Solar panels, selling property, staffing – everything’s on the table

Pastors continue preaching, planning, and preparing as financial strings tighten in many parts of the country. How are their congregations’ budgets surviving this economic environment? We sent questionnaires to 200 pastors to ask about the state of their church finances; we received 49 responses from pastors and church staff.

Downturn affects budgets
A survey of more than 1,000 churches by Your Church magazine found 40 percent reported lower giving in 2009 – with more of the same expected ahead.

“The effects of unemployment tend to lag a bit for churches that emphasize tithing, but as the unemployment rate continues to increase, more congregations will get hit financially,” according to Ed Stetzer in the Your Church magazine survey.

How are the 49 churches that responded experiencing the downturn? About one-half of them made cuts in staff, buildings, ministries, or administration during 2008 and 2009.

Diverse steps to face difficulties
The congregations are adapting to difficult financial realities in a wide variety of ways, including:

• Reducing the operating budget for next year.
• Cutting pastoral support from full time to half time and planning a staff reduction.
• Reviewing philosophy of ministry, vision, and connection to resources.
• Placing building projects on hold.
• Using any extra funds to reduce church debt.
• Reduce staff use of Blackberry and cell phones.
• Installing solar panels to provide electricity.
• Making a contingency plan if the general fund falls to emergency levels.
• Considering sale of the church building and other property.
• Going to a variable budget with quarterly updates and revisions.

Hope evident in growth
Yet, as many churches feel pinched, some also have ambitious building programs underway – two of them committed to finishing those programs debt free. Some churches said they are responding to current economic news by swimming upstream. They are:

• Exploring new ways to find funds and providing new opportunities for volunteers.
• Committing to increase outreach funds.
• Finishing a third building program in 20 years.
• Committing to hold to previous commitments on church-wide and missions giving.
• Starting a capital campaign for major building improvements.

Alternative means to stabilize budgets
Teleios asked pastors if their churches had reserves or a rainy-day fund available. Twenty-six of the 49 said they have such a fund, while one more pastor’s congregation is considering one. Twenty-eight of 49 churches said they have no debt, 13 are working diligently to reduce their debt load, and one is considering new re-payment schedules.

We also asked pastors how they viewed fundraising for special ministries – and whether they might use fundraisers to fill gaps in the general congregational funds. Over half of the responding pastors said they use fundraising for special ministries while 16 said they don’t ever use fundraising events. The remaining pastors said they are considering fundraisers to finance unusual needs or special ministries. Meanwhile, four said they have used extra fundraisers to fund their general funds.

Some church consultants say electronic giving options increase giving among parishioners, particularly young adults and those who don’t attend church every Sunday. So, we also asked pastors if their churches were accepting funds via electronic giving. Only five of the 49 responding pastors said they were accepting funds electronically, and one was considering the idea.

In the end, while many churches respond in the financial heat with needed budget cuts, the good challenges are just as evident to build faith, strength, and resiliency in parishioners.

Possible actions for reducing expenses

• Using electronic newsletters and cutting mailing costs when possible.
• Freezing salaries for the year.
• Cutting back on food purchased for church events.
• Extra watchfulness on giving trends – thinking further ahead.
• Teach biblical stewardship as part of a newlywed class.
• Do a congregational skills audit to determine areas where your church can be more volunteer-driven.
• Re-evaluate the congregation’s core values with wide congregational participation and then determine if funding strategies match the core values.
• Give thanks for the blessings of continuing contributors and continue to minister faithfully.

  Collected from: elca.org, www.yourchurch.net, mennoniteusa.org.