Jewish Council Sells Paper to Own Leaders

The Jewish Federation Council, which found that operating its own newspaper, the Jewish Journal, was both divisive and costly, voted Tuesday to sell the paper to a business group composed of its president and several board members.

Before the vote was taken at a meeting of the group’s board, two Los Angeles federation attorneys involved in the negotiations emphasized that under no circumstances will the buyers--including federation President Stanley Hirsh, Vice President Ed Brenglas and past President Osias Goren--make a personal profit out of operating the Journal.

The attorneys, Marvin Shapiro and Ed Sanders, said any profit will be contributed to the federation and its charities.

2 Offers Rejected

Two purchase offers from the publishers of the Baltimore Jewish Times and the publisher of the local B’nai B’rith Messenger, which would have been considerably less lucrative to the federation, were rejected.

Under the deal approved in principle Tuesday, the buyers will repay virtually all of the $663,000 the federation loaned the newspaper two years ago to get started.

But the federation will continue to use the newspaper to disseminate much of its own publicity and its solicitations of charitable contributions to its membership of approximately 50,000. For this, the federation will purchase 50,000 subscriptions at $8 each, guaranteeing the Journal annual revenues of $400,000, for at least three years.

The agreement limits the new publishers’ investment to $2 million, and if it exceeds that after two years, the investors are permitted to shut down the publication.

In short, as it was explained at the board meeting, the newspaper will continue to serve the federation, but it will not be owned by or under the direct control of the federation.

The federation’s new executive director, Wayne Feinstein, told the board members that running the newspaper had proved to be divisive. He said that some federation members who didn’t think the organization should be in the business of running its own paper had stopped making contributions to the federation, which is an umbrella group for 500 Jewish community agencies. Others said there were objections to the paper’s editorial content.

Feinstein estimated later that the federation had lost about $1 million in donations last year as a result of antipathy to the newspaper. Altogether, he said, the federation raised about $44 million last year.

Only one person, identified as Leonard Smith, rose in the board meeting to protest the sale, calling such dealings with the federation’s own officers “unclean.”

Other speakers, however, characterized the deal as a good thing for the federation, relieving it of a money-losing business that had caused internal trouble. They pointed out that the federation would be spending more than $400,000 a year to communicate with its membership if it did not have the newspaper, so they said its continued subscription payments to the Jewish Journal were justified.

Present at the board meeting was Herb Brin, publisher of the Jewish Heritage newspaper, who has sued the federation for $1.4 million, charging that in controlling or subsidizing a newspaper of its own, it is taking an unfair business advantage.

When Brin was asked to leave the meeting, he replied he would go “only in handcuffs.” Rather than have a scene, the meeting’s chairman said Brin and a Times reporter would be allowed to stay.