Transcript St. Martin’s Vestry

St. Martin’s Vestry
2009 Budget Presentation
February 1, 2009
10:00 a.m., Parish Hall
Parish Mission Statement
• The Church of St. Martin-in-the-Fields is
an Episcopal parish in the Diocese of
Pennsylvania that is centered on the
worship of God, the ministry of all baptized
persons, and the call to be agents of
Christ’s love in the world.
December 31, 2008, Final Close
• We ended 2008 with a $26,000
deficit.
December 31, 2008, Final Close
• On a $950,000 budget, a $26,000
deficit (-2.7%) is not good, but it is not
a disaster, especially in this economic
climate. We can handle a deficit of
this size with our cash reserves. In
2007, we ended with a slight surplus
of $6,000, which we absorbed into
cash reserves.
December 31, 2008 Final Close
• The primary reason for the deficit was
reduced member giving, particularly
current year pledging. We budgeted
$535,000 in pledge payments and
received $505,000 (-5.6%).
December 31, 2008 Final Close
• We are sending out 2008 statements
this week, which usually results in
some parishioners catching up. This
will not, however, affect the 2008
bottom line, and $7,000 has already
been budgeted as previous year
pledges for 2009.
2009 Budget Income
There are two basic sources of parish income:
• Member Giving
• Endowment Income
2009 Budget Income
The most important source of income:
• Member Giving (59% of total)
– Annual Giving
– Pledge payments for prior year
– Unpledged member giving
– Plate
2009 Budget Income
And the second most important source of
income:
• Endowment (29% of total)
– Woodward Trust
– St. Martin’s Endowment
2009 Budget Income
Additional Sources of Income: (12% of total)
• Building Use
• Rent
• Miscellaneous
2009 Income
Rent
7%
Misc
2%
Building
Use
Endowment
29%
Giving
59%
2009 Budget: Annual Giving Income
• As of January 25, 2009, we have received
208 pledges, totaling $452,000.
2009 Budget: Annual Giving Income
• In 2008, we received 255 pledges, totaling
$511,477.
2009 Budget: Annual Giving Income
• 30 Households that pledged last year have
not pledged for 2009.
2009 Budget: Annual Giving Income
• Another 30 “active” households did not
pledge in 2008 and have not pledged in
2009. They may give, but we have no
idea how much.
2009 Budget: Annual Giving Income
• Not surprisingly, the households that are
behind on 2008 pledge payments tend to
be the same households that have
reduced their pledges or not pledged for
2009.
2009 Budget: Annual Giving Income
• Most of our largest pledges have stayed
the same or increased. Many pledges of
less than the average ($2,000) have either
been reduced or are outstanding.
2009 Budget: Annual Giving Income
• Based on last year’s experience, the
Vestry is reluctant to budget more for 2009
member giving than what we actually
received in 2008. This means that for
2009, we are budgeting $40,000 less in
member giving than we did in 2008.
2009 Budget: Annual Giving Income
$-40,000!
2009 Budget: Endowment Income
 We received word this past week from
Wells Fargo/Wachovia Bank that the
market value of our interest in the
Woodward Trust has gone from
$4,400,000 at the end of 2007 to
$2,850,000 at the end of 2008 (-35%) and
that our 5% draw will be reduced from
$220,000 in 2005, 2006, and 2007, to
$142,500 in 2009. That is a reduction of
$77,500.
2009 Budget: Endowment Income
Woodward Trust:
•
Unlike the St. Martin’s endowment draw,
the Woodward Trust distribution is not
averaged over 3 years. It is a straight
5% distribution of the full market value on
12/31/08. If the market improves, the
distribution will not change until next
year.
2009 Budget: Endowment Income
Woodward Trust
$-77,500!
2009 Budget: Endowment Income
• The 5% draw from the St. Martin’s
Endowment has not been reduced as
dramatically, because it is averaged over
three years, one bad year (2008)
averaged with two good years (2006 and
2007). The value of the endowment has
dropped from $3,173,000 at the end of
2007 to $2,112,000 at the end of 2008 (33%). The draw has been reduced from
$146,000 to $140,000.
2009 Budget: Endowment Income
• The Vestry has decided to take more of
the St. Martin’s draw into the operating
budget than last year ($110,000 compared
to $100,000 last year). But with a lower
overall draw, this means that the capital
improvements budget will receive $15,000
less than last year. ($30,000 compared to
$45,000 last year.)
2009 Budget: Income
The problem:
•
Total member giving is down by
$40,000 compared to the 2008 budget.
•
Total endowment income is down by
$67,000 compared to the 2008 budget.
2009 Budget: Expenses
Part of the Solution:
• Budget cuts, fairly and equally spread across the
entire operating budget.
2009 Budget: Expenses
Personnel:
• Freeze all salaries at 2008 levels. (No Raises,
no Cost of Living Adjustments).
• Eliminate Part-time Administrative Assistant
position ($6,000).
