Parsonage Under Fire

There are advantages for synagogues in being classified as a religious organization.

Regular not-for-profit organizations have to file a 990 annually with the Internal Revenue Service. Like our own individual tax filings. If the organization’s revenue is more than $1 million, an annual audit by a CPA is also required. Synagogues have no such requirements. In the spirit of transparency with congregants, an annual audit is always a good thing. But it is not a requirement for religious organizations.

Being able to offer ordained clergy a Parsonage – a housing allowance – is another advantage for synagogues through their IRS classification as a religious organization.

Parsonage is really a “win-win” for both the clergy and the congregation. It has been part of the tax code since the U.S. income tax system was created back in 1913.  That amount of salary devoted to expenses for housing that ordained clergy incur – mortgage or rent, real estate taxes, utilities, maintenance and upkeep, are not subject to Federal tax.

What is the financial impact? I examined my own housing costs from when we owned a larger home two years ago. For our house, housing costs which include mortgage, real estate taxes, insurance, utilities, and maintenance, amounted to approximately $40,000. We are in a 25% tax bracket. If I was an ordained rabbi or cantor, that $40,000 of income wouldn’t have been subject to federal income tax. It would have also meant that we would have had an additional $11,500 in disposable income.

A few years ago, I wrote about this topic, as well as about a Wisconsin lawsuit that was making its way through the Federal courts.  Its intent was to declare the clergy housing allowance unconstitutional. In 2014, a Federal Court of Appeals struck down the lower court ruling.

Recently, in a new case brought by the Freedom from Religion Foundation before the Federal District Court for the Western District of Wisconsin, the same Federal Judge struck down the ministerial housing allowance as an unconstitutional preference for religion.

So, what does this mean to synagogue leaders and to clergy? This case will probably take several years to work itself through the Federal Court system. And it will probably end up before the U.S. Supreme Court.

It is important for synagogue leaders and clergy to be aware that the housing allowance remains under attack. One blog I read noted that the Wisconsin judge’s ruling may be affirmed on appeal and applied nationwide by the IRS. Should this happen, this will have a direct impact on our clergy as well as on synagogue budgets.

Clergy will experience an immediate increase in Federal income taxes. In my example noted above, I would have been required to pay an additional $11,500 in income tax.

Should this happen, synagogue leaders may want to increase the compensation packages for their clergy to offset the financial impact. For synagogues with multiple clergy, such financial impact will of course be greater.

I am not sure that there is anything synagogue leaders can do at this point. Other than wait.

 

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Tickets Redux

Somehow my family always sits towards the back on the High Holy Days. And we usually arrive a few minutes before the start of Worship. We sit on the least comfortable of the 3 types of chairs. This year, I was thankful that there was a cushion – a small one, though. Better than those uncomfortable white ones.

On Yom Kippur, as we came in the police officers and ushers greeted us at the door with big smiles. No one asked for the tickets which I made sure were in my coat pocket, just in case. Maybe they were profiling – if you had on nice, clean clothes (coat and tie for me, skirt and a dress for my wife and daughter), you received the same warm smiles that we received and a “Happy New Year”.

The sanctuary seats 800. And there are two sessions of a family service with 400 at each happening that morning. As we approached the Torah Service, the main sanctuary became a little crowded with people standing on the side scanning for seats.

I recognized some people sitting in the sanctuary who were no longer “paying congregants” who had either come with friends or on their own to hear the last High Holy Day sermon of Rabbi Steven Kushner, who will be retiring in June after 38 years at Temple Ner Tamid.

There were several congregants standing on the side who didn’t have seats. You could say it’s their fault for coming late. But they have tickets, and I assume paid up on their synagogue annual commitments. Shouldn’t that mean something?

I thought of Rabbi Avi Olitzky’s recent article decrying that tickets are only about generating income and are not very welcoming. I have also written about my own association with tickets to entertainment – plays, concerts, sporting events.

I am all for having the High Holy Days, like every Shabbat throughout the year, being open to everyone. But how do you balance on the High Holy Days being sure the expectations are met of congregants who fund the synagogue year after year with being warm and welcoming to the public?

