Tidings lead article

Funds flows at Saint Saviour’s

At the vestry’s October retreat, a couple of vestry members suggested explaining to the parish as a whole where money comes from and where it goes. This is an attempt to offer an explanation of our funds flows.

One thing to note is that the finances of the Nursery School and Dance School are accounted for separately from those of the church.  This is because the two Schools run on an academic year and the parish runs on a calendar year. It is also because the “business” of the two Schools is so different from that of the parish (and they also differ from each other substantially).

The parish’s operating income is close to $300,000 annually.  This is the amount it takes to run regular activities (like worship, adult education, the youth group, and Sunday School).  Operating income excludes major maintenance (like painting the interior of the church) or capital projects (like replacing a roof on the church or on the rectory). 

Where does the $300,000 come from?  A little under half of that amount comes from pledges that folks make towards our operating budget. These are the pledges we ask parishioners to make in the fall stewardship campaign. Making a pledge helps the vestry get a pretty good idea of how much money the parish will have to work with in the coming year.   Money paid against the pledges (usually by means of a check) is accounted for separately from cash that is put in the plate or contributions from people (however made) who have not submitted a pledge.  About 3% of our intake of money comes to us through these “other contributions” (checks from non-pledgers) and “plate” (the cash). 

The two Schools also make contributions to the parish to defray the cost of their operating in the church building (utilities, snow-plowing, etc.).  Together, the two Schools contribute a little under 20% of our overall operating revenue.  This is not “profit” from the Schools because the parish pays the utilities, etc., for the Schools as well as the church. The church seeks to break even on the operating expenses associated with the Schools. 

Almost all the rest of the roughly $300,000 we take in for operating purposes comes from our principal endowment, The Blanche Weed Fund (which consists of a gift made to the parish in the 1930s plus growth).  Reducing the amount we take from the Weed Fund is one of the vestry’s top priorities.  We presently take about $83,000 out of the Fund annually (representing about 28% of our operating income and about 18% of the value of the Trust).  We need to reduce the amount we take from the Fund and can only do this by increasing by amount of money we raise through pledge revenue (and other contributions), both by growing the number of households which contribute to the parish and by increasing the amount each household contributes.  For 2012, we have received 48 pledges for a total of $132,010.  This is down from the $140,000 pledged for 2011.  Pledges for 2012 range from $300 to $10,000 in size, with an average pledge of $2,750 and a median of $2,000.

Where does the money go?   Roughly 22% of our operating expenses arise from looking after the basic needs of the church building, the church grounds, and the rectory (where the Rector lives).  These are not capital expenses, but operating expenses – such as paying for a plumber or electrician for a small fix, paying for cleaning supplies, covering the cost of liability insurance, etc..  Almost 90% of the property operating expense is for the church and the church grounds (as opposed to the rectory). 

The single largest category of operating expense is staff expense.  The parish has one full-time employee (the Rector), two part time employees (the Minister of Music and the Minister of Children’s Education), and a part-time bookkeeper (who is paid on a contract basis).  We also employ two sextons (caretakers) whose compensation consists of housing.  A little under 60% of our operating revenue is spent on staff – salaries for all paid employees, plus pension, health insurance, and life insurance for the Rector.  Insurance is provided through a combination of the The Episcopal Diocese of Connecticut and the Church Pension Group (the main business institution of the national Episcopal Church).

Saint Saviour’s also contributes toward the operations of Diocese (the diocese is the regional grouping of churches we belong to) – all parishes are required to do this.  Our contribution to the diocese represents approximately 9% of our operating expense.  We pay a little in interest to the diocese for a loan we took about several years ago (the loan was for capital projects, but the interest shows up in our operating statement).  And we spend about $9,000 on programs such as adult education, Sunday School, and music and also pay two part-time Sunday childcare providers as part of our program expense.  Program expense represents about 3% of our overall expenses.  Office expenses plus our annual audit fees together represent about 5% of our operating expenses.

What about capital expenses?  These are the large, occasional (as opposed to regular) expenses we incur when major work is needed on our buildings or grounds.  The amount we spend each year for capital purposes varies, ranging in recent years from about $31,000 to about $151,000 (back in 2007 when we were badly flooded: insurance helped with much of this expense).  In 2010, we spent about $72,000 (mostly in redoing the parish office and making a new Godly Play room in the Nursery School wing) and about $86,000 in 2011 (some for another flood, with which insurance will help again, and a substantial amount for the repair of the flat roof over the church). (More details about recent capital expenses may be found in the Annual Report.) 

In most years, we pay for capital expenses largely through the Weed Fund and through funds raised by capital campaigns undertaken perhaps once a decade. We were able in 2011 to draw down cash balances to eliminate the need to draw on the Weed Fund for capital expenses. Our last capital campaign was held in 2006, and we raised about $188,000 through the campaign.  (We received over $200,000 in pledges, but some folks moved away or died before completing their payments against their capital pledges.)   

In 2012, we need to complete the work on the flat roof and repair the window frames for the upper stained glass windows.   The vestry is also considering purchasing a generator for the church (to help us when power goes off and the lower level of the church is being flooded).  We have some work to do on the sextons’ kitchen and on some trees around the grounds, plus a few other smaller projects.   We anticipate needing to spend $60,000 in 2012 on capital projects, again relying on cash reserves and perhaps the Weed Fund. So you can see that the more we can decrease what we draw from the Weed Fund for operating purposes, the more we have left to spend on major capital projects.

If you have questions about funds flows – operating or capital – please speak with me or Bruce Graham, our Treasurer, or Marky Carter, our Senior Warden. And if you don’t have a copy of the Annual Report and want one, extras will be on the table in the main entryway to the church. Thanks. Victoria