Over the past year or so, stories of Jewish donor-advised funds blocking grants have started to appear. These moves by the Jewish community are both hypocritical and self-destructive. To understand why, it is important to understand what a donor-advised fund is.
If you had to guess what was the highest grossing non-profit in America by revenues received, a hospital, a university or major aid organization would probably top your list. But you would be wrong. The top receipt in 2016 was Fidelity Charitable Gift Fund, a sponsor of donor-advised funds (DAF).
DAF’s are one of the biggest changes in the non-profit landscape and the Jewish community has been getting involved in the DAF business for a long time. DAFs are a tool in which a donor can transfer the totality of their charitable giving into a fund and get the tax benefit immediately. They then make recommendations to the fund on which registered charities they wish the fund to give to, and the grant is made on their recommendation.
By getting the Jewish donors to direct their giving through Jewish communal funds or the federation system, the established community maintains a link with major contributors and has the opportunity to pitch issues the Jewish community cares about.
When a donor uses a DAF they realize that they cannot utilize the funds to fulfill personal pledge commitments or buy tickets to galas or charity auctions. They also know that their recommended beneficiary must be a legal non-profit that does everything above board. Apart from that, the donors assume that the money is theirs to give where they choose.
While the vast majority of DAFs respect the recommendations of the donor, it appears they are not under any obligation to do so as events on the West Coast this past year have shown. In San Francisco, the Federation blocked donors from giving grants to American Friends Service Committee on the basis of guidelines on BDS that were passed after the donors had set up their DAF. In Los Angeles a grant to IfNotNow was blocked given their hostility to Jewish Institutions.
The hypocrisy and self-destructive nature of these moves cannot be stressed enough.
Blocking these donations is hypocritical as they only apply to the left of the political spectrum, but not the right. If you support BDS or the goal of a single democratic state, you will be denied a platform and the donors who have placed their resources within the community will be prevented from supporting you. If however you support annexation, settlement or groups that attack equal rights for Israel’s citizens, there is no platform or funding test. In the case of San Francisco, a grant was made to the Hebron Fund even though it was shown to give a stipend to a Jewish terrorist.
The blocks are also self-destructive as donors have the choice to remove their funds and go to a fund like Fidelity or any of the thousands of other hosting agencies for DAFs that have none of the hang-ups of the Jewish community. The opportunity to move ones money elsewhere means that the Jewish community does not have the luxury of being the only provider of DAF’s to add politics into the mix.
The Jewish community DAFs are one of the few places left where both the right and left of the community use the same resources. It bonds the donor to the Jewish community as they see it as their gateway to giving to Jewish and non-Jewish causes allowing them to express their Jewish values in their largesse. The desire to control where donors can and can’t place their philanthropic dollars will kill this public commons to the detriment of us all as the community will lose one of the last elements of the institutional glue holding back the partisanship.
There is a way to save the public commons and keep Jewish donors using Jewish mechanisms for their giving but it requires a shift from control to conversation. On the right or on the left, the donor community will never accept a committee telling them where they can or can’t place their gifts (as long as they are a legitimate charity). Rather then demanding control, the Jewish DAFs should require that donors engage in conversation with each other if they wish to make grants that the fund feels is not within the mainstream of the majority of donors. This should be applied evenly on the right and the left. This can be through the same committee structure that is currently blocking grants. We need to move our mind-set from control to education.
Being invited to explain why you wish to support a group, with the express understanding that the grant will be made in any case, utilizes the fund as a platform for dialogue and conversation between our fractured community and keeps everyone invested in it. Donors enjoy the opportunity to evangelize about their chosen causes and the conversation that comes out of these discussions can keep difficult conversations within a common space, something that we are losing.
The Jewish communal funds are things that are worth saving. To do so we need to remember our communities strength is not a monolithic approach, but a vibrant never ending passionate conversation, one that we all can be invested in.