Months into the COVID-19 pandemic, the financial situation of the Presbyterian Church (U.S.A.) continues to look troubling — with contributions to the national church in the first seven months of this year down $4.8 million from the same period in 2019, a 14% decline.
Among the contributing factors: contributions from congregations were $1.5 million less compared with the same time period last year, and giving to the denomination’s Special Offerings was down $2.3 million.
“The number are not encouraging,” said Kathy Lueckert, president of the PC(USA), A Corporation – the denomination’s corporate entity – speaking Aug. 20 during a Zoom meeting of the A Corporation board.
Investment income through July 31 was down $24 million — although that is mostly unrealized losses in the endowment funds held by the Presbyterian Foundation, said Denise Hampton, the PC(USA)’s controller.
The Foundation uses a spending formula to determine how much money to send to the Presbyterian Mission Agency to fund the denomination’s mission work, which means that downturns in the market aren’t felt immediately in the funding that’s available — the impact is usually felt a year or two down the road.
As of July 31, the net assets of the PC(USA), A Corporation were $570 million, down $1.5 million from that same time in 2019.
The stock market now is back to about where it was a year ago, said A Corporation board member Cynthia Campbell. “This spring was horrible,” but “it’s come back,” she said.
But it’s in the declines in giving “where we need to keep the eye on the ball,” Campbell said.
By the end of the year, it’s anticipated that Stony Point Center outside New York City – which relies heavily on income generated from events held there – will run a deficit of $2 million, Hampton said.
The $8.85 million Paycheck Protection Program loan that the PC(USA) received from the Small Business Administration is helping significantly with cash flow needs, Lueckert said. Cash flow is particularly a concern when giving is down — because while expenses can be controlled, “what income comes in each week is not under our control,” a report to the board states. “Cash is king. Cash is flexibility. It would be awesome to have a regular cash balance of over $3.5 million for an organization of our size” — but the typical amount is well below that.
In June, the General Assembly approved a unified budget for 2021 and 2022 for the Presbyterian Mission Agency, the Office of the General Assembly and the Administrative Services Group. That determined how much money those entities have to spend — but now each of them needs to figure out how to cut costs so spending matches the income available.
The Committee on the Office of the General Assembly, which also met virtually Aug. 20, heard that eight of the 16 employees from the Office of the General Assembly and the Presbyterian Historical Society who had been offered early retirement packages have accepted them.
Lueckert reported that the Administrative Services Group (ASG) needs to cut its budget by $1.5 million in 2021 and just over $1.1 million in 2022. Savings will come in part from not filling vacant positions; from reducing travel costs; and by the staff going without a planned 3% salary raise in 2021 and 2022. Ten ASG employees have been offered early retirement packages, and have until Sept. 17 to decide whether to accept.
“Our plan is to bring you the final 2021-2022 budget adjustments in October, for review and approval,” a report to the board states.
For now, “there are no reductions in force planned,” Lueckert told the board.
Board co-chair Bill Teng asked what is being done to let Presbyterians know what the numbers look like — and of the need for donations.
So far, there hasn’t been a unified message or broad discussion of the idea of some sort of national financial appeal for the PC(USA), Lueckert said.
Lueckert said the PC(USA)’s COVID-19 Financial Team plans to meet next week with Diane Moffett, president and executive director of the Presbyterian Mission Agency, and with J. Herbert Nelson, the PC(USA)’s stated clerk — and “it’ll certainly be a topic” in that conversation.
Presbyterians in churches need specific information on the financial need, Teng said. “People are probably ready to give, but they don’t know how,” he said.
“The operational truth of fundraising is you never get what you don’t ask for,” Campbell said.
The A Corporation board’s meeting – which began Aug. 19 with an afternoon of new-member orientation – will continue Aug. 21 with committee reports, updates on continuing work and a closed session.
