THE DIOCESE OF NEWARK - OUR DIOCESAN COUNCIL
Wednesday, October 12, 2011
St. Agnes’ Church, Little Falls
Draft Minutes of Meeting
Officers Present: Mr. Paul Shackford, Treasurer; Mr. Michael Francaviglia, Secretary
Elected by Districts: Mr. Thomas Bisdale, The Rev. Timothy Burger, Mr. T. Donald Cairns, The Rev. Deborah Drake, Ms. Edith Gallimore, Ms. Naomi Horsky, Ms. Lorraine Jones, The Rev. Thomas Mathews, Jr., Ms. Barbara Piccirillo, Ms. Martha Reiner, The Rev. William Thiele
Bishop's Appointments: Ms. Gail Barkley, The Rev. Ginny Dinsmore The Rev. Joseph Harmon
Absent: The Rev. Michael Allen, The Rev. Barrie Bates, The Rt. Rev. Mark Beckwith, Ms. Terrie McColl, The Rev. Victoria Geer (Vicki) McGrath, The Rev. Jon Richardson, The Rev. Dean Weber, The Rev. Canon Dr. Sandye Wilson, The Rev. Laurie Wurm
Staff: Ms. Kai Alston, Ms. Kitty Kawecki, Ms. Nina Nicholson, Canon Greg Jacobs
Others: The Rev. John Mennell, chair of the Budget and Finance Committee
In the absence of Bishop Beckwith, Mr. Thomas Bisdale presided at the meeting.
The agenda was adopted with the addition of the Alleluia Funds recommendations.
Motion: It was moved and seconded to accept the minutes for the meeting of September 10, 2011. The motion was adopted.
STEERING COMMITTEE CONGREGATIONAL VITALITY GRANT RECOMMENDATIONS
The Rev. Ginny Dinsmore, co-convener of the Empowering People action team presented the Congregational Vitality grant recommendations for adoption. The motion was adopted with one abstention.
St. Paul's, Englewood. Amount Requested: $3000. Amount Granted: $2300.
Project: Stewardship Revitalization Program
- St. George, Maplewood. Amount Requested: $2760. Amount Granted: $0.00
- St. James, Hackettstown. Amount Requested: $3950. Amount Granted: $0.00.
Project: “Spanish as a Second Language”: Spanish language program for outreach volunteers. Not a funding fit. Suggest applying to ACTS/VIM
Project: Worship service for children, ages 2-7.
- St. John, Boonton. Amount Requested: $5000. Amount Granted: $3100.-
Project: Music ministry support; “YES! Program”- Discovering identity, mission, & purpose
Project: Congregation advertising and welcoming directed to community.
- Christ Church, Budd Lake. Amount Requested: $4831. Amount Granted: $2300.
Project: Portable Welcome/Evangelism kit for autistic children.
Project: Funding for joint pre-schools executive director
Project: Liturgical Arts workshops.
- Project: “All God’s Children” program equipment & supplies.
Project: Worship service for high school/college students. Application Incomplete
Christ Church, Ridgewood. Amount requested: $5000. Amount Granted: $1900.
Project: Light On Main Youth Group.
St. Dunstan, Succasunna. Amount Requested: $3350. Amount Granted: $2300.
Good Shepherd, Ft. Lee. Amount Requested: $11.035. Amount Granted: $5400.
St. Andrew, Lincoln Park & Church of the Transfiguration, Towaco. Amount Requested: $5000. Amount Granted: $3900.00.
Grace Church, Nutley. Amount Requested: $2730. Amount Granted: $1500.
St. John, Montclair. Amount Requested: $3500. Amount Granted: $2300.
Total Amount of Grants Awarded: $25,000.00
STEERING COMMITTEE DIOCESAN COUNCIL RETREAT FOLLOW UP
Council members had the opportunity to share comments and reactions to the September retreat.
