Youth work lost two major benefactors to the alleged Ponzi scheme created by financial manager Bernard Madoff.
The New York-based JEHT and the Palm Beach, Fla.-based Picower Foundation abruptly closed their doors before Christmas because their primary donors’ money was lost by Madoff, who has been charged with operating a scheme that bilked at least $20 billion from investors.
Their grantees ranged from the Annie E. Casey Foundation’s Juvenile Detention Alternatives Initiative and Girls Inc. to the Children’s Services Council in West Palm Beach, Fla., and Jewish Family & Life in Newton, Mass. (A list of grantees and description of the funded programs is at http://www.youthtoday.org/publication/article.cfm?article_id=2575, in an online version of this story.)
Picower, which posted assets of nearly $1 billion on its most recent tax return, was established in 1989 and run by Executive Director Barbara Picower, who founded the foundation with husband Jeffry Picower. It has invested heavily in health research and after-school programs. Picower’s largest youth-related grants in fiscal 2007 went to Boys & Girls Clubs of America ($1 million for executive leadership development) and the Harlem Children’s Zone ($1 million for its middle school initiative).
Last year, Picower entered into a network of co-investors, spearheaded by the Edna McConnell Clark Foundation, that committed themselves to funding expansion and capacity-building for three youth work organizations: Denver-based Nurse-Family Partnership ($50 million), Boston-based Citizen Schools ($40 million) and Memphis-based Youth Villages ($30 million).
The foundation gave the Children’s Aid Society $3 million over the past 10 years, most recently to help replicate the New York nonprofit’s pregnancy prevention and early childhood obesity prevention programs.
“There is no doubt it leaves a hole,” said Chief Operating Officer Bill Weisberg. “We have to … find new funders.”
As with countless New York charities, which are plagued by state budget cuts and a drop in philanthropic dollars because of Wall Street’s collapse, Picower’s closure could not have come at a worse time for Children’s Aid.
“We are projecting that next year will be very difficult; we could face major cutbacks,” Weisberg said. “We are pretty bitter that someone’s apparent fraud would damage funding for low-income kids.”
JEHT, whose name stands for justice, equality, human dignity and tolerance, was an international funder with a staff of 24. It made grants in four main areas: criminal justice, juvenile justice, international justice, and fair and participatory elections. Since JEHT was founded in 2000, it has given away more than $62 million, including $26.4 million in fiscal 2006.
The foundation’s closure jeopardizes several juvenile justice-related projects carried out by youth-serving grantees.
“We’re being told that JEHT funds were with Madoff and that they are ending all funding commitments immediately,” said Abby Anderson, executive director of the Bridgeport, Conn.-based Connecticut Juvenile Justice Alliance, a JEHT grantee.
David Steinhart, director of the juvenile justice program at Bolinas, Calif.-based Commonweal (also a JEHT grantee), credits JEHT for wading into policy and advocacy work that was often controversial.
“They filled a big niche,” he said.