South Head – Where has all the money gone?

https://www.jewishnews.net.au/south-head-voluntary-administration-rabbi-terminated/63008

South Head in voluntary administration, rabbi terminated

JOSHUA LEVI

SOUTH Head Synagogue’s board has appointed a voluntary administrator, Rabbi Benzion Milecki’s contract has been terminated and three members have loaned the shul $500,000 to ensure the bank can’t sell the property.

Shul president James Hochroth informed members on Thursday night that the administrator has terminated Rabbi Milecki, who has been South Head’s rabbi for more than 30 years in Sydney.

“Rabbi Milecki was one of the highest paid rabbis in Australia – terminating him will save a great deal of money.  We will go without a rabbi for a period and expect the costs of a new rabbi to be more modest,” Hochroth said.

“Rabbi Milecki may decide to challenge in court the actions of the Administrator, which if successful would increase the costs of the Administration and delay its finalisation.”

According Hochroth’s letter, the situation between the rabbi and board completely disintegrated.

Hochroth told members “in the interests of full transparency, but with considerable regret” that Rabbi Milecki terminated the board, administrator and IT consultant’s access to ShulCloud, which controls newsletters, accounts functions and various databases.

A day after Rabbi Milecki allegedly locked the board out, he wrote an email to members using the software.

“Should you notice my absence from an edition of eNews, or should it contain material that does not fit the mission statement, please know that it has not come from me,” he wrote.

“At any time, should you wish to communicate with me, please do not reply to this email. To ensure that I receive your email please write to rabbi@me.com.”

The board contacted the software provider in New York to restore access but when Rabbi Milecki then contacted them again, the company shut down the system until the board and rabbi could reach an agreement.

“We still do not have use of our computer system,” Hochroth said.

“The administrator will be advising ShulCloud of his appointment and the termination of the Rabbi and request that the suspension be lifted.

“As you will appreciate, it is apparent from the above that the relationship between the Rabbi and the Board has irretrievably broken down.”

The greatest risk for the shul of going into voluntary administration is that the bank could call in the mortgage on the property.

“This potentially puts our property at risk of being sold up or falling into the control of persons unknown who may have differing objectives to those of the majority of members,” Hochroth wrote.

“Three members of the shul – Curtis Mann, Rodney Naumburger and myself  – have each loaned $500,000 to pay out and replace the bank to alleviate this major risk to our property and kehillah.

“The terms of this new loan are no less favourable than those of our current bank facility.  The primary benefit of this new loan is that its lenders have every desire and intention to see the shule and kehillah continue and flourish which is not necessarily the case with a major commercial bank.”

Hochroth said the decision to call in a voluntary administrator was a “last resort” to protect the company from further financial loss and then to attempt to bring the shul back to financial viability.

In a second letter to members on Thursday, Anthony Elkerton, who was appointed as voluntary administrator, explained to members that during the administration period he is personally liable for debts incurred by the synagogue.

“For this reason following a review of the Synagogue’s financial position and projected cash flows that I made the decision to terminate the employment of Rabbi Milecki,” Elkerton wrote.

“I formed the view that the costs of employing the Rabbi are such that cash flow would be negative during the administration period and I would be assuming a potential personal liability.”

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