New Fiscal Chief at Seminary Resigns Post Amid Debt Crisis
The Jewish Theological Seminary of America’s new chief financial officer has resigned after just three months on the job at a time when the institution, the flagship of Conservative Judaism, is facing an unprecedented fiscal crisis.
The departure of CFO Richard Bengloff marks the second resignation in four months of a top seminary financial officer. Longtime seminary controller S. David Shapiro abruptly resigned his post November 9, 2004, only weeks before news stories disclosed that JTS was struggling to cover tens of millions of dollars in debt borrowed from undisclosed sources.
In a February 17 e-mail distributed to the entire seminary community, Rabbi Michael Greenbaum, the school’s vice chancellor and chief administrative officer, stated that Bengloff “has decided, for personal reasons, to move on.” Greenbaum wrote that he intended “to engage an interim financial officer within the next week or two, and/or recruit for a full-time replacement.”
Bengloff’s resignation comes two months after published reports that JTS had borrowed an estimated $36 million from “internal sources” to meet rising operating expenses. The debt was accumulated over several years, before Bengloff was hired.
Ismar Schorsch, chancellor of seminary, which is located on Manhattan’s Upper West Side, has announced that proceeds from the sale of a nearby land parcel would be placed in the school’s endowment fund.
Schorsch stated in a December 17 e-mail that the JTS board has “implemented a plan to reduce our current borrowings, which represent less than half of our endowment.”
In the e-mail, Schorsch stated that the seminary has an endowment of $80 million.
Seminary officials have declined to discuss the school’s financial picture, including whether the “internal source” of the loan sale of a nearby land parcel would be placed in the school’s endowment fund. Seminary officials have declined to discuss the school’s financial picture, including whether the “internal source” of the loan refers to the institution’s endowment fund.
The seminary’s director of communications, Elise Dowell, declined to discuss the institution’s financial situation, or to provide the Forward with a copy of the seminary’s annual report or with any investment policy statements. She declined to discuss how the endowment is invested or whether it had grown or shrunk in recent years.
Dowell declined to address the significance of the departure of two top financial officers in such a short time frame. But a veteran faculty member, who requested anonymity, said: “There seems to be some sort of hidden smelly mess in there that is not being publicized, and the people who get too close to it don’t want to get mixed up [with it].”
This past December, Dowell confirmed that Shapiro abruptly resigned as controller November 9 to become executive director of a day school in New Jersey. She would not discuss whether Shapiro’s departure was related to the seminary’s financial crisis.
Shapiro could not be reached for comment.
Bengloff did not return several calls to his home on Tuesday. That same day, Dowell said he left for personal reasons.
The next morning, Dowell e-mailed a statement which she said could be attributed to Bengloff announcing his new position as “the Chief Administrative Officer at WNYC,” a public radio station in New York. “It has been a pleasure working for JTS,” Bengloff was quoted as saying. According to the statement, he added that the new job “was a wonderful opportunity that I couldn’t turn down.”
Bengloff’s hiring and departure were just two of several recent staff changes in the seminary’s financial accounting and donor relations departments. JTS tapped Andrew Dorsch “several months ago” to serve as the seminary’s new budget manager and director of internal audit. Half a year ago, Jordan Chattam was hired to be the institution’s new director of donor relations. Dowell said it would be ridiculous to link the hiring of Chattam to the school’s debt problem.
JTS officials said in December that major borrowing was necessary to offset declining income from investments and donations that did not meet projections. But Schorsch, stated in his December e-mail that the school is in fine fiscal health and that a business plan was being developed to reduce the debt.
“JTS is exceedingly strong financially. Our assets far exceed liabilities by many times,” wrote Schorsch, who has served as chancellor for 18 years. “Our Board has implemented a plan to reduce our current borrowings, which represent less than half of our endowment, to [ensure] that we move forward from a position of strength.”
The seminary operates a rabbinical school, a cantorial school, graduate and undergraduate colleges of Jewish studies and a world-renowned library, in addition to the William Davidson Graduate School of Jewish Education.
JTS’s annual operating costs rose by nearly $10 million in a four-year period, from $27.5 million in 1999 to $37.2 million in 2003, according to The Chronicle of Philanthropy. During the same period the school’s fund raising jumped from $3.8 million to $6.4 million.
On Tuesday Dowell declined to answer questions about the seminary’s debt or its debt-reduction plan. “We have a plan in place and we are moving forward,” she said. “We are not going to go into specifics.”
Asked about JTS’s unwillingness to provide basic information, an expert on the financial practices of nonprofit institutions said, “We think a public institution owes it to its donors, the public and the press to be transparent and accountable.”
Another nonprofit expert said the seminary’s refusal to answer questions about its investments is indicative of a wider national problem with accountability at charitable institutions.