A brutal fundraising year came to a close for the Jewish Federation of St. Louis with an annual campaign total that fell below $10 million for the first time in more than a decade.

“It isn’t what we would like but it’s better than what it might have been,” said Federation president Sanford Neuman. “It’s certainly a bittersweet ending.”

The campaign raised just under $9.95 million – its lowest total in 13 years. It was the third year in a row the troubled fundraising effort shrank, shedding nearly three percent from last year and more than a million dollars from its record high in 2007. That campaign capped five years of increases.

As disappointing as the figures are, Federation leaders note they could have been significantly worse. In an effort to head off difficulties, the organization announced a Challenge Grant program in late November. The six-figure initiative was funded by a group of families who pledged matching funds for new or increased donations over last year. Ruth Lederman, assistant executive vice-president/director of development for the Federation, said that more than 600 donors either increased their gift or gave for the first time after the program’s announcement raising another $400,000 including matching funds.

It made a big difference, she said.

“We were looking in November at a campaign that could have been as low as $9.3 million,” Lederman said.

Throughout the course of the year, federation figures indicated that 2,400 families gave for the first time or added to their previous donations.

Neuman also credited the program with bolstering the campaign during a hard year for philanthropy.

“It’s a major achievement in light of where we were before the Challenge Grant,” he said of the final total. “It’s a difficult time. I’m on some other not-for-profit boards. All organizations are struggling. With fundraising, it’s just the way of the world. When the economy turns down and the market turns bad, people lose their confidence and their ability to make significant gifts.”

The effects of the economic turmoil were exacerbated further by the deaths or departures of some major donors. Lederman said the Federation’s starting base for 2010 stood at $9.4 million, significantly below its final $10.2 million final total for 2009 – a figure that left fundraising at a disadvantage.

Robert Millstone, Federation Campaign vice president. said it was important to excite younger donors to replace those who have moved or passed away.

“When you have someone who has been supportive for a long time, you need to make up those gifts and the best way we’re trying to go about it is we’re trying to broaden the base to people who are younger,” Millstone said. “As people come into their own and take an interest in the work that we are doing we obviously hope to replace the donors that we lose.”

Exact effects on agencies were tough to gauge but they seem likely to be broadly felt.

“Obviously, if you don’t raise as much there is not as much to allocate,” Neuman said. “We have to look at cash flow. We have a financial policy committee that is examining that. There will obviously be some reductions across the board for agencies based on what’s available.”

Still, Neuman was optimistic about the future. He said a slowly strengthening nationwide recovery could brighten the picture for next year.

“My perception is that it’s picking up,” he said. “Perhaps not as quickly as everyone would like but I think it will be a better economy than last year. A number of people I spoke to during the last campaign said that if things get better in 2011, they hope to increase their gifts.”

Lederman called 2011 another “very difficult year,” with a starting figure similar to that of 2010. However, she said the rebounding economy gave her confidence as did the success of the Challenge Grant, which she felt was indicative of donor generosity in difficult times.

“What it said to us was that people care deeply about the Jewish community,” she said.

Millstone also credited the flagging economy for the poor showing. He said the numbers, while low, were still better than the hits taken by many other federations across the country. He noted that it’s sometimes difficult to judge the situation on a year-to-year basis.

“Trends take a long time to play out,” he said. “I think the new strategic plan that the federation adopted last year will help to innovate both in better ideas of how to serve people in St. Louis and around the world. That’s how we move the campaign forward. We need people to know the work that we are doing locally, nationally and overseas.”

He said that as individuals buy into federation’s efforts and feel confident in how money is being spent, their gifts will increase.

He also noted that while the annual campaign was a very visible aspect of the federation’s financial picture, it was still only one part of the equation. Targeted gifts, endowments and other funds also come into play.

“The annual campaign is down and we are obviously going to work hard to increase it because it’s important to the community,” he said, “but when you look at our total development efforts, I think we’ve done a very good job of getting back to where we were before the economic crisis.”

Barry Rosenberg, executive vice-president of the Jewish Federation, said allocation projections had not been made for the year yet but would be based on available revenue from all sources.

Rosenberg praised the community’s response to the Challenge Grant and expressed gratitude to the funding donors saying the initiative made a “huge difference.” He hoped that those who had been a part of the grant would maintain those levels of giving.

The grant wasn’t the only extra effort the Federation made this year. A Visionaries Gala brought in $180,000 and a Young Professionals Division event attracted 70 new donors.

Though the initiatives were successful, Rosenberg said the key would be sustained giving from those who wish to invest in the community.

“We know that building long-term success around special one-time efforts like Visionaries is not the best way to build stability so we need to bring that case to our donors and hopefully they will understand that and respond,” he said.