Jewish communities invented socially responsible investing with Hebrew Free Loan societies. In communities across the nation, those free loan organizations continue to operate, but now there’s a new Jewish way to participate in what has become a trendy way of investing, through The Shefa Fund.
Although the Philadelphia-based national public foundation is now 12 years old, its message of redistributing Jewish wealth through community reinvestment and other “social justice” projects is just now making its way across the country to Seattle. During a recent visit here to talk to individual investors and representatives of the Community Endowment Fund of the Jewish Federation of Greater Seattle, Shefa Fund President Jeffrey Dekro explained the organization’s work.
“We are particularly interested in the ways tzedakah can be used…to increase justice and enhance community vitality,” he said. The organization is also concerned about relations between the Jewish and wider communities. In this marriage of traditional tzedakah (Jewish charitible giving, which is usually translated from Hebrew as “justice”) and the social responsibility movement, the Shefa Fund has created a unique organization because of the range of its work.
“We believe that American Jews should use their abundance (‘shefa’ in Hebrew) to repair the world,” the agency’s 1999–2000 annual report explains. Since its founding in 1988, Shefa has distributed more than $10 million in grants and managed projects.
Shefa’s Tzedek campaign has catalyzed $9 million from the American Jewish Community for investment in low-income community development. The program encourages Jewish federations, synagogues and other groups to switch a small percentage of their institutional money from commercial banks to community banks, credit unions and loan funds. The institutions lose some potential interest with this approach but they make a difference in their communities by making the money available to low-income people and businesses that don’t usually have access to credit.
During the 1999–2000 fiscal year, Shefa’s Tzedek component leveraged $1.907 million in loans to low-income community development, for more than $9.1 million from Jewish sources nationwide. Jewish federations in six cities have invested or committed $800,000 to community-controlled banks, credit unions and loan funds through Shefa. In April 2000, Shefa launched The Shefa Community Fund in Washington, D.C., to allow the Jewish community there to invest in its own city’s low-income neighborhoods.
The third main component of Shefa is its “Torah of Money,” the educational side of the organization, highlighting in publications and presentations the wisdom of Judaism’s economic teachings and helping American Jews implement their values through philanthropy and in organizational life.
Shefa is both a loan fund and a foundation, with both small and large “stakeholders.”
“Anyone who gives tzedakah is a founder,” said Dekro, who is co-author with Lawrence Bush of Jews, Money and Social Responsibility. “To those people who can give only a little, we want your little.”
Dekro emphasizes that large investments like those coming from federations in other cities are important, but much of the money being leveraged by Shefa comes from individuals who make “stakeholder” donations as low as $36. Small individual donations are added to The Shefa Foundation, where it increases in value and earns interest and creates a “powerful base for our long-term future. This is a way we add dignity and impact to small contributions,” Dekro said.
The Shefa Fund was one of three co-founders of the Jewish Funders Network, which for its first five years operated out of Shefa’s office. The organization is “kissing cousins” with the New Israel Fund, the Jewish Fund for Justice, the American Jewish World Service and MAZON: The Jewish Response to Hunger, Dekro said, explaining where in the Jewish organization horizon Shefa fits in.
No Shefa Fund money is being reinvested in Washington at this time, but Dekro was in Seattle recently in an attempt to expose local givers and investors to the concept. He said the organization takes donations in Washington but cannot yet accept investments from people who live in this state because Shefa isn’t registered in the state as an investment company, but that is something he plans to change as well. When Shefa begins taking investments in Washington, they will start at $1,800 and go as large as the investor wants.
The Shefa Fund does have at least one important connection to Seattle. Rabbi Drorah O’Donnell Setel of Congregation Kol Ami in Woodinville and Kadima in Seattle is on its board of directors. She invited Dekro to visit Seattle and work to get the community involved in Shefa.
For more information, visit the Shefa Web site, www.shefafund.org or call 215-247-9704.