UJC May Shrink Jewish Agency Funding

By Nacha Cattan

Published November 07, 2003, issue of November 07, 2003.
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On the eve of the annual gathering of North American Jewish charitable federations in Jerusalem, supporters of their main Israeli beneficiary, the Jewish Agency for Israel, are in an uproar over a proposal by fundraisers that could slash the agency’s funding.

Federation representatives recommended this week that funding to their other main overseas partner, American Jewish Joint Distribution Committee, be increased by $13 million. Since there was no parallel call for additional dollars for the Jewish Agency, the decision could in effect mean a reduction in the share going from a limited pot to the Israeli body.

Advocates of the Jewish Agency, the venerable Israeli state-building body, were livid. “When you have declining allocations and a crisis in Israel of immeasurable proportions, it’s not the time to recommend a reallocation of core resources,” said Chicago attorney Richard Wexler, chairman of the North American Council of the Jewish Agency for Israel.

The reports were made by four independent working groups, which submitted separate recommendations this week to the federations’ roof body, United Jewish Communities. The dispute comes just days before the UJC’s General Assembly opens in Jerusalem on November 16.

In other signs of unrest at UJC, one of its 160 member-federations, the United Jewish Federation of Tidewater in Virginia, has decided to defy the national system by distributing funds directly to the two agencies abroad, bypassing the central allocations channel. The two agencies say they will accept the Virginians’ money.

In another blow, Combined Jewish Philanthropies of Greater Boston is circulating a letter to federations calling on UJC to institute “two significant budget cuts” in the next two years. UJC already trimmed its budget by almost 10% this year, from $42.5 million to $38.5 million.

The federation proposals on overseas spending are bringing to the boiling point an ongoing debate over how much money federations should allocate to each of their two main overseas beneficiaries, the Jewish Agency and the Joint. This past year the UJC collected in so-called unrestricted funds from federations $143 million for the Jewish Agency and $45 million for the Joint, roughly a 75% to 25% split.

Advocates of the Joint say that the 75/25 funding formula should be reworked to accommodate a shift in needs away from Israeli immigrant absorption and toward the poverty crises in Argentina and the former Soviet Union. Jewish Agency supporters counter that the split should remain the same given the toll terrorism is taking on Israel’s citizens and the costs of absorbing new immigrants in a devastated economy.

The federation proposals appear to support the Joint’s position. Of the four federation-led working groups, only the one charged with assessing the needs of “social welfare outside of Israel” explicitly called for additional funds, requesting $8 million for the former Soviet Union and $5 million for Argentina. The other working groups stated that if additional funding should become available, more aid should be considered for immigrant absorption and other social services in Israel.

But the lay chairman of UJC’s overseas needs assessment department, or ONAD, said that the difference in language among the separate proposals doesn’t necessarily translate into a cut in aid to the Jewish Agency. “One could interpret it that way,” said the chairman, Steven Klinghoffer of New Jersey. “I don’t think it’s necessarily a correct interpretation. That’s a subject that needs to be discussed among others.” Klinghoffer said that members of ONAD will meet December 8 to decide on the recommendations.

In fact, the Jewish Agency’s spokesman’s office is taking a wait-and-see approach: “The ONAD subcommittees validated and legitimated most of the requests [for additional funding] submitted by the Jewish Agency. All the recommendations will be brought to discussion, clarification and decision on December 8.”

The Tidewater federation, however, has leapfrogged the funding fracas by sending about $1 million directly abroad, splitting it in half between the two overseas partners. In doing so, federation leaders say Tidewater has broken a cardinal rule of the national system to submit donations through the UJC and to follow the accepted monetary split.

The decision, said Tidewater’s new executive vice president, Harry Graber, “was based on a desire on our community’s part to take upon itself — based on our views — to provide its dollars where we felt the needs are.” Tidewater is currently under threat of expulsion from UJC for withholding its dues to the national body.

But Tidewater is not the only federation getting creative with UJC’s rules on overseas allocations. While sources say that Tidewater may be the only federation to go completely outside the system, federations in Boston and Houston, among others, are not exactly falling in line.

Noting that the process for overseas allocations is voluntary, the president of the Boston federation, Barry Shrage, said, “We have our own priorities that are separate and different from the ONAD process.” Boston forwards $2.2 million to UJC in so-called unrestricted overseas funds, regardless of whether that is what UJC has requested. It sends an additional $1.4 million to the Joint and gives hundreds of thousands of dollars directly to grassroots organizations in Israel. Shrage said that at least four other communities are backing the Boston letter calling for a reduction in the UJC budget.

One of them is the Jewish Federation of Greater Houston. Like Boston, Houston does not abide by the specific request made by UJC for unrestricted funding abroad. “We’ve been basically doing our own thing,” said Lee Wunsch, executive vice president.

But Klinghoffer of UJC sounded a positive note, “What’s amazing,” he said, “is that the vast, vast majority of communities comply.”

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