As we posted earlier this evening, in a ground-breaking move, the UJC/Federation system is considering a plan to end their exclusive funding relationship with the Jewish Agency and the Joint.

Here are the letters, in full, between Richard Pearlstone and the UJC leadership.

Re: The UJC Strategic Working Group Recommendations

Dear Kathy, Joe and Howard:

This letter is written with regret at a time that the very fiscal survival of the Jewish Agency for Israel (“JAFI”) is at stake. We fear that United Jewish Communities is on the way to abandoning its obligations and responsibilities to the hundreds of thousands of Jews we serve every day, with the clear result of deconstructing the historic partnership between JAFI and the federations of North America while continuing to broadcast a commitment to THE “partnership”.

UJC, through UIA, is a direct owner of the Jewish Agency. UJC requests total “loyalty” from JAFI without reciprocity — no loyalty either in the historic partnership sense or in the current ownership sense. As reflected in the Strategic Planning Work Group Draft Recommendations, January 2009, UJC is recommending creating a third “partner” in Israel for the expression of American federations’ philanthropic and social welfare services in Israel and Overseas. UJC cash collection efforts at the end of calendar year 2008 left JAFI facing a multi-million dollar cash deficit greater than ever before experienced. The intent of CJF, UJA and UIA as premised in the merger, are being frustrated. I, as Chair, Zeevik and the leadership of JAFI have been unswervingly supportive of the partnership that we believed we had with the federations through UJC. Yet, we find in the pages of the SPWG Draft a set of proposals totally at odds with partnership or the merger. In fact, we were totally surprised by both the recommendations and the dramatic implications that included no input from us.

To refresh your recollection, the Merger Agreement specifically recited as one of its primary goals, ten years ago, increasing the revenues to JAFI and JDC.

The basic principles of the merger have not been realized as evidenced by:

• The steep drop in federation allocations to overseas core threatens the very basic ability of JAFI and JDC to fulfill its Mission with no advocacy by UJC among the federations;

• UJC’s dictate to JAFI and JDC’s lay and professional leaders that they are not welcome at the Federation Leadership Institute;
• The Plan Draft calling for the end of UJC’s exclusivity with JAFI and JDC.
• The Plan Draft’s recommendation that an invitation to JAFI and JDC to sit with federations at a “planning table” can be withdrawn at any time;
• UJC has disqualified itself as the “honest broker” vital to the role as mediator of issues between JAFI and JDC;
• The UJC refusal to exclusively allocate $10 million to JAFI and JDC for respite and care of Victims of Terror from the Gaza War substituting funding for advocacy in the United States and funds for the IAI and ITC at its whim; and, among other matters;
• UJC’s attempts at direct, competitive fund raising among Israeli philanthropists without regard for the relationships established by JAFI and JDC with them.

We are proud of the fact that a vast super majority of Jewish federations around the continent and throughout the world via Keren Hayesod continue to rely upon JAFI for its ability to provide its very substantial level of support and relief for Jews in Israel and around the world. As UJC has chosen a path that would place it in direct competition with JAFI for allocated dollars, donors’ dollars in North America and in Israel, regretfully, UJC has left JAFI no alternative but to engage with the federations directly on matters related to allocations, supplemental funding and special projects. Our dire financial circumstances coupled with the direction outlined in the UJC Plan Draft requires us to consider alternatives to ensure our survival and to assure that in Israel as we have been, we will continue to be the federations’ central address.

We urge you to rethink the recommendations of the Strategic Working Group and to enter into a dialogue with JAFI, JDC and the Federations on strategic directions that are beneficial to all parties.

As a former Chair of UJA and an ardent supporter of a system that my father and grandfather helped build, I am personally saddened by the choices before us.

Sincerely,
Richard Pearlstone
Chairman of the Board
Jewish Agency for Israel

Cc: Mr. Zeev Bielski / Mr. Moshe Vidgor

The UJC Response

January 27, 2009
Mr. Richard L. Pearlstone
Chairman of the Board
Jewish Agency for Israel
48 King George Street
Jerusalem 91000 Israel

Dear Richie:

Your letter of January 22 raised many issues – issues of vital importance not just to JAFI but to the entire system. The fact we all have to confront is that, like it or not, we have been in transition for the last twenty years or more. As in all major transitions, when you’re in the middle of it, the outcome is not clear.

Our commitment to overseas needs was shaped by two events – the Holocaust and the creation of the State of Israel – both extraordinary, even “Biblical” in magnitude.  Those two realities motivated us and millions of others.

But what worked magnificently in 1975 may not work so well in 2010, not to mention 2025. The Jewish world, both here and in Israel, is substantially different today than it was decades ago. By itself, the sheer growth of wealth and civil society in Israel – developments we can take great pride in – challenges the way we do business and also creates new opportunities for us. And, of course, our donor community has changed markedly. Add to the mix the biggest financial crisis in three quarters of a century, and we all have reason to be concerned.

You spoke movingly about the work of your father and grandfather in building the system. They were visionaries who understood the needs and strengths of their generation. We must follow their example by understanding the needs and strengths of ours.

It is for this reason that we are engaged in a series of conversations. These have included an intensive strategic planning process with the full engagement of the federations; the upcoming Federation Leadership Institute, designed to get further input and to gauge what will ultimately be our proposed actions; innumerable exchanges with JAFI and JDC; and significant research at our marketplace. None of these by themselves will result in final decisions, but all of them together will contribute to formulating a direction that will be based upon what we learn through all of these processes.

What we now need to do is to understand what the federations are doing and have been doing for years regarding the overseas agenda, examine what we have been doing by way of response, and then consider the changes we need to adopt to align us more closely with what they tell us they want. By understanding our generation and acting on our contemporary realities, we can turn this crisis into an opportunity for JAFI, JDC, UJC and the federations.

As you know, we have met with JAFI and JDC – at times separately and at times together. We have been disappointed when attempts to meet have not worked out. Let us all agree to convene as soon as possible after the Institute.

As we move forward, tensions and even setbacks will be inevitable, for we – leaders of federations, UJC, JAFI and JDC, and our donors – rightly embody a variety of perspectives. In the meantime, we remain determined to help federations raise more money, reach a broader base of support, and provide input so that they can allocate overseas dollars wisely, while always remaining committed to the vision of the Jewish people, united in its values and destiny.

With best wishes,

Joe Kanfer  Kathy Manning      Howard M. Rieger

Chair of the Board Chair, Executive Committee     President & CEO

cc:  Zeev Bielski / Moshe Vigdor