I know many of you are dealing of being in or headed for tough times financially. Our
network of Executive Pastors is working hard to as proactively as possible deal with this situation.
Here's an e-mail from my friend
Rob Cizek, Executive Pastor of
Northshore Christian Church in Everett, Washington.
With the across-the-board downturn, I imagine that many of you are dealing with reduced giving just as we are here in the Seattle area. I believe that it is important to get out in front of this. Last week we re-forecast our giving budget to reflect the changing realities that we have seen over the last months (our fiscal year is July 1 - June 30). Our best estimate is now for a 16% reduction in giving, necessitating cuts of $400,000. With one quarter of our fiscal year complete, we are not waiting to act. I am meeting next week with our ministry leaders. We are essentially re-budgeting expenses the year, strategically reducing costs now. We hope this will help us avoid major across the board cuts later.
I have included my memo to ministry leaders below, just in case it might be helpful to any of you working through similar situations.
As you are well aware, the economic downturn has affected giving at the church. This week we are at an important time of budget reevaluation now that we know what the year-to-year trends are for the summer months and First Fruits offering. I am very grateful that the First Fruits offering was on par with last year. This is a meaningful event for our congregation.
Not to take away from this, but overall giving to the general fund for the first quarter (July, August, September) was down significantly. When you combine this with the extended Boeing strike, rising unemployment and the historic drop in the value of stocks, it is only prudent to reforecast general fund giving for this year. Our previous projection was for church income of approximately $2.8 million. Our updated best estimate is now $2.4 million, a drop of 16% or $400,000.
Because time passes so quickly, it is important that take action now. When we address financial concerns early, we leave opportunities open and preserve flexibility. By contrast, waiting until a shortfall becomes daunting leaves little room for anything except drastic action.
Starting this week, we are assembling a financial action plan to present to our Finance Committee and Elder Board. Generally speaking, we are re-doing our current 2008-2009 budget to match an income of $2.4 million rather than $2.8 million. It is our desire to be
strategic in spending reductions, rather than simply dictate cuts to you. As such we need your help. Please examine your current ministry budget, with an eye towards trimming it by 15-20%. We will meet with you next week to redo your ministry budget with these cuts in place. Some obvious questions to ask when trimming:
- What can we simply live without?
- What can be done differently?
- What have we "always done" that we really don't need to do now?
- What are the things that are directly on mission? Keep them fully funded (or shift more money to them).
- What are the things that really aren't on truly on mission (reduce dollars to this line or eliminate altogether)?
- What things can be accomplished by charging participants?
- What things can we fundraise for?
- What things could I get donated or make by hand?
- Can a volunteer provide a service that we currently pay for?
- Can I buy something used instead of new?
- What can I put off until next year? Do I need to do this annually or can we do it every-other-year or perhaps every-third-year?
- Can I partner with another ministry to share costs?
- Can an event be changed or simplified to reduce costs?
- Can I accomplish the same ministry goal by using a different program or tactic?
- How do other churches accomplish the same thing in a different manner?
Please know that we understand the situation that our ministry budgets are in. Already modest budgets have been held flat for the past two years and trimming will not be easy. We also understand that trimming may result in cancellation of some programs the church historically has come to expect. This is a dynamic that we will simply have to ask our congregation to understand. People will respect prayerful, intelligent and strategic choices made during times such as these.
You are not alone facing this challenge. The church will make other changes to achieve a $400,000 savings:
- Holding open all unfilled staff positions.
- Holding all capital spending.
- Using our reserve funds.
By taking these cost saving measures now we avoid drastic action later. After making these changes we can operate confidently with our budgets (provided that giving doesn't fall any more that 16% this year).
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