May Day! Budget Crisis! What To Do

One of your top donors moves to be closer to their grandchildren. Another major donor gets a new job two states away. And then two or three of your oldest members pass away.

When your annual stewardship drive comes along, your finance folks discover that–in spite of an overall growth in membership–these losses in the top quartile of your pledge distribution can really affect your bottom line.

Here’s what you can do:

How to meet the budget in a time of distress

by Patricia Infante, UUA Congregational Life Consultant, Central East Region

 

  • Reduce variable and discretionary expenses
  • Raise income from within the congregation
    • Increase pledges, even incrementally
    • Increase pledge units, turn friends into members
    • Special “fill the gap” campaign
    • Large donor matching gift program
    • Legacy Gift program
  • Raise income from sources beyond the congregation
    • Facility rental: generate new
    • Facility rental: renegotiate tenant agreements
    • Sell gift cards (bought at a discount) from local grocers
    • Seek entrepreneurial opportunities
    • Grants, crowdfunding campaigns
  • Ensure you have technology to catch money from all sources
    • Online donation capacity on your website
    • Electronic Check capacity for recurring donations
    • Onsite electronic payment tool (such as Square) for one-time payments or  collections at special events
  • Renegotiate debt
  • Scale back ministries
  • Cut staff benefits
  • Cut staff hours
  • Layoff staff
  • Sell real property
  • Merge or close

Additional Resources:

 

Don’t Leave Money on the Pew!

Two decades ago, you could be pretty sure that people in your church would carry a checkbook, cash, or at least a spare check or two in their wallet.  Today, it’s becoming less and less likely that people carry cash or checkbooks. Yet, the ritual of the offering plate continues, and it is less likely to be filled with spontaneous gifts.

Some congregations have been paying attention to this trend, but has yours?  Here are some technical ways to make it easier for people to give to your congregation:
(Please note that the services mentioned are not meant to be an endorsement!)

Automated Giving

Members and supporting friends may already have their banks set up automatic transfers for their pledge payments. But you can make it easier for them by enrolling in a turnkey electronic payment service such as VANCO.

One small congregation has created special “I give electronically” cards that members and friends who pay electronically can put in the offering basket.

E-Giving

Other congregations have set up PayPalSquare, or similar e-giving accounts, and make tablets available for people to give using their credit or debit cards.

Text-to-Give

Still other congregations (especially those with online streaming) have subscribed to a “text-to-give” service where participants can use their cell/smart phones to send their financial gifts. Here is a partial listing of popular services:

Service Fee
Tithe.ly

 

$19/month

 

GivingFire

 

$49/month

 

Txt2Give

 

$25/month +1%

$60/month +0%

 

EasyTithe

 

$0/month+3%  +$0.39 Flat

$29/month+2.6%  +$0.30 Flat

 

GivingFuel

 

Free for 1st $5K
$59/month
Givelify

 

$0/month+2.9%  +$0.30 Flat

 

 

Crowdfunding

Crowdfunding apps such as GoFundMe, Kickstarter and Indiegogo seem to be quick and easy ways to raise money for a project or concern.  But they also have significant fees that reduce the amount of funds that actually go to your campaign. There is an alternate UU crowdfunding app called Faithify that has a much smaller financial transaction fee that means that more money goes to your campaign!

-Rev. Renee Ruchotzke, Central East Region, UUA Congregational Life

The Bubble of Beloved Community

Sometimes, living in a bubble can be a good thing. It can create a barrier between harmful things on the outside and precious things on the insidebubble-by-serg-c.

In some ways, our congregational covenants operate in this way. They articulate that “in this community, this is how we will be together.” We promise to treat one another not only with respect, but with a sense of mutuality so that every one of us can flourish. We promise to work toward becoming our best selves, to learn from our mistakes and to help one another learn and grow.

As religious liberal communities, especially in the current climate of hateful rhetoric, we have a responsibility to model to the rest of the world how we believe people should treat one another. When our congregations are at their best, the are truly communities of people who care deeply and feel cared for.

The funny thing about bubbles is that–no matter how beautiful they may be–it’s human nature to want to pop them. It’s also not uncommon in human nature for some of us to want to pop the fragile bubble of beloved community. This is why our congregations must keep and renew our covenants with the same patience and persistence as a parent blowing bubbles for a toddler.

But sometimes more than a gentle reminder is needed when one of us is out of covenant. If someone persists with a behavior that is hurting the community, congregational leaders need to rely on good, faithful policies to address disruptive behavior. If someone is using racist, sexist, sexual or threatening language, the leaders have a responsibility to step up and stop the behavior, and the members of the congregation has a responsibility to support them in setting those limits.

