Dr. David Hahn, Executive Director, Long Island Lutheran Middle & High School, Brookville, New York

Everyone agrees. Lutheran schools are great places for kids, families, communities, and the Church.

So tell me, how come so many of our schools labor under perennial financial difficulties? Why do so many congregational meetings include the familiar litany—“This school isn’t a business; it’s a ministry!” Regardless of your interpretation, the negative implications of shaky finances are undeniable—stagnation of creativity; teacher attrition; neglected facilities; recruitment woes; low morale; and more. Does any of this sound familiar?

At Long Island Lutheran Middle& High School, we faced all of these problems (and many more) in the 1980’s. A deepening financial crisis resulted in an atmosphere of dissension, a turnover of leadership, a deteriorating campus, and even a missed paycheck. Rumors of the school’s imminent demise were even printed in the local newspapers.

By the grace of God, thousands of LuHi supporters pulled together to get the school back on its feet. The immediate storm was weathered and Long Island Lutheran has moved forward with dramatic results for the last decade-and-a-half. Today, our school is blessed with record enrollment, a top-quality faculty, innovative programs, new facilities, fiscal stability, and, yes, still plenty of stimulating challenges.

Looking back over the past 15 years, many factors have contributed to our school’s success. Among these strategies, however, there are five principal initiatives that continue to fuel LuHi’s operation. Every school is different, but these FIVE STEPS TOWARD A FISCALLY HEALTHY SCHOOL are offered in the hope that they might assist your ministry, as well.

Every successful journey begins with a good road map. This is certainly true for our schools. Your map can take many forms—an annual strategic planning process, a less formal board action plan, or just a set of agreed-upon goals. What is important is that your school sets priorities, establishes measurable objectives, and develops a system for holding itself accountable for results.

An effective planning process always grows out of a clear, compelling mission statement which is supported by an effective organizational structure. As a school administrator, one of your most important jobs is to raise your eyes above the day-to-day grind to develop and share a vision of what your school can be!

Strategic planning unites a school behind a course of action. Input and participation are solicited from all sectors of your school’s constituency. Effective marketing, fundraising, and public relations initiatives spring naturally from your school’s plan of action.

At Long Island Lutheran, we utilize a rolling three-year planning model. One example of its application was the process by which we developed a comprehensive Middle School program in 1995. Before launching our new venture, we took a year to gather input for faculty, parents, administrators, donors, and Board members as part of a coordinated planning process. As a result, we were able to synchronize decisions regarding such interdependent areas as curriculum, extracurricular offerings, staffing, marketing, facilities and finance. The result was a dynamic educational expansion which continues to generate huge student waiting lists each year.

Your school’s financial success begins with an attitude of quality. And (contrary to our traditional Lutheran thinking) people are willing to pay for quality, especially when it comes to the education of their own kids. Conversely, I am finding that even the most loyal members of Lutheran congregations will not send their children to our schools if they feel that our educational environment is somehow inferior.

Quality means different things for each school setting. My point is simply that an attitude of quality needs to be apparent at every opportunity. This begins with taking care of our most precious resource—the teachers and staff who form the bedrock of the educational experience. While this certainly infers that we do our best to offer competitive compensation, it is also crucial to provide teachers with the finest educational resources and equipment. Quality should also be reflected in your school’s communications. If you didn’t know anything about your school and picked up your newsletter, what would your impression be?

An attitude of quality also should be reflected in your school facilities. Around the LuHi campus, we have invested significant dollars into our physical plant. Sometimes our Board and administration are even criticized for raising and allocating funds for our buildings and grounds. But there is no doubt that part of Long Island Lutheran’s appeal to students, parents, staff, and donors has been an increasingly beautiful, up-to-date campus. If an organization looks organized and cared for, it probably is! Whether your improvement plan involves volunteers with buckets of paint or millions of dollars of construction, the impression of quality in your building will pay big dividends for your school.

A quality school with a well-crafted game plan can still fail. Your school’s ultimate mission and financial position depend on attracting, enrolling and retaining an adequate number of qualified students. In most cases, the easiest way to build fiscal stability in your school is to enroll some more great kids.

This doesn’t happen by accident. Today’s Lutheran school (Pre-K, elementary, secondary, or college) needs to develop and execute a comprehensive marketing plan. The heart of this plan is to get prospective students and their parents to visit your facility. Prospect names can come from many sources including congregational lists, feeder schools, and commercial mailing lists representing targeted ages and communities.

Telling your story early and often is a big key to success. At Long Island Lutheran, we host our first Open House on a Sunday afternoon in late September. We begin testing students for admissions during the first week of October and continue with monthly events until enrollment is full for the following fall. All prospects receive personal telephone calls and participate in a one-on-one interview with the Principal prior to acceptance. Promoting your school early and often is one of the best ways to ensure your school’s fiscal stability.

I have yet to hear one of my fellow Lutheran administrators complain that their school has too much money. In fact, very few of our schools charge tuition amounts sufficient to cover the costs of a top-quality educational operation.

To paraphrase a recently received email, I have good news and bad news for you. The good news is that there is probably plenty of money to support your school. The bad news is that it is still in the pockets of your parents, alumni, and friends. One of the marks of a successful, growing school is the presence of a comprehensive plan for resource development.

An effective fundraising plan needs to focus on improving your school in some tangible, exciting ways. Specific cash goals for facilities, innovative programs, or endowment attract the most interest. A month-by-month schedule of fundraising contacts and events will ensure that everyone has a chance to participate. It is especially crucial that you cultivate relationships with constituents who are capable of making leadership gifts to your campaign, as the top 10% of the donors often contribute 90% of the money.

One other key—involve your parents in your major fundraising efforts. Often I hear administrators who are reluctant to approach parents for major gifts because, “They’re already paying tuition.” At LuHi, our parents have become the #1 group of financial supporters to our on-going capital campaigns. Obviously, the amount of support varies from family to family, but parents are often able and highly motivated to assist their children’s school move forward with educational enhancements.

A fiscally sound school begins with sound financial management. This requires that your school have an annual budget driven by a positive, but realistic calculation of revenue sources. This estimate of income should then be compared to your school’s likely expenses for the upcoming year, with the goal that the former should be at least equal to the latter. Even after adoption, your school’s budget projections should be updated on a regular basis to chart reality versus your original spending plan.

This process of budgetary development and review is seldom easy. But as our friend Shakespeare said, “ To thyself be true!” Faithful fiscal management is the foundation upon which the rest of your school’s success will depend. This includes clear record keeping, reporting, billing, and vendor payments. An annual independent audit (or at least, audit review) is highly recommended as a way to build and maintain a credible bookkeeping system. Another helpful tool is a multiple year projection of income and expenses to assist in identifying trends before they become crises.

A final word of advice from the annuals of Lutheran High’s past fiscal crisis —beware large, overdue tuition balances. Most of our schools are heavily dependent upon tuition as the primary source of income. When our schools do not regularly tend the billing and collection process, everyone suffers. Policies need to be put in place and enforced, albeit with as much Gospel light as possible. Sometimes, an additional scholarship grant is in order. The process of collecting tuition is not easy. (You may even join me in occasionally being labeled “un-Christian” in the process!) At the end of the year, however, LuHi regularly collects nearly all of its $3 million in tuition. This is a huge blessing to everyone, including those parents who were not allowed to fall behind.

These FIVE STEPS are offered in the hope that our experiences at Long Island Lutheran will assist your school to avoid pitfalls and enhance its ministry. What a privilege it is to be part of Lutheran schools! Ours is a mission truly worthy of time, talents, and treasure—and our best financial stewardship. May God bless all we do to His glory!

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