by Sharon Leyhow
Today, Sunday, October 27, 2019, the Finance Committee (Steven Jones, Bill Kaufman, Sharon Leyhow, Drew Serres, and Janice Teemer) held two town hall meetings. Many were not able to attend the meeting, so I want to provide you the outline of the meeting and a copy of the charts we shared with the congregation. (Click here!) Janice Teemer took notes and the many suggestions which came up during the meetings. We would love to share those comments with you at your convenience.
THE FLOW OF THE FINANCIAL TOWN HALL MEETING 10/27/19
Opening Prayer – Fr. David
Title for Financial Town meeting: “Where We Are Now and Where We Want to Go?”
Purpose for the meeting:
a. To share with the congregation (to inform) our current status by using historical financial data (charts) for handouts
b. To share with the congregation that Finance Committee’s focus is to reduce SsAM’s dependency to withdraw principal from the endowment fund to meet operating expenses.
Bill Kaufman – There are so many things we love about SsAM. The people, the mission, the music, the hub as an advocate for justice, and so much more.
Right now we all know that SsAM is spending more than it’s receiving in revenue. This is a challenge, but also an opportunity. It’s a chance to really build up the SsAM community, invigorate our members, and put us on a path of growth for the future.
Review of Charts – Drew Serres and Steven Jones
What that means is that, within the next 3 years, we recommend we only spend what’s within our revenue stream, without pulling from the endowment. Once we raise more revenue, we can look at where we as a congregation want to grow our services and programs, but we can only do this after we’ve received the funds (as opposed to spending funds in the expectation that donations will come).
That means in 2020 we recommend reducing draws from the endowment’s principle by 33%. This means we also recommend the need to reduce some of our expenses. We know this involves tough choices, and we all may have different priorities for SsAM’s budget, but we hope all of the SsAM community understands the urgency of making those tough decisions this year, instead of waiting even longer.
As we all recall, there are four pillars that we use at SsAM to inspire us. The Finance committee is focusing on
• Create a sustainable financial picture.
— Balance budget with no need to draw on the endowment
— More people giving and avg. pledge is higher
— Endowment has grown 20%
— Have so much we can give to outside groups
We welcome ideas and input on how to make sure SsAM live within its budget. The Finance Committee is both 100% committed to making sure we support our current congregation and avoid depleting SsAM’s endowment so it hinders the mission of future congregations.
We believe SsAM is a pillar in Delaware for promoting peace, justice, reconciliation, and empowerment for all people so we want to take the necessary financial steps now, even though they may be difficult in the short-term, to ensure we’re protecting our great history and preserving our exciting future.
STOP and get reactions from the congregation. Members of the Finance Committee
Steven, Sharon, Bill select one question raised at the September Town Hall Meeting each to share with the congregation if time permits we may select a second one.
If you have suggestions or ideas on how we can address this issue, please contact one of us or a member of the vestry.
What are the next steps? Over the next few weeks, the Finance Committee will prepare a draft budget and share it with the vestry. It will reflect a 33% reduction from the amount we will take from principal. This means that we will create a budget that is projected to take $60,000 or less from principal for 2020. We will have to reduce the operating costs by $30,000 and/or raise income. The vestry will review the draft budget and decide whether to accept it as drafted, to continue to with draw down the current rate or some other rate, to reallocate funds from one area to another and to develop ideas and ways for the congregation to grow and to increase income.
Key Financial Points
Since 2010, 5 of the past 10 years have required a withdrawal from the endowment’s principal (i.e. beyond what’s earned in interest annually). The total withdraw over the past 10 years is over $400,000.
Main Issue: The more SsAM spends from the endowment’s principal the less it will have to spend in future years on services, music, and the operation of the church.
We need to ensure SsAM can continue to support crucial services, music, and church activities well into the future. At our current spending, future SsAM members won’t enjoy the same benefits we do.
Our goal is for SsAM to have a balanced budget within the next 3 years.
We know that we will need to replace our HVAC system soon and the cost may exceed $170,000.