To do this, you also need to be at a physical location where there are enough seats to accommodate everyone, congregants who pay fulfill their financial commitments as well as anyone from the general community who wants to be a part of the High Holy Day Community.

There needs to be buy-in by everyone in terms of this High Holy Day Welcoming Philosophy. Send out a message that there are plenty of seats, and that everyone – congregants and anyone in the community who wants to come and pray with us – is welcome.

It might also be a subtle way to hint to congregants to come on time.

I have always thought that having a shortage of seats on the High Holy Days is a good problem to have. Like double sessions of Religious School.

What you are doing to encourage and engage those who join you on the High Holy Days to become more active, and at some point, to become congregants, needs to also be part of a larger plan. It is great that High Holy Day Worship is open to anyone and everyone. But in order to build community, the relationship needs to extend beyond the High Holy Days.

If you don’t want to have open High Holy Days, then maybe Rabbi Olitzky’s premise about a synagogue’s financial gain is correct. Synagogues shouldn’t just be about money. But there does have to be some deference to the paying customers. As there is also the reality that bills have to be paid.

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Where Should All The Past Presidents Go?

A vacation, of course! At least the immediate Past President, anyway.

After two or three years of countless questions via email and telephone calls, board meetings, staff meetings, and basically worrying about everything pertaining to the synagogue, what comes next for past presidents? Especially for the immediate past president, such people know the operations of synagogue and its DNA better than anyone. Particularly at this time of year, with the High Holy Days approaching, the shoulders of a synagogue president are pretty heavy.

So when the president pounds the gavel at their last annual meeting or board meeting, a vacation is well deserved!!

President George W. Bush wanted to give Barak Obama space to find his own way as president. And Obama has followed suit regarding President Trump, despite many pleadings for him to be more active.  I am not saying that past synagogue presidents should follow the practices of Bush and Obama. Or even do the opposite and become activists.

But past presidents of synagogues possess tremendous knowledge, leadership experience, and commitment in their hearts to help foster a strong Jewish community. And hopefully will not be moving away to another city of the ranch.

Isn’t that something we should take advantage of?

And the tendency is not to make an effort to involve past presidents. You can give them honors at the High Holy Days. Perhaps there is a regional or national board appointment through a synagogue movement or Federation. Most often the big reward for their service is appointment to the synagogue board with a life appointment. It may or not be honorary. And having their picture up in the gallery of presidents. Past presidents may attend and participate at board meetings. Or not. They certainly don’t have to be concerned about reappointment to the board.

So what should the current president, on behalf of the synagogue, do to take advantage of this bullpen of talent?

One idea is to create a President’s Council comprised of all of the synagogue’s past presidents. Invite them to a gathering at the synagogue or the current president’s homes 2-3 times a year, to share with them as insiders what is going on at the synagogue. Yes, they are more than capable to check out the wonderful calendar on the website. But maybe this group can be used as a sounding board for challenges the president is facing, or even new program ideas that the current leadership is thinking about.

Perhaps there is a special task force or working group where the presence of experienced synagogue leaders would be beneficial. A search committee for a new rabbi or cantor are the obvious ones that come to mind. But think about special working groups for strategic planning, governance, and interfaith relations with other houses of worship in the community. Even an audit committee. Something of import – to the synagogue as well as to the person – and that is time limited.

Synagogue involvement in leadership shouldn’t end with one being the president of the synagogue board. Past presidents have experience and wisdom. And we should make every effort to take advantage of that!!

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 Not A Fellini Film…

Charlottesville. North Korea. Afghanistan. The Eclipse. The past couple of weeks have been kind of crazy. Perhaps it is fortuitous that the Eclipse and its path of totality across a swath of the United States happened at the time it did. Or maybe there is intention behind the timing and confluence of events. Regardless, spreading God’s light throughout the very dark places in our world – “By Your Light do we see light” (Psalms 36:9) – remains an appropriate and timely calling.

