Jewish Giving’s New Era

Established groups face growing competition for funds

It was just a generation ago that the first checks most American Jews wrote to charity were to their local Jewish

federations, which provide social services to the needy, and to the United Jewish Appeal, which supported Jews in Israel.

Today, such giving is not the top priority for many American Jews, even though a merger five years ago of America’s most-established Jewish organizations — including the Jewish federations and United Jewish Appeal — was intended to reinvigorate the structure that undergirds American Jewish philanthropy and make sure that the organizations continued to be fund-raising powerhouses.

Jewish federations “aren’t doing a good enough job of understanding the changing mentalities” of the donors they are trying to reach, says Howard Rieger, who in September became the third chief executive of United Jewish Communities since it was created in 1999 to serve as the umbrella organization for the Jewish federations and as a conduit for donations to help impoverished Jews overseas. In addition to the Council of Jewish Federations and United Jewish Appeal, United Jewish Communities absorbed United Israel Appeal, which monitored how donations were used in Israel.

Mr. Rieger, 61, previously ran Pittsburgh’s Jewish federation and has worked for federations throughout most of his professional career. Jewish federations, he says, need to turn away from their standard approach of aggressively asking Jews to give without doing much to cultivate them.

“We have to go to people where they are, not meet them one day and the next ask what they’re contributing,” he says. “We need to give people a reason for being at the table.”

Raising $2.25-Billion

To be certain, Jewish federations still have significant fund-raising clout: They expect to raise a total of $2.25-billion this year.

But the outlook for the future is cloudy. Only 30 percent of American Jews make gifts to their federations, and the competition is coming from both other Jewish causes (which draw gifts from 41 percent of Jews) and non-Jewish causes, which attract donations from two of three Jews.

Not only are more Jews giving to other causes, but a big portion of the donors to federations are older. Jewish adults age 55 to 64 are almost twice as likely to give to federations as those age 35 to 44, a sign that the approach to fund raising that worked for the federations in their first 100 years is proving less effective among new generations of Jews.

Not only must Mr. Rieger lead the entrenched federation approach to fund raising into a new era, but he must also prove United Jewish Communities’ relevance to his constituents, some of whom have questioned whether the group needs to exist.

Since United Jewish Communities was born, it has been beset by continuing internal conflicts over fundamental issues, including its mandate.

The organization’s members, 155 Jewish federations across North America, continue to grapple with whether it is to be a trade association serving its constituents by supporting their fund-raising and staffing needs, or a big-picture think tank providing intellectual and creative leadership to the federations and the nonprofit causes they support.

Those causes include a diverse array of organizations, such as local Jewish community centers and day schools as well as groups that provide housing for elderly Jews and distribute food to Jews in the former Soviet Union and other countries with significant numbers of impoverished Jews.

“This was the most complicated nonprofit merger in American history,” says Jeffrey Solomon, president of the Andrea and Charles Bronfman Philanthropies, who worked a consultant in the merger process.

‘Work in Progress’

Even the organization’s own leaders, including volunteers and top executives, say publicly that the organization has had difficulty finding its footing.

“UJC is very much a work in progress, and to a large extent, I’m not sure that folks have decided what UJC should be when it grows up,” says Steven Klinghoffer, a newsletter publisher who is a longtime federation volunteer and immediate past president of the MetroWest, N.J., Jewish federation, the country’s ninth largest, which is based in Morris County.

Concerns that the United Jewish Communities merger was not accomplishing its goals were so strong that two researchers at Hebrew Union College, in Los Angeles, decided to undertake a major study to examine what could be done better.

“We were motivated to do this by what we were hearing, by the high level of discontent with UJC that was apparent,” said Gerald Bubis, who is working on the report with Steven Windmueller. The Hebrew Union College scholars, who plan to reveal their findings in January, won’t say what they found after interviewing 85 staff members and volunteers, but the title they plan to use on their report offers an indication: It is “From Predictability to Chaos? The Story of the Creation of UJC.”