2009 Budget Expenses
Personnel Continued:
• Depending on the contract that we sign with an
Interim, there may be some savings in the
Rector position. The Vestry expects that these
savings will offset the expenses of the
discernment/ search process, and will not be
available to offset the deficit in the operating
budget.
2009 Budget: Expenses
Administration:
• Freeze administrative expenses at 2008 levels.
• This is in effect a reduction in office expenses
because we already have signed contracts for
increased IT support, website support, and
telephone/DSL supply.
2009 Budget: Expenses
Buildings and Grounds:
• We have already done the most accurate
budgeting possible for oil, electricity, and gas.
We have lowered thermostats and put all
thermostats on timers and introduced CFL
lighting.
• Freeze over-all B&G expenses at 2008 levels.
Given increases in comprehensive and workers’
compensation insurance, this represents a
reduction in other areas.
2009 Budget: Expenses
Program:
• Freeze all program expenses at 2008 levels.
• Reduce hospitality budget from $5,600 (Actual
2008) to at least $4,000 and live within it.
2009 Budget: Expenses
Diocese:
• For the third consecutive year, freeze our
contribution to the diocese.
• This in effect means that we are pledging a total
amount of less than 10% of previous year
income for the first time in memory.
2009 Budget: Expenses
Outreach:
• Freeze our total outreach expenses at $80,000
plus $35,000 of income and expenses for
special projects like the Guatemala scholarships,
the Guatemala Medical Mission, Heifer Project,
and Friends of the Church in Jerusalem.
2009 Budget Expenses
Outreach Continued:
•
This will mean not renewing our commitment to
YouthBuild Charter School and reducing our
financial commitment to the Guatemala
Companion Parish Program over the next two
years, from $25,000 in 2003 - 2008, to $20,000
in 2009, to $15,000 in 2010, bringing it in line
with our other primary outreach partners.
2009 Budget Expenses
Outreach Continued:
• For 2009, reduce the contribution from the
operating budget from $50,000 to $30,000 and
take the difference from the Outreach Fund,
exhausting the Outreach Fund a year earlier
than anticipated.
• Beginning in 2010, the Outreach program will
have to be funded from the operating budget.
2009 Expenses
Diocese
9%
Outreach
5%
Misc
1%
Program
3%
Personnel
57%
B&G
12%
Comp.
Insurance
3%
Deficit
4%
Admin
8%
Recommendations
• The Vestry has passed this deficit budget and
plans to revisit it in May. Between now and then
the Vestry plans to:
– Communicate the financial condition of the
parish to the whole parish in several different
ways
– Contact outstanding pledging units
– Negotiate a contract with an Interim
Recommendations
• In May, if we are in a position to reduce the
deficit and even to restore some of the cuts, we
recommend that the priorities be:
– Restore a COLA for the staff.
– Raise the diocesan pledge to a total of 10% of
2008 parochial report line E revenue (not
calculated yet, but around $93,000).
Further Considerations
Income:
• This 2009 deficit budget is a result of reduced
income from member giving and reduced
income from the endowment. Both are a direct
result of the current economic climate. We
cannot control the endowment income. We
must increase member giving.
Further Considerations
Expenses
• On the expense side, the main point to be
emphasized is that the Vestry does not feel it
can make further cuts in the expense budget
without seriously affecting our identity as a
parish.
Parish Mission Statement
• The Church of St. Martin-in-the-Fields is an
Episcopal parish in the Diocese of Pennsylvania
that is centered on the worship of God, the
ministry of all baptized persons, and the call to
be agents of Christ’s love in the world.
Our Identity as a Parish is at Stake
Personnel:
• We are a parish that prides itself on having
superior, experienced, well-compensated, fulltime persons in all senior positions.
Our Identity as a Parish is at Stake
Program:
• We are a parish that is committed to excellence
in liturgy, music, Christian Formation, pastoral
care, communications, and hospitality.
Our Identity as a Parish is at Stake
Buildings and Grounds:
• We are a parish that cares about being good
stewards of our campus and our buildings.
Our Identity as a Parish is at Stake
Diocese:
• We are a parish that is considered an example
to other parishes in our strong support of the
Diocese of Pennsylvania and the National
Episcopal Church.
Our Identity as a Parish is at Stake
Outreach:
• We are a parish that cares passionately about
making a real difference in the lives of the poor
and the powerless, acting as agents of Christ in
the community, the diocese, the city, the nation
and the world.
Conclusion
• To repeat, the Vestry does not feel it can make
further cuts in the expense budget without
seriously affecting our identity as a parish. That
is why we passed a deficit budget.
Conclusion
• WE MUST, THEREFORE, DO
EVERYTHING WE CAN TO
INCREASE MEMBER GIVING, EVEN
IN THIS DIFFICULT ECONOMIC
CLIMATE. THIS IS WHERE OUR
ENERGY NEEDS TO GO IN THE
NEXT FEW MONTHS.