The Jewish Community Federation of the Greater East Bay is raising more money than ever — and enjoying it less.
With the dot-com boom a thing of the past and the national economy teetering, the federation’s fund-raising efforts have done just the opposite — they’ve gone through the roof.
The federation raked in $14 million in its latest campaign, up from slightly more than $4 million five years ago, an increase of more than 250 percent.
But here’s the rub: While two out of every three dollars were given with no strings attached back in 1998, only one out of every five is now. Unrestricted giving has actually shrunk during this explosive period, according to Ami Nahshon, longtime federation executive vice president.
What this means is that many of the less glamorous programs funded by the federation are starving for dollars, while projects appealing to donors like Jewish day schools and emergency funds for Israel are bringing in the big bucks.
If it were not for a recent anonymous $500,000 donation by a person who, more or less, asked Nahshon, “How can I help?” various programs would have been in jeopardy, including the Volunteer Action Center, the Community Rabbi program and the Jewish Coalition for Literacy in the East Bay.
Clearly, programs such as those three — which Nahshon deems successful and vital — are losing out in the competition for restricted giving to those that “have an easier story to tell,” such as Israel emergency campaigns and Jewish education programs. And, as a result, the federation may have to make major changes.
“Restricted giving is both a boon and a problem,” says Nahshon, who believes today’s donors are more “entrepreneurial” than in the past, and wish to exercise greater control over what they’re funding.
The overwhelming trend toward restricted giving is a national one. Many Jews and others profited immensely during the boom of the ’90s, and a tremendous generational transfer of wealth is anticipated during the next 10 to 15 years. If current trends continue, Nahshon predicts that philanthropic organizations will be coping increasingly with restricted giving.
“What worries me the most is the challenge in providing day-to-day support to institutions, including the federation itself, to pay the cost of turning on the lights in the morning, cleaning the building at night — the basic operations that don’t tend to benefit from the tide of restricted giving,” he says.
“In the fund-raising world, it’s relatively easy to find donors to support a great new idea. It’s more complicated to find donors willing to support a great new idea after five to 10 years. Our generation tends to have a short attention span.
“The danger,” he adds, “is that we will flip from one issue to another, and…risk losing the ability to create sustained efforts that are required to grow and nurture basic human and Jewish needs domestically and globally.”
What to do? With a chuckle, Nahshon admits he is “a slow learner.” For the first half of his 18-year tenure at the helm of the federation, he attempted to modify donor behavior “with only modest success.” Now he’s more inclined to change the federation to better suit the goals of donors than vice versa.
Nahshon, therefore, is seriously considering radical alterations to the federation’s framework. He discussed his potential plans over the weekend at a federation board and leadership retreat.
The group acknowledged that the notion of the federation acting as the central community chest for Jewish organizations is more or less passé. In its place, Nahshon proposed a number of alternate “business models.”
Take, for example, a concept in which the federation would serve largely as a conduit for philanthropists, utilizing their visions, their dollars and the federation’s legwork. This, said Nahshon, “would result in a realignment of how we were staffed, governed and the programs we sponsor.”
Other possibilities abound:
*The federation could chart a course 180 degrees in the other direction, becoming freelance fund-raisers commissioned by individual Jewish organizations.
*With so many federation-funded organizations able to raise significant funds independently, perhaps the federation would focus more heavily on Israel and global Jewish needs.
*The federation could fund selected programs more heavily, perhaps at the expense of general allocations.
Discussing the weekend meeting, Marjorie Wolf, the federation’s president, says, “People were very open to the discussion; they felt like it was a discussion whose time had come.
“Nobody wants to fund the receptionist in the office of the federation. It’s not juicy. They want to fund something that does good for others. So it’s our need to figure out ways to get those funded and still meet the needs of the donors.”
There is no timeframe — and certainly no hurry — for a potential federation economic makeover, says Nahshon. The director admits, however, that he’s “not an incrementalist” and would prefer a large-scale shift to a minor one or none at all.
Yet whatever the federation opts to do, it must stay true to its founding principles.
“We have to retain a strong capacity to respond to both local and international crises, no matter what,” Nahshon maintains.
“We have to retain a leadership role in the area community. We have to plan and build coalitions, bring groups together that in some way address our urgent needs and direct resources toward those needs.”