Saturday, July 07, 2018
Hasidic school system returns Orange County bond money
A Hasidic school system that obtained $8 million in Orange County bonds last year returned the money months later, after outraged parents learned from a newspaper article that the funds could benefit only secular areas of their children’s yeshivas.
Congregation Bnai Yoel, which serves about 2,000 students in the Kiryas Joel area, got the bonds in July through the Orange County Funding Corp., which issues tax-exempt bonds for manufacturers, nonprofits and other entities. The apparent purpose of the bonding was to refinance a $5.7 million mortgage Bnai Yoel had gotten several years earlier to pay off previous debts.
In a Times Herald-Record article two weeks later, a county official said the Bnai Yoel bonding didn’t violate a prohibition on funding religious activities because it would apply to “portions of the school that relate to secular education” and activities.
That came as unpleasant news to Bnai Yoel parents, who took the unusual step of taking out an ad in the Times Herald-Record to disavow the bonding and the notion any part of the schools could be deemed secular. To some, the blurring of the secular and religious was reminiscent of the creation of Kiryas Joel’s public school for handicapped children in 1989 and the sharp opposition that aroused in Kiryas Joel’s dissident community.
The parents’ outcry led to a quick cancellation of the county-issued bonds. In December, Congregation Bnai Yoel repaid the bonds by borrowing $7.4 million from the Bank of Princeton, the same bank from which it had gotten a $5.7 million mortgage in two stages in 2013 and 2014, according to public records.
The new loan bore this explanation: “Shortly after the closing of the original loan, the borrower became aware that it could not use certain portions of its real estate for religious purposes and this was unacceptable to the borrower. Accordingly, the borrower requested, and the bank consented to, a conversion of the current tax-exempt bond transaction to a taxable loan transaction.”
One Bnai Yoel father, who asked that his name be withheld for fear of retaliation, said Friday that the loan conversion could cost the congregation an additional $1 million over the life of the new loan, but was worth it. Many parents were so upset about the secular condition of the bonding that they would have withdrawn their kids from Bnai Yoel schools, he said.
“It’s a terrible violation against the Torah,” the father explained. “It’s like you break the bond between you and God.”
http://www.recordonline.com/news/20180706/hasidic-school-system-returns-orange-county-bond-money
Congregation Bnai Yoel, which serves about 2,000 students in the Kiryas Joel area, got the bonds in July through the Orange County Funding Corp., which issues tax-exempt bonds for manufacturers, nonprofits and other entities. The apparent purpose of the bonding was to refinance a $5.7 million mortgage Bnai Yoel had gotten several years earlier to pay off previous debts.
In a Times Herald-Record article two weeks later, a county official said the Bnai Yoel bonding didn’t violate a prohibition on funding religious activities because it would apply to “portions of the school that relate to secular education” and activities.
That came as unpleasant news to Bnai Yoel parents, who took the unusual step of taking out an ad in the Times Herald-Record to disavow the bonding and the notion any part of the schools could be deemed secular. To some, the blurring of the secular and religious was reminiscent of the creation of Kiryas Joel’s public school for handicapped children in 1989 and the sharp opposition that aroused in Kiryas Joel’s dissident community.
The parents’ outcry led to a quick cancellation of the county-issued bonds. In December, Congregation Bnai Yoel repaid the bonds by borrowing $7.4 million from the Bank of Princeton, the same bank from which it had gotten a $5.7 million mortgage in two stages in 2013 and 2014, according to public records.
The new loan bore this explanation: “Shortly after the closing of the original loan, the borrower became aware that it could not use certain portions of its real estate for religious purposes and this was unacceptable to the borrower. Accordingly, the borrower requested, and the bank consented to, a conversion of the current tax-exempt bond transaction to a taxable loan transaction.”
One Bnai Yoel father, who asked that his name be withheld for fear of retaliation, said Friday that the loan conversion could cost the congregation an additional $1 million over the life of the new loan, but was worth it. Many parents were so upset about the secular condition of the bonding that they would have withdrawn their kids from Bnai Yoel schools, he said.
“It’s a terrible violation against the Torah,” the father explained. “It’s like you break the bond between you and God.”
http://www.recordonline.com/news/20180706/hasidic-school-system-returns-orange-county-bond-money
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