February 3, 2003
Churches nationwide feeling pinch of tight times
___By Kevin Eckstrom & Adelle Banks
___Religion News Service
___HOUSTON (RNS)--When people look at First United Methodist Church in Houston, Pastor Steve Wende knows they see big buildings with big crowds and think big money.
___But when Wende looks at the church's $5 million budget and sees a $150,000 deficit from last year--with a $300,000 shortfall expected in 2003--all he sees is a big headache.
___"The image many people have of the church is a very wealthy instit
ution taking in lots of money," Wende said. "The only people who have that image are people who don't serve in churches."
___Wende's church was particularly hard-hit when energy giants Enron and Dynegy collapsed, putting some parishioners out of work and evaporating the savings of others. With the stock market already shaky, things quickly went from bad to worse.
___It's a problem shared by churches from coast to coast as pastors and budget planners try to do more with less.
___While most churches seem to be immune from layoffs so far, Simeon May, executive director of the National Association of Church Business Administration, said many churches are finding that contributions are down, prompting tough decisions about budget cuts.
___So what kinds of ministries are affected?
___"Anything and everything," said May, who is based in the Dallas suburb of Richardson. "The money has to come from somewhere, and to avoid laying off people, they're cutting back on ministry dollars."
___The ailing economy has been especially hard on denominations that survive on their investments and rely on money to trickle up from the local level.
___Among the hardest hit:
___ The Lutheran Church-Missouri Synod has reduced its national ministries staff of 320 by 48 people--with more than half of them from its missionary force--and trimmed its budget from $99 million to $89 million in one year.
___ The Presbyterian Church (USA), laid off 66 people at its Louisville, Ky., headquarters last year as part of a $4 million cutback. At least $5 million in cuts are expected through 2004.
___ The United Methodist Church will not deploy new missionaries this year as part of $12 million in cuts at its overseas missions agency.
___ In Southern California, the Roman Catholic Diocese of Orange reported a loss of $14 million last year, largely due to stock investments. The Archdiocese of Los Angeles slashed 60 jobs in a $4.3 million cutback. The shortfall recently grew to $13.4 million and may require more layoffs.
___ The New York-based Episcopal Church is planning to trim $10 million from its budget over the next three years to make up for losses on Wall Street.
___While executives of some denominations--like the Southern Baptist Convention and the Presbyterian Church in America--say their total giving is on the increase or at least stable, others are being hit by a range of financial challenges. Depending on the religious group, economic woes have been coupled with in-house scandals, soaring insurance rates and declining endowments.
___Some Catholic dioceses have been hit hard by a yearlong sex-abuse scandal. While most have weathered the storm largely intact, some, like Boston, have seen donations plummet as angry parishioners withhold their wallets in protest.
___Bob Doerfler, president of the Diocesan Fiscal Management Conference and director of finance for the Diocese of Colorado Springs, said dioceses have suffered more from the economy than the sex-abuse scandal.
___Most everyone, it seems, is feeling the pinch from the Wall Street slump, causing them to pay closer attention to the bottom line, particularly on stock portfolios.
___Officials at the Lutheran Church-Missouri Synod said the fall in value of stocks and bonds is to blame for cutting missionaries and related staff. Less than 20 percent of its world mission budget comes from Sunday morning offerings. Most of that budget is, instead, dependent on foundations and individual bequests.
___Church-related social service groups also have been forced to cut back because many state budgets are awash in red ink. Many charitable programs for children, the homeless or the elderly rely in part on state money to operate.
___Jill Schumann, president and CEO of Lutheran Services in America, the nation's largest non-profit group, said smaller individual contributions to community groups like United Way have made things worse.
___"People are having to amputate arms and legs in order to save the entire agency," Schumann said.
___On top of that, a number of church groups reported higher-than-normal hikes in insurance costs, especially for employee health insurance.
___The hike in health insurance rates comes at an already difficult time for some missionary-sending groups, noted Paul McKaughan, president of the Evangelical Fellowship of Mission Agencies.
___"We are being squeezed both on the revenue side and on the expense side, and one of the things that is doing the squeezing is health insurance," said McKaughan, who is based in Atlanta.
___Terrorism also has raised premiums on overseas assets for the Presbyterian Church (USA), which has ties to a vast network of foreign hospitals and schools. Last August, gunmen killed 10 people in two separate attacks on Presbyterian-affiliated schools and hospitals in Pakistan.
___In many cases, leaders of faith groups find they are forced to be cautious or prudent but they don't consider themselves in imminent financial danger.
___
The Baptist Standard
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