The Jewish National Fund (JNF) rejected late Thursday a deal to swap lands with the Israel Lands Administration (ILA). Earlier, the Zionist General Council of the World Zionist Organization was expected to approve on Thursday a future swap of some 70,000 dunams (about 17,000 acres) of built-up land in the country's central region, owned by the JNF for a similar amount of undeveloped land in the Negev and Galilee owned by the ILA. The government has already approved the swap, but it will only be implemented in the context of a broad reform of the ILA that is being prepared by the Netanyahu government. Under that reform, legal land ownership in Israel would change from the status of a temporary lease from the government to full-fledged private ownership. The ILA reform was originally slated to pass as part of the economic arrangements bill that accompanies the state budget, but on Wednesday it was decided to remove the reform from that framework, and instead debate it separately before a special Knesset subcommittee. While the land-ownership reform has its critics - including the JNF itself - the JNF has negotiated the land swap with government officials in order to "defend its interests" in case the reform passes, according to JNF chairman Effi Stentzler. The reform will disband the ILA, transferring ownership of properties from the state to private individuals and corporations. A new lands authority will be formed to regulate the privatized land ownership system. The land swap deal with the JNF is a compromise reached by the JNF's leadership and government officials from the ILA and the Finance Ministry that stipulates that the JNF will have significant representation on the board (5 out of 12 members) and in the management of the new lands authority. The JNF owns 13% of all lands in Israel, some 2.2 million dunams. The swap of the 70,000 urban, developed dunams, which contain some 750,000 apartments and properties, for undeveloped periphery lands is meant to allow the government to privatize those urban properties while enabling the JNF to develop more of the periphery. According to Stentzler, the periphery areas the JNF would acquire are completely empty - "no claims to them, no Beduin squatters, nothing" - and will be used for solar and wind energy farms and water infrastructure, not settlement. The swap is also helpful to the JNF because, according to Stentzler, it will stop the continuing legal complaints by civil rights and Arab rights groups over the JNF's policy of leasing its land to Jews alone. For many years there was an informal arrangement between the ILA and the JNF whereby if an Arab won a tender for a plot owned by the JNF, or purchased a home from a Jew that had been built on land leased to the owner by the JNF, the ownership of the plot was transferred to the ILA and the ILA compensated the JNF by giving it land of equal value. However, this arrangement has not held up in High Court decisions, which demanded that the state and the JNF find ways for the organization, founded in 1901 to settle Jews in Palestine, to deal with Jews and non-Jews alike. The new land privatization, coupled with the JNF-government swap, is expected to solve this problem by placing the relevant developed lands in the hands of the state, and then of the private citizens who currently lease the properties. Meanwhile, the land reform, which has come under attack, is going to be debated by a special economic affairs subcommittee before being legislated. Likud MK Carmel Shama will chair the committee. Some believe the reform will lead to widespread sales of state-owned land to private developers and fear that some land may end up in foreign hands. Others worry about the social and environmental implications of private ownership. Some are concerned about racism, while others call the reform anti-Zionistic. "We're talking about one of the largest reform in Israel's history. Land is the basis of everything - housing, commerce, culture, economic development and growth," said Shama. "The minute you begin to work on a reform that impacts 93 percent of the states' lands, it's not proper to discuss it within the framework of the economic arrangements bill or within an already overburdened committee." The subcommittee was established last week, before the decision to remove the reform from the economic arrangements bill. Rivlin directed the committee to have all the discussions and recommendations completed before July 15, the deadline by which the long-overdue 2009 budget must pass. Shama said that although his panel had no decision-making authority, it is not meant to be a rubber stamp. "We will have intense discussions for as long as it takes â€¦ until the last grain is discussed," he said. Uri Metuki, spokesman for The Core of the Fight Against the Privatization of the Land in Israel, a coalition of 15 groups, called Shama's panel "a fig leaf for the democratic process. "A reform like this ought to be discussed in hundreds of hours of public debates, with all the issues weighed and deliberated, not in a rushed time frame," Metuki said, calling the reform "dangerous." His group claims the government is misleading the public by trying to present the reform as a small logistical reorganization, when in fact it has grave consequences for the future of the Jewish people and the State of Israel.