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Charities Left In Lurch As Federations Abruptly End Funding Program

Since the early days of Donald Trump’s presidency, the Jewish refugee aid organization HIAS has emerged as a major voice opposing the administration’s crackdown on immigrants.

Now, a last-minute funding cut from the umbrella group for Jewish federations nationwide could mean a reduction in those efforts, and in the efforts of eight other leading Jewish organizations that had been expecting grants from the same funding pool.

In a memo distributed Tuesday, the Jewish Federations of North America announced that it was shuttering a three-decade-old program that pools funds from local federations to support a handful of national Jewish agencies. The announcement came just three months before the agencies expected to receive their annual allocations.

“We were counting on that funding for June,” said Mark Hetfield, HIAS’s president and CEO. “And now we’re going to have to ask individual federations for support. And that’s obviously going to take away resources, and make us spend more of our resources asking for money rather than carrying out our mission.”

The discontinuation of the program, called the National Federation/Agency Alliance, comes amid a broader breakdown of the joint fundraising model on which the federation system was built. As wealthy donors demand more control over their donations, local federations are less willing to hand over funding decisions to a national body. The resulting disorder can be a drain on the resources of charities seeking funds.

Donors “are not really interested in having organizations make their philanthropic decisions for them,” Hetfield said. “It certainly is a bad sign for collective action.”

As of 2016, the Alliance distributed $4 million a year to nine national groups, most of which had historic ties to the federation system. While some, like HIAS, counted on the Alliance for only a tiny proportion of their budgets, others relied heavily on the money. The Jewish Council for Public Affairs, another recipient, received 15% of its total revenue from the Alliance.

The Alliance’s grants were particularly valuable because they were unrestricted, which meant they could be used however the recipient organization deemed necessary. Unrestricted grants are rare, and HIAS, which is largely funded by government grants that are earmarked for specific programs, was able to use the Alliance money for synagogue outreach and advocacy work.

Other Alliance recipients included Hillel International, the American Jewish World Service, BBYO and 70 Faces Media, which publishes the Jewish Telegraphic Agency. Nearly 30 local federations contributed to the pool.

The writing has been on the wall at the Alliance since at least 2016, when UJA-Federation of New York, the largest member of JFNA, announced it would stop contributing to the pool in 2017. JFNA appears to have determined that it could not continue the program without the New York federation.

In the memo announcing the cuts, JFNA leaders said that efforts to save the Alliance had failed. “The pool of funding available continues to erode as more individual communities seek to manage their own decisions,” the letter read. The JFNA leaders acknowledged that the news was coming late in the funding cycle. “While Federation communities continue to respect and value your work, our historical model is no longer sustainable. We are committed to facilitating an easy transition to your working directly with individual communities.”

Mark Hetfield Image by courtesy of HIAS

Mark Gurvis, executive vice president of JFNA, did not respond to an inquiry from the Forward about why the announcement was made only three months before the checks were due. JFNA said in a statement to the Forward that “local Federations want to manage their own decisions about which national agencies they will support,” and as such the Alliance was being “discontinued.”

Members of the Alliance had already been counting on the grants as part of their 2018 budgets. Now, they will need to seek funding from each of the Alliance’s members to try to meet the expected amounts. JFNA said it would facilitate a “joint review process,” though the funding decisions would be up to each individual federation. JFNA did not respond to a question about whether the local federations had committed to any specific funding level.

“Obviously we are troubled by the breakdown in the collective funding system, but we choose to look at this as an opportunity to deepen our ties with individual federations,” said David Bernstein, president and CEO of JCPA.

But Hetfield said that the value of the Alliance was greater than the grants, which for his organization were just over $100,000 per year. Hetfield said that membership in the Alliance acted as a sort of seal of approval from JFNA that helped them raise money from other funders. “Now we can no longer say that,” he said. “There’s no longer a system that gives us support. That’s harmful, too.”

Contact Josh Nathan-Kazis at nathankazis@forward.com or on Twitter, @joshnathankazis

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