2009 – 2010 Budget Concerns & Responses Concerns 1. Current year situation. After a great deal of work by everyone, a lot of prayer, help from the bishop and intercession by God, COGS has been able to put together a financial plan to get us through 2009. However, our 2009 plan is based on receiving 100% of pledges - something that is highly unlikely. Do we or will we have a contingency plan to deal with this potential shortfall? 2. The mortgage. During our fundraising drive, there was much talk of trying to modify the Sun Trust mortgage. This was followed by hints that the diocese may intervene with a plan and this plan would be made known within a short period of time—a few months. What is the long term plan for dealing with the mortgage? Has the diocese given us any direction? 3. Our long term financial plan.To make it through this year, we asked our parishioners to reach deep and they did. However, this is not a sustainable approach for the future. What are we going to do differently for the future and when are we going to start developing a plan? 4. Transparency. A contributing factor to our financial situation last year was that it seemed like a large number of our parishioners had no idea of the size of our mortgage commitment and the financial situation COGS faced. It was communicated in January that monthly Vestry minutes would be posted, but this does not appear to be happening. This is critical to providing our parish with information we need to know. What happened to the posting of the Vestry minutes and is there more information that can be provided in the near future about the plans for this year and 2010? Responses 1) Current Year Situation: As of April 30th, we had collected 96% of our 2009 Pledges for the first four months of the year. We have noticed that the recent focus on our financial situation has contributed to a strong positive response from our membership. This is a very powerful statement given that we probably just negotiated the worst few months of the nationwide economic crisis. Despite the response last year, we have every expectation that we will collect close to 100% of our pledges this year. To insure that this happens, we will be mailing pledge statements more frequently and we will make more announcements (i.e. Shepherd’s Voice and in Church) regarding the importance of keeping pledges up to date. All of the financials are being monitored closely on a weekly if not daily basis as monthly reports will not suffice at this time to guarantee the collection of 100% of the 2009 Pledges. At this time, our contingency plan is to monitor our finances on a weekly basis and “nip” any unusual fluctuations “in the bud.” Our goal this year is to be proactive versus reactive. Should we face a shortfall at the end of the year then we are prepared to take the necessary steps to balance the budget which could include program and/or staff reduction. 2) The Mortgage: After consultation with several banks, we found that we have a very equitable and competitive plan in place. In addition, given the current economic times, we have not been able to locate a bank that would consider any type of interest-only loan. We have decided that the best plan of action is to continue making the full payments instead of taking a short-term approach that only saddles us with a longer term of debt. The Diocese continues to hold financial meetings in regards to the overall debt at the local and the diocesan level, but any resolution on this front would not have a significant impact on our bottom line. Our buildings are now in place and we are fully committed to the responsibility of ownership. 3) Long-Term Financial Plan: In all reality, we strongly believe that this level of financial commitment from our membership is sustainable. In the midst of our economic crisis, we not only closed the gap in our budget, but we noticed continued and increased giving in other areas of our program. San Jose Obrero has already collected almost $13,000 this year!! In addition to this great news, giving through our Collection Plate is at 140% for the first four months of the year!! Currently (end of April), we have $100,000 in our bank account which is significantly better than last year when we had around $30,000 going into the Summer months. Our actual income so far this year is $310,000 versus the budgeted amount of $276,000 and we have incurred $233,000 in expenses versus our budgeted amount of $247,000. This means that we can manage our current budget as we have squeezed an additional $48,000 of cash flow in a few short months by significantly reducing expenses and increasing our incoming funds. I can also assure you that we are not becoming complacent as we do recognize the reality and challenge of 2010 as we need to fund an additional $139,000 that was covered in 2009 through the Youth Ministry grant of $45,000, a onetime gift of $50,000, and the $44,000 elimination of our Diocesan pledge. To live into the growth of our financial plan, we are already doing the following: 1) We are taking steps to revise our Stewardship campaign in the Fall, 2) We have taken a new strategic approach in bringing new members into the life of Good Shepherd, and 3) We have increased the programming offerings for all members to cultivate deeper commitments within the parish. Keep in mind that the work towards meeting our financial goals is shared across the spectrum of ministries at Good Shepherd. The Vestry is not the lone piece of the puzzle as the Staff, Finance Committee, Long Range Steering Committee, Personnel Committee, Stewardship team, and ultimately the entire congregation is equally charged with the task of securing the future of Good Shepherd. 4) Transparency: As we learned in our meetings in January and February, clear and informative communication is essential for the continued success of our work together. We have moved the Vestry minutes into a more visible place both at the Church and on the website. In addition, we are taking all of these concerns to the congregation by posting them here on the website and mailing out a letter by the end of May to update everyone on our progress. The Vestry is completely committed to seeing that all of our financial issues are addressed with the entire congregation in the spirit of openness and honesty. |