Budget Deficit Disorder

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A narrated power point on diagnosing and confronting church budget deficits

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Budget Deficit Disorder :

Budget Deficit Disorder Diagnosis and Treatment By Andy Gustafson Associate Conference Minister for Stewardship and Financial Development Massachusetts Conference, United Church of Christ

Deficits Drive Us Crazy!:

React out of fear – not faith Catastrophize Deny Blame Game Ask people to give to the deficit instead of the mission Go negative during worship announcements Deficits Drive Us Crazy!

Matthew 6.31-34 :

Therefore do not worry, saying, “What will we eat?” or “What will we drink?” or “What will we wear?” For it is the Gentiles who strive for all these things; and indeed your heavenly Father knows that you need all these things. But strive first for the kingdom of God and his righteousness, and all these things will be given to you as well. ‘So do not worry about tomorrow, for tomorrow will bring worries of its own. Today’s trouble is enough for today. Matthew 6.31-34

Remember Who You Are:

It is God’s church – not yours We are called to be faithful – not successful in the ways the world measures success Budget reflects your mission and your values “Seek first the kingdom” Be Clear on Your Vision and Purpose Who you are Who your neighbor is What God is calling you to be and do Remember Who You Are

Diagnosis:

What is the REAL problem? Gather your data on a time-line: History of income and expenses Exceptional circumstances Fundraising history Pledge programs Other fundraising activities Other income Giving dynamics Diagnosis

Example:

Example

Is it REAL? Is it Avoidable?:

Overly Pessimistic estimates Failure to use standard invested fund policies Counting capital expenses against annual expenses Not using available income for the operating budget Is it REAL? Is it Avoidable?

Temporary or Structural?:

Temporary: Loss of giving income which can be replaced over time (i.e. death of large donor) Loss of other income (such as rent) which can be replaced One time exceptional expenses Gap is closable within a few years Trend-lines are favorable Church conflict/malaise Temporary or Structural?

Temporary Deficit Solutions:

Second mile campaigns Internal loan External loan Extra fundraising events Wait and see Expense reductions Multi-year plan Temporary deficits can be addressed with technical change Temporary Deficit Solutions

Structural Deficits:

Judgment call Long term – cannot be closed in next few years unless major change occurs Gap between operating income and operating expenses large and growing Analysis of giving indicates that a strong stewardship program will not be sufficient to close gap Requires significant adaptive change Structural Deficits

Examples of Adaptive Measures:

Implement a turn-around plan Reduce non-pastoral staff –replace with volunteers Reduce amount of building used by church – rent the rest Start a business Sell building - relocate Go to part time pastor Leadership change Examples of Adaptive Measures

Downsides to Drastic Measures:

Loss of members Loss of giving Loss of volunteers Loss of sense of purpose and vision Loss of vital ministry End up worse off than when you began Downsides to Drastic Measures

Downsides to Inaction:

Only “kick the can down the road” When forced to deal with problem in the future, no longer have the assets needed Constant worry drains morale Downsides to Inaction

Drastic Measures Require Careful Planning:

Timing Consensus building Truth-telling without panic Mission driven Avoid blame-frame Respect and honesty Whole church involvement and ownership World Café model Asset Mapping Bring in outside help, especially if leadership change is needed Drastic Measures Require Careful Planning

Create a Plan with SMART Goals:

Specific Measurable Achievable Relevant Timely Create a Plan with SMART Goals

Words of wisdom from Paul Nixon’s “I Refuse to Lead a Dying Church”:

Choose Life over Death Choose Community over Isolation Choose Fun over Drudgery Choose Bold over Mild Choose Frontier over Fortress Choose Now rather than Later Words of wisdom from Paul Nixon’s “I Refuse to Lead a Dying Church”

Matthew 28:20b:

Matthew 28:20b “And remember, I am with you always, to the end of the age.”

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