Now might be a good time to review and refresh your congregation’s covenant as well as your safety policies, especially around disruptive behavior. Let’s keep our bubbles intact.

-Rev. Renee Ruchotzke, Congregational Life Staff

Resources:

http://www.uua.org/safe/disruptive-behavior-policies

https://www.uua.org/leadership/skills/conflict

Never Call Them Jerks By Arthur Paul Boers

 

Church Governance Should Serve, Not Rule

Rev. David Pyle
Rev. David Pyle

Congregations often look to the corporate and not-for-profit worlds for models of leadership, organizational development, fundraising and volunteer management. Unfortunately, they also look there for models of governance to the detriment of their core purpose.  Congregations are ground in covenant, not bound in contract, so the relationship between minister and governing boards should not copy the relationship between a CEO and a corporate board.

Rev. David Pyle, Congregational Life Consultant in the Central East Region, recently shared what congregational governance should look like on his Facebook Page:

1. The purpose of church is not governance.

The purpose of church is mission. The purpose of church is transforming lives to transform the world. Governance is important only as it helps you to live your mission in the world. If you are spending more time on governance than you are on mission, something is wrong. Governance should free your congregation for mission, not serve as a replacement for mission.

2. Corporate style governance systems were not designed for religious community.

Neither were traditional non-profit governance systems. Both import an adversarial mindset between the Governing Board and the Executive that is detrimental to religious mission. Both depend on the Board’s ability to terminate the Executive, which Congregational Boards often cannot do (called ministry). You can make corporate or traditional non-profit governance systems work in congregations, and it takes significant energy and effort, often detracting that effort and energy from mission.

3. There is no perfect governance system.

Governance is about providing some order to the power relationships amongst human beings working together for a common purpose… and human beings are endlessly creative, messy, and chaotic. Governance is far more art than science, because human beings are infinitely complex. Good governance is a creative compromise, and it takes leaders who keep their eye on mission. Good governance is about how can we best all build the “world made whole”.

4. There are many forms of good governance.

Almost as many as their are churches. I am not picky. If Policy Governance helps you best fulfill your mission, then Amen Hallelujah! If having an Operational Board works best for you, then Amen Hallelujah! I even know a Portfolio Board or two that achieve mission well, and a few Family Model congregations who kick serious mission butt. I am not a Governance Fundamentalist. Because it is your religious mission that is vital, not necessarily how you get there. Whatever you do, do what best leads you to mission.

5. Institutional structures come, and institutional structures go.

They are tools, not talismans. They must change as time and culture changes. It is religious mission that remains. Neither Jesus nor Buddha founded significant church structures or governance, they left that to their followers. They focused on religious mission. If your governance is supporting your religious mission, amen. If not, then change tools. But realize they are only tools (including Congregational polity). Letting governance or polity replace mission as the center of our religious focus is a form of idolatry. Our eyes must be on the mission of transformed lives that transform the world, and we must craft tools that best help us to achieve that.

Especially Congregational governance.

Are Your Church’s Retirement Benefits “Legal?”

January is always a good time for a church to take stock of its fiduciary responsibilities. Rev. Richard Nugent, the UUA Church Staff Finances Director, has some important advice for UU congregations, in particular about how congregations administer their retirement plans:


Congregations are legal entities required to comply with all sorts of legal requirements. While religious institutions

Rev. Richard Nugent, Church Staff Finances Director
Rev. Richard Nugent, Church Staff Finances Director

might be exempt from a FEW legal requirements, churches are NOT exempt from most. This includes many requirements stemming from being an employer.

Today’s post pertains to the UU Organizations Retirement Plan. Our plan is a 401(a)/401(k) non-electing church plan. It is governed by IRS and US Labor Department rules. It is also governed by a plan document that every participating congregation has adopted/re-adopted in 2014 or 2015. In adopting our plan, by motion of your governing board, your congregation committed to abide by the rules of the plan (and hopefully federal regulations).

What does this mean:

1) All employees (and all means all) must be offered enrollment in the plan for purposes of making their own employee contributions toward their retirement.

2) All new employees, who never worked for a UUA-related organization before, MUST receive employer contributions after meeting the requirement of 12 months of employment during which they worked 1,000 hours or more. If someone previously worked for a UUA-related organization and was enrolled in our plan, then they must receive employer contributions from day one of employment. New ministers who completed a UUA-related internship are also eligible immediately. After meeting the 1,000 hour/12 month requirement, if anyone’s hours are reduced, they still receive employer contributions. Essentially, once in our plan, always in our plan.