Alan Zimmerman, the president of Congregation Beth Israel in Charlottesville, VA shared his story of the synagogue’s Shabbat experience during the White Nationalists march just 10 days ago.  Many of you have probably read it. It is a story that I have been thinking a lot about since it happened.

What would happen if White Nationalists were marching down Broad Street in Bloomfield, NJ in front of my synagogue – Temple Ner Tamid? Or on 5th Avenue in New York City in front of Congregation Emanu-El? Or on Ward Street in Newton, MA in front of Temple Emanuel? Or your synagogue?

I have always been an optimist – the cup is always half full rather than half empty. But Charlottesville caused me to do some thinking that is out of character for me. What if such a march happened on Yom Kippur? I am all for free speech and the right to assembly guaranteed by the Constitution. But hearing people outside of the synagogue chant “Jews will not replace us” and simply yelling “Sieg Heil” seems surreal.

45 states have open carry laws – meaning that people can legally carry guns holstered on their belts or slung on their shoulders for all to see. A bit intimidating, don’t you think?

It is like we are all stuck in a Fellini film and can’t find our way out. But this is real! Charlottesville did happen.

And in just 4 weeks, people will be gathering en masse in synagogues and in other places and spaces to celebrate Rosh Hashanah and Yom Kippur. And each Shabbat – while most often in smaller numbers – before and after that.

There are many resources about synagogue security. I have blogged about it. Your local Jewish Federation, ADL, the Religious Action Center are organizations with some useful information on their websites.

In preparation for the High Holy Days, and for all that happens at the synagogue every day, now is the time to check in with the local police department. Walk through your building with local police officials to review the security protocols when people are not in the building. And review security practices for daily operations as well as for the High Holy Days.

I still remain an optimist. But what happened in Charlottesville was not a Fellini film. It is the shock of it that highlights the importance of preparation regarding synagogue security matters.

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Are You Ready?

The last day of summer camp always was the marking point for the end of summer. Of course, there was that 10 days between the end of camp and Labor Day. This was taken up by camp reunions at Red Sox games (bleacher tickets were $2.00!!) and pre-season soccer practices. I thought everyone went back to school after Labor Day. There were those 3 Florida kids from camp who had to leave early. And the 6 Adelmans who lived in Mars Hill, ME where school started in early August because schools closed for 3 weeks beginning in late September so everyone could help with the potato harvest.

Only as an adult did I fully realize that the first day of school is often much earlier than right after Labor Day in other parts of the U.S.

In many synagogues outside of the Northeast, congregants are now back. The schedule of activities in terms of religious school, adult learning, and social action is more robust. And for synagogues along the Northeast corridor of the country, Labor Day will soon be upon us.

6 weeks from this evening marks the beginning of Rosh Hashanah. People are beginning to be in a synagogue frame of mind. Does your synagogue have a High Holy Day game plan leading up to six weeks from now? Of course, the Worship will be great. I am really talking about “welcoming”, utilizing social media, and of course fundraising.

Last year at about this time, I wrote a Blog about getting ready for the High Holy Days. Check it out. It gives you a roadmap to follow, if you haven’t begun your action plan already.

The High Holy Days is THE BEST TIME FOR FUNDRAISNG. Congregants are thinking about the synagogue. We are all together several times as a community.

DON’T BE AFRAID OR APOLOGETIC.

Studies show that this is the time of year that Jews are most likely to give Tzedakah. The numerous direct mail appeals, email blasts, phone calls, and social media articles and ads might give you that impression. You know the synagogue is important. You know there is a need for funds beyond Dues/Annual Commitments.

ASK.

My Blog from August 2014 is a High Holy Day Fundraising Toolkit that still has relevance today. In addition to what I have noted in this blog, you should utilize email and social media to maximize your efforts.  If you have online giving, be sure to include the link to your online giving page.

If the synagogue president is making a pitch for the High Holy Day Appeal on Yom Kippur morning, I would have an email reminder ready and programmed to be sent at sundown. Or at 9:00 AM the next day.

Holler if you have any questions. And let me know what happens.

