baysidecemeterylitigation.com

Dear Bayside Cemetery Litigation Friends:

I wanted to provide some comments on the content of the excellent article called “Offering TLC for Jewish Cemeteries” written by Alex Weisler on Forward.com (http://www.forward.com/articles/110374/).  Many thanks to Mr. Weisler for his work to write this article.

• With regards to Gary Katz’s comment where he says that “every cemetery that’s filled with Jews” and “looks nice” now will one day “look like Bayside [Cemetery in Queens – a cemetery owned by Congregation Shaare Zedek in Manahattan]” is a grim prediction that I take exception too and don’t agree with at all.  I have done considerable research on the cemetery business over the past few years as the plaintiff in a class action lawsuit against Bayside Cemetery and Congregation Shaare Zedek (http://www.baysidecemeterylitigation.com/ ).  While it is possible, and perhaps even likely, that other NYC area Jewish cemeteries will suffer the same fate as Bayside, it will likely occur entirely or largely due to mismanagement, incompetence or, as in the case of Bayside Cemetery, from alleged financial malfeasance.  The mechanisms to create a sound financial plan for a cemetery are not terribly complex but they require a sound plan to carefully manage cash flow, ensure adequate payments at inception of a cemetery plot sale, collection of perpetual care and annual care funds due, honest and competent financial management of a cemetery’s trust assets and diligent maintenance of the cemetery using the funds expended.  For old cemeteries, management should also work hard to locate relatives of the deceased, maintain contact with them, and work with them to get them to pay monies for annual or perpetual care when it wasn’t paid by the deceased historically.  I believe that most families would pay money for such services if they knew that the money would be responsibly managed and used for the purpose intended.  In the case of Bayside Cemetery’s history, all of the ingredients for the successful management of the cemetery were in place.  They had a mechanism to collect Perpetual Care and Annual Care and over many many years they collected both forms of care payments.  As for Annual Care, a 1905 document by Congregation Shaare Zedek’s Board of Directors to create rules and regulations for the management of Bayside Cemetery required the payment by all plot owners of $4.00 per year.  To illustrate the efficacy of this simple payment mechanism, consider this example:
  • From the 1905 document called “Congregation Shaari Zedek Rules and Regulations for the Government and care of Bayside Cemetery”, page 15 (page 16 of the PDF at http://site.baysidecemeterylitigation.com/uploads/1905_Rules___Regulations_for_the_Govt_and_Care_of_Bayside_Cemetery-WEB.pdf ), it says “An annual charge of $4.00 per year will be made upon every plot, for the maintenance of the cemetery”
  • I have not seen records for how many plots had been sold in 1905 but assume 20,000 plots had been sold by 1905 (this may be low but I’d rather make conservative guesses).
  • Assume that in 1905, the locations for owners of 50% of the plots were known and would pay the annual fee (this might be low given that people didn’t move as much back then)
  • Therefore there are 10,000 plots that were to pay the annual fee of $4.00
  • Therefore there should have been $40,000 paid for annual maintenance to Bayside Cemetery
  • It clearly didn’t cost $40,000 to maintain the cemetery in the early 1900’s.  Assume 50% of that was spent to maintain the cemetery which is still probably quite a bit higher than it actually cost.
  • Assume $20,000 of annual care money was not spent and was saved in the cemetery trust account
  • So even if they only collected the $4 per year per plot for 5 years and then stopped (but why would they stop collecting the money?  They wouldn’t but let’s just assume they did) and set aside the $20,000 surplus money per year to grow, they would have $5,471,021.80 in 2009 at a 4% interest (which is also a conservative and low interest rate)
    • 1905 – 104 years - $1,181,672.92
    • 1906 – 103 years - $1,136,223.96
    • 1907 – 102 years - $1,092,523.04
    • 1908 – 101 years - $1,050,502.92
    • 1909 – 100 years - $1,010,098.96
  • Of course, based on the $4 per year per plot rule, they should have been collecting this money for much longer than 5 years – like each year through time - they should have been doing it ‘forever’ and should still be collecting annual care money for whatever amount – and the reality is that Bayside Cemetery has been collecting Annual Care money but they haven’t necessarily been using it appropriately and caring for the plots for which the Annual Care was paid.
  • Plus there is profit that should have been generated from all the other cemetery services provided and outlined with the schedule of fees in the 1905 document also.  Plus they of course generate money from the sale of the plots themselves.
  • None of this considers the payment of Perpetual Care monies also.
  • So what happened to all this money that Congregation Shaare Zedek and Bayside Cemetery may have collected and invested over the years?
  • So, in short, Bayside Cemetery should have had plenty of money.  The core question is, and has been, what happened to the cemetery’s money?  In the NY Daily News article at http://www.nydailynews.com/ny_local/queens/2007/10/04/2007-10-04_bayside_cemetery_is_a_disgrace_suit_says.html the cemetery and synagogue’s lawyer says that the synagogue borrowed money from the cemetery’s non-restricted account.  However, according to NY State Cemetery law, accounts are always restricted and only under court order can the funds be used for a purpose other than which cemetery law requires.  I am not aware of Congregation Shaare Zedek getting court permission to use Bayside Cemetery funds to “repair the synagogue roof”.  So they must have used restricted fund in violation of trust rules/law.
