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Decision to Reject School Merger: Loyalty, Yes, but a Sound Move?

March 12, 2009 By:
David Magerman
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Saligman Middle School students at a meeting to decide the fate of their school. Photo by Jordan Cassway

As president of the Kohelet Foundation, and as a parent and board member of the Raymond and Ruth Perelman Jewish Day School, I applaud the passionate support our community has demonstrated for the Saligman Middle School and the wonderful education it provides. The community's grass-roots efforts demonstrate deep concern for our school.

However, while congratulating the community for its boldness and commitment, I wonder if we fully appreciate the ramifications of the stand we have taken. I write with a strong sense of our shared values -- a love for Perelman and a passion for Jewish education.

We are living in perilous financial times. The economy is in crisis, and our community is not immune from its effects. It is already the worst recession we have had in more than a quarter of a century, but it may get far worse. How bad will it get? We just don't know. But we do know that Jewish day schools around the country are struggling mightily.

I strongly believe that the future success of Jewish education is tied to the principles of fiscal responsibility and sound business modeling. The Kohelet Foundation defines its mission based on these principles. The decision to reject the merger of Saligman and Barrack Hebrew Academy, while well-intended, is contrary to those principles. Sound business decisions require balancing risk and reward. Business-wise, haven't we committed a cardinal sin? We are taking on more risk in a risky environment without an understanding of the reward.

What do I mean by that? Barrack, in accepting Perelman's merger offer, was effectively agreeing to adopt Saligman and give it a home on its Radnor campus. Without hearing the details of the deal -- i.e., knowing the reward -- it was rejected, and we have opted to keep running the school for ourselves. Was Barrack going to change the program, or keep it intact? We don't know. Was Barrack (or the Kohelet Foundation) going to provide further financial incentives to encourage our children to come to the school? It was never asked. We are keeping our school, our program and our hallway, but at what cost?

The reward of this decision is not clear, but the risk certainly is. The financial future of the entire Perelman system is now on the Perelman community's shoulders. Make no mistake: The decision to keep Saligman open puts the adjacent elementary Forman Center at greater risk. The greater Jewish community was offering to ease Perelman's financial burden to make the long-term viability of our lower school more secure. By rejecting that offer, the Perelman community has sent a message to Barrack, Federation and Kohelet: We can take care of our school ourselves.

What are we implicitly promising through our bold choice? Perelman community philanthropists will have to open their wallets beyond their current commitment levels to support the school, even at a time when they are being bombarded by requests from an ever-growing number of suffering Jewish institutions. Parents will have to keep sending their children to day school, even when sounder judgment would tell them they can't afford it. Students will have to be asked to scale back on luxuries so that their parents can continue to afford tuition.

It is impressive that the community raised nearly $150,000 so quickly, just as news of the merger broke and before it was to be finalized. But the budget for Saligman is north of $2.5 million. If just 10 tuition-paying children leave the system each year (not an unthinkable proposition in the current economy), in three years alone that will create an additional $600,000 hole in the school's budget. This fundraising effort must be repeated annually, and increased substantially, for it to have any lasting impact. Despite the rumors, there are no miracle philanthropists stepping forward to save Saligman.

I have great respect and admiration for our community's passion for and commitment to Jewish education. I pray that the risks we have taken are rewarded with success and long-term survival. But I wonder if those members of our community who took that stand to "save" the school understood the risk they were taking -- and the reward they were passing up as they made the decision. Perhaps the opportunity is still available. If so, it behooves us all to give the merger possibility a second look.

David Magerman is a computer scientist, venture capitalist and Jewish philanthropist.

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