The new organization’s first chief executive, Stephen Solender, left after two years on the job. Mr. Rieger’s predecessor, Stephen Hoffman, who stepped down after three years as United Jewish Communities’ chief executive, says his tenure taught him “that when you have one of the largest mergers in the nonprofit world ever attempted, it’s easier to dream about what you want to be than to attempt it. There was some stumbling.”

Tensions Over Priorities

Mr. Hoffman, who left to return to Cleveland, where he had continued to hold the title of chief executive of the local Jewish federation even while he was head of United Jewish Communities, says that as head of the group, he realized the organization had to rein in its ambitions to succeed.

Trying to be a leader on both “big picture” issues, like the future of Jewish philanthropy, while also helping federations carry out their day-to-day work, such as creating online giving sites and cultivating new leaders, was too much for the organization, he says.

Adding to the pressure United Jewish Communities was under, says Mr. Hoffman, were demands from local federations that the umbrella group cut its costs so the local groups wouldn’t have to pay so much in dues to support the organization.

Mr. Hoffman says he learned a good deal from the failure of one of United Jewish Communities’ first and most ambitious efforts: the creation of the Trust for Jewish Philanthropy, which was designed to be the venture-capital arm of the organization, a place where philanthropists could put their money into innovative, risk-taking projects that local Jewish federations might not be willing to try.

United Jewish Communities leaders hoped the trust would attract multimillion-dollar gifts from wealthy donors who in the 1990s had started financing their own efforts to encourage younger Jews to learn more about their religious traditions. Several of the donors had made clear that they deliberately went outside the federation network because they didn’t trust the organizations to carry out new approaches to reaching out to young Jews. The creation of the trust was an attempt to win back those donors who had left in frustration.

Michael Steinhardt, a New York City financier, estimates that he has donated $100-million in the past decade to such projects because, he says, “I felt the Jewish institutional world was growing weaker and was structurally archaic.”

But getting money for the trust became problematic. Aside from the pressure United Jewish Communities faced to cut its costs, leaders of the local federations felt threatened when the umbrella group sent fund raisers to seek contributions for the trust from the same wealthy donors that the federations were trying to reach.

“Who ‘owned’ access to the people you wanted to talk to?” says Mr. Hoffman. “We were having a lot of trouble sorting that out.”

The Trust for Jewish Philanthropy closed in January 2003. Some of the projects begun under its aegis, including a project to recruit and retain female federation leaders, have continued independently with support from individuals, while others, like an effort to start overnight camps for disabled Jewish children, were abolished.

Some federation leaders say United Jewish Communities missed a major opportunity by closing the trust. Steven B. Nasatir, president of Chicago’s federation, says he understands the financial concerns facing United Jewish Communities.

“The system was under tremendous pressure in terms of lower cost, lower cost, lower cost, and this was to cost $1.5 million — which isn’t much money in the scheme of things, but when you’re looking for nickels, it is,” he says.

Yet not to have a place within the United Jewish Communities system in which innovative ideas can be tried “puts the whole system in peril” in the long term, says Mr. Nasatir: “It must have that kind of vehicle for engaging in some of the big ideas in Jewish life.”

Mr. Rieger says that he intends to develop the kinds of projects that the trust was supposed to. “Just because we don’t have the trust doesn’t mean we can’t do what it aspired to do,” he says.

Getting United Jewish Communities focused on big ideas is one of Mr. Rieger’s primary goals.

“There’s lots of money out there in the Jewish world that we can reach,” he says. However, he says the group needs to provide the data and philosophical rationale behind new, ambitious campaigns.

For example, he says that 700,000 Jews in the United States live in nearly impoverished conditions, while 600,000 children in Israel live in similarly difficult economic circumstances. If United Jewish Communities can communicate effectively about the needs of such people, and the way contributors to United Jewish Communities can help such people, it will attract new donors. “People will step up to the plate when they’re given a reason to. These things aren’t in our mission but need to be. I’ve only been here a short time, but it will happen, trust me.”

Attracting Leaders

The organization Mr. Rieger has taken over has a broad and complex mission.

United Jewish Communities helps federations improve their fund-raising operations and obtain new sources of revenue. It runs Web sites for 83 of the federations, for instance, so they can offer professional-looking sites and accept online donations.

