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Jewish academy in trouble $1 million mortgage to be due in full


Baltimore's Talmudical Academy, a 76-year-old private school for 640 Orthodox Jewish boys, is facing a financial crisis that could threaten its existence.

Top school officials insist, however, that they will come through this crisis as they have others in the past.

The immediate problem is an end-of-May deadline on full payment of a $1.1 million mortgage on the school's 10-acre Old Court Road campus in Baltimore County. The mortgage is held by the Resolution Trust Corp., the federal agency in charge of cleaning up the nation's savings and loan debacle. RTC inherited the mortgage from the now-defunct Yorkridge-Calvert Savings and Loan Association.

Sources close to the situation said the school has not made a payment on the mortgage for the past year while it struggled with other debts and chronic cash-flow problems that have made some teachers' paychecks late. An April payment deadline on the debt already has been extended.

According to school officials, an RTC spokeswoman and Bruce Eisen, vice president for finance of the Associated Jewish Community Federation of Baltimore, the parties are negotiating to find a way to refinance the mortgage and pay the RTC before the new deadline at the end of this month.

Mr. Eisen said Talmudical Academy already gets more than $100,000 a year from the Associated as part of an annual grant distributed among all Jewish day schools in the area.

Several teachers and parents, who declined to be publicly identified, said they have been kept in the dark about the problems, which have surfaced by word of mouth and have spread fears about about the school's viability.

Allen J. Gibber, president of Talmudical Academy's board of directors, said the school hopes to save money in the fall by eliminating the positions of six or seven teachers and combining the three classes in each of the school's elementary grades into two.

He said that would increase class sizes from "the low 20s" to a high of 30, but one teacher said the result could be elementary school class sizes as high as 35.

Talmudical Academy has been in its current location on Old Court Road at the Baltimore Beltway since 1966, when the two-story administration building, a 33-room dormitory and two three-story grade school buildings were built for $2 million.

The school added a fourth floor to the elementary school building and installed air conditioning in classrooms in 1991.

Rabbi Yehuda Lefkowitz, the school's director, said parents were advised of the current problems, though not in specific terms, in a letter sent out last week.

He said a meeting of parents will be called, probably next week, to give them more precise information. He said he was concerned that publicity about the school's problems would hinder renegotiation of the mortgage with the RTC.

Anne Freeman, a spokeswoman for the RTC's Washington office, said she could only confirm that the RTC holds the mortgage and that negotiations are under way. But she said she could not provide details because of confidentiality laws.

She said the agency doesn't generally call in loans, "especially with a school" or other noncommercial operation. She said the agency has no desire to take over a religious school in Baltimore.

"Talmudical Academy is not closing its doors," Rabbi Lefkowitz said. He said school officials had hoped to have a complete rescue package arranged before revealing details of the situation to the school community or the public.

Speculation about the school's debt or the risk of closing are "irresponsible," he said. But neither he nor Mr. Gibber would disclose the school's total debt.

Mr. Eisen said "cooperation from a number of parties" is necessary to resolve the problem. The Associated's goal, he said "is keeping the school open. The last thing we want is a bank foreclosure." He said the refinancing is a complex issue that may take several weeks to work out, but he would not discuss specific plans. "We're looking at all different types of scenarios," he said.

Rabbi Lefkowitz said tuition ranges from $3,100 for preschool nursery children to fees in excess of $4,500 for high school students

A hint of Talmudical Academy's difficulties surfaced in September when the school demanded that tuition be paid up front, instead of spread out over the course of the year as it had been in the past.

That requirement created a stir among the school's typically large families, many of which have several boys at the school.

Rabbi Lefkowitz said the money was needed at the start of the year to help ease cash-flow problems, and because that is the standard payment practice for private schools. He said the issue was resolved and no children were kept from classes.

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