Last month I reported that due to significant financial and operational issues, FEGS Health & Human Services, a large human-service agency that is part of the UJA-Federation of New York network, had determined that it was in the best interests of its clients to transfer its programs to other agencies. To further these goals, FEGS today filed a petition under Chapter 11 of the Bankruptcy Code. UJA-Federation’s Board of Directors approved debtor-in-possession financing of up to $10 million to help ensure the smooth transfer of FEGS’s programs to other agencies and continued client services.

From the moment we learned of FEGS’s financial issues, our top priority was — and continues to be — providing what is needed to maintain services for FEGS’s clients. Our loan will allow FEGS to continue delivering care to tens of thousands of people in need through the transition. The loan will be secured by FEGS’s assets, including real estate in the Bronx and Brooklyn. UJA-Federation will closely monitor FEGS’s cash-flow projections, receipts, and expenses, and will receive weekly reports from FEGS throughout this process.

The goal is to situate all FEGS’s programs under other providers’ management within just a few months. New York State recently announced its intention to transfer one of FEGS’s largest and most significant portfolios — the behavioral health programs, serving up to 30,000 clients — to the Jewish Board of Family and Children’s Services (JBFCS), also an agency in the UJA-Federation network. We appreciate the State’s support for a stable transition and are pleased that, if the agreement with JBFCS is finalized, these critical services will remain in the UJA-Federation network.

We have also been working closely with JBFCS and, like the State, have confidence in its ability to assume the operation of these programs. All involved — the State, FEGS, JBFCS, and others — are fully invested in ensuring the safety, well-being, and continuity of care for those individuals who currently receive FEGS’s services. We recognize and appreciate that should JBFCS take on these significant additional responsibilities, we will provide added support for this important effort.

On a parallel track, we have been actively working to find appropriate homes within our network for FEGS’s programs that are funded by UJA-Federation targeted grants. These programs, serving specific Jewish communities, provide counseling for the unemployed, end-of-life care, outreach to at-risk youth, and more. We will announce that complete transition plan by the end of March.

Even as we address the immediate need to support continuity of services, we have been carefully examining UJA-Federation’s accountability guidelines, other audit and governance requirements, and training for the network agencies. We are committed to having strong and appropriate measures in place and are working with independent governance experts to examine our policies.

This has been a challenging time for all involved, and it is a testament to the strength of our network and the support of our community that FEGS’s clients will continue to receive the excellent care they have come to depend on. When agencies have faced difficulties in the past, UJA-Federation has stepped in to provide guidance and, where needed, resources. This is what we are uniquely positioned to do thanks to our donors, dedicated professionals and lay leaders, and agency colleagues. For your continued trust and support, we are immensely grateful.