The Berman Theater
for the Performing
Arts was a recent

!OR 1, Ff./01714,o ■ PTS

At the same time, we recognize that his-
torical and significant financial issues have
to be addressed in a fashion that will allow
this legacy to continue"
Will the debt mean increased dues for
the JCC's 10,000-plus members?
As we have diligently benchmarked all
of our pricing against competitors, and
because the JCC operates in a highly com-
petitive marketplace, it seems unlikely the
current financial situation will result in
a material change in costs for members"
Siegel said.
The JCC, with buildings in West
Bloomfield and Oak Park, reports it
attracts 1,000 visitors a day. Each building
has its own flavor, but similarities include
health clubs, swimming pools, day camps
and kosher restaurants.
The JCC in West Bloomfield also houses
Frankel Jewish Academy, the Berman
Theater for the Performing Arts and sev-
eral agency offices.
No existing JCC programs will be cut,
but because of the long-term debt, the Task
Force recommends a
careful look at any new
programs proposed to
make sure they will be
viable financially.
"No one is panicking;
things happen and you
just handle them" said
Florine Mark, JCC presi-
Florine Mark
dent since June 2013.
"We will work through this. You just go
forward, making the JCC as fabulous as it
is. We have the best JCC in the nation — a
jewel. With Federation and the Foundation
behind us, how can we lose?"

Future Finances
As of this month, Federation and Foundation
have already advanced all Campaign alloca-
tions and other grants approved for the JCC
through May 31.
"The JCC has cycles where they are

strong in cash and where they are short
in cash," Weiner said. "This is before the
camp season, before JCC Maccabi, before
the times of the year when revenue starts
coming in. Federation regularly advances
allocations to agencies depending on spe-
cial circumstances:'
Still, it is expected the JCC will come
back to the Federation/Foundation com-
bined board after mid-February to request
additional funds to see it through May 31,
the end of its fiscal year.
That request could be about $3 mil-
lion, the Task Force report said. Weiner,
however, said the amount might be less
due to additional sources of funding, as
well as the corrected reports Financial
One is currently working on and other
factors. A Financial Oversight Committee
soon will be appointed from Federation/
Foundation leadership to direct the JCC's
financial function, including the activities
of Financial One and Grant Thornton.
Aside from its annual allocation, money
going to the JCC has not and will not come
from Federation Annual Campaign dollars,
Weiner and Kaufman said.
"It will come from the United Jewish
Foundation [Federation's banking arm]
general fund only if other sources cannot
be used" Weiner said. "We believe other
sources of revenue will be available to fund
some of this shortfall:'
Kaufman agreed. "There are numbers of
community supporters and philanthropists,
many of whom have a specific passion for
the JCC, who are interested in helping" he
said, adding that many other sources of
revenue also will be explored.
Looking at JCC expense and revenue
charts from the JCC's 2012-2013 annual
report, it's clear that compensation and
benefits as well as facilities' costs consume
much of the JCC's revenue — 77 percent.
Though the JCC claims bragging rights
in North America on the size of its West
Bloomfield building at 321,000 square feet,

there is a financial price to pay for its vast-
ness. For example, financial reports show
that projected utilities costs for January
through May are $92,000 each month.
Additionally, because the JCC frequently
delayed payments to vendors because of
its cash flow problems, late fees likely have
accrued on some accounts.
"It's an expensive building to operate, but
it generates a great deal of activity" Weiner
said. "Drive by the Oak Park and West
Bloomfield campuses and the parking lots
are full night and day"
In recent years, the JCC in West
Bloomfield was expanded with the addition
of Berman Center for the Performing Arts,
a 600-seat theater. This addition enhanced
the JCC and serves the Jewish community
and beyond, but is not yet a significant rev-
enue generator.
The Berman Center surely has potential
to produce income, but is still in a learning
curve, Weiner said. Kaufman says donor
support is allowing it to break even now.
Like the JCC in West Bloomfield, the
Jimmy Prentis Morris JCC in Oak Park is
not a money-making venture, Weiner
said.
"It services the Oak Park community
very well" he said. "It is vibrant, but it is
also part of this process. There are great
opportunities in Oak Park because our
youth are moving in that area. We see that
as a potentially wonderful place to expand
and grow once we get everything analyzed
and evaluated:'
Salaries are 56 percent of the JCC bud-
get. The JCC employs 341 full- and part-
time staff.
As part of a deep dive into all aspects of
the operation, [salaries] are an area that will
be looked at very carefully" Kaufman said.
"But they are in line with the industry"

On The Horizon
Weiner understands the challenges facing
the JCC, but he also sees the positives in
the process.
"This presents an opportunity for the
JCC to self-evaluate" he said. "It's an oppor-
tunity to make it a stronger organization"
The Task Force report concurred, stat-
ing, "The agency cannot continue with its
current business model. The Federation
and Foundation are committed to making
those necessary changes that create a sus-
tainable, world-class, 21st-century JCC:'
Siegel said, "The JCC has been and will
continue to be very open-minded to new
ideas that will advance its mission. The mis-
sion and relevance of the JCC to our Jewish
community is more compelling than ever:'
So, what can Jewish community mem-
bers expect next?
"A restructuring element will take place
over the next six months" Kaufman said.
"We will come out of that with a model
that is sustainable and has the best busi-
ness practices and is affordable.
"It will be a collaborative effort among

community professionals and lay lead-
ers, national figures amongst the JCC,
Federation and Foundation. This is a com-
munity that works together. That's a great
strength of our community"
Though Kaufman said legacy debt
is common in the JCC world, the top
executive at the Jewish Community Center
Association (JCCA) in
New York says "there is
no typical debt" for JCCs.
"It has happened
before and each situation
was handled differently"
said Allan Finkelstein,
president and CEO of
the JCCA, a continental
Allan
umbrella organization
Finkelstein
for the JCC movement.
"I've had several
experiences with challenges in commu-
nities and with federations; the Detroit
Federation is handling this in the most
positive, community-minded, supportive
way from the beginning.
"The initial assumption has been that
this is an important institution. They might
be upset, but the goal is to make it a strong,
impactful institution with community sup-
port" Finkelstein said.
"Several things need to be solved: the
debt; every program has to be of the best
quality and financially sensible; and you
have to make sure all internal systems
make sense and that there's accountability
up and down.
"Detroit is a great fundraising communi-
ty" he said. "The Federation wants to solve
[this] once and for all. The JCC is doing
great things; if it is free of debt, it can keep
doing that ... and be in good position both
long and short term"
Another positive element on the horizon
is that Detroit will be a host of the JCC
Maccabi Games and ArtsFest this summer.
"Maccabi is an international event; we
are fully staffed, and it will be part of the
solution" Kaufman said.
"Historically, Maccabi has been a great
enhancement to the budget. Because the
economy in Michigan is improving, we
expect that it will be better than normal,
which will help mitigate the problem at
large. We're an experienced community at
doing Maccabi, and I expect this to be the
greatest Maccabi we've ever thrown"
Siegel agreed. "In August ... we will be
opening our hearts and homes to over
2,000 Jewish participants and 2,000 addi-
tional family and friends from throughout
the world [for Maccabi]" he said.
"These games will bring positive nation-
al attention to our JCC and the extraor-
dinary Jewish community that we are so
proud to be a part of"

❑

Senior Copy Editor David Sachs and Managing

Editor Jackie Headapohl contributed to this

report. Look for more stories about the JCC

situation in future issues of the JN.

January 30 • 2014

9