The proposed mission budget for the Presbyterian Church (U.S.A.) for 2017 and 2018 includes a 15 percent decrease from the 2016 budget, and is expected to result in job losses for fewer than 10 employees from the Presbyterian Mission Agency national staff.
Being proposed is a mission budget of $63.53 million for 2017 and of $63.45 million for 2018. That’s more than $11.2 million less than the revised mission budget for 2016 of $74.82 million, and is the smallest mission budget in the agency’s history. The plan calls for the budgets to be balanced without pulling any funds from unrestricted reserves.
This is a proposed budget – which means it is still preliminary and could be changed. The Presbyterian Mission Agency board is meeting in Louisville April 27-29, and is expected to vote on the budget April 28. Once a budget is approved, employees whose jobs are affected would be notified on April 29.
Here are some details.
Zero based budgeting
In an interview with the Outlook, Tony De La Rosa – interim executive director of the Presbyterian Mission Agency – explained that his staff has worked for 10 months to craft a budget proposal that includes elements of agency-wide work restructuring.
The starting point, he said, was to consider mission work funded by restricted funds – meaning it was certain funds would be available. “That was sort of the ground. … Then we begin building the superstructure on that essential foundation.”
The budget was built using “very conservative revenue assumptions,” De La Rosa said.
“We used trend data for support from congregations and Special Offerings. We are also looking at worst-case scenarios” – assuming, for example, that space on the first floor of the denomination’s national offices in Louisville, which is currently being rented out to a construction firm, might not have a tenant when that lease expires.
Programs were scrutinized to see whether they aligned with the three directional goals of the Mission Work Plan:
- Evangelism and discipleship;
- Servant leader formation; and
- Justice and reconciliation.
Another consideration was whether particular programs potentially could be accomplished more effectively or efficiently by other Presbyterian entities, such as mission networks, mid councils or local congregations, or whether it was work the national staff was uniquely positioned to do.
“What we’ve tried to do is maintain some capacity even though the nature of the work is changing, because the church is changing,” De La Rosa said.
No specifics have yet been presented of which programs will be directly affected by the budget cuts, although De La Rosa said that under the proposal “a handful of programs will be eliminated.” The impact of the proposed budget cuts would be felt broadly across both administrative and ministry areas, he said.
Up until now, the unrestricted reserve fund has been called the Presbyterian Mission Program Fund, or PMPF. In 2016, the budget was balanced in part by pulling $4.2 million from unrestricted reserves – but board members had warned repeatedly that those reserves were expected to be exhausted by 2017.
In 1990, the General Assembly imposed a requirement that the PC(USA) keep in the PMPF reserve a minimum of 30 percent of the unified portion of the General Assembly Mission Budget – which came to $5.14 million as of Nov. 30, 2015.
The proposed mission budgets for 2017 and 2018 are built using a different approach – setting aside at least three months of operating expenses as a reserve. The Presbyterian Mission Agency board voted in February to ask the assembly to change the rules for determining how much money it needs to keep in reserve.
For 2017, the unrestricted reserve would be set at a minimum of $3.04 million (25 percent of the $12.18 million in unrestricted expenses) and the minimum restricted reserve at $5.062 million (with restricted expenses of $51.34 million).
No funds will be drawn from unrestricted reserves (the new name for PMPF) to balance the budget in 2017 or 2018, De La Rosa said. The hope, he said, is to build up both the unrestricted and restricted reserves over time to amount to a year’s worth of operating expenses.
The change in PMPF requirements would need approval from the General Assembly in June. The assembly also will be asked to approve the 2017 and 2018 mission budgets, which De La Rosa described as a “two year bridge plan,” as he serves as interim executive director.
While the proposed mission budgets for 2017 and 2018 are about 15 percent lower than the budget for this year, fewer than 10 employees are expected to lose their jobs, De La Rosa informed the staff by email on April 22. That’s in part because there are currently 80 vacant positions on the Presbyterian Mission Agency staff. As positions became open, ministry directors often held off from filling them, knowing that budget cuts were on the horizon.
Also included in those 80 vacancies are the jobs of 26 employees who accepted voluntary separation packages earlier this year (of 46 who had been eligible) – a package offered to workers who were at least 60 years of age and had at least five years of continuous service to the PC(USA).
As of April 18, the Presbyterian Mission Agency had 269 employees, including full and part time workers and term employees, according to Kathy Francis, the PC(USA) director of communications.
The budget also includes a new way of approaching what was formerly described as funds development – and now is referred to in the budget document as Mission Engagement and Support. Under the leadership of Rosemary Mitchell, who was named interim senior director of Funds Development in March, new approaches are being taken in this area – including adopting a geographic and “more holistic” approach to fundraising instead of targeting efforts to raise money for specific programs, De La Rosa said.
Today, the ways congregations and individual Presbyterians want to be involved in supporting PC(USA) mission work “isn’t merely by writing a check,” he said. “They want to visit the sites. They want to see their mission dollars at work. They want engagement with those mission projects.”
In both the 2017 and 2018 proposed budgets, the document breaks out as a line item $15,000 for Mission Engagement and Support expenses. De La Rosa pointed out, however, that expenses for fundraising actually are much higher – but at the request of auditors and others, those expenses are distributed across the ministry areas for which funds are raised – to reflect the total cost of doing business for each of those areas.
The total expenses for fundraising activities, before being allocated to the ministry areas, comes to $4.79 million in 2017 and $4.88 million in 2018.
Although the proposed budget does include some staff cuts, De La Rosa said he will strive to be as pastoral as possible in making them – relying on the procedures used in implementing the voluntary separations earlier this year. Some staff may be asked to extend their service temporarily to meet urgent mission needs; those departing will have some choices about when to pack up their belongings; and a chapel service will be held May 4 to thank those workers and honor their service.
De La Rosa has been communicating with the staff weekly by email to update them on the budget process, because “sometimes fear and anxiety are caused by lack of information,” Francis said.
And while there will be some restructuring of work, “we will not be simply combining two positions into one and expecting people to do double the work,” De La Rosa said. “That won’t be the case.”
De La Rosa also said, “I have to commend the work of the staff who really stepped up as part of this process. Everybody in senior management and particularly the folks in finance and accounting, who had to crunch the numbers for us” – and who were short-staffed themselves because of departures – “really deserve kudos.”
The board’s executive committee will consider the proposed budget in closed session April 27. The full board is expected to meet in closed session on April 28 to discuss the budget and to vote on the budget proposals for 2017 and 2018 later that day.