Collecting Outstanding Balances From Members

It costs money to run a Shul. On a the back of a napkin, we previously estimated a cost of $75,000 per year for a 50 member family Shul. The costs include rental space, Rabbi’s salary, utilities, food costs, program costs and professional fees.

The vast majority of the necessary funds come from the membership through donations, dues, holiday seats and other fees. It’s inevitable that you’ll run into situations were Shul members are not current or behind more than 120 days in their obligations. The question is how to deal with these situations.

The first idea is to have a written policy, usually in the bylaws, regarding what constitutes a member in good standing, and what rights are reserved for members of good standing.

Secondly, you should send out bills on a regular basis, be it monthly. bi-monthly or quarterly. Generally, people pay their balances more readily, if and when they receive a bill.

The third and most difficult issue is setting and enforcing a policy for collecting balances.
Here are three possible policiies:
1) Enforce a strict policy of removing the member’s rights as specified in the bylaws. This will probably result in better collections, but it’s at the cost of alienating and possibly losing members who have outstanding balances.
2) Enforce a very lenient policy, with little or no removing of member rights. This will result in worse collections, but less people will be offended.
3) Enforce a selective policy, with great leniency in the case of true hardships, and some from of enforcement in other situations.

I’ve always personally advocated a very lenient policy, based on the assumption that Shul members are by and large honest, an assessment that the Shul can afford such a policy, and that nobody wants to be the collection enforcers. Another thing to keep in mind is the increase in Shul choices, for members in mid-size to larger neighborhoods, with many being low or no-cost options.

None of the choices are ideal, so it’s up to the board and/or the kitchen cabinet to set a sensible policy.