STEERING COMMITTEE DISTRICT REPRESENTATIVES TO DIOCESAN COUNCIL
The Rev. Joseph Harmon introduced to the Council a planned proposal being formulated by the Steering Committee on the future of districts and the election of representatives to the Council from the districts. The district representatives would be elected by convention rather than by the districts, that in some instances do not meet. The proposal would eliminate the requirement of districts but would not preclude districts from functioning as they currently were doing. Candidates would self-nominate for the Council offices. There were some districts working quite well and others not so well or at all. There were several diocesan canons that addressed the structure and operations of the districts – canons 2, 5, 8 and 9. Additionally, there was a constitutional provision for the election of youth deputies to the annual diocesan convention through the districts. The proposed change would make Council elected similarly as were other diocesan offices. Affinity groups that cross district lines could do so. The changes would be more permissive than proscriptive. The timing intent would be for the changes to happen in 2013. The change to the constitutional provision for the election of youth deputies would require two successive readings and votes at Convention and that was envisioned to happen in 2012 and 2013.
STEERING COMMITTEE EPISCOPAL CAPITAL LOAN FUND: TRANSFIGURATION, TOWACO
Mr. Thomas Bisdale presented and moved for ratification the ECLF minutes that approved a loan of $40,000 to Church of the Transfiguration, Towaco, for the damages caused by Hurricane Irene when the undercroft was flooded. The space is used for the nursery school; the church derives $25,000 annually in income from the school.
Motion: It was seconded to ratify the minutes from the Ward J. Herbert Fund Executive Committee which approved a loan of $40,000 from the Episcopal Capital Loan Fund for Church of the Transfiguration, Towaco, on October 5, 2011 for the damages caused by Hurricane Irene when the undercroft was flooded.
The motion was adopted.
STEERING COMMITTEE DIOCESAN COUNCIL ORGANIZATION DRAFT PROPOSAL
Mr. Thomas Bisdale introduced the report and draft proposal from the bishop that the members received on a different way to organize Diocesan Council. The proposal was for the structure of Council meetings and the attempt to streamline the meeting process through conferencing methods (phone and video), an intentional focus on mission priorities, and the effort to recruit new members who are engaged and interested in mission.
The draft proposal included:
- Re-organize the Council agenda in order to devote more time to mission program oversight. The mission program oversight– currently carried out by the three action teams – Equipping, Empowering and Engaging – needs to be given more time and attention. Presently, the Council monthly agenda and the planning year calendar do not allow enough time for the action teams to adequately discuss and plan mission program.
- The Council also needs to take into consideration the issue of people’s time. Some Steering Committee members currently sit on the Council and Budget & Finance Committee, chair the action teams – and attend extra Steering Committee meetings. That’s a lot of meetings – and when commuting is factored in, it adds up to a lot of time. We need to consider more evenly distributed leadership responsibilities among Council members.
- The formal budget considerations of the Council would be conducted as a Council of the whole as follows:
- October (presentation of initial budget)
- December (presentation and vote on final budget)
- February (budget orientation and discussion of budget approved by Convention)
- June (Report on diocesan budget year-to-date)
- The entire agenda the Council’s action teams would be devoted to mission program considerations in the months of:
- September (annual planning retreat)
- February (some time for orientation/review of strategic plan to date)
- June (bulk of meeting devoted to mission program)
- The Steering Committee monthly planning meetings would be conducted by conference call, Skype or video conferencing.
- Not all members of Steering Committee would necessarily serve on the Budget & Finance Committee. Other members of the Council could be recruited for the Budget and Finance Committee (so there is a link between the two). The Budget & Finance Committee would meet in March, June and monthly between September and December.
ALLELUIA FUND GRANT RECOMMENDATIONS
Motion: It was moved by Ms. Barbara Piccirillo and seconded that the Alleluia Fund grant recommendations that were presented at the September meeting be adopted. The motion was adopted.
Name Requested Awarded
Sussex County Interfaith Hospitality Network $5,000 $4,500
Montclair Emergency Services for the Homeless $5,000 $4,500
Montclair Protestant Foundation $5,000 $3,300
Newark School of Theology $5,000 $2,500
Gateway Pregnancy Centers $11,000 $-
Greater Life, Inc. $5,000 $3,000
Epiphany Food Pantry $5,000 $4,500
Faith and Hope Pantry $1,200 $1,200
Senior Resource Center $5,000 $3,000
Arts Unbound, Inc. $5,000 $3,000
Shepherd's Haven Adult Day Care Center $4,000 $3,000
St. Paul's Episcopal Church After School Program $10,000 $8,000
Newark ACTS $5,000 $4,000
Care on the Corner ESL & US Citizenship Program $5,000 $4,500
ASCSDC Hoboken Summer Educational Program $10,000 $8,500
Cedar Hill CDC at St. John's $4,000 $3,500
St. Barnabas Reading, Math and Study Program $4,000 $2,500
St. Peter's Haven $9,888 $8,000
Haven of Hope for Kids $8,000 $7,000
The Hoboken Shelter $10,000 $8,000
Christ Church CDC Hackensack $10,000 $9,000
Toni's Kitchen at St. Luke's * $5,000 $4,500
Total $137,088 $100,000
Mr. Paul Shackford, CFO, presented the finance report for September 2011.
