understand and appreciate the power of high quality fundraising and its impact on affordability, but are a taking a bit more time to develop the right approach and culture that fits their institution.

Parenthetically, many of the institutions in this third bucket become highly motivated and end up embarking upon very successful and meaningful fundraising approaches.

When viewing the current day school affordability picture from thirty-thousand feet,  we see a wide array of recent affordability initiatives and projects, which at first blush appear to be logical, doable and realistic no-brainers. However, upon closer examination what quickly emerges are a series of very complex, distracting, burdensome and politically challenging processes.

Today’s Jewish day school and yeshiva enterprise is in a state of  financial flux and in serious search for leadership which will respond to the challenge of affordability in a  more palpable and doable fashion

In the ideal world, our schools would all have a financial resource development strategic plan which would help these institutions navigate and pursue a path of fundraising quality and high impact. But, reality dictates that most do not. Therefore in the absence of a comprehensive plan, which offers a total or whole-school approach to affordability, I would like to suggests three initiatives which if successful would help reduce some of the major stresses and strains on the affordability scale.

They are: Major Gifts and Endowments, Pooled Resources and Joint Purchasing

Although for many of us in the day school/yeshiva leadership field inherently know that these three strategic approaches can produce amazing outcomes, they nevertheless require the engagement of professional and lay leadership with expertise, and an unswerving institutional commitment; and, above all, a sense of urgency.

Major Gifts and Endowments:

The concept of endowing institutional gifts is not new. In fact, there are hundreds of colleges and universities as well as select schools which have successfully embarked upon endowment development and major gift initiatives with millions of dollars being raised and invested annually.

Endowment giving demands that schools raise dollars and use the interest only for capital or operational expenses. Its an arduous process, especially when a school requires significant dollars/liquid today for operations and expenses. It requires a discipline and a process and expertise. The expertise is usually anchored in leadership who are knowledgeable about where and how to invest the endowment in order to yield the highest value possible. In fact, there are many institutions that do not touch the interest, but let the “corpos” dollars grow the endowment.

Endowments should never  replace annual fundraising which is the bread and butter of support for our schools. But, it does and will provide the school with a continuous  funding stream in perpetuity.

Endowments, like “major gifts”(usually over $100,000.) can be designated or earmarked for specific purposes like capital improvements, technology, scholarship assistance, special projects, salaries and in select cases overhead costs.

Both endowment giving and “major gifts” are two of the most powerful ways to respond to the affordability crisis. But, we should always keep in mind that effective “bread and butter”  high impact fundraising is usually your best shot.

Finally, at the end of the day, its all about “people”.

To be successful in any fundraising initiative, schools must have an expanding philanthropic base from which to draw resources and a cadre of leaders who can inspire, motivate and encourage meaningful giving.

Not all schools have this capacity. But if there is a willingness to develop these approaches than they will eventually succeed.

Pooled Resource

In light of today’s economy, scarcity of personnel  as well as the physical proximity of one day school or yeshiva to the other, schools can save thousands of dollars annually by combining instructional and administrative staff.

Although, this process can be somewhat political, there is no reasons why a school cannot share its general studies and even select Judaic studies faculty or back office accounting and purchasing with one another.

This is where lay leadership needs to invest its time. Not necessarily in the functional aspect of pooled resources but in assisting and motivating  schools and communities to break down the potential political and turf barriers and obstacles.

Joint Purchasing:

The unlimited potential for a school or community to save millions of dollars a year is through “joint purchasing” is amazing. Just think about how all of  these dollars which are being  saved can be pumped back into our schools in order to help defray scholarship assistance. and other challenges impacting affordability.

Although the administration of an operation of such magnitude can require administrative coordination and significant detail in its execution, the concept is beyond simple and it is just begging to happen.

As a communal leader, I have been advocating for years  that our communities undertake a national or regional  Jewish day school and yeshiva joint purchasing program. The savings to our communities will be in the millions annually..

I also submit that if our federations on the local level or Jewish communal agencies on the national level cannot make this a reality, that we must encourage clusters of schools to begin this process. By not doing so, the organized Jewish community is leaving hundreds of millions of dollars on the table.

Something to think about!

PostScript:

The Jewish day school and yeshiva community has reached an inflection point in its growth and evolution which demands creative and bold thinking.

If we can experience and innovate bold and creative moon-shots, there is no reason under the sun why we cannot individually and collectively respond to our affordability challenge or crisis.

The response to our Jewish day school and affordability challenges rests with our  individual and collective ability and capacity to raise and leverage more fugable dollars.

As we know well, if we will it, it will happen.

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This blog is based in part on an article this writer published in 2013; and in response to a recent article entitled : Opening the Books, by G. Edelstein, Mishpacha Magazine.