LOUISVILLE – The Presbyterian Mission Agency Board has approved adjustments in the mission budgets for the Presbyterian Church (U.S.A.) for the next three years – authorizing spending increases that the denomination will pay for by drawing down reserves.
Also, funding for both the Ghost Ranch and Stony Point conference centers – both of which have significant needs for capital improvements – remains a subject of discussion.
These conversations have significant implications for the denomination’s financial future. With declining unrestricted revenue – and with reserves being drawn down closer and closer to the required minimum – the PC(USA) will face increasing difficulties in balancing its future budgets unless new sources of revenue are found.
On Sept. 19, meeting in Louisville, the board approved the following budget changes:
- For 2014: The board committed $1.5 million from the denomination’s reserves for high-priority capital expenses at Ghost Ranch. The board also voted to increase the revised 2014 mission budget it approved in April 2014 by $1.6 million, bringing it up to $81.5 million (a move unrelated to the Ghost Ranch expenses) – with much of that additional money going to increase emergency reserves at the Presbyterian Center (the denomination’s national offices in Louisville) to a more stable level.
- For 2015: The board approved a net increase of $1.7 million in the mission budget, bringing the 2015 revised budget to $75.4 million.
- For 2016 mission: The board approved a net increase of $1.6 million, bringing the 2016 revised budget to $79.8 million.
The proposed budget increases for 2015 and 2016 include additional funding for:
- Executive director’s office: An increase of more than $209,000 in both 2015 and 2016 includes additional costs for legal expenses and the sexual misconduct ombudsperson office.
- Communications: An increase of more than $367,000 in 2015 and $474,000 in 2016 includes funds for a new strategic communications plan for the PC(USA), including a revamping of the denomination’s website.
- Mission: Includes additional funding of more than $295,000 for 2015 and $68,000 for 2016 for items the 2014 General Assembly approved which have financial implications.
In order to achieve these budget increases, the board voted to dig more deeply into the Presbyterian Mission Program Fund (PMPF) – the denomination’s reserves – for a total of more than $6.4 million. Those draws on reserves include $1.5 million for the Ghost Ranch capital expenses, plus another $4.94 million for the budget revisions – $1.61 million in 2014, $1.84 million in 2015 and $1.49 million in 2016.
According to reports presented to the board, that PMPF reserve fund had a balance of just over $10.2 million in undesignated funds as of July 31. There’s a mandated reserve requirement – meaning, for 2014, the reserves can’t go below $5.94 million. The financial decisions the board made today – along with some pending developments (the projected sale of some Ghost Ranch property that should put about $2.5 million into reserves, plus expenses of no more than $180,000 to fund Stony Point operations in 2014-2016) are expected to produce a projected PMPF reserve fund balance of a little over $6.1 million by Dec. 31, 2016.
In other words: unless something changes, by the beginning of 2017, the PC(USA) will likely be out of unrestricted reserve funds upon which it could draw.
Chad Herring, a teaching elder from Missouri and chair of the board’s finance committee, explained that the $1.5 million for capital improvements at Ghost Ranch is needed to address immediate problems related to safety – including a collapsing roof, potholes in roads and replacing an aging bus.
Expenses to support Stony Point have been capped. A plan hammered out earlier this year requires Stony Point to meet certain financial milestones over the next two years. Failure to do so could mean discontinuing the center’s mission and selling or leasing the center’s property.
According to a report presented to the board, the Stony Point milestones have been set (in part) as follows:
- For 2014, an operating loss no worse than $90,000;
- For 2015, an operating loss no worse than $60,000;
- For 2016, an operating loss no worse than $30,000;
- For 2017, the center would break even.
Kitty and Rick Ufford-Chase, co-directors of Stony Point center, told the finance committee that they’ve been working with a hospitality industry consultant on strategies to increase occupancy at the center. The consultant told them that “you have very good foundations” and “this is very do-able,” Kitty Ufford-Chase reported.
They are working on developing a donor base; adding the ability for guests to reserve rooms online; systematically contacting groups that might be willing to hold events at Stony Point; and prioritizing capital needs. While things look promising, Rick Ufford-Chase said, the last few months have been challenging.
“We are not out of the woods,” he said. “It is touch-and-go for us every month.”