- Key revenue items are behind budget:
- Pledge revenue (line 1) for this year-to-date period is $35,549 behind budgeted receipts, which are based on prior year. At the end of September 2010, we were within $1,000 of budget. Since we based the 2011 budget on the actual receipts from 2010, a shortfall may be of concern. We are in the process of contacting congregations that are behind in payments this year, and we will continue to monitor collections.
- Alleluia Fund (line 10) – Through September, we have received contributions of $59,278. In addition, another $4,600 of contributions through the Bishop’s Church Extension Fund have been received but have not yet been transferred into the Council’s financial statement. Together, then we have received approximately $64,000. While we have some pledges still outstanding, we are approximately $46,000 behind budget. The intention is to promote this endeavor during the latter months of the year in a way that will not conflict with annual congregational stewardship programs, and we hope to narrow the gap by the end of the year. However, we do anticipate a shortfall from the $110,000 budgeted for 2011.
- Rental Income (line 13) – We have retained a new real estate firm to assist in finding organizations to rent a portion of Episcopal House, and the firm has been successful in its efforts to rent a portion of one floor, and our first tenant moved in on October 1st. We continue to meet with possible tenants. Due to the amount of time it takes to find tenants and for them to move in, however, we expect that the amount of rental revenue to be received this year will be about $47,000 lower than the $50,000 budgeted for 2011.
- Expense items are mostly at or below budget:
- Staff expense for the Finance Department (line 15) is below budget because the budget anticipated a full-time CFO for the full year, offset in part by expense related to the Interim CFO. The CFO position was filled in May. This expense will be somewhat under budget for the full year.
- Congregational/Clergy/Ministry Development (line 18) is over budget by $5,355, due principally to expenses related to providing consulting and other support to congregations. It is expected that this cost center will be over budget by about $3,000 for the full year.
- A refund of expenses for the Annual Diocesan Convention (line 22) was received in June. We also used an available credit from 2010 of $11,537 to reduce the net projected cost for 2011 to zero.
- Christian Formation (line 23) routinely receives deposits/payments early in the year for events that occur later in the year. Income received early this year has exceeded expenses through September, and the budget for the full year appears to be on target.
- Clergy Conference (line 26) – the favorable variance is the result of receiving income prior to having to pay expenses. As a timing difference, we expect for the full year to be close to budget.
- The 2008 TEC pledge payment of $10,000 (line 35) is being paid in four quarterly installments, and three payments have been made through September 30.
- Domestic (line 36) and International (line 37) Outreach – all spending for domestic outreach is budgeted for the October through December period, while spending for international outreach was budgeted to occur beginning in July. No amounts have been spent relating to these expense categories, pending a review of projected full year results.
- Communications/The Voice (line 40) shows a favorable variance through the September YTD period; the variance is due principally to the timing of payments, and we expect the final annual expense amount to be somewhat below budget for the full year.
- Insurance for Retired Clergy and Lay Employees (line 52) is under budget. It was discovered that one aspect of the 2009 change to post-retirement insurance benefits was never implemented – benefits for under-65 spouses of retired clergy and for surviving spouses (widows) of retired clergy have remained at the generous pre-2009 levels. We have notified the affected people that this change will be made beginning in 2012. However, available funding will cover the expected additional expense this year. Additionally, in June Council approved a change to alter benefits to retired lay employees of the Diocese so that they are in line with the change in benefits to retired clergy.
- Administration & Finance expenses (line 53) reflect a favorable variance through September due to the timing of the payment of annual audit expenses. It is expected that expenses for this department will be on budget for the full year.
