Wall Street stockbroker - AP - from print 8.11.11
A Wall Street stockbroker, holding his head after watching the market take a dive. Photo by AP
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Major Jewish organizations that rely on funds contributed by American Jews are gearing up for cuts in donations as the financial crisis takes its toll, raising the possibility that U.S.-based groups will be moving Israeli causes to the back burner as they struggle to cope with an increasingly dire situation at home.

The Jewish Agency recently announced it is slashing $45 million from its 2009 budget, cutting grants to other institutions in Israel and cutting its staff. And the UJA-Federation of New York has said it will dip into its emergency reserves to serve the ballooning needs of its own community − a move it last made in 2006, to help residents of the north during the Second Lebanon War.

In addition, the World Jewish Congress, United Jewish Communities, UJA-Federation of New York and Jewish Federation of Greater Washington all said they were expecting a drop-off in contributions.

“We have lots of small donors and I’m afraid we’re going to see a drop-off in contributions there,” says businessman and philanthropist Matthew Bronfman, who heads the WJC governing board. “And I would suspect that if you look at the fact that it’s a financial crisis and people in the finance industry are losing jobs hands over fist – and a great number of those employees are probably Jewish – you have to think it’s going to impact contributions to charity.”

Organizations that receive funding from Wall Street and the American government, like the UJA-Federation of New York, may be particularly vulnerable.

“Probably every not-for-profit in America, as well as every business in America, is being affected by the current economic crisis,” says Stuart Tauber, senior vice president for financial resources development at the federation. “We know we’re going to be affected,” he says, adding that at least a quarter of the group’s campaign funds come from Wall Street. “Everybody is going to be affected.”

“Here in New York, the city, the state and the federal government, which give a lot of money to our organization, will be clearly cutting back in certain areas,” he says. “They will have less in tax revenues, so they’ll cut back, so there’s no way that UJA-Federations, or anybody in the non-profit world, can make up the difference.”

Tauber says that just as UJA-Federation sent more money to Israel when the intifada broke out, Israel may now have to make do with less funding if Jewish communities in America need the help more.

“It is quite possible that we will also see a greater need here that will have to be addressed,” he says. “We are going to look at what’s the most pressing need in the Jewish community at any given time and we will try to focus on it like a laser beam and deal with the most critical areas.”

Other Jewish leaders also say they need to take local needs into account more than ever, possibly at Israel’s expense. “We’re not forgetting Israel, certainly not. But we have a new situation now, and we also need to take care of ourselves, and our means are not unlimited,” says Susie Gelman, who heads the Jewish Federation of Greater Washington. “What we do know is that people can’t at the moment contribute the same amount they donated last year. But how much less it will be depends on the depth of the crisis.”

William Daroff, director of the Washington office of the United Jewish Communities, says the organization will try to help everyone in need, not just Americans, but acknowledges the difficulty in the face of what he says is a triple blow: fewer individuals are able to donate, foundations have been hammered by the collapse of Wall Street, and the number of people in need of social services is rising.

“We haven’t yet seen a major decrease of donations and I cannot predict what the will happen this year,” says Lori Klinghoffer, chair of UJC National Women’s Philanthropy. “I can only say that we are not forecasting any growth [in our campaign budget] at this time. We hope it will be in the worst case a flat year.”

But for all the dire ‏(and slightly less dire‏) predictions, Jewish organizations are holding out the hope that some donors will give more generously than usual to help make up for the expected shortfall.

A break from philanthropy

“There is no doubt that we will have to work much harder to find substitutes for those who will not be able to give us as much as they gave in the past,” says Gidi Mark, the international CEO of Taglit-Birthright Israel. “In the meantime, some of our donors have agreed to give us more than usual.”

About $45 million of the organization’s $75 million budget for 2009 comes directly from private philanthropists.

Jeff Kaye, director general of the Jewish Agency’s department of resource development, acknowledges that some donors will need to take a break from philanthropy for a year, but says he expects others to donate more.

“The donors who give us money are people who will not walk away from their responsibilities,” says Kaye. “None of them are the kind of people who will say, ‘Okay, we are going to stop being philanthropic.’”

The president of Hadassah, the Women’s Zionist Organization of America, says she is confident that if the organization could survive the Great Depression it will be able to get through the current crisis as well.
Hadassah has yet to receive a single phone call from a donor withdrawing a pledge, president Nancy Falchuk said last month.

“We are reaching out to our donors; we tell them that we think about them in these difficult times,” says Falchuk. “Their commitment to us is a commitment from the heart, not just from their pocketbook.”

Some Jewish organizations have found new ways of encouraging new, and larger, donations. An incentive program created by UJA-Federation of New York, called a challenge grant, will match donation increases of 10 percent or more, as well as 50 percent of new donors’ gifts. The federation has also realized it may need to sacrifice some of its programs to make sure the most basic needs, like food and housing, are met.

UJA-Federation gave the city’s Metropolitan Council on Jewish Poverty an emergency $400,000 grant in September to keep its food pantries stocked, executive director William Rapfogel told the New York Jewish Week last month. “We are seeing more need than ever,” Rapfogel said, adding that the housing situation was expected to worsen dramatically. “There is no way some people can deal with it.”

“There is an acknowledgment that this is a tough economic time, and that there will be some programs that we end up losing, and that’s painful,” says Tauber. “We’ll have to look very carefully at the services that we are providing and say, ‘Okay, we can’t make up for everything, but let’s make sure that there are no hungry Jews on the street, let’s make sure that the elderly have basic support.’”