Conference leaders hear financial update

10/20/2011

Staff Report

Members of the South Georgia Conference Leadership Forum heard some challenging news about the financial condition of the South Georgia Conference at their September meeting, held in Macon.  

“There is a tension between our mission of making disciples of Jesus Christ and reaching the point where the Conference has a revenue generated budget,” said Rev. Jimmy Cason, Conference Chair of Council on Finance and Administration (CFA).  “We can’t forget that our primary mission task should drive our budgeting process. However, at the same time, our mission will suffer if we do not have the resources to finance the ministries of our Conference.”

Dr. Brad Brady, Assistant to the Bishop for Connectional Ministries, oriented Leadership Forum members to the current financial picture.  The Leadership Forum, a group of representative leaders from various conference committees, meets together, usually twice a year, to sit at the same table for prayer, dialogue, discernment and stewardship of God’s vision for common ministry as it is expressed through the South Georgia Annual Conference.  Dr. Brady is part of the newly formed Mission Sustainability Task Group, an ad hoc group of conference leaders who are committed to furthering the church’s mission while reducing expenses.

The South Georgia Annual Conference approved an amended 2011 budget at its June 2011 session in Tifton.  The revised budget amount was set at $12,272,099, which was a $323,782 reduction of the original 2011 budget adopted at the 2010 Annual Conference session.

To simplify the Conference’s complex budget, Dr. Brady divided the budget into items that are paid on actual expenses, regardless of revenue receipts for that particular item (Type “A”).  These items include Conference Benevolences, New Congregational Development, Clergy Support, Pension Costs and the administrative costs of operating the Conference.  These items total $8,651,481, which is 70% of the total 2011 amended conference budget.

Type “B” budget items, which include World Service Fund, General Church Episcopal Fund, Black College Fund, Africa University Fund, Interdenominational Cooperation Fund and others, account for only 30% of the total amended budget.  These items are only paid out based on the revenues actually received for each item.

One of the main points in talking about the budget in Type A or Type B terms is the impact each has on the Conference’s undesignated reserve funds.

Dr. Brady gave the following example to show the impact.  “If the churches in the Annual Conference only pay 80% of World Service, only 80% of World Service is sent to the General Church thus making it a Type B item.  However, if only 80% of one of the Type A budget items is paid by local churches and the actual expenses are 90%, the difference is paid out of reserves.”

Last year the Conference received 81% payment on Type A budget items but spent 91.6% of Type A budget items.  Through August 31 of this year, the Conference has spent 62% of the budget while only collecting 50%. 

“While there are still four more months to receive monies, and typically we receive our largest contributions in December, there is great cause for concern,” said Rev. Cason.  “In order to get to 80% collected by December 31, we will need to receive $2,659,526, or 38.4% of the total budget. This amount seems within reach if our cash flow on apportionment giving is similar to 2010, but year-to-date we have collected $113,080 less than we collected last year at the same point.”

Dr. Brady pointed out to Leadership Forum members the reality of how much reserved funds could be used. “If we collect 80% and spend 80%, we will use $699,629 from reserved funds.  If we collect 80% and spend 90%, we will use $865,147 in reserved funds.

There are several groups within the Annual Conference who are working together for the purpose of producing a revenue-generated budget.  These groups include the Leadership Forum, CFA and the Mission Sustainability Task Force.  Bishop King is also naming an executive team with whom he will be actively involved in helping the Conference find a solution.  These groups will be looking at either finding a way to generate about $1.7 million dollars in revenue or reducing the Conference’s budget by the same amount.

“We have made difficult decisions in reducing the budget, but further reductions will be even more difficult because those cuts will probably involve personnel and other highly valued services we have come to expect,” Rev. Cason said.

“Every leader joining this extended conversation is prayerful that the solutions we find will bring into better balance the Conference’s part in making disciples of Jesus Christ through the South Georgia connection and the faithful stewardship of the available resources,” Dr. Brady said.  “We covet the prayers of the whole South Georgia family.”

 

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