Update from Finance & Planning

By Ronald Kelly

2000 financial year
completed

To the millennial purists, the second millennium came to a close Dec. 31, 2000.

Of course the popular interpretation of the millennium changeover occurred one year earlier. However, how we count the end or beginning of a new millennium makes no difference to church finances. We simply close the books on one year and start all over again on a new year.

December income on target

And so 2000 has come to a close. Mail income for December came in near our projections at about $2.3 million for the month. Mail income for December 1999 was $2.6 million, so we had about an 11 percent decrease in regular donation income.

Of all our income trends, this remains the one we have the most concern about--regular donations. If the trend continues to drop by 10 or 11 percent each year, you can easily see that dramatic expense reductions would have to take place in the next year or two. So please pray with us that in 2001 we will see a leveling off of member donations and a dependable, steady amount contributed each month.

On the other hand, as we have been reporting in the WN each month, other sources of income have held up well. The amount of estate donations, bequests and foundation giving provided a much-needed boost. Also our festival or seasonal offerings were up more than we had projected.

What that all means is that we only had to take $3 million from the church reserve fund this year. Please notice I put the word only in italics. When we began the year, we projected we might have to impact the reserve fund by as much as $6 million. So by comparison $3 million doesn't appear so bad.

The flip side of that coin, however, is that we sadly had expenses that exceeded income by $3 million.

Total income for the year, including festival offerings, estate donations and mail income, as you see on the accompanying chart, was about $31 million, while total expenses were about $34 million--thus the $3 million deficit I mentioned above.

Belt-tightening for 2001

As we plan our budget for 2001, we realize we will continue to spend at a deficit until we complete the sale of the Pasadena property. We are doing all we can to keep that deficit at a minimum, so there is a lot of belt tightening as we plan our budgets.

District conferences

I won't go into a lot of detail here, but once again we encourage as many of you who can to attend one of our district conferences. At these conferences, usually on Friday afternoon, I will be thoroughly discussing the exciting projections we have for local congregation funding and budgeting.

We hope to begin implementation of a new budgeting process later this year, transition to new financial models during 2002 and have full implementation during 2003. I think you'll find the plans exciting.

If you are not able to attend one of the district conferences, I'm sure your pastor will bring you up to date after he returns from his district conference. But as you know we welcome all of you to the conference nearest where you live.

This column brings you up to date through the end of 2000. Next month we'll see what kind of a start we will have for the new year.