3) Personnel policies that limit eligibility for retirement benefits to certain employees DO NOT TRUMP THE UUA REQUIREMENTS. Our requirements rule, and congregations agreed to that when they signed on to our plan. .

4 All employees eligible for employer contributions must receive the SAME percentage contribution. THE MINISTER CAN NOT RECEIVE 10% OR MORE WHILE EVERYONE ELSE RECEIVES 5%. This is not allowed by our plan and in violation of IRS regulations. I am happy to discuss this with anyone who finds their congregation in this situation.

5) The minimum employer contribution is 5%. 86% of congregations contribute 10% or more. Fair Compensation requires an offer of 10% or more. People need to put away 14% of their salary to ensure the possibility of retirement.

6) If you believe your congregation might be in violation of these policies, please contact me to discuss how you can legally come into compliance.

7) For any questions about our plan, the very helpful and informative Linda Rose directs our retirement plan. As a spouse of a UU minister, Linda understands congregational dynamics. Linda can be reached at retirement@uua.org.

We at the UUA are appreciative of all the hard work you do, and the challenge of keeping up with administrative details.

Reverend Richard Nugent, UUA Church Staff Finances Director

 

Covenantal Faith in a Transactional World

Photo credit:  https://www.flickr.com/photos/zizzy/89696604/
Photo credit:
https://www.flickr.com/photos/zizzy/89696604/

Because our congregations run on money, it’s tempting to bring–along with it–assumptions about how money operates in other parts of our lives.  We go to work and we get a paycheck.  We pay the electric bill and the power company keeps our lights on. We pay at the first window and pick up at the second.

But when we fill out a pledge card, or put together the annual operating budget, the numbers represent more than goods and services.  The numbers represent the ministry that our congregation is called to do in the world, and the numbers represent our financial commitment and accountability to that ministry.

Our covenants are our promises to one another about how we are going to walk together as we do that ministry.

Our pledge cards are promises about how we will help fund that ministry.
Letters of agreement are promises that paid staff and church leaders make to one another about how they will do ministry together and expectations around how they will be accountable to one another.

When we are under financial stress, we are tempted to slip into transactional mode.  The budget looks like any other set of numbers.  The simplest places to cut are the largest line items: staff salaries and benefits.

The financial stress is real, but our responses to the stress can be covenantal instead of transactional.  As you begin a meeting where budget cuts are needed:

  • Remind yourselves of who you are and the good that your congregation is already doing in the world.
  • Remind yourselves of your vision of what more you hope to do to build the beloved community.
  • Remind yourselves of the promises that you have made with one another to support your congregation’s ministry.

Then you will be ready for your discernment as leaders grounded in our covenantal faith.

-Rev. Renee Ruchotzke, Congregational Life Staff

 

 

 

Worst Case Scenarios…and How to Be Prepared

Operation_Upshot-Knothole_-_Badger_001The phone rings.  There is an anxious board president on the phone with a crisis on their hands.  Perhaps their minister has fallen seriously ill, or there is a member who is regularly disrupting the Sunday worship service, or a registered sex offender has expressed interest in attending the church.  Some situations cannot be anticipated or prevented.  But there are many situations where having the right policies, procedures and safeguards in place will help a congregation get through a crisis.

Here is a checklist for your board to use to determine your congregation’s preparedness:

1. Make sure your staff members have adequate insurance.

Having your minister fall ill and not be able to perform their duties would be hard on the congregation.  Having your minister not be able to perform their duties–with no financial safety net–would be devastating.  Make sure that, along with your health plan, you include group insurance plans that include term life and long-term disability insurance.  These are relatively inexpensive add-ons to insurance policies.

2. Make sure your congregation has adequate insurance.

Call your insurance agent for an insurance check-up. Many UU congregations use Church Mutual, because they have an understanding of the needs of liberal religious communities.  Insurance can help your congregation recover financially after a fire, embezzlement or other harmful event.

3. Set up clear expectations about behaviors.

Even if you recite a traditional covenant on Sunday morning (i.e. Love is the Spirit of this church….) you will want to have a behavioral covenant or a covenant of right relations that spells out how members promise to treat one another.  In addition to this, you will want a disruptive behavior policy so that you give your leaders the authority to set limits on particularly damaging behaviors, and a process for restoring right relationship if the disruptive person is willing to abide by the limits.