 

 

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Prudent Investing

A longtime congregant passes away and leaves your synagogue $500,000.

Death is always sad. But the bequest is a good thing, right?

But what if there were stipulations in the legal documents that specified how the funds were to be invested? That the $500,000 was to be kept in accounts at the local bank and invested in CDs? The synagogue has an endowment fund of approximately $1 million invested conservatively and generated a return of 11% last year. Current 1-year CD rates are 1 ½ %. What should you do?

I read a story recently where a church member passed away in 1999 and left his church $460,000. The funds were to be held in trust and invested only in insured bank accounts and government securities, and the net income was to be used for maintenance of the physical property of the church.

A few years ago, Mike, a synagogue president had called me and shared a similar story. The synagogue was in a vacation area. During the 1990s, the Goldbergs would come each year and spend several months in the community, attending services frequently. They set up a trust of $600,000 to benefit the synagogue. The legal stipulations were similar as the church above. The funds were to be housed at the local community bank, and could only be invested in Bank CDs.  And the local bank officer was to be the administrator of the fund. The Goldbergs had both passed away during 2000.

In 1995, the return on a 1 year CD was 5.40%, and just over 6% for a 5-year CD. Today, such rates are 1.50% and 2.25% respectively.

Mike said as CD rates plummeted, they had asked the bank officer if the funds could be invested in a similar way as endowment funds for universities and other not-for-profits, with a mix of equities and fixed assets such as bonds or government securities. The return to the synagogue from the CDs was minimal. And after paying bank fees, very little was left for use by the synagogue. The would make this request every year. And the bank officer always insisted that the donor’s intent regarding investment be followed.

UPMIFA, The Uniform Prudent Management of Institutional Funds Act, is the official governmental guide for how not-for-profit boards are to invest endowment funds. Being prudent is key. The synagogue board is the ultimate authority regarding the management of all synagogue funds, and this includes investing. In 2017, having such a substantive amount of money invested in CDs, or even just in government securities is not prudent.

The church leadership filed a lawsuit in order to invest these funds prudently, in the spirit of UPMIFA, with the desire for a bigger return.  When the New York Trial Court denied their request, the church leadership appealed. The Appeals Court agreed with the church leadership noting that such restrictions “have become impracticable and frustrate the trust’s purpose of generating funds to assist in church maintenance” (In re Estate of Chamberlin, 135 A.D.3d 1052-NY App. 2016).

No one wants to go to court, especially members of a synagogue board. But there are times when such legal action is warranted.

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Importance of “Being”

Measurement is a big part of our lives.

How tall are you? How much do you weigh?

What were your grades in school or your GPA in college? Or even your SAT scores?

As adults, measuring continues. The number of square feet in your home – and even how much you paid for your home, or how much it sold for – your salary, the size of your IRA.

We do this a lot, too in synagogues.

How many people attend Shabbat evening worship?

How about at the High Holy Days?

How many students are in religious school, or pre-school? How many B’nai Mitzvot in a given year?

How many people attend an adult education program?

How many member families, or units, belong to the synagogue?

How many likes does the synagogue have on its Facebook page?

How many people open up the weekly email or monthly newsletter, and click on any of the links that might be shared?

I could go on. You get it, I am sure.

Of course we have to be focused on some measurements, namely related to the budget. We have to raise the necessary funds, through dues, fundraising, tuition, or other means, to cover the budgeted expenses.

Recently, I read an interesting article about the demise of the small church throughout America.  The premise is that the major Christian Church denominations are focused on measurement and small churches really don’t operate in such a metric centered philosophy.

The author was making the case that small churches matter because their primary focus is on “being”.

Of course in small churches – and small synagogues – it is not as if there is no focus on measurement. At least when it comes to finances. You have to pay the rabbi, the electric bill, even the website hosting fee. But the premise here is that such measurements are not as significant in both size and priority.

The lone synagogue in a small town today doesn’t have to be so concerned about competition.  Of course they have other challenges – few, if any, new congregants, people moving away to be with nearer to family, and people passing away.

