AVI CHAI concluded its general grant making on December 31, 2019.

Day School Benchmarking- One Small Step Toward Day School Affordability

Posted by: dperla

August 16, 2011

Day School Benchmarking- One Small Step Toward Day School Affordability
In his well written article Why Does it Cost So Much To Educate a Jewish Child?, Rabbi Eliyahu Teitz makes some excellent points regarding a conundrum facing many day schools–the cost vs. quality trade-off.  Rabbi Teitz argues that teacher compensation needs to be reasonable yet competitive with the marketplace. He highlights the trade-off between quality and cost that comes from lowering teacher to student ratios and correctly suggests that filling empty seats in a given class is a better financial solution. Finally, Rabbi Teitz lays out the pros and cons of the “extras” that many schools now typically provide—special education, computer resources, trips etc. He notes that many day schools feel the need to offer such extras in order to appeal to the students themselves and to remain competitive with the offerings of similar schools.
Under the direction of Yeshiva University’s Institute for University-School Partnership, The AVI CHAI Foundation is co-funding a novel benchmarking program which addresses head-on many of the issues raised by Rabbi Teitz. This benchmarking program has been conducted in approximately 30 schools in five different communities and the results are now being shared with both the schools and the communities they serve. The benchmarking program begins with extensive data collection from the schools themselves. This data is analyzed and sorted and used to customize a financial plan for each individual school. The program focuses on a variety of metrics including class size and capacity, teacher and administrator compensation and a host of non-educational expenses. The goal is to improve a school’s own capacity building efforts by highlighting their ranking compared to a relevant peer group. In this way a school can gauge whether they are over or under-spending relative to other comparable schools. On the income side, the program takes a close look at gross tuition, level of financial aid and fundraising. Here the goal is to show schools whether the opportunities lie (again relative to their peer group) for revenue enhancements.
The goal of the program is to create a customized plan for each school to improve its bottom line by 10% over five years. This will typically come from some combination of income improvement and cost reduction. While it is too early to fully judge the impact of the program, it seems clear that gathering and analyzing detailed income and expense data and building financial plans based on a deep understanding of a school’s own data and how it measures up to peer schools goes at least part of the way to solving the day school financial conundrum. As such, it should please Rabbi Teitz and others committed to a high quality, reasonably priced day school education.
As AVI CHAI and other organizations dedicated to Jewish education work toward creating a detailed road map for day school sustainability and affordability, initiatives like this one provide an important piece of the puzzle. But other pieces still need to be addressed and solved. These might include middle income affordability, community-based fundraising, endowment building, government funding, favorable tax legislation, and the use of on-line learning in our schools.  We are, of course, still in the early stages of formulating a sustainable school funding model. But thanks to programs like YU’s benchmarking and financial planning program we are at least on our way. We look forward sharing to sharing these and other initiatives with the broader Jewish community and to hearing from others what they think the road map to affordability should consist of.
Dan Perla is Program Officer of Day School Finance at The AVI CHAI Foundation.

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