Struggling To Stay Afloat

Schools Get Creative In Financial Crisis

By Lana Gersten

Published January 21, 2009, issue of January 30, 2009.
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Last August, just as the new academic year was starting, Rabbi Yaacov Dvorin, head of Hillel Torah North Suburban Day School, in Skokie, Ill., was facing an increase in the number of families applying for financial aid, decreased dollars coming in through fundraising efforts and the possibility of cutting back on teaching assistants. It was a tough position to be in, given that the school had limited funds and prided itself on maintaining small classroom sizes with lots of individual attention.

Now, Dvorin struggles to make payroll each month, and he will have to make severe budget cuts for the 2009 school year. He predicts that he’ll have to cut around $200,000, which is a tremendous amount of money for a school that has fewer than 450 students, ranging from pre-nursery through eighth grade.

“What’s educationally sound is not always financially responsible,” Dvorin said matter-of-factly. “We’re going to have to tighten the belt.”

Dvorin is not the only one making difficult choices during this academic year. Jewish day schools and high schools across the country are facing even tougher financial situations than they did this past fall, as the economy continues to spiral downward and Jewish giving suffers.

“Small schools with low enrollment and fragile financials prior to this are thrown into a new crisis,” said Marc Kramer, who is the executive director of Ravsak, a national network of Jewish community day schools. “Whereas maybe the year-to-year conversation was about getting by and making do, or making excellent with little, now it’s about surviving with nearly nothing. Some of those conversations will, I think, terminate with some schools closing.”

In August, Kramer said he fielded many phone calls from school heads worried about their enrollment numbers for the 2008-2009 school year, but now, he says, the conversations are dedicated to working through the intense anxiety felt from schools across the denominational and geographical map.

To address the concern, leaders of Ravsak dedicated an entire day of their three-day annual conference, which was held January 18 to January 20 to brainstorm ways to pull through the tough economic times. A panel of economists, investors, financial planners and others held workshops on the final day, to discuss everything from protecting endowments to re-imagining professional development and implementing creative fundraising models.

The interest in the conference was great, Kramer said, because “the needs are starting to outweigh the capacity of the system to respond.”

“The situation is worsening considerably,” said Marvin Schick, a senior educational consultant at the Avi Chai Foundation. “There are schools that are on the ropes, and there are parents who have already pulled their kids out because they can’t afford the tuition.”

A new study, conducted by Miriam Prum Hess, head of day school operations at Los Angeles’s Bureau of Jewish Education, was completed by 22 out of a total of 36 Jewish day schools in the area. The study found that 125 students had dropped out of school either just prior to its start or during the month of September, and an additional 10 students had dropped out of school in October because they were unable to pay tuition. According to Prum Hess, these numbers are “definitely an increase from typical academic years.”

Every school is affected by the current state of the economy, but not all in the same way.

“The schools that charge high tuition and have a good donor base are going to be able to weather the storm,” Schick said. “There are a great number of schools in the Orthodox sectors, particularly schools that cater to poor families or immigrant families, that are going to be hurt.”

That is certainly the case for Dvorin. Hillel Torah never had big donors, but the ones who did give are now giving considerably less than they had been.

Many schools are starting to think outside the box. The Kadima Hebrew Academy in California and the Perelman Jewish Day School near Philadelphia announced that they would decrease tuition for the coming school year, an unprecedented move for private institutions whose strategy is to increase tuition each year. Other schools have adopted new, creative fundraising models in the hopes that they might bring in some extra money.

Ray Levi said that the Amos and Celia Heilicher Minneapolis Jewish Day School, where he serves as principal, has trained a large number of parents and grandparents to serve as solicitors. The school is also encouraging donors to spread gifts out over a longer period of time, and has considered treating some percentage of donor gifts as a loan.

In addition, the school has instituted new communication efforts to reach out to parents, including coffee meetings to keep them in the loop about their children’s progress and to provide more information about the updated curriculum. The administration hopes that this effort will maintain enrollment numbers.

“I think we’re trying to find a balance between being realistic and empathetic to families, but also to really enlist people’s support in underscoring the importance of our work and our mission,” Levi said.

At the Solomon Schechter School of Manhattan, where the maximum tuition is $27,540, the board members gave an additional $75,000 from their own pockets as a matching gift — a challenge for supporters to come forward with a dollar-for-dollar increase in their donations to help make up for some of the unanticipated shortfalls the school is facing. Principal Steven Lorch is confident that the community will meet the challenge.

Though tuition is high, Lorch said that as many as 45% to 50% of students receive financial aid in a typical year. This year, more than 50% are receiving financial aid, and a few families who were paying tuition in full have requested aid midyear. The school uses an outside service to determine aid, and is optimistic about UJA-Federation of New York’s new Rose Biller Day School Scholarship Fund, which will give up to 200 awards of $5,000 or more toward the cost of tuition at a Jewish day school in New York.

Even though schools are competing for the same money, many are working together to weather the storm.

“There’s a lot of energy, a lot of people who care,” said Don Sylvan, CEO of the Jewish Education Service of North America. “There’s a tremendous amount of innovation going on in the schools.”

That’s what has heartened Kramer as he continues to work with schools across the country. “We know that the one strategy that will fail is panic, so we’re trying to help everyone move beyond it, or minimally to contain it,” he said. “What are we going to do, and how do we learn from one another, and how do we support one another become the real questions.”

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