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JDC Upsets Federation System with Appeal for Emergency Funds

March 5, 2003
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In an extraordinary move to meet pressing human needs abroad, the organized Jewish community’s main rescue and relief agency has made a direct appeal to local federations for emergency funding.

In doing so, it has circumvented the established overseas allocation process, angering officials of the United Jewish Communities, the federations’ coordinating body, which has been struggling to unify members with divergent goals for the umbrella group.

The move by the American Jewish Joint Distribution Committee and the angry response by some federation officials have sharpened the debate about overseas priorities and the capacity of the federation system to fund them.

While the JDC has appealed directly to federations before, its Feb. 20 letter to federations across the country marked the first time it calculated and asked federations for their “fair share” — a determination made by the UJC. The letter was a plea to raise nearly $20 million in emergency funding to aid desperate Jews in Argentina and the countries of the former Soviet Union.

UJC leaders meeting in Miami in January had authorized the JDC to raise $10 million in supplemental funds for Argentina. But a specific amount of money was never authorized to aid elderly Jews in the FSU — though the UJC’s overseas committee had earlier validated this as an “elective” need.

That gave the JDC authorization to raise additional funds from the local federations. But the JDC letters went a step further: They calculated each community’s share of the $19.775 million that the JDC determined it needed for Jews in both Argentina and the FSU.

The move triggered confusion among local federations and a rebuke by UJC leaders, who penned a sharply worded response to the JDC. It said the agency’s direct appeal would “undermine our national effort to distribute scarce financial resources in a rational manner.”

“It’s an affront to the UJC system,” said Robert Schrayer of Chicago, who chairs UJC’s Israel Emergency Campaign.”I think we should tell the JDC if they’re going to do that, then we won’t allocate them money through UJC. They can’t have it both ways.”

But Steven Schwager, the JDC’s executive vice president, said he would make no apologies for the direct appeal.

Schwager said he can “sit back or try and raise money to feed hungry Jews. I’m going to try to raise money to feed hungry Jews,” he said in a telephone interview.

The organization’s appeal is its latest maneuver to cope with the fact that federations are falling increasingly short of meeting UJC’s recommended overseas allocations.

JDC’s president, Eugene Ribakoff, said the group took the measure because UJC’s Overseas Needs Assessment and Distribution Committee “isn’t in a position to allocate enough funding to cover our welfare programs.”

The UJC — a three-year old merger of the Council of Jewish Federations, United Jewish Appeal and United Israel Appeal — was formed, in part, to reverse a trend over the last decade: Federations have been allocating fewer dollars for overseas needs and keeping more of their campaign proceeds at home to fund local needs.

While the UJC has managed to stabilize the drop in overseas allocations, federations are still falling short of the total that UJC has requested to meet needs in Israel and elsewhere overseas.

According to Richard Wexler of Chicago, who serves on UJC’s Budget Committee, federations fell short by $7 million in UJC’s first year, $17 million its second year, and they “will fall significantly short” again this year.

Though the intifada has returned Israel to the forefront of North American Jewish concerns — the UJC’s Israel Emergency Campaign has raised $345 million in pledges to date — many federations’ annual general campaigns are down. And consequently their overseas allocations are expected to fall short of UJC requests.

In response, the UJC is planning to launch an overseas advocacy committee.

But the JDC has taken matters into its own hands.

In addition to its letter, Schwager has spent the last 10 months canvassing the country to press federation leaders to earmark more money for his organization’s humanitarian work.

The JDC’s key gripe is the federation system’s longtime 75-25 split in overseas allocations, in which the Jewish Agency for Israel, which runs immigrant absorption and other programs in Israel, gets three times the amount of federation dollars than the JDC.

The JDC argues that since immigration to Israel has decreased, while Jewish humanitarian needs elsewhere have risen, it deserves a larger share of funds. Jewish Agency proponents point to the JDC’s large endowment and the Jewish Agency’s long-standing debt. They say current immigration packages are costly, and that funds should not be diverted from Israel at a time of crisis for the Jewish state.

Caught in the middle of the flap are local federation leaders.

“Why aren’t our partners doing this together,” asked Gary Weinstein, executive vice president of the Jewish Federation of Greater Dallas.

“That’s frustrating, it’s confusing, and at the middle of which we’re being asked to raise money” for an Israel Emergency Campaign and Ethiopian resettlement program. “All of this coming together causes great confusion and anxiety.”

The situation highlights a complaint among many federations that the national system is not working as effectively as hoped.

In a Jan. 13 letter to the UJC, the Jewish Federation of Greater Houston criticized the system for, among other charges, poor planning, exclusive decision-making and a flawed overseas allocations process.

UJC’s overseas allocations process “has caused our key overseas partners, the JDC and JAFI, to inflate and expand their infrastructure to maximize funding from federations at a time when they should be increasing services,” the letter read.

“A multitude of overseas agencies are now approaching federations on an individual basis for funding, creating chaos and greater inefficiencies.”

In its letter to the JDC, the UJC took the organization to task for adding to the chaos.

The federations are “sensitive to the full range of Jewish needs in Argentina, the FSU, in Israel and throughout the world,” the letter said. “Unfortunately, it is unlikely that we will ever raise sufficient money to pay for all of them.”

“However, the answer to the problem of growing needs cannot be for one of our overseas partners to act unilaterally,” the letter said. “This will only serve to subvert our national effort.”

According to Daniel Allen, executive vice president of the Jewish Federation of Greater Hartford, UJC’s response corrected the JDC for overstepping its bounds.

“The UJC did exactly what they should have done in a timely manner,” said Allen, who formerly chaired the United Israel Appeal, which represents the Jewish Agency.

Others thought the UJC should have been firmer.

“It was disconcerting to see one of our partners deviate from the process,” said Jay Sarver, president of the Jewish Federation of St. Louis. “I hope that UJC will put policies in place that make such a deviation more difficult.”

UJC spokeswoman Gail Hyman said this is “an internal issue that we’re in conversation with JDC on.

“We recognize that there are needs in the former Soviet Union,” she said. “We’re working hard with JDC to address those needs.”

For his part, JDC’s president, Eugene Ribakoff, said his organization remains committed to a national allocations system. “We believe in the UJC process, and we’re following it,” he said.

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