• The article quotes Howard Feinberg who says that perpetual care (PC) contracts are vague.  I’m not sure I understand how Bayside Cemetery’s PC contracts are vague.  The typical Congregation Shaare Zedek PC contract says that payment is to “be used toward the Perpetual Care and upkeep of the following lots, plots or graves: [specific lots for which PC  was purchased is listed]”.  Now would a rational person argue that this is vague because it doesn’t say specifically that the grass will be cut, that weeds and wild bushes and trees won’t be allowed to grow through the middle of a plot where the deceased’s grave is, or that garbage/litter/debris won’t be allowed to aggregate at a grave site???  I think any rational person would know that these conditions, conditions which have been ubiquitous at Bayside Cemetery, are not appropriate when people have paid for Perpetual Care.  A simple Google search for definitions of Perpetual Care show what one would expect: “guarantee of perpetual cemetery upkeep”, “the care and maintenance and the reasonable administration of the cemetery grounds and buildings at the present time and in the future”, “for the maintenance, care, repair, upkeep or ornamentation of the cemetery”.  I could go on and on but this seems like a silly thread of discussion… it’s pretty obvious to most anyone what form of reasonable care is included in the meaning and intent of the term Perpetual Care… and the condition of Bayside Cemetery today is not what is intended.
• The article continues with comments from Mr. Feinberg about how PC contracts don’t help pay for general upkeep of the cemetery.  Without getting into a detailed discussion on cemetery management and how portions of plot sales, fees for services, etc are supposed to go into a general cemetery maintenance trust fund to be used for the general maintenance referred to in the article, the core issue of my lawsuit is that Bayside Cemetery and Congregation Shaare Zedek have not even been maintaining the graves and plot areas for the people who PAID FOR perpetual care.  People (my grandparents’ burial society included) paid for Perpetual Care and the photos at www.baysidecemeterylitigation.com clearly show the abhorrent condition of Gate 19 where my grandparents are buried.
• Later in the article, Mr. Katz says that “cemeteries are an inherently financially unsustainable enterprise”. If this were the case, we wouldn’t have such financial instruments as annuities, cash flow analysis, present/future value, etc.  Our world is filled with examples where people make very long term financial plans where cash flow is required each year in perpetuity.  But this means that the fiduciary of the money needs to manage the funds correctly and use it how it was intended and not divert monies for improper purposes like fixing roofs of structures unrelated to the cemetery.
• Mr. Katz continues by talking about how the financial unsustainability of cemeteries is a unique situation for Jewish cemeteries because the burial societies that bought the plots no longer exist.  First of all, there are some burial societies with plots at Bayside Cemetery that do still exist.  Secondly, even if they don’t still exist, so what?!  The burial societies and their members purchased plots from the cemetery.  Fees were paid for the plots, fees were paid to bury the deceased in the plots, and PC contracts were purchased for the plots and the gate areas.  What’s Mr. Katz’s point?  If the money was all managed correctly in the cemetery trust accounts and the proper financial plan was being executed by the cemetery, then all should be OK.
• It is also important to note that other cemeteries of other religions and other ethnic and national origins also had burial societies and purchased burial plots for members.  Burial societies are not unique to Jewish people.
• Mr. Katz then continues to say that most Jewish cemeteries will be like Bayside Cemetery in “50 to 80 years”.  Based on what information does he make this statement?  I also have family buried at Mt. Zion cemetery and I am not aware of the likelihood of that cemetery looking like Bayside in the future.  In fact, Mt. Zion is well maintained despite it being about 8 times larger than Bayside Cemetery.  Absent facts and figures, Mr. Katz shouldn’t make such statements.
• Mr. Feinberg says that he is “technically a member” of my lawsuit.  If Mr. Feinberg’s family purchased Perpetual Care, then he is correct.  He then continues by saying “[if so,] so what?”  From my perspective, the “so what” is that people shouldn’t be allowed to take money that isn’t their’s.  People shouldn’t be allowed to break the law by breaching their fiduciary responsibility and dipping into funds for things not allowed with those funds.  People should be held to the moral and ethical and legal standards by which our society intends for the management of such perpetual care monies and with respect for the dead.  And people should not be allowed to let Bayside Cemetery turn into a rainforest as a result of their actions.  While it’s fine that CAJAC is cleaning the cemetery now, where will they be in 50 to 80 years?  Who will maintain the cemetery in 2010 and 2011 for that matter?  Each and every year the cemetery needs ongoing maintenance just like my lawn needs to be cut every week.  That’s the so what!

CAJAC’s one-time cleanup is cutting down the Chinese bamboo weed growing rampant at Bayside Cemetery.  For any of you who ever had the misfortune of trying to remove Chinese bamboo from their yard, you will know that it has underground runner that keep growing unless the entire plant and root is killed.  Chinese bamboo is one of the most virulent and pervasive weeds that grows in this area - just cutting it down now will do nothing to prevent its growth next year!

Is CAJAC just a one-time cleanup service?  Mr. Feinberg’s comment in the article causes me to wonder… “we want to finish this [Bayside] and do it right [before moving onto work at other cemeteries]”.  I ask, what does it mean to finish at Bayside?  Once the grass, weeds, wild growth and trees are cut down and the trash picked up in 2009, what happens next year in 2010?  You see, the task of maintaining Bayside Cemetery is never “finished”…  it needs the same effort each and every year in perpetuity.  That’s why people purchase perpetual care… because they want their grave plots and areas maintained forever.  And FOREVER is a real long time.

John Lucker
Plaintiff – Lucker et al v. Bayside Cemetery and Congregation Shaare Zedek