Scars

For the past 25 years I’ve lived in 2 cities: Birmingham, Alabama and Richmond, Virginia. These two are integral to African-American history in the US. Richmond was the capital of the Confederate States of America and one of the centers of the slave trade. Birmingham was founded after the Civil War but was a focal point of the Civil Rights Movement and infamously had a bombing in September 1963 which killed four girls who were at their church (the family of one of those girls worshiped at a church where I worked).

 

Bombingam – it will be a hundred years before it lives down that name – is still living its racist history. Here’s what I witnessed living there from 1995-2005

  • A bombing of a women’s clinic just six blocks from a church I worked at. The bombing killed a police officer and maimed a nurse.
  • I regularly drove on a bridge under which the 1963 bombing was planned
  • I attended briefly the trial of one of the 1963 bombers. The prosecutor is current US Senator Doug Jones; his opponent this November is an ardent support of Donald Trump. Doug will probably lose – to a man who endorses a racist president.
  • I supervised dozens of African-Americans. I always treated them with the same respect I treated everyone else – the way I wanted to be treated.

Richmond

  • Hollywood Cemetery is the final resting place of over 18,000 CSA soldiers and it has a CSA flag (not the battle flag)
  • Monument Ave was a real estate venture in 1920 and to attract home builders, they erected statues of CSA generals, all sons of Virginia. Those statues honor men who were traitors to the USA. A few years ago a statue of Arthur Ashe was added, but the rest of Virginia’s history is completely ignored on Monument Ave.
  • Maggie Walker got a statue in the city a few years ago. She was the first female bank president and the first African-American bank president. But it took almost a century after her death for her to be honored.

 

These cities have scars. Your city has scars, too. They may be covered up (16th St Baptist Church was repaired after the bombing) or they may be on a pedestal (as Robert E Lee is in Richmond), but they’re there. Acknowledge the scars, learn from them, talk about them with others. Never forget what made the scars lest you cause more scars.

 

Lead On!

Steve

Considerations When Getting a New Copier

  1. Start the process of getting bids for a new/replacement copier about 4-6 months before the current contract expires. It will take about 2-3 months to get the bids in and make a decision. Take delivery of the machine within a month of the end.
  2. Do NOT let a new vendor “eat” the current lease. They won’t eat it, they’ll just add it to the monthly bill. Let the current lease expire or come within 2-3 months of expiration before getting a new one.
  3. Ask other churches for references of companies and copiers they like. Ask those for bids.
  4. Remember, a copier is a commodity. There is essentially ZERO difference between today’s machines. THE difference is in service. Thus, when getting quotes, it is vitally important to talk with the VP/Director of service to ask about the number and types of problems that each machine has. The VP of sales will give you a nice pitch (that’s his/her job) but the VP of service will shoot straight(er).
  5. Get a 48 month lease; 36 months are too expensive and 60 months are too long. By month 42 people are ready to get a new machine; around that time, many machines start breaking down more frequently.
  6. Get a quote for the base model and then get quotes for the add-ons (hole punch, staple, saddle stitch, etc.). Most machines do 11×17; desktop copiers can’t do that but 99% of office copiers do bigger copies.
  7. To figure out how many copies you current use in a moth, ask your current vendor for that info. Most copiers today let the company login and billing info such as how many B&W versus color copies were printed that month. When you ask the company for the totals, let them know you’re putting this contract out to bid. When they know they may lose their copier contract, they’ll work harder to keep the contract.
  8. Get info from the current copier company about the cost of returning a machine if you don’t renew with them. Some companies charge a shipping fee (I’ve paid $750) for old machines. Make sure the new lease doesn’t have that clause.
  9. Financially, I was most satisfied with the leases that made you pay for the copier plus the actual number of B&W/color copies. The old method of building in X thousand copies was simply a way to pad the monthly base fee.
  10. You should pay somewhere in the range of 2/10ths to 1/2 a penny per B&W and 3 to 5 cents per color copy. Anything more than that is wrong.

