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Finalized Merger Plan Heads for the Road, Seeking Approval

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Jewish leaders have finalized a plan to merge the central American Jewish fund- raising organizations and are set to present it to federations across the country in hopes of securing their approval.

The plan is aimed at strengthening flagging campaigns, making the fund-raising bureaucracy more efficient and ensuring that domestic and overseas needs are met in a fair and systematic way.

If implemented, the plan could lead to one of the biggest changes in the American Jewish fund-raising structure since the United Jewish Appeal was founded.

The finalized plan promises $310 million a year for overseas programs for the first three years, the sum received by the UJA in 1994.

While that promise is considered a linchpin for the plan’s survival, it also poses the biggest challenge in the effort to win the support of federations.

Sources say many will balk at the protest of losing flexibility in their allocations process – even for a period of there years – at a time when the Jewish world is undergoing such rapid change.

At the same time, there is broad consensus that the Jewish philanthropic system must change to respond to changing needs, which augurs well for the fate of a restructuring plan.

“The idea of the merger is good, the idea of the Jewish community being frozen for three years is bad,” said Barry Shrage, president of the Combined Jewish Philanthropies of Greater Boston.

The plan calls for the consolidation of the Council of Jewish Federation and the UJA. The United Israel Appeal, which funnels and oversees campaign money to the Jewish Agency for Israel, would remain intact for three years of transition and then join the new entity.

The American Jewish Joint Distribution Committee would receive funds raised by the new organization and be part of its governance but would remain independent.

Federations raise about $725 million annually in concert with the UJA. The overseas portion is distributed by the UJA to the UIA and to the JDC, which provides humanitarian relief to Jews throughout the Diaspora and in Israel.

The authors of the plan, which has been two years in the making, have been hoping to get federations’ final approval by May at a CJF gathering.

But that timetable is “looking less and less possible,” said Joel Tauber, president of the UJA and co-chairman of the committee that devised the restricting plan.

The boards of the other entities also have to sign off on the new entity before it takes flight, though this is actually a formality. Their leadership already has registered its support.

Most challenging throughout the planning process has been finding a method acceptable to all parties of dividing the money raised by the federations between needs at home and programs in Israel and elsewhere overseas.

Such a division is especially sensitive a time when campaigns are flat, Jewish education has become a top priority and federal budget cuts are expected to drastically hurt federation-supported social programs.

In fact, allocations to Israel has been dropping in recent years. Nevertheless, calls for guaranteed minimum finding for overseas needs have been resisted by local federations that like to guard their autonomy.

The current plan represents a compromise.

According to Tauber, it offers a “guarantee” that the new national entity will funnel $310 million annually overseas for the first three years. Planners have held that such a transition is needed to build confidence for the change among those concerned with overseas programs.

But rather than ask the communities for guarantees, each community will be asked to give “assurances” that they will give a certain sum of cash per year “so the national system will have enough.”

The assurances, said Tauber, would be based in “discussions with individual communities based on each situation.” Among the factors used to calculate the sums, he said, would be their cash collections and allocations from the past two years.

The term “assurance” is being used instead of “guarantee,” said Tauber, “because `guarantee’ smacks of legalese.”

Leaders of some major federations have signaled their support for the plan, but still need approval from their boards.

For others, concerns remain that clearly need to be assuaged.

“I understand the need for assurances of stability within the system,” said Boston’s Shrage. “I’m not attacking the concept that there are needs to be met overseas – I believe that very strongly. But, there needs to be flexibility.”

Shrage said federations would want to know they can respond to “emergency needs” and that their obligations to the Jewish Agency for Israel will not be “frozen,” even for three years.

He also said federations would also want to be assured that there would be “significant savings quickly” in the system as a result of the plan.

For Tauber, the planned restructuring is of critical importance. The changes in the Jewish world are “cataclysmic,” he has maintained, and if nothing is done to reform the existing structures, “the organized Jewish community could become irrelevant.”

The restructuring committee, according to its documents, determined that the “new entity” would “help the system move forward as a leader in Jewish life as the 21st century is being confronted.”

The committee touted the proposed system’s “ability to raise more financial resources; connection with Jewish life world wife; reduce; strong and responsive governance structure; building leadership and community; as well as effectiveness and efficiency.”

Planners says they have designed a governance structure, to be put into place after the transition period, which reflects a balance of domestic and overseas interests and which will allocate campaign money accordingly.

Under the plan, the new structure will include and assembly of up to 1,000 members, half of whom would represent federations, while the other half would represent the “cross section of the Jewish world,” Tauber said.

It will also include a 125-member board, which will reflect the same balance and will be charged with choosing an 18-member operating committee.

Under the latest plan, the Jewish Agency will be represented in the assembly and on the board, accounting for the new entity’s only non-American members, Tauber said.

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