Dénes Dienes: History of the Reformed Church Collég in Sárospatak (Sárospatak, 2013)
SECONDARY SCHOOL AND COLLEGE-THE COLLEGE AND THE DEVELOPING, MODERN EDUCATION SYSTEM - The modernization of financial management
136 SECONDARY SCHOOL AND COLLEGE the school’s lawyer and treasurer, and three part-time teachers of the College rounded out the membership of this body. They were in charge of finances, management of property and effects and coordination and execution of financial matters. By this arrangement, education matters and the management of economic affairs were separated. T he inclusion of teachers with expertise ensured that the College’s primary functions of teaching and educational training were kept in focus. In the year of the Compromise of 1867, a sixth member was added to the board, this being a manager of livestock and legal matters, this addition giving the Board more clout. Members of the Economic Board were selected by the public school board to serve for three years, so the previous practice of annual but often hectic changes was replaced by a predictable cycle. The difficult years in the 1870s forced the managers of the institution to implement additional changes. The Economic Board increasingly drifted towards being under the supervision of the church district. Of the seven regular members, three were selected by the church district and four by the public school board. Top economic officials were given extraordinary membership in the committee. Over the course of time, the number of such members increased by three: next to the lawyer, the treasurer and the legal and livestock manager came the dining- hall and foodstuff coordinator and the bookstore supervisor, both of them being in charge of relatively significant funds. The Literary Circle appointee also attended the meetings. The increase in membership was associated with an increase in the amount of professional work to be done. Not only had financial management been separated from matters of education but now there existed within the board external and internal management and general management and financial control were separated as well. The new regulations very clearly defined the authority and responsibility of each member as well as obligating the cooperation of each of them. By this time, the selected members of the Board were to serve for six years, another change which enhanced stability. In the spirit of reorganization and renewal in terms of financial management, it was decided during the 1850s to significantly reduce the College’s property holdings. The majority of the land owned was sold, the rest was rented out. The school completely ended its direct involvement with property use. The only economic activity of significant proportions which was retained was the placement of capital. Due to the limited possibilities of this nature in the region, the College remained a frontline player in this field. Being close to bankruptcy, the first move to alleviate this was the decision to invite financial donations to move the long-time inactive, dormant capital. In the latter matter, in 1851, the College initiated legal action in close to one hundred such cases. Credit provided by the College was very popular because the school extended loans with six to eight or a maximum of ten percent interest rate, while the savings cooperatives charged a rate of ten to twelve percent. Difficulties cropped up only when the base capital was close to being depleted, this being partly due to the sometimes flagging arrival of repayments. To address this matter, the period of grace for repayment was reduced from one year to three months and then turned over to the courts. In years of crisis, up to eight lawyers were entrusted by the College to represent their interests. There were cases which dragged on for years and inflicted serious losses on the institution given that the courts typically mandated the debtor to pay only the last three years of interest. The effects of the large
