 $5 million shortfall forecast for PCUSA mission budget By Craig M. Kibler The Layman Online Thursday, November 7, 2002 Despite an April decision to balance the 2003 mission budget by cutting more than $4.2 million in unrestricted funds, including the elimination of 66 jobs in Louisville and 34 international mission workers, a top denominational official says a rising tide of red ink will require $5 million in additional cutbacks over the next two years – and more job cuts are "a possibility." The April reductions in the Presbyterian Church (USA) came in the wake of Louisville scaling back its publications, stopping the presses on a major curriculum, initiating a hiring freeze and cutting travel – but still left a $5.3-million deficit. That gap was covered by a 12 percent reduction in the workforce, decreasing missionary support services, consolidating administrative support functions, reducing grants to 165 partner churches in 80 countries, eliminating activities, and other efforts. The remainder of the deficit – $1.3 million – was covered by using $610,000 from capital reserves and $720,000 from the Presbyterian Mission Program Fund. The mission fund is a cash flow reserve that must remain in excess of 30 percent of the annual expense budget. The mission budget is separate from the general assembly's per-capita budget, which pays for the operations of the staff and headquarters in Louisville, Ky. In explaining the need for more cutbacks in the mission budget to the Presbyterian News Service, General Assembly Council executive director John Detterick made no mention of any anticipated cutbacks in the per-capita budget, which could be crippled by a reaction to the stated clerk's refusal to deal with churches that are defying the constitution. Detterick's projections are based, in part, on the year-to-date level of congregational giving. This figure, however, could be deceptive since many congregations and presbyteries wait until year's end to forward money to the denomination. In the past, approximately 40 percent of the funds were received in the last quarter of the year. At the time April cutbacks, Detterick said the budget process was driven by three challenges the council approved at its January meeting – $1 million to begin a $40-million fundraising campaign; $500,000 in additional mission dollars for the new curriculum, We Believe; and a 4-percent pool for staff pay raises in 2003. The pool was decreased to 3 percent during the budget process. Now, citing unexpected expenses and a scaled-back investment income formula, Detterick told the Presbyterian News Service on Nov. 6 that the mission budget faces additional cuts of at least $1 million in 2003 and $4 million in 2004 – approximately four percent of the $132,123,844 mission budget approved by the 214th General Assembly. "This is obviously not good news," he said, blaming the budget shortfall, which he estimated at between $1 million and $1.5 million in 2002, on four factors:
Investment income, which Detterick said represents about two-thirds of the general assembly's revenue, will change by 2004. The income from the church's investments, most of which are administered by the Presbyterian Foundation, will drop from 6 percent of the average balance of funds to 5 percent. "The bottom line is that the new spending formula will mean that our revenues for 2004 will be about $2.5 million less than in 2003," he said. Some other reasons for the shortfall, which Detterick did not mention but which have been previously discussed, include:
Much of the loss was due to the failure of the PCUSA's Covenant People curriculum, which was shut down after incurring more than $1 million in red ink during 2001. Despite the failure of Covenant People, the Congregational Ministries Division – with the authorization of the 214th General Assembly – has begun another publishing venture titled We Believe: God's Word for God's People, which will be available to congregations in the fall of 2003. Through all of the layoffs in staff and missionaries, the scaling-back of and reductions in programs and services, there has yet to be a discussion about cutbacks in unpopular programs. The elimination of the 34 missionaries and their support services, for example, saved $1.6 million, roughly the same amount as the denomination pays to support four controversial programs that were spared budget cuts: the World Council of Churches, the National Council of Churches, the National Network of Presbyterian College Women and the Washington Office. The World Council of Churches and the National Council of Churches are due to receive the same amount of money in 2003 as they are getting this year through the General Assembly's per-capita budget. (Both ecumenical groups receive additional support through the mission budget and in-kind contributions made by PCUSA staff members handling NCC and WCC assignments.) The 2003 mission budget figures for the National Network of Presbyterian College Women and the Washington Office will remain at their 2002 levels. Both groups got more money in 2002 than they did in 2001. The NCC is a shrinking, once limousine-renting agency that spent itself into a financial crisis and exhausted its reserves. In 1999, auditors discovered that the NCC had run up a $3.9-million deficit, effectively wiping out its reserves. Since then, the NCC has cut employment from 102 to 36, and faced a $600,000 deficit for the budget year just ended. The World Council of Churches also has been financially strapped because of fallout from its engagement with political and social issues that often do not reflect a Christian worldview. The Washington Office has essentially been a booster club for leftist political issues. While the Washington Office has a number of ardent critics and supporters, very few Presbyterians know it exists. In a September 2000 exercise intended to establish some guidelines for spending, a General Assembly Council committee ranked the Washington Office and Church & Society magazine as the lowest priorities in the National Ministries Division. Evangelism was the top priority in that ranking. Nonetheless, full funding was approved for the Washington Office. The National Network of Presbyterian College Women is a radical feminist organization that almost lost its lifeline. In 1999, the General Assembly voted the Network out of business, only to give it a second chance after an emotional demonstration that the national staff helped stage on the floor of the General Assembly. Criticism of the Network focused on its published materials that advocated homosexual relations and New Age-like religious rites. The organization borrowed heavily from the Re-Imagining God movement, even after the 1994 General Assembly declared the movement to be beyond the bounds of the Christian faith. The 214th General Assembly approved a glowing report about the organization from a task force that recommended the group be continued with close oversight. None of the major allegations about the organization was disputed in the task force's report. And, despite Detterick's gloomy forecast about the rising tide of red ink in denominational headquarters, more may be in store in the future. In some internal letters and other documents obtained by The Layman in April, Marian McClure, director of the Worldwide Ministries Division, said projections indicate a shortfall of $11.3 million for the 2003-2005 budget years. "This shortfall will decrease the church's ability to send mission workers, and to support important ministries in evangelism, education, health, development, and others with partners around the world," she said. "There will be some staff cuts within Worldwide Ministries. It will also be more difficult to consider new mission personnel positions and even replacement personnel." |
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