Merger Reflects New Strings Tied to Donations

In the decades after World War II, the United Jewish Appeal had it easy.

American Jews horrified by the Holocaust and fervent in their support for Israel poured hundreds of millions of dollars a year into the coffers of the UJA, by far the largest Jewish fund-raising group in the nation.

But today, in an age obsessed with quick results and individual control, donors are far less eager to open their checkbooks for large, impersonal annual campaigns.

Jewish charities, like their secular counterparts, are scrambling to adapt. Last week, the UJA concluded a mega-merger with two of the other biggest Jewish charitable groups in the country, creating a fund-raising behemoth with a focus on the kind of individualized giving that is changing the face of American philanthropy.

The new United Jewish Communities--which combines UJA with the Council of Jewish Federations and the United Israel Appeal--is headed by the Canadian billionaire Charles Bronfman, co-chairman of Seagram Co.

He hopes to streamline operations and work closely with wealthy donors who want to direct their gifts toward specific projects instead of contributing to a general fund.

The new approach reflects a sea change in the way Americans, particularly the very rich, give away money.

Far more than their parents, members of the baby boom generation “want to know exactly what their money is going toward,” said Jack Wertheimer, a Jewish Theological Seminary provost and professor who has studied Jewish philanthropy. “They’re interested in helping a particular cancer research unit of a particular hospital in Israel rather than giving to Israel, let alone the UJA. This is a pattern in philanthropy across the board.”

The Seattle-based Social Venture Partners, founded by a retired Microsoft Corp. executive and financed largely by young Internet millionaires, typifies the new style of giving. Donors give at least $5,000 per year and get heavily involved with the causes they give to.

The entrepreneurial approach often reflects big givers’ business backgrounds--they are focused on efficiency and eager for results. Even the United Way now lets donors direct gifts to specific causes.

Similarly, many Jewish philanthropists have set up private projects and family foundations to finance their favorite causes.

That approach is at odds with nearly a century of Jewish fund-raising in which local federations put all donations into one pot and then collectively decided how to allocate the money.

United Jewish Communities is setting up a separate entity just to work with donors who want to earmark gifts for specific causes.

“There’s been a quantum leap in wealth, and I think people are saying . . . I want to have some joy out of the money I’m giving and see where it’s going, what it’s doing,”’ Bronfman said. “One used to give to the symphony orchestra. Now you can have the ‘Joe Blow violinist’ . . . that can be in your name. . . . I think people like that idea.”

United Jewish Communities expects to raise $800 million in general funds next year and an additional $1 billion for endowments, said Joel Tauber, chairman of the group’s executive committee. He was uncertain how much would be tagged for specific causes but said directed giving is likely to surpass general giving in the next decade or two.

Bronfman and his wife, Andrea, are themselves deeply involved with personalized giving. Together with retired Wall Street money manager Michael Steinhardt, they launched the Birthright Project, an effort to raise $300 million to pay for young Jews to travel to Israel.

But Bronfman and others warn that the pet-project approach to giving has its drawbacks. If people give just to their favorite causes and no one looks at the bigger picture, experts say, some pressing needs could go unmet.

“Cities can get voters excited about a new cultural attraction a lot more than they can about sewer pipes, but the cultural attraction won’t do real well in a city that doesn’t have a proper sewage system,” said David Altshuler, who will head the directed giving branch established by United Jewish Communities. “It’s not always romantic. Just think about group health or care for the elderly.”

Bronfman hopes consolidation will also help his new group be more effective. “In business, we’ve had this going on for over a decade,” he said. “Downsizing and taking a look at ourselves and being more productive.”