 Lead On!

Steve

 

Pros & Cons of Changing the Fiscal Year

Changing a church’s fiscal year away from a calendar year is hard. Usually it requires changing the constitution and that alone means multiple presentations to the church membership. It also requires changes in the budget year, the way committees and teams plan and spend, the way the Finance Committee reports to the church, etc. But it can be beneficial to the church’s finances and not ending December with “will we make it” mentality.

I recommend a church do an analysis to determine the cost/benefit of such a change. Here are some points to consider.

Pros

  1. Allows the church to use the end of year gifts into the next year.
  2. Avoids the “Will we make it?” mentality associated with getting end of year gifts and all that uncertainty.
  3. Moves the budget process to the spring instead of the summer and early fall.
  4. Aligns the fiscal year with the school year which in society is the beginning of the year.
  5. Allows TCCC to have their fiscal year aligned with their school year.
  6. Pushes the year-end financial reports away from January and the requirement to get that done even if staff is sick or the weather is bad.
  7. Moves the year-end and year-beginning work on the creating/storing folders and files; inputting new budget into the financial software; adjusting personnel wage changes in payroll; etc. away from the holiday season.
  8. Every five years allows the audit to be done during the low auditing season. High season is tax season (February-April).

Cons

  1. A lot of work initially to adjust the fiscal year, the budget, and communicate with all the vested parties and get their input on the process and its desired outcome.
  2. Affects several committees/teams and changes some routines:
    1. Admin Board and Finance – new budget timeline, end of year reporting, etc.
    2. Personnel – affects when salaries are changed and reviews are done
    3. Constitution – requires a constitutional change
    4. TCCC – moves their budget
    5. Nominating – may affect them (uncertain about this)
  3. Moves away from a clear fiscal year = calendar year.
  4. There is still a last minute, year-end rush to get gifts which still keeps the staff busy at Christmas, New Year’s, and the first few weeks of January.

 Treasurer’s Recommended Fiscal Year: August 1 through July 31

Lead On!

Steve

 

Church Finances during COVID-19 (part 5 of 5) – Closing Doors

Every year several hundred churches close their doors permanently. Countless churches are already on wobbly financial grounds and an economic crisis will close more than the usual number. The impending economic crisis forecasted for us is huge: double digit unemployment lasting months or years, economic recession or even depression, etc.

 

If your church does find itself being forced to close forever, consider some alternatives that will enable the assets of your church to help others.

  1. Talk with your local religious body leader to see if you can donate your building and property to the local judicatory (association, convention, conference, presbytery, diocese, etc.). They will take ownership of the building and give or sell it to a new congregation. If that isn’t possible, they can sell the property to a developer and then they’ll invest that money and at a future date, make grants to new churches so that several phoenixes can rise from a closed church.
  2. If you don’t have anyone to talk with about this, please contact me. I have resources.

 

Please do not go to extreme lengths to prolong the life of a church that is moribund. Like people, churches should have a DNR (do not resuscitate) protocol. Instead of using resources to keep a building open and a congregation going, use those resources to close the doors gracefully and bless new church starts with your assets. That will honor the Kingdom the most.

Lead On!

Steve

Listen to the podcast:
https://anchor.fm/cbf-va/episodes/Church-Finances-during-the-Pandemic-Navigating-the-Financial-Fallout–the-CARES-Act–and-Making-Tough-Decisions-ecfgm7

Church Finances during COVID-19 (part 3 of 5) – reducing expenses

During this time when church buildings are closed, the church can address its finances in a productive way. During the 2008-2010 Great Recession, I advised churches to reduce their budgets by 10%; the churches that did that survived without letting go any staff or even cutting their wages. The level of our impending economic crisis is dramatically different than the Great Recession so the ideas of the past may not serve us in the present but they can help. Here are some ideas for the present reality (these ideas are good for any time of the year, not just during a crisis).

