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Funds for the Future: Rethinking the Way a Model Works Best
As part of this year's funding process, the chairs and volunteers of each Center Board (Center for Social Responsibility, Center for Jewish Life and Learning and Center for Israel and Overseas) of the Jewish Federation of Greater Philadelphia worked through a very difficult and challenging process, reviewing and discussing hundreds of proposals from community groups locally and overseas.
As the process concluded, it has become increasingly obvious that our methodology will need to be modified. The board of directors has already had discussions about the subject, and I know we will continue this dialogue in the weeks and months to come.
The challenge for us -- as an organization -- is to figure out how to align ourselves to reflect what has become a much different composition of our campaign. We need to closely examine how the dollars are being raised, and what implications these dollars have on funding decisions and on the needs of our community.
We can no longer focus on directing funds from our single traditional source of revenue -- the allocable pool of resources. Federation has become a central philanthropic address once again, but it is faced with an environment that is drastically different than it was 20 years ago.
In 2003, Federation approved a Strategic Philanthropy Business Plan. As part of a clear implementation strategy, we created a Financial Resource Development Committee to examine and recommend ways to take advantage of the changing philanthropic world and maximize our revenues.
The recommendations, unanimously approved by the boards of directors and trustees in September 2004, included the need to focus on donors and their philanthropic desires, and skillfully match them with our community's priorities. The articulated strategy was based on a realization that more experienced and more sophisticated donors do not have the trust in or the comfort level with the traditional unrestricted giving model. The document called for the development of new models of giving that would enable donors to relate to subject matters that resonate with them.
There was a realization that our annual unrestricted campaign would become one option for donors to express their philanthropy, but not the only option, as had been the case for years. That said, there continues to be a strong belief that the annual campaign must be at the center of all fundraising activities -- as a central galvanizing force -- since the majority of Federation's lower-end donors continue to give unrestricted gifts.
Federation's leadership firmly believes that our annual unrestricted campaign will remain flat or may marginally increase. The real revenue growth will most likely come from larger restricted gifts. In fact, we have already seen this growth over the past three years as our total revenues continue to climb.
In an article in Contact, the journal of the Steinhardt Foundation for Jewish Life, Robert Aronson, president of the Steinhardt Foundation and Birthright Israel Foundation, clearly illustrates what we as Jewish fundraisers face, and the disconnect that exists between our realities and the realities from a donor's perspective.
In his article, "What I've Learned About Raising Money From Jews," he speaks of the harsh lessons he has learned. "Jewish fundraisers," he writes, "are still operating in the world of 1975, but our donors -- current and potential -- have moved on."
He further quips that today's donor "has the unmitigated gall to want to determine for him/herself where they want their charitable dollars to go. The donor wants to make a difference, demands accountability and measurable results," and "oftentimes wants to leverage the commitment with giving from others."
Most of the fundraising "how to" literature continues to emphasize the strategy of transparency, accountability and impact as three ways in which to assure continual growth of a nonprofit. Federation has been on the cutting edge of these strategies, and for the past three years, has been working under just these premises.
This is why our total revenues continue to increase, as donors develop a much higher confidence level in our ability to wisely invest their philanthropic dollars.
As our revenue streams continue to evolve, we need to be much more strategic in looking at how best to assure the most impact these revenues can have on the needs of the community. We have to be true to our strategies and set appropriate expectations. Everyone needs to be on the same page and understand the realities we all face. Donor wishes are paramount. Increased and improved communication among the Policy, Strategy and Funding committee (which leads the funding process), our Center Boards and FRD team will assure that the funding decisions are based on total dollars raised and not just on one revenue stream -- the unrestricted annual campaign.
Leonard Barrack is president of the Jewish Federation of Greater Philadelphia. This piece is adapted from remarks he made at the Federation's July 29 meeting of the Board of Trustees.