But measuring any of the stuff listed above is secondary to “being” – to relationships, building community, and touching lives Jewishly and helping people learn and grow.

Jewish denominational leadership, synagogue thought leaders – I like to think that I am in this group – all contribute to the focus on measurement. I have written blogs about membership, the importance of websites, High Holy Day Campaigns, dues/annual commitments, and utilizing Facebook and other social media platforms. Maybe too many. My blogs have been about areas of synagogue life that we constantly measure.

While all are important and necessary tools for the synagogue of the 21st century, it is easy to forget about what is most important: they are just tools to help you build a more vibrant sacred community, where through personal relations, people feel a deeper connection to each other and to their Judaism.

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Summer

Is there ever a slow time for synagogues?

There are certainly intense times of activity around the various holidays – especially the High Holy Days, Hanukkah, and Pesach. And there seems to be a natural finality, or break, with the end of the school year. Religious School and Pre-School mark the close of another academic year in various ways. The end to the public and private school year follows very quickly. Soon children are off to camp and many people are in vacation mode, a mindset that extends from Memorial Day and Labor Day.

The end of the academic year is also a time when people move. For a new job or just because they want to. And some will be looking for a synagogue. Children are of an age for Religious School. People are looking for community.

How will these seekers find your synagogue? Maybe they will ask a realtor, a neighbor or a friend. Not that long ago, synagogue leaders were encouraged to buy ads in local newspapers – outmoded today when a growing number of people get their news on their smart phones.

Social media is perhaps the most important element today to any synagogue marketing strategy. And in particular, your website, Facebook, and even Snapchat.

Does your website present the synagogue how you want it to? Does it convey the special sauce of your synagogue through copy, pictures and videos?

Is the synagogue website up-to-date? I can’t tell you how many times I have been on a synagogue’s website and clicked on the link to the “Blog” and saw that the most recent posting was from 12-18 months ago. Sometimes, this is even true for event listings.

Your synagogue’s communications plan should call for ongoing website calendar updates. If no one has interest in continuing a blog, maybe it is best to simply archive past blogs and have a message that “this page is down for maintenance”.

Seekers today will be accessing your synagogue’s website from their smart phones. So your website needs to be mobile compatible. Otherwise, they will seek elsewhere.

Your synagogue’s Facebook page is also another social media platform where seekers will find you. Here, too, you need a plan that involves posts of articles, events, pictures and videos. If a really great event happens at the synagogue, post a video using a smart phone on Facebook. If you think Shabbat worship is a part of your synagogue’s special sauce, post a 2-minute video of people singing. Some might take issue with photos and videos on Shabbat. I get that. But for many synagogues, with a Shabbat band and a streaming service, this shouldn’t be an issue.

I have to admit, that I don’t know a whole lot about Instagram. Other than the other members of my family use it a lot to post pictures. A synagogue’s Instagram page certainly will tell a story about what worship and programming through pictures. Seekers may imagine themselves in the pictures, and if this is a community that they can be a part of.

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“Bread & Torah”

Years ago, it was pew fees that was the funding mechanism of synagogues. Where one sat at the High Holy Days was the determinant as to how much you were to contribute to your synagogue. The closer you sat to the Bima, the more you were obligated to donate. There are a handful of non-Orthodox – in addition to Orthodox ones, I guess – synagogues today which still utilize this annual funding method.

Post World War II, annual dues became popular. There was fixed dues, fair share dues and hybrid models.  Along with what families were paying for religious school tuition, any of these various dues models seemed to be enough to cover the synagogue’s annual expenses. There would be the obligatory building fund one began to pay over 5 years when you joined to cover building expenses. And perhaps an occasional building campaign to renovate, expand or even move and build something new that targeted those with capacity and interest.

During the 1990s, many synagogues began to look to other streams of income. Traditional fundraising efforts such as a High Holy Day Appeal and fundraising events; facility rentals whether it be for a Bar/Bat Mitzvah or wedding celebration, or a long engagement to a school program. Looking to a university model, synagogues were encouraged to create and grow endowment funds in order to utilize a portion of the annual return for operating expenses.