 

Reduce Expenses

  1. Personnel – this is 50% to 60% of a church’s budget so let’s start here
    1. Hiring freeze – do not hire anyone new to your staff. Stay focused on who you currently have and try to retain them. Some may leave and that’s okay but don’t replace them right away. Try to get by with a smaller staff. When your finances stabilize decide then if you can afford to hire new staff.
    2. Cutting staff – if you do need to cut staff, then first let go the staff that under-perform. It is always painful to terminate people (I’ve terminated over 50 in my career so I speak from experience) but this might be a time for you to terminate staff that have not performed well or are part of a ministry that isn’t in your core. That is harsh – I recognize that – but we’re talking about the continuance of your church and ministry. You can provide the terminated staff with benevolence money for groceries and rent/mortgage for a few months. Terminating staff will let the rest of the staff and the membership know how serious the situation is – it’s a reality check.
  2. Building – this is the second largest expense area of a church’s budget, usually 15%-25% (depending on whether you have debt)
    1. Talk with your bank about refinancing. Banks are borrowing money from the Federal Reserve at 0% so they can afford to lower the rate they charge their customers. Have this conversation – the worst your banker can say is “no.”
    2. Change your thermostat settings: 60 or 65 when it calls for heating; 80 when it calls for air conditioning.
    3. Turn off lights and keep them off
    4. Reduce the number of trash pickups
    5. Look at every one of your contracts and put them out to bid in the next few weeks and months. This is low-hanging fruit through which you can save a LOT of money if you negotiate.
    6. You may not need to bid out every contract. If you’re particularly satisfied with a vendor, ask them to reduce their fee. In 2010 I asked and my lawn management company cut their fees by 30% so I kept them and they’re still there 10 years later.
  3. Programming – this is the third area of church spending and it is the smallest, usually 15%-20% of which 5%-10% is missions. There’s not much you can do here but you can be creative.
    1. It appears now (April 2020) that mission trips for this summer will be cancelled. Use the money allocated for that to do creative missions:
      1. Send the money directly to your missions partners in the country or region where you were going and let them use the money however they want or need to.
      2. Use the money to do missions in your own city.
        1. Provide meals and snacks to your local hospital’s staff.
        2. Send gift cards to your banker who is working hard for you.
        3. Give gift cards to people whose income has been deeply affected by the economic shutdown: restaurant workers, hotel staff, retail employees, small businesses, etc. These are your friends and neighbors – take care of them. They’ll remember what you did.
        4. Create videos and have them sent to your nearby retirement communities. They are in lock down and they desperately need to know that you’ve not forgotten about them. Ask the retirement community to show the videos on their in-house TV network.
      3. Natural attrition
        1. You’ll have a natural reduction in some expenses such as flowers, candles, Sunday School materials, etc. Some of your printed materials may switch to online PDFs and they are cheaper.

 

Bottom line: take this opportunity to seriously look at your expenses and see what you can cut that won’t affect your ministry or that will protect your core ministry.

 

Lead On!

Steve

Listen to the podcast:
https://anchor.fm/cbf-va/episodes/Church-Finances-during-the-Pandemic-Navigating-the-Financial-Fallout–the-CARES-Act–and-Making-Tough-Decisions-ecfgm7

Church Finances during COVID-19 (part 2 of 5) – Paycheck Protection Program

friends hugging

As part of the $2.2 trillion CARES Act, Congress approved the Paycheck Protection Program. This program is aimed at small businesses including churches and religiously affiliated non-profits. It is a rare time when Congress authorizes money to be given to churches.

 

I’ve done the application for a few churches and organizations. The amount of money is you can get is dependent on your payroll but in the churches I’ve worked with it amounts to about 5-6 weeks of income. Word is that the program is so popular that it ran out of money in its first few days but Congress is already working to supply additional money.

