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2020 Vision |
Financial Stewardship
by: Harvey Hill, October 28, 2019
The Financial Picture
We have a strong financial foundation. For the last eight years, Saint David’s has been blessed with balanced budgets and a slowly growing reserve fund. Our capital reserve grew dramatically when we sold the rectory and invested the proceeds. Although the final numbers for 2019 are not yet in, we are likely to have a deficit this year due largely to the expense of replacing the HVAC unit on the office side of our building. Thankfully, our income for the year should exceed our ordinary expenses. And we continue to hold a comfortable reserve. (The Vestry established the goal of maintaining a cash reserve at least equal to half our annual budget. We are well above that threshold.)
The Challenges
Looking ahead, we face several clear challenges.
First, our expenses are likely to rise. We anticipate significant capital expenses in the near future: e.g., replacing the rug in the sanctuary, the roof, and the other two HVAC units. Also the Vestry has expressed an interest in increasing my hours. I am currently half-time. Moving to two-thirds or three-quarters time would be desirable but also expensive.
Second, pledge income is not likely to keep pace with our expenses. People today are less likely to attend Church and slower to make a financial commitment when they do. Our pledge income has been relatively steady over the last eight years, which is great. We will continue to rely primarily on pledge income for the foreseeable future. But we are not likely to see significant increases in pledge income anytime soon.
The Opportunity
Our Vestry is keenly aware of these challenges and has begun planning for our financial future.
Part of that preparation is prudent budgeting. Our goal is to build our capital reserve back up by setting aside money each year. Hopefully by the time our next significant capital expense occurs, we will be ready.
Part of the preparation is continued fund-raising. The people of Saint David’s have been remarkably creative in finding fun and appropriate ways to raise money. Particularly helpful are events that bring in people from the community. They both enjoy our events and help to cover our expenses without draining the resources of congregants.
Finally, we continue to seek rental income. Our building is both our single most valuable financial asset and our greatest potential financial liability. We currently have a number of tenants. Many, like the Twelve-Step Groups, pay a nominal rent that mostly covers the expense of opening the building. Supporting them is part of our Christian mission. Others are tenants in the normal sense of the term and contribute significantly to our budget.
This last is our best opportunity for future growth. Ideally, renting space would bring in enough income to cover the ordinary expenses associated with maintaining our building. And we have a lot to offer: convenient location, good parking, everything on a single level, air-conditioning, and availability during much of the week. The trick is to get the word out. Going forward, we all need to do what we can to let potentially inter
The Financial Picture
We have a strong financial foundation. For the last eight years, Saint David’s has been blessed with balanced budgets and a slowly growing reserve fund. Our capital reserve grew dramatically when we sold the rectory and invested the proceeds. Although the final numbers for 2019 are not yet in, we are likely to have a deficit this year due largely to the expense of replacing the HVAC unit on the office side of our building. Thankfully, our income for the year should exceed our ordinary expenses. And we continue to hold a comfortable reserve. (The Vestry established the goal of maintaining a cash reserve at least equal to half our annual budget. We are well above that threshold.)
The Challenges
Looking ahead, we face several clear challenges.
First, our expenses are likely to rise. We anticipate significant capital expenses in the near future: e.g., replacing the rug in the sanctuary, the roof, and the other two HVAC units. Also the Vestry has expressed an interest in increasing my hours. I am currently half-time. Moving to two-thirds or three-quarters time would be desirable but also expensive.
Second, pledge income is not likely to keep pace with our expenses. People today are less likely to attend Church and slower to make a financial commitment when they do. Our pledge income has been relatively steady over the last eight years, which is great. We will continue to rely primarily on pledge income for the foreseeable future. But we are not likely to see significant increases in pledge income anytime soon.
The Opportunity
Our Vestry is keenly aware of these challenges and has begun planning for our financial future.
Part of that preparation is prudent budgeting. Our goal is to build our capital reserve back up by setting aside money each year. Hopefully by the time our next significant capital expense occurs, we will be ready.
Part of the preparation is continued fund-raising. The people of Saint David’s have been remarkably creative in finding fun and appropriate ways to raise money. Particularly helpful are events that bring in people from the community. They both enjoy our events and help to cover our expenses without draining the resources of congregants.
Finally, we continue to seek rental income. Our building is both our single most valuable financial asset and our greatest potential financial liability. We currently have a number of tenants. Many, like the Twelve-Step Groups, pay a nominal rent that mostly covers the expense of opening the building. Supporting them is part of our Christian mission. Others are tenants in the normal sense of the term and contribute significantly to our budget.
This last is our best opportunity for future growth. Ideally, renting space would bring in enough income to cover the ordinary expenses associated with maintaining our building. And we have a lot to offer: convenient location, good parking, everything on a single level, air-conditioning, and availability during much of the week. The trick is to get the word out. Going forward, we all need to do what we can to let potentially inter
