Yesterday, in a post on his blog UJThee and Me, Chicago communal leader Richard Wexler, indicated that Jewish Federations of North America (JFNA) has lost use of their bank credit line. Wexler further wrote, “the Board Chair, at the last Board meeting, in a moment of rare public candor acknowledged that during the calendar year JFNA “borrows” from federations’ monthly allocations for overseas needs without notice to JAFI or JDC, the intended beneficiaries, and always with the intent … to “true up” at calendar year-end …”
In light of the reduced allocations to JFNA’s overseas partners over the past few years, and the fact that (at least) one of them finds it necessary to borrow in anticipation of receiving transfers from the JFNA system, we felt obliged to question JFNA about this. This is what a JFNA spokesperson told us:
“Here are the facts: JFNA obtained a line of credit in 2006 during the Operation Promise campaign in anticipation of emergency cash needs for the expected mass influx of Ethiopian Jews to Israel. The line of credit was rarely used, and consequently was reduced over the years in accordance with good business practices. The line of credit was up for renewal in 2010. Although the issuing bank was willing to renew the line of credit, it requested new covenants in light of the new banking environment. Because of these new covenants and because the line of credit was rarely used, JFNA decided not to renew the line of credit. This decision was made after full consideration by our professional staff and knowledgeable lay leaders with financial expertise. JFNA notified our board of this decision in a timely manner at the November 8, 2010 Board of Trustees meeting. Should we need a line of credit in the future we do not at this time anticipate a problem in obtaining it.”
JFNA did not respond to our further query on how this statement relates to the Board Chair’s words.