GROUP CUTS FUNDS TO ISRAEL : S.F. JEWS SIGNAL RISING DISPLEASURE.

Byline: Michael Dougan San Francisco Examiner

In a move that may presage a national trend, the San Francisco Jewish Federation intends to slash its annual contribution to Israel this year.

Local Jewish leaders - whether they oppose or endorse the move - believe the nearly 17 percent funding reduction has come in response to two political trends in Israel: a bill to codify Orthodoxy as the only legitimate form of Jewish religion, and moves by Prime Minister Benjamin Netanyahu that many American Jews perceive as threats to the peace process.

``No doubt there are many members of the San Francisco Jewish community who have had concern with both matters,'' said Wayne Feinstein, head of the local Jewish Federation. He spoke of ``donor angst'' over giving money to a country that pursues policies they oppose.

The federation, in response, is slicing its annual donation to the United Jewish Appeal - an umbrella organization that distributes the money in Israel - from $6 million to $5 million for the current fiscal year.

Feinstein said $500,000 of the money taken from the UJA still will go to Israel, but in support of causes like Arab-Jewish relations, non-Orthodox congregations and the development of democracy.

The money will be distributed by Amutah, an Israeli nonprofit group established to oversee donations from the San Francisco Jewish Federation, he said.

While continuing to offer the UJA support, ``we want to increasingly concentrate on these areas of values that we share,'' Feinstein said.

Of particular concern to American Jews, most of whom practice Reform or Conservative Judaism, is a bill moving through the Knesset that would mean non-Orthodox conversions to the Jewish religion would not be recognized in Israel.

The intensity of feeling among most American Jews on the issue is reflected in a letter distributed by Rabbi Ted Alexander of San Francisco's B'nai Emunah congregation.

The angry missive was posted by Dr. Ismar Schorsch, chancellor of the Jewish Theological Seminary in New York and lead spokesman for Conservative Judaism.

The letter tells Jews to curtail their donations to Israel.

``He said if we are not recognized by the people in Israel, they have no right to recognize our money,'' said Alexander, who distributed the letter to the 200 members of his congregation.