- Bishop’s Expenses (line 56) are over budget through September. This variance is principally due to higher maintenance and utility costs reflecting the harsh winter in the beginning of the year, and costs associated with a new communications consulting agreement. We anticipate that this department will be approximately $10,000 over budget for the full year.
- Building & Grounds expenses (line 57) is over budget by $14,226. The budget anticipated a “normal” year of expenses but, with the harsher than expected winter 2010, expenses exceeded the anticipated spending. In addition, there were some required unbudgeted expenditures relating to the Episcopal House building. We expect that the full year 2011 will be over the budgeted amount by somewhat less than the current overage.
- Pledge receipts in the early months of the year are usually insufficient to cover expenses, so we generally would anticipate a deficit for the first nine months of the year—and, in fact, the budget anticipated a shortfall of $203,614. The negative variances in Pledge Revenues, Alleluia Fund and Rental Income, however, have exacerbated the overall income shortfall so that, through September, revenues are $103,446 behind budget. Even with the $41,375 favorable variance in expenses, the net effect is that, through September, we are $62,071 behind budget.
- Since (a) we anticipate lower than budgeted Alleluia Fund and Rental income, (b) there could be a shortfall in Pledge Revenue, and (c) since most of the expense variances are favorable due to timing matters, it may be difficult to achieve the balanced budget for the full year.
Additional item of note:
- At the end of 2010 we accrued $206,000 of pledge revenue due for prior years (principally 2010) that was expected to be received in 2011. Through September, we collected $206,000 relating to this accrual. Some congregations have remitted higher than the amount originally pledged for 2010, and we may eventually exceed the accrual by a small amount for the full year.
Motion: It was moved and seconded to accept the Treasurer’s report. The motion was adopted.
ACTION TEAMS MEETINGS
The action teams met for the remaining time of the Diocesan Council meeting before the start of the budget review forum that started at 7:30pm and presented by the Budget and Finance Committee and Mr. Paul Shackford, CFO.
BUDGET REVIEW FORUM
Mr. Thomas Bisdale welcomed the attendees. Mr. Paul Shackford, CFO, and The Rev. John Mennell, chair of the Budget and Finance Committee, presented the review. Members of the committee were introduced. (A series of slides were used for the presentation.) [In attendance were four people in addition to the Diocesan Council members, the chair of the Budget & Finance Committee, and diocesan staff.]
The topics included:
- Pledge revenue (actual vs budgeted)
- Budget 2011 review and September year-to-date results
- Alleluia Fund income
- Pledge to The Episcopal Church in 2012 (the “ask” amount; spending for TEC and Outreach would be 25%)
- Domestic and International Grants (Council approved $100,000 for the grants allocated by the Alleluia Fund board)
- Currently $62,000 behind expectations but there were still over two months left in the year and pledge income could go up. Deficit was projected at $100,000. Can the year end in a deficit? Do we have to break even? What do we cut not to have a deficit or to have a lower than expected deficit?
- First pass on the 2012 budget with more conservative assumptions than when the 2011 budget was formulated.
- Congregational pledging in 2010 and 2011: less than 10% were 52 churches in 2010 and 57 in 2011; exactly 10% were 24 in 2010 and 18 in 2011; above 10% were 32 in 2010 and 33 in 2011.
- Diocesan outreach giving totaled nearly $1 million dollars that included the national church pledge, the various grants and Bishop’s Church Extension Fund.
- The budget doesn’t reflect the fact that churches and the diocese has less money. The reductions in the budget don’t reflect the realities and financial stress faced by the churches. The diocese has to say we can’t have the staff and the activities at the levels that we would like.
- Congregations facing similar problem as the diocese. This is an opportunity for a teaching moment for our churches. The first step is to talk honestly about the numbers and ask what do we do. How the diocese processes the budget issues will help congregations.
- The projection for Alleluia was $110,000 incomeThe 2011 budget indicated an amount to give out for outreach unlike 2010 when the amount raised was given away.
- Bishop’s discretionary funds should not be used for budget support. It was shown now as part of transparency in reporting.
- Diocese has been paying into the defined benefit lay pension program and following the actuarial advice.
- The Alleluia Fund continues to be problematic – restricted income, unrestricted deficit.
The meeting was adjourned at 8:25 p.m. with prayer.
Michael Francaviglia, Secretary