Officials close to discussions between the Jewish Agency and the government over helping to shore up the agency's financial condition have told The Jerusalem Post in recent days that under no circumstances will the government directly fund the agency.
At the heart of the issue is the Jewish Agency's legal status abroad. If it receives direct Israeli government funding, the agency and its donor organizations could lose their tax-exempt standing in their home countries.
A Jerusalem Post report last week based on leaks from government sources said "the government is considering becoming a direct funder of the Jewish Agency," preparing to offer the agency $12 million as a direct contribution to its core budget as part of the agency's efforts to avoid a budget deficit in 2010.
According to at least two officials familiar with the discussions, however, the funds are not a government contribution, but a proposed advance payment ahead of the possible sale in 2011 of apartments belonging to the agency's subsidiary housing company Amigur.
All aspects of these discussions are as yet undecided, including the sale of the Amigur apartments and the government's willingness to pay for them before the date of the sale.
An agency spokesperson would say only that "there are discussions at various levels between the Jewish Agency and the government on joint projects. In these discussions, all sorts of suggestions have been raised."
An agency spokesperson questioned on the matter last week did not explain the mistaken government leak because agency policy has been to refuse to comment on the discussions while they are underway. At the time, the spokesperson would only say that a professional committee chaired by the directors-general of the Prime Minister's Office and the Jewish Agency was considering ways in which the government could help the agency profit from properties it owns in Israel.
The discussions are part of agency chairman Natan Sharansky's efforts to prevent a cut to the organization's budget in 2010, during which time the agency will conduct a thorough reexamination of its funding priorities and fund-raising strategies.