Funding requests exceed $120 million triennial budget

June 26, 2015
Members of the Joint Standing Committee on Program, Budget and Finance will present their proposed budget to the full General Convention on July 1.Photo: Mary Frances Schjonberg/ ENS

Members of the Joint Standing Committee on Program, Budget and Finance will present their proposed budget to the full General Convention on July 1. Photo: Mary Frances Schjonberg/ Episcopal News Service

[Episcopal News Service – Salt Lake City] Members of The Episcopal Church’s Joint Standing Committee on Program, Budget and Finance (PB&F) heard a strong call June 26 for reducing the amount of money it asks from dioceses and regional mission areas, knowing that they face an approximately $12 million gap between the funding already included in Executive Council’s draft 2016-2018 triennium budget and additional funding resolutions that have come to convention.

Council’s balanced $120 million budget was passed in January after the church’s committees, commissions, agencies and boards filed their reports to convention containing funding resolutions. Some of those requests have been amended here at convention. Plus, many new resolutions filed since council passed its budget also ask for money to be included in the 2016-2018 budget. They are the ones that account for the $12 million gap.

“I want to make people understand that even a request for funding passed by both houses is not a binding mandate on PB&F,” the Rev. Canon Mally Lloyd of Massachusetts, PB&F chair, told Episcopal News Service after an early morning committee meeting June 27. “It carries great weight with PB&F, probably the greatest weight of any of the input we get, but it’s still PB&F’s job to discern how things get funded.”

The new or amended requests “will far exceed any reasonable way for us to handle that, so our challenge is going to be to see what we can do with this, and most of them will not be able to be funded,” Diocese of San Diego Bishop Jim Mathes, a PB&F member, told ENS after the June 26 revenue hearing.

While such a gap is not unusual, the logistics of attempting to reduce the shortfall are different at this convention than in the previous two.

“This is not an unusual position for budget-makers to be in at this point in the budget process,” Lloyd told ENS, “but we’re just urging people to be realistic about what is possible.”

“Three years ago, we were pulling together alternative budgets and we were trying to create a budget structure and that process actually gave us some wiggle room,” Diocese of Maine Bishop Stephen Lane, PB&F vice chair, told ENS on June 27. “This time we have a balanced budget with considerable internal integrity so for every dollar in, dollars have to come out. That’s a different process than the last time.”

When asked if this process was harder or easier, Lane said “it’s different hard.”

PB&F collaborated with the Executive Council on the draft 2016-2018 budget from the beginning of the 2013-2015 triennium.

The Episcopal Church’s three-year budget is funded primarily by pledges from the church’s dioceses and regional mission areas. Those entities are currently asked, but are not required, to annually contribute 19 percent of their income from two years earlier, minus $120,000.

Council’s draft budget increases that exemption to $175,000. Its revenue projection is based on asking the church’s dioceses and regional mission areas to give 18 percent of their income to fund the 2016 budget, 16.5 percent for the 2017 budget and 15 percent in 2018.

The three-year movement to reduce the asking to 15 percent results in $74,931,206 in revenue, according to Kurt Barnes, treasurer for The Episcopal Church. This total assumes a $175,000 diocesan exemption and assumes that each diocese not paying the full asking will increase its percentage contribution by 10 percent above the rate it is contributing in 2014. Full participation in a mandatory 15 percent assessment for all three years of the 2016-2018 triennium, with the same diocesan exemption and growth-in-giving assumptions, would result in $80,236,645 in revenue, he said.

Out of 109 dioceses and three regional areas, 49 dioceses paid the full asking or more in 2014. A list of 2013 diocesan commitments and payments made, and 2014 commitments, is here. Barnes has said that if all dioceses participated fully in the asking adopted by General Convention for 2014, nearly $7.4 million more would have been available for church-wide ministry. Payment of the full asking is not canonically required and there are no penalties for not paying the full percentage.

“I didn’t hear any advocacy for keeping the asking at 19 percent,” Lloyd said reflecting on the revenue hearing during an early morning committee meeting June 27. “So I think we can take away from that hearing support for some kind of reduction in the asking.”

She later told ENS “there’s still come decisions to be made about how far and how soon.”

Lane told the committee June 27 “My own sense is that (council’s) step-down is actually the framework for the step-up and that across the church there’s a commitment to do that.”

“The other piece that is critical for the life of this church is full participation and that’s not happening,” he said. “The set-up, the three years, is time for diocese large and small to become full participants.”

Nebraska Bishop J. Scott Barker cautioned that three years may be time enough for dioceses to increase their contributions to the 15 percent level, but “it is way too long” for dioceses such as his to get relief from meeting the full 19 percent asking.

Convention faces proposals to reduce the assessment to less than 15 percent and to make the assessment mandatory. The resolutions to date on those issues are here. The question of changing the asking from a voluntary response to a mandated payment is not within PB&F’s purview.

The total income in council’s draft budget is $120,470,577 and the total projected expenses are $120,468,248. In addition to diocesan payments, the revenue side includes income from other sources such as $28.2 million from a 5 percent draw on the Domestic and Foreign Missionary Society’s unrestricted assets, nearly $10 million in rental income from The Episcopal Church Center, $2.1 million from Episcopal Migration Ministries’ refugee loan collection program, $2 million to be raised by the development office and $1.2 million in General Convention income, along with other smaller sources.

PB&F will hold its spending hearing at 7:30 p.m. MDT July 27 in Grand Ballroom A,B,C of the Hilton Salt Lake City Center.

PB&F will use the comments it receives, council’s draft budget and any legislation passed by or being considered by General Convention to create a final budget proposal. That budget must be presented to a joint session of the Houses of Bishops and Deputies no later than the third day before convention’s scheduled adjournment. According to the draft convention schedule, that presentation is set to take place at 2:15 p.m. MDT on July 1.

– The Rev. Mary Frances Schjonberg is an editor and reporter for the Episcopal News Service.