Seeking A New Balance In Philanthropy

‘Being a child of the ‘60s, I actually believe that Federation is countercultural in many ways,” the CEO of UJA-Federation of New York recently told a roomful of people attending a symposium at his organization’s headquarters. “Many of us,” said John Ruskay, “are going against the grain of rampant individualism” in a consumer-driven era.

Anyone assuming that Ruskay was addressing a gathering of liberals or old-time radicals might be forgiven for that notion. Instead, his audience consisted of individual and institutional donors and their advisers, including bankers, accountants and consultants — not a tie-dyed shirt among them.

But Ruskay also captured the spirit of the meeting, which explored core operating support, also known as unrestricted giving, general operating support and a variety of other titles.

And the Jan. 18 symposium, “Core to the Mission,” certainly bucked a longtime trend, both in the Jewish community and elsewhere: the unprecedented wave of designated or earmarked giving in the past two or three decades.

One widely quoted figure comes from the Foundation Center, a resource for nonprofits and grantmakers, which says that only 20 percent of grants from the largest private and community foundations in 2005 were for general operating support.

That wave of earmarked giving, providing grants to short-term projects rather than agencies themselves, came as private philanthropists began calling for greater accountability on the part of nonprofit agencies, experts in the field have said. Donors came to believe that the work of charities could be measured much as corporations and businesses are judged and that operational or administrative costs took away from the agency’s efficiency.

But the symposium challenged those beliefs, reflecting a small but growing movement among foundation leaders who are calling for a greater balance in giving. Organized by UJA-Federation of New York in collaboration with eight other organizations, including the New York Regional Association of Grantmakers, the Jewish Funders Network and Grantmakers for Effective Organizations, the event brought together more than a dozen speakers from the philanthropic world to present another point of view.

The keynote speaker, Ami Dar, the Israeli-born founder of an Internet community for the nonprofit sector, spoke of how his venture, Idealist.org, would never have taken off as it has without the core support of a key donor.

Imagine calling donors around the country in 1995, the year he created Idealist, to say “there’s this thing out there and it’s called the Web,” Dar asked his audience. “It’s very difficult for me to talk about core support versus project support without talking about innovation. … Strict guidelines work in such a way that they essentially fund the past, or perhaps the present, but certainly not the future.”

Like Dar, several speakers said that general support to a nonprofit agency can be evaluated as readily and fully as restricted grants. “Core operating support is not writing a blank check,” said Ronna Brown, president of the New York Association of Grantmakers, but, rather, it’s getting more involved in the agency, often through dialogue and negotiation. “I’d argue that unrestricted funding actually increases the level of candor and honesty” in the relationship between donors and grantees, said John Weiler, senior program officer at the F.B. Heron Foundation.

Susan Friedman, managing director of UJA-Federation’s Jewish Communal Network Commission, addressed the topic, as well, calling the federation’s approach to evaluation “quite specific” and one that involves self-assessment by its agencies. But she also spoke of evaluation as “a piece of a bigger pie” that also includes building relationships. “We’re looking to create a standard relationship where [the agency] can be our partner in carrying our mission forward.”

In an interview later, Friedman, whose commission organized the conference, described UJA-Federation as unique among most grantmakers in that most of its allocations are for core support. Out of the $130 million allocated by the federation in its previous fiscal year, which ended in June, $85 million (65 percent) went to unrestricted grants for its agencies in the New York area, in Israel and elsewhere overseas. The percentage is even higher, 83 percent, when only grants to New York-area agencies are considered.

“UJA-Federation is one the few organizations in the New York area that’s giving out core organizing support,” said Louise Greilsheimer, its senior vice president for agency and external relations. “We’re certainly the largest without question.”

UJA-Federation proposed the conference to spread the word about “the value of these grants,” Friedman said, adding that they give agencies “bench strength” and, therefore, greater flexibility.

The grants also build trust between the federation and its agencies, said Helen Samuels, chairwoman of the Organizational Review Committee of Friedman’s commission. Her panel’s responsibility, Samuels said, is to evaluate each agency in UJA-Federation’s 102-member network. The process involves meeting with agency leaders and arriving at a set of measurable objectives — not requirements, Samuels continued, but “best practices.” In addition to the monitoring, the federation helps to train and mentor the leaders and staff of each agency.

Describing how core support has strengthened one particular agency, the Jewish Board of Family and Children’s Services, Karen Spar Kasner, a board member of both UJA-Federation and JBFCS, said the Jewish Board was one of the first agencies to respond to 9/11. Within hours of the tragedy, the agency sent mental health professionals to locations near Ground Zero to work with families and colleagues of the victims, Kasner recalled. Moreover, those professionals were trained specifically in the area of trauma — training that would not have taken place, she indicated, unless JBFCS had the financial resources to implement it.

Why, Kasner asked rhetorically, was JBFCS able to act so quickly on 9/11? “Because we were there on 9/10.”

Another example is JBFCS’ involvement in Partners in Caring, a program, created at the behest of Federation, in which the Jewish Board and two other agencies place mental health professionals at synagogues and Jewish community centers, gateways to the Jewish community. JBFCS was working along similar lines even before the program’s creation, said Paul Levine, the agency’s CEO, who added that his organization was able to draw on unrestricted funds.

By strengthening individual agencies, the core support also strengthens UJA-Federation’s entire network of agencies, Greilsheimer said. The agencies already have the leadership, the ideas and the trained staff to respond to emergencies and emerging needs, she continued. “You don’t have to start from scratch.”

In promoting the idea of core support, Greilsheimer said, UJA-Federation isn’t suggesting that project-related grants should be abandoned. To the contrary, she said, the two strategies are “interwoven” and “reinforce each other.”

She also suggested that the language of giving needs to change. “Core operating support has always been thought of as money to turn on the lights,” Greilsheimer said. But the better definition involves “investing in the whole organization and its leadership. If one looks at which area of giving has the most impact today, you can have real impact, true impact, by investing in organizations and their ability to deliver on the mission.”