4. Make sure your congregation has well-communicated “Safer Congregations” policies.

The Religious Institute has well-defined “best practices” for congregations to prevent sexual abuse, sexual harassment and professional sexual misconduct.  They also provide resources on how to include known sex offenders in your community while still protecting your other members and children. Your congregational commitment to sexual safety should be known to every member.

5. Establish and practice emergency evacuation procedures.

In case of a fire, tornado, live shooter or other immediate emergency, you will want to have your staff, greeters/ushers and teachers know what to do and where to go. It’s especially important to practice evacuating once or twice a year so that if — heaven forbid — the real thing happens, everyone knows what to do.  Also make sure your leaders are familiar with the post-trauma response resources from the UUA.

 

Other resources:

www.uua.org/safe/response/120488.shtml (video: 44:53)

www.buildingsguide.com/buildingsguidecom-presents-emergency-preparedness-guide

www.churchmutual.com/index.php/choice/risk/page/intro/id/21

www.cerguua.org/emergmanage.html

Sunrise, Sunset: Generational Trends in Stewardship

Photo copyright: https://www.flickr.com/photos/matthewpaulson/
Photo copyright: https://www.flickr.com/photos/matthewpaulson/

Many of our “solid” congregations noticed a drop-off in giving that was not a result of a drop-off of membership during the past two or three years.  We don’t have much data (the trend is too new) but we do have some anecdotal information that seems to align with greater generational shifts.

The Baby Boomers Are Retiring

With the recovery of the stock market, many baby boomers–who were holding off on retiring–are now ready to retire.  Nationally, the Baby Boomers are the largest source of charity gifts.

The good news is that most hold steady on their pledges and have more time to serve in volunteer roles.  The bad news that many of them are moving away from their congregations to be near their grandchildren, resulting in the congregation losing substantial (1st quartile–see below) donors.

There also seems to be a trend where Boomers are not dipping into their nest eggs for their daily living expenses, but instead use that money to splurge on big ticket items or vacations with their children and grandchildren.  This may mean they might be more likely to give to a capital campaign rather than raise their pledge to the yearly operating budget.

Generation X Can’t Possibly Fill the Gap

Nationally, the 76 million Baby Boom was followed by only 55 million babies born who are known as Generation X.  That means that there are around 1/3 fewer Gen Xers than there are Baby boomers.  We don’t have hard data, but I suspect that the ratio of Gen X (roughly age 40-54) to Baby Boomers (55-70) is even smaller in our congregations, if we reflect national trends.

Gen Xers also did not have the financial advantages of previous generations.  Those who went to college often graduated with high levels of student debt. Limited job opportunities, cost-saving employment practices, the reduction of employer benefits, the volatility of the stock market, and the bursting of the housing bubble have all contributed to a sense of financial insecurity that is not always acknowledged in our congregations.

Also, Gen Xers are known as a generation of hackers and slackers (stay with me!).  Their small numbers kept them from having an impact on “stuck” institutions–including our congregations–so they either gave up on the institution (which labeled them as slackers) or found work-arounds within the system (acting as hackers). Their experiences probably affected their sense of loyalty to the institutions.  (Again, this observation is anecdotal.)

 Millennials Have a Different Mindset About Giving

The number of Millennials is eclipsing the number Baby Boomers.  Their job opportunities are a mixed bag, with some Millennials finding great jobs and others struggling.

They are suspicious of institutions, but–at the same time–they appreciate that institutions can be used “for good.”  And yet–they can be generous givers.  They want to know where the money that they donate is going, and that it is changing lives.  If your congregation’s message and actions reflect solid core values, you can invite Millennials to support your work with integrity.

Healthy Pledge Distribution ChartWhat you can do:

  • If possible, do an analysis of the distribution of pledges by quartile (i.e. look at your total amount pledged, divide it by 4, and see how many of your pledge units are in each quartile.   According to Wayne Clark:

The first 25% of total dollars should be coming from the first 10% of the household donors
The second 25% of total dollars should be coming from 15% of the donors
The third 25%of total dollars should be coming from 35% of the donors
The final 25% of total dollars should be coming from the last 40% of household donors

 If you have less than 30% of your members in the top two quartiles, you may be at risk.

  • Make sure your leaders are transparent, trustworthy and act with integrity.  Your donors want to know that your congregation will be a good steward of their financial gifts.
  • Be crystal clear when it comes to your mission and vision.  Let people know how your congregation makes the world a better places and transform lives.