The organization has also begun a pooled bond-issue program to make it easier for small Jewish federations to raise tax-free financing for construction projects, something large-city federations have long done on their own.

Mr. Rieger is also taking over a project created by Mr. Hoffman to focus on ways to attract and retain leaders of the Jewish federations. Mr. Hoffman persuaded the Cleveland industrialist Morton Mandel to provide $500,000 a year over four years to establish a professional-development institute that will focus on training top volunteers and staff members.

United Jewish Communities is also stepping up its efforts to represent the interests of Jewish organizations in Washington.

For instance, it took a lead role in securing $25-million from Congress last month for synagogues and other nonprofit organizations to spend on antiterrorism precautions.

Mr. Rieger says that he plans to intensify efforts to help federations attract government funds, as well as to look to foundations. He says he will focus not just on the federal government, but also on helping federations obtain support from local governments, which few have done.

In Pittsburgh, he says, when a federation-supported drop-in center for people with psychiatric disorders lost state funds, “we went out and found several hundred thousand dollars from the county, which everyone used to think we couldn’t get funding from. We’ve managed to raise several million dollars putting ourselves in places we never traditionally would have.”

“We have equal power in this arena if we see this as our mandate,” he says. “I don’t think we have any choice because if we don’t, we’re leaving money on the table. The needs in the Jewish community are absolutely critical, and we should be getting our fair share.”

Attracting Young Donors

Aside from seeking more government funds, Mr. Rieger is continuing some of the efforts that United Jewish Communities and the Trust for Philanthropy started to encourage more young people to support Jewish federations.

“Perhaps the tried and true system that has worked for someone 75 doesn’t work for younger people,” he says. “We have to talk with people about how to attract them.”

One of the most visible efforts now being unveiled is a series of print and broadcast advertisements featuring young Jewish celebrities who talk about why they believe it is important to give to local Jewish federations.

Another project, called Blue Knot, is designed to attract Jews in the technology industry. While federations have long recruited donors from industries like real estate and retail, Blue Knot is consciously trying to do it in a way that will attract the young and hip.

It operates in 20 cities, making it easy for people who move around a lot for their careers — as people in technology tend to do — to keep connected to one another and to Jewish institutions.

Blue Knot rallies members around volunteer projects that tap their expertise, such as an after-school program that teaches computer skills to needy Israeli youngsters. That approach departs from conventional federation efforts, which typically involve bringing people together to volunteer for social-service projects that don’t relate specifically to their professional skills.

Another United Jewish Communities effort, undertaken as a collaboration with the Jewish Education Service of North America, is called Bikkurim, or “First Fruits.” It supports projects similar to those the Trust for Jewish Philanthropy was considering, but on a more modest scale, such as Hazon, or “Vision,” which is a Jewish environmental group, and JDub Records, a nonprofit record label and production company that promotes new Jewish music and tries to use music as a way to improve relations between Jews and non-Jews. United Jewish Communities provides office space and other support to the projects financed through Bikkurim.

Change Comes Slowly

United Jewish Communities is also consciously grooming young donors for major, visible leadership positions: In March, Mark Wilf, a 41-year-old New Jersey real-estate executive, was appointed the chair of the United Jewish Communities annual fund-raising drive. Mr. Wilf took over for S. Stephen Selig III, who is 61.

Some say that these efforts are too little, too late.

“There are signs of a change, which is heartening, but change here is not as rapid as one might like,” says Mr. Steinhardt.

Mr. Solomon says expecting quick change is unrealistic. “The kind of change that the system needs is going to take a very sustained effort,” he says. “I think it will take five years of someone really deconstructing the organization and rebuilding it on a different basis.”

He is hopeful that Mr. Rieger, who has a five-year term, will be able to do the job. “Howard’s challenge will be not to respond to the immediate, very real pressures, but to build the kind of alignments at the professional and volunteer levels that get everybody moving in the same direction,” he says.

Taking note of Mr. Rieger’s passion for running, he says: “Howard is a marathoner, and he knows that the first steps are not nearly as important as the last ones, and that one has to look at the goal line.”