 

  1. It was launched on Friday, April 3, 2020 and the deadline is June 30, 2020.
  2. Work with your bank, you’ll need to calculate your spending on payroll for the past year, complete some forms, and get some signatures. Your banker is the key to the program.
  3. The PPP provides for a 100% forgivable loan by the US government for 2.5 months of your payroll expenses (based on some calculations). If you have the same or more employees after June through December 2020, then the loan is entirely forgiven.
  4. If you don’t need or want the money – get it anyway. You can always
    1. Return the money later
    2. Give it to a non-profit that you partner with
    3. Use it for missions in your community
  5. The CARES Act also has some changes in charitable giving laws which might be of benefit to some people in your church. Please consult your tax professional to see if these laws would be beneficial in letting you give more money to your church. And even if the laws aren’t in your favor, give anyway – you’ll rarely regret giving money to your church.

 

Lead On!

Steve

Listen to the podcast:
https://anchor.fm/cbf-va/episodes/Church-Finances-during-the-Pandemic-Navigating-the-Financial-Fallout–the-CARES-Act–and-Making-Tough-Decisions-ecfgm7

 

Church Finances during COVID-19 (part 1 of 5)

Issues to address immediately:

  1. Online giving – if you don’t have it, get it now. My currently preferred vendor is Tithely. They can get you set up in a few hours (they say they can do it in minutes but…). Then, promote the heck out of your online giving.
  2. Audio & video technology – This crisis has forced many churches to acknowledge their AV equipment wasn’t ready. PLEASE invest more money into this area. You won’t regret it. After this is over you’ll have really good microphones. With your video equipment, you can improve or launch an online service so that members can watch you whether they’re homebound, traveling, sick, in a retirement community, or just want to watch the service again during the week.
  3. Paycheck Protection Program – the $2.2 trillion CARES Act (and its related additional acts) provide churches federal money. This is the first time the US government has offered money to faith groups. Fill out the forms, work with your local banker, and get the money. If you don’t need or want the money – get it anyway. You can always
    1. Return the money later
    2. Give it to a non-profit that you partner with
    3. Use it for missions in your community

 

I think every church in the world has realized the need for those two things. These are no longer “wants” but actual needs. Yes, it will cost some money but it may be the difference in survival and closing your doors.

Lead On!

Steve

Listen to the podcast:
https://anchor.fm/cbf-va/episodes/Church-Finances-during-the-Pandemic-Navigating-the-Financial-Fallout–the-CARES-Act–and-Making-Tough-Decisions-ecfgm7

Columbarium – Part 6: Moving?

One of the serious considerations that each church faced was moving the columbarium should the church ever relocate and the property be sold. As cities and suburbs change, churches wax and wane; some are closed for good and some move to a new location. In either case, what would the church do if moving the columbarium was necessary?

Relocating the Church

  1. The columbarium committee secured a commitment from the church leadership at the time that if the church ever moved, then the columbarium would go to the new location. That leadership will certainly be gone when/if the church ever moves but at the time that was comforting to the people who were buying niches.
  2. The niches were in a brass box – a series of about nine rows and seven columns which created 64 niches (singles and doubles). This brass box is exceedingly heavy and sturdy.
  3. The decision was made that should the church relocate, then a mason would chip away at the bricks surrounding the brass box of niches, each box would be lifted out and moved. At the new location, a new columbarium would be constructed and house the brass boxes.
  4. As to the areas where ashes were scattered or interred in the ground, the committee said that as much dirt as possible would be transported to the new location and placed in a new area set aside for ashes. It was recognized that not all dirt could be moved but that every effort would be made to move as much as possible in a dignified way.

Closing the Church

  1. Should the church close, the decision was that the church would approach a cemetery and make arrangements to move its niches and dirt. The sale of the church and the perpetual fund would cover the moving costs and the permanent fund at the cemetery.
  2. Then, the move would follow steps 3 and 4 above.

The committee was thorough. We wanted to ensure we created a sacred space for the eternal rest of people created in God’s image and then ensured that they would be taken care of forever. The committee achieved that and then disbanded. We gather now only when we meet at the funerals of friends but we also are glad that we made a place for them to be and their families to visit.

Lead On!

Steve
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