Today, the mantra “if you build it, they will come” is no longer a guiding principle for synagogue leaders to follow. Many Baby Boomers and Generation X leave the synagogue once their children have had their Bar/Bat Mitzvah. Experience and research tells us that Millennials are not joining synagogues in the same way that their parents did.

The synagogue funding model continues to evolve. In recent years, a number of synagogues have adapted a Voluntary Dues Model.  60 synagogues is the current number, double the number from a few years ago. Remember, there are more than 1400 Conservative and Reform synagogues in North America, not counting Reconstructionist, Renewal, Orthodox and unaffiliated.  And I am sure that there are leaders of several congregations that continue to ponder whether making such a change would be better operationally and philosophically.

The straight numbers might not make one overly enthusiastic about the voluntary dues model. The average increase in membership was 3.6 %. Average income from dues/annual commitments was 1.8%. From reading the report, though, and a recent article, leaders of synagogues that have made such a change are certainly feeling good about it.

No matter the dues model – fixed dues, fair share dues, voluntary dues, or even pew fees – focusing on engaging people through worship, relationships, and programming to build community is more important than the funding model.

The experiences of synagogues who have adopted the Voluntary Dues model highlight that former congregants are returning. And there is no longer a need for dues relief where congregants had to have uncomfortable conversations with the synagogue treasurer or executive director about their financial situation.

The new voluntary approach, or any dues model, does not take away the need for synagogue leaders to continue to raise funds.  For synagogues of all sizes, dues and tuition from Religious School, and Early Childhood programs are still supplemented by the various streams of income: whether that be through traditional fundraising activities like a High Holy Day Appeal or special events; renting out the facility; or growing your synagogue’s endowment fund to generate additional income.

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Website Strategy

Communication today is so immediate. An email, a tweet, a Facebook post – write it, hit send or return and you have reached your target audience. Of course they have to open it and read it. And there are also the tricks of the trade that you do to have a catchy subject line in an email or heading on Facebook to encourage people to read it and click on the links.

Think about how synagogues inform congregants about someone’s passing. We send an email to the membership, create a post for Facebook and/or the website, maybe even send a group text. I can recall when we would receive pre-fabricated post cards where someone would handwrite (many times – their hand must have hurt!)  the information about the grieving congregant, the person who died, and Shiva information.

Or there was a phone squad to be sure that everyone in the synagogue was reached. And this was before answering machines and voicemail.

Spoken communication may be a lost art.

Today, synagogue websites are really a powerful communications tool. Congregants look there for all kinds of information – upcoming events, dates and times, contact info for staff. When people new to a community have even a thought about synagogue membership will probably do a Google search of synagogues in a particular town or geographic area.

I read an interesting article today about websites for not-for-profit organizations which certainly is relevant for synagogues as well. I have visited numerous synagogue websites – including my own sometimes – where information is outdated. Newsletters and Facebook posts are also important, and should serve as a way to give people a snapshot of information.  And then articles and Facebook posts should drive them to the website where they can find all of the details. And links to RSVP, purchase tickets when necessary, and other important information.

Websites also need to be smart phone friendly, or to speak in the vernacular “mobile compatible”. More and more people today are accessing websites on their smart phones. Especially Millennials. Websites that aren’t mobile compatible are at a disadvantage. If the viewer can’t easily maneuver throughout your synagogue’s website, they will loose interest and move on. And this experience will color their view of your synagogue, no matter how “warm and welcoming” and “special” your synagogue is for people who come through the door.

Does your website incorporate SEO – search engine optimization? Basically, there are things that you can do to insure that when someone does a google search using specific terms like “synagogue” and the name of a specific city your synagogue is high up on the list that appears on the screen. Central Synagogue in New York City is incorporating SEO as a part of its internet marketing strategy to insure that when someone does a google search for “synagogue” and “New York City”, its placement is very prominent on the listing of links that is generated.

To create and implement such an internet strategy incorporating SEO, it is best to seek advice from congregants involved in marketing. Especially Millennials.

 

 

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