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Around the Jewish World Gleaming New Jcc Reflects Tension Between JDC and Local Jewish Groups

September 29, 2006
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A state-of-the-art Jewish community center in St. Petersburg opened earlier this year, but tensions continue to simmer between some local community leaders and their prime donor, the American Jewish Joint Distribution Committee. The community center, known as YESOD, was built by the JDC with funds raised from North American Jewish federations.

It has fueled debate among some local leaders who say the JDC doesn’t understand its needs and doesn’t allow the local community to make decisions about how to run the center.

JDC says local leaders are unprepared to take full responsibility for the $10 million dollar center, which was intended to become the central Jewish address in Russia’s second-largest community.

The controversy in St. Petersburg underscores a larger issue in relations between local Jewish communities in the FSU and their international benefactors.

The post-Communist paradigm for Jewish life in the former Soviet Union, best described as “rescue and renewal,” has given way to a more complicated reality.

Most Jewish communities in the former Soviet Union — even the better-off ones, like St. Petersburg — couldn’t survive without external help, but they’re clamoring for a greater role in making decisions and shaping their own futures.

“I have a two-sided attitude toward the JDC. On the one hand, it’s this community’s main donor. But on the other, I feel that they do not always hold real community interests in mind,” said Yuriy Teplitsky, a St. Peterbsurg businessman and a former member of the YESOD planning committee.

But JDC says the wide discontent in the community stems from a different cause: JDC is trying to push the communities to become more self-sufficient and raise more funds locally.

The three-story YESOD has a light, welcoming interior, organized around a large open hall covered by a glass ceiling.

The four organizations the JDC had in mind when it designed the center — the Hesed Avraham welfare center, the Adain Lo family network group, Hillel and the St. Petersburg Jewish University — have all moved in, and there is plenty of activity, according to JDC officials.

But half of the facility remains empty.

Portions of the building were reserved for commercial tenants that the JDC hopes to attract to cover part of the maintenance cost. The idea of commercial tenants in Jewish institutions is new here but common in North America.

Asher Ostrin, JDC’s director for the former Soviet Union, says the organization is trying to limit the commercial component to 20 percent of the space. So far, only two minor commercial tenants have signed up. This month JDC said it was negotiating a lease with a health club.

YESOD may be JDC’s flagship project in the region, but it’s just of one of a dozen or so properties in six former Soviet republics that JDC has built or remodeled in recent years.

All the buildings have to be maintained and managed, which seems to the biggest problem for both the JDC and local Jews.

JDC estimates YESOD’s annual maintenance costs at $1.2 million, much more than the St. Petersburg community has collected in any single year for nonbuilding projects. Without JDC, the project simply would fall apart, especially considering that the JDC also provides funds and programming for the organizations the center houses.

With its current budget of $100 million in the former Soviet Union, the JDC is the largest sponsor of secular Jewish life in the former Soviet Union. Acting with money raised from North American federations, Holocaust reparations and its own fund-raising initiatives, JDC is a major financial lifeline for nonsectarian Jewish life in the region’s mostly impoverished Jewish communities.

According to Steve Schwager, JDC s executive vice president, 300,000 people in 3,000 cities across the former Soviet Union receive welfare assistance through 170 JDC-operated welfare and community centers.

But local leaders say the property issue is harming the JDC’s relations with local communities.

Furthermore, they charge that the JDC initiates flashy projects that help attract big donors but that don’t fit community needs.

Having built YESOD and some other expensive real estate projects, such as JCCs in Kishinev and Moscow, JDC has become overly concerned with saving its investment, local leaders say.

JDC disputes this assessment. These facilities were “not a fund-raising tool, but a tool to build community,” Schwager said.

In St. Petersburg, with some 100,000 Jews, he added, “this is the first space that is a Jewish facility designed by Jews and shared by Jews of all denominations.”

“All you have to do is watch the people” involved in the center’s activities to see its success, he said.

Nonna Levina, the former director of YESOD, resigned from YESOD in July over a disagreement with the JDC managerial team on how to run the center.

“All decisions are being made somewhere else and not in consultation with the community. We don’t even know who is making these decisions and why,” she said.

For its part, the JDC is trying to push the community toward greater independence.

“After 15 years of providing free services in the old community model, we started to do things differently,” Schwager said, referring to the modest rent and fees the groups are charged.

“The issue isn’t so much how much they pay, but that they pay. People value what they pay for.”

And, he said, there’s a second issue: Who will support the buildings in the long term?

“Charitable dollars won’t be here forever, and the community should take responsibility. This isn’t an easy change,” Schwager said, adding that the new situation is causing animosity in a number of cities.

The JDC expects YESOD to be self-sufficient in three to four years, Schwager said.

Centers like YESOD and ones in Kishinev, Moldova and Moscow were built or remodeled with designated funds from various North American federations. But donors in some cases are not willing to provide maintenance dollars as well.

JDC officials say they have enough federation funds to support these projects and continue providing services for two or three years. Other money should come from local sources, they say.

But local sources say that local Jewish donors are unlikely to start supporting the St. Petersburg facility.

That’s partly because the community is just developing a tradition of giving to charities. But local leaders also say that local businesspeople are unlikely to invest in JDC projects because they lose control over what happens to their money.

Complicating the situation is a new ownership system JDC began to implement for the centers it operates in Russia, Ukraine and some other former Soviet republics.

Due to a recent change in Russian laws governing nonprofit organizations, JDC became concerned about the future legal status of the properties in its hands.

New Russian laws prohibit nonprofits from accepting any payments, even to cover their own costs. That has left groups concerned that the government may confiscate property, a JDC source told JTA.

The group came up with a plan for dual registration, and earlier this year began to transfer titles to its buildings — including YESOD — to a commercial subsidiary registered in Cyprus, a step that conforms to local laws.

The offshore business entity will charge rent to JDC-sponsored organizations and future commercial tenants. The funds will be returned to the community centers as maintenance money, JDC officials say.

The business plan has alarmed many in the community. A perceived lack of transparency, with the Cypriot company making some of the decisions on lease rates and ownership status, for example, may potentially tarnish the JDC’s reputation in these countries. And if something goes wrong with the business, part of the project may have consequences for local Jewish communities, critics say.

But a JDC official insists the plan was developed according to the best professional advice and in consultation with the group’s Russian and overseas lawyers.

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