Episcopal Press and News
Executive Council Turns to Surpluses to Help Finance $40.5 Million Budget
Episcopal News Service. December 5, 1996 [96-1633]
Ed Stannard, Editor of Episcopal Life
(ENS) Facing a continuing shortfall in diocesan contributions to the national church, the Executive Council approved a $40.5 million budget for 1997 with a $3.4 million deficit.
The council, meeting in Toronto November 7-11, agreed to close the gap by trimming programs and by using surplus funds from earlier years. Even so, the budget assumes a four percent increase in contributions from dioceses in 1997, $1 million more than the $25 million received this year. The 1997 budget is about $2.9 million higher than 1996's revised plan, mostly because of expenses of next year's General Convention.
Projected revenues totaled $37.1 million. The remaining $3.4 million will come from several sources:
- $1.6 million in surplus from 1995. Among other purposes, the budget includes $400,200 of that money to pay for a reopened planned-giving office, which Executive Council approved during its June meeting.
- $1 million from reserves -- unspent money from before the 1995-97 triennium. Those funds, totaling $8.5 million, were identified earlier this year by the treasurer's office during its examination of national church accounts.
- $600,000 in cuts from the program budget, a reduction from the $19.3 million budgeted by the 1994 General Convention. However, about $600,000, approximately half of the cuts made to the 1996 program budget, will be restored.
- $200,000 in other reductions.
Treasurer Stephen Duggan said that senior executives decided that it was important to restore some of the program money lost in 1996, even though the budget was not balanced.
"There is a strong feeling that we would want to bring that back up at least 50 percent of the way to where we had been, notwithstanding the gap," he told the council's administration and finance committee. Later, Duggan said that senior executives felt that to cut the national program further would seriously hurt the church.
"We had a responsibility to be fiscally prudent but we didn't want to do damage to the program of the church that would do significant harm," Duggan said. He called the shortfall a temporary situation, caused partly by a flawed funding formula.
The national church program, approved by General Convention, includes relations with overseas dioceses and other church bodies, missionary work, refugee work, education, congregational development (including racial, ethnic and women's ministries), peace and justice advocacy, communication and other work.
Diane Porter, senior executive for program, said that the $600,000 restored from 1996 will be used to restore funds to dioceses in Latin America and the Caribbean, three small Western dioceses and the Episcopal Council on Indian Ministries. She also plans to hire an assistant ecumenical officer and to enhance the Public Policy Network, a grassroots lobbying program which has grown from 1,700 to 6,000 members since its move to Washington, D.C., in January 1995.
George Shields of Spokane, Washington, called the program budget an "appropriate compromise" that "restores the principle that we know the General Convention" establishes the program. "We still can't manage it but we could manage it if we got a little help" from the dioceses, Shields said.
Not everyone was optimistic about dioceses' increasing their giving, even though the $25 million received in 1996 was $4.5 million below expectations based on General Convention's budget.
"In my dialogues with some of these bishops, they're not interested, period," said Bishop Don Wimberly of the Diocese of Lexington, chair of administration and finance.
Duggan, however, was hopeful. "We will do better than we did last year," he said. "Whether we get $1 million or not, I don't know. My preference was to shoot for an aggressive but attainable target, and if we have to cut later we will."
The treasurer said that he hoped next year's General Convention will fix the funding formula, which determines how much dioceses are asked to contribute to the national church. In 1994, a range was created for each diocese; the budget was based on the average pledge falling in the midpoint. However, actual giving has fallen short.
In response, the Joint Standing Committee on Program, Budget and Finance (PB&F) is considering a proposal to change the asking to a simple 20 percent of diocesan income.
"The range had consequences that no one anticipated and they were disastrous," Duggan said. "There's no doubt in my mind, had we asked for a higher amount we would have gotten a higher amount."
The council also approved:
- $200,000 to partially restore funds for Latin American and Caribbean dioceses, the Episcopal Council for Indian Ministries, three small Western dioceses, Micronesia and Taiwan. Those dioceses' funds were cut five percent in 1996.
- $1 million from reserves to make repairs to the Episcopal Church Center.
- $600,000 from reserves to upgrade the computer and communications systems at the center.
The council also took its first look at the 1998-2000 budget, which will be voted by convention next July. It projects revenues of $116.3 million and expenses of $121 million for the three years. Council's task will be to balance the budget before submitting it to PB&F next year.
The '98-'00 budget includes some new programs, mostly to increase communication and resource sharing with dioceses. Porter said she hopes for a beefed-up resource center and linkage program and additional communications and mission personnel.
"In terms of outreach programs there would be a greater emphasis on support for congregations and sharings," she said. "People are calling for printing [in languages] other than English and we're trying to take that call seriously."