-Rev. Renee Ruchotzke, Congregational Life Staff

Resources:

Committee, Team or Task Force?

many ways to participateAs we reimagine how to do the work of a congregation, we need to take into account that younger folks (and by “younger” I mean people under 50) are wary of making commitments without fully understanding the implications.  These people want to feel like they are making  a contribution that makes a difference.  Expecting members to attend meetings out of a sense of duty (with no pragmatic objectives) will repel the next generation of leaders.

How should we pragmatically organize the groups that do the work of the congregation? The Rev, Marian Stewart offers this framework:

Committee:

Long-term groups that have legal and structural responsibilities. In some models, these are referred to as Standing Committees.

For example: Endowment, Finance, Human Resources, Rentals.

Team:

Ongoing responsibilities but membership terms/commitments may be informal or formal and can vary from short to long-term. Mostly these  groups are responsible for the church programs and activities. In some  models, this group forms a Program Council that meets several times a year  to do calendaring, find partner groups to sponsor events, etc.

For example: Communications, Membership, Religious Education, Social Justice, Worship.

Task Force:

A group of people who gather around an identified need that  has a defined goal or time-limit.

For example: Bylaws revision, policy creation,  insurance coverage change.

Despite its name, a Search Committee might also  be defined as a Task Force, although it has a much longer impact and  involvement in the life of the congregation.

Event Organizers:

A group of people responsible for one-time or short series of activities.

For example: anniversary party, social gathering, ordination service.

All of these groups have a defined mission and purpose. Each fits into the overriding Long Range Plan, which has very distinct and accountable short, medium, and long term goals.

While the above structures and defined purposes are extremely useful, the real purpose of almost all groups is to learn to work together, build relationships, find meaning or experience spiritual growth, and do something to make this world a little better – even if that world is helping the church operate more smoothly as its fulfills its larger mission and vision.

Want to Develop Church Leaders? Stop Training Them!

Photo credit: https://www.flickr.com/photos/wonderferret/
Photo credit: https://www.flickr.com/photos/wonderferret/

Let me share a fable of two congregations.

Alpha Congregation has several corporate trainers who work in the not-for-profit world.  Three of them were asked to serve on the newly-formed Leadership Development Team (LDT).  They spent a couple of months designing a fabulous in-house training for potential leaders and a couple more months advertising the program and inviting members to participate.  On the day of the event, they were a little disappointed about the low turnout.  There were a couple of attendees who they thought might be good leaders, but several others were missing some key leadership qualities.  When it became time to fill the slate for the board of trustees a few months later, the LDT asked Kris, one of the promising candidates, if Kris would like to be treasurer.  “Oh I’m awful with finances!” exclaimed Kris.  “What made you think that would be a good role for me?”

Delta Congregation has a couple of community organizers who were serving on their newly-formed LDT.  They suggested that they use a One-to-One model of connecting.  They spent their year connecting with those folk in the congregation who seemed to have a strong sense of belonging but were not in yet leadership roles; a manageable 20% of the people who attended church somewhat regularly. In these one-to-one conversations the LDT members shared about their own commitment and sense of passion toward the mission and vision of the congregation. Next, they inquired about the interviewee’s values, passions and gifts.  Then the LDT member just listened–deeply. After a couple of months of these interviews, this LDT compared notes and followed up with their interviewees, connecting about half of them into various leadership roles that everyone found were good fits.

Many of our UU congregations have been moving from having Nominating Committees (which meet for a few months out of the year to help fill the slate of board members and other key positions) to Leadership Development Teams (which work year-around on leadership development).  This is meant to be a holistic approach to growing leaders in a congregational setting.

There are different facets to leadership development, the “Five I’s:”

  • Identify (Pay attention to people who are involved in congregational activities and how they interact with others.)
  • Invite (Help potential leaders discern their gifts.)
  • Inform (Equip your potential leaders with training)
  • Involve (Help potential leaders find a way to serve the ministry that best matches their gifts and calling)
  • Inquire (Check in annually with leaders to assess how well they are serving and how the role is serving them)

It’s tempting — especially if you have expertise “in house” — to put too much energy into training (i.e. “Inform“), at the expense of the relationship-building activities that–in the long run–results in committed leaders matched to fitting roles.  There are many ways to collaborate to spread the tasks of offering trainings so that your congregation’s Leadership Development Teams can concentrate on the relational one-to-one work that can have the most impact:

-Rev. Renee Ruchotzke, Congregational Life Staff, Central East Region