NEW YORK — This is going to be a leaner year than usual at the Andrea and Charles Bronfman Philanthropies.
With an expected 12 percent cut in its grantmaking, the foundation is “reviewing the programs we’re funding and making the painful decisions between right and right,” said Jeffrey Solomon, the foundation’s president.
Like many Jewish and non-Jewish North American foundations, the Bronfman Philanthropies — which gave away almost $12 million in 2001, much of it for programs in Israel and North America that foster Jewish identity and community — have lost money in the stock market.
And that means they have less money to give away.
According to the Chronicle of Philanthropy, assets fell by a median of 10 percent last year among the nation’s largest private foundations.
More than 100 of the 131 foundations recently surveyed by the newspaper reported that they were cutting or freezing their grantmaking as a result.
However, the news is not all bad for Jewish philanthropy.
The recession’s toll has been offset by a combination of other factors. Among them is the crisis in Israel, which is spurring an increase in Jewish giving by individuals.
In addition, the Jewish foundation world continues to grow.
According to Mark Charendoff, executive director of the Jewish Funders Network, there are now more than 7,000 Jewish family foundations — representing roughly $20 billion in assets — in the United States. There were approximately 2,500 such foundations in the early 1990s.
“The field on the whole still has a very good and upbeat story to tell,” Charendoff said.
While some foundations have been hurt by the recession, he said, “there is still remarkable growth going on in the number of Jewish family foundations being created and in the asset base of those foundations and in the raw dollars that they are allocating.”
Most major Jewish foundations declined to participate in the Chronicle of Philanthropy survey, but several of the Jewish ones that did participate reported cuts in grantmaking.
In addition to the Bronfman Philanthropies, the Helen Bader Foundation, the Richard & Rhoda Goldman Fund and the Koret Foundation reported a reduction in grants, ranging from 1.9 percent for the Koret Foundation to 19.3 percent for the Goldman Fund.
Robert Gamble, executive director of the San Francisco-based Goldman Fund, said the foundation’s drop in grantmaking was a direct result of drops in its financial portfolio.
The foundation gave away $26.2 million last year, with 20 to 25 percent for Jewish causes, mostly in Israel and San Francisco.
The Nathan Cummings Foundation reported a 2.6 percent decline in grant commitments because it shifted last year from awarding multiyear grants to one-year grants. However, the actual dollars paid out remained steady at $20 million, 25 percent of which was for Jewish causes, said Caroline Williams, the foundation’s chief financial and investment officer.
Cummings’ investment portfolio decreased by 2 percent in 2001, Williams said, but the foundation board “felt it was important to not reduce the grants budget.”
The Baltimore-based Harry and Jeanette Weinberg Foundation — which with more than $2 billion in assets is one of the largest Jewish foundations in North America — actually increased its grants by 29.3 percent in 2001, according to the Chronicle of Philanthropy.
The foundation, whose Jewish grantees include the Baltimore Federation, the American Jewish Joint Distribution Committee and Hillel: The Foundation for Jewish Campus Life, expects to give away a hefty $100 million in 2002, according to the Chronicle.
U.S. tax law requires charitable foundations to give away at least 5 percent of their assets each year.
While many foundations adhere strictly to the law — essentially spending only their investment returns in order to preserve the principle in perpetuity — many in the Jewish sector give away considerably more.
Some — like the New York-based Avi Chai Foundation — were set up with the purpose of spending all the assets within a certain number of years, rather than operating forever.
“Bad market, good market, we’re going to try to spend the bulk of this foundation’s capital over the next 15 to 20 years,” said Arthur Fried, chairman of Avi Chai’s board of trustees.
While the last two years “have not been robust in the stock market,” he said, the foundation — which funds Jewish causes, particularly education, in North America and Israel — still has more than $450 million in assets.
“Today, philanthropic trustees have funds — let them use it in the best possible way they can to satisfy the enormous needs of the Jewish people today across a broad outline of activities.”
But many foundations are taking harder looks at their grantees, and are conservative about awarding new grants.
Yonatan Gordis, a consultant to many major Jewish foundations in North America, said the recession is forcing foundations to “separate the wheat from the chaff,” and sharpen their missions and priorities, which is “ultimately a really healthy thing.”
However, the crisis in Israel is complicating the process, he said, forcing foundations to do “triage” work, rather than long-range planning.
Gordis declined to specify which causes, other than Israel, were emerging as winners in the re-prioritizing, and which are facing cuts. He did say, however, that “riskier ventures are taking more of a beating.”
The Bronfman Philanthropies is not focusing cuts in any one area. “Literally we reviewed hundreds of grants on a grant-by-grant basis” to make cuts “in as responsible a way as possible,” Solomon said.
However, despite the cuts, the foundation made what Solomon described as a “major” gift to the federation system’s Israel emergency campaign, and it is hoping to fund some new projects as well.
The foundation is also cutting its administrative budget.
The Goldman Fund did not cut existing grantees, but has become “more careful about new commitments,” Gamble said.
David Altshuler, president of the Trust for Jewish Philanthropy, warned against assuming that the recession is the only factor influencing Jewish philanthropy.
The growth of new foundations, the fact that much is still in flux and the crisis in Israel — which is generating hundreds of millions of dollars in new giving — make the recession’s impact hard to measure, Altshuler said.