NCC balances six-month budget with money that’s not committed
By John H. Adams, The Layman Online, November 14, 2000
ATLANTA – The executive board of the National Council of Churches approved a budget for Jan. 1-June 30, 2001, that will require laying off 17 of its 64 employees – effective Nov. 20. The budget also includes more than $1 million in funds that have not been committed.
The uncommitted money includes $800,000 from member communions in a category called ecumenical commitment funds and $250,000 in anticipated grants that have not been approved.
“Never, never has the National Council of Churches received $800,000 in the first six months in ecumenical commitment funds,” said Philip Young, an executive board member and a leader in the restructuring of the NCC.
Young, an executive at the Presbyterian Foundation, and Barbara Ellen Black, general manager of the NCC, both emphasized that the budget is precarious and that there are no anticipated revenue sources that would offset the revenue projections if the ecumenical commitment falls short of the $800,000 goal or the $250,000 in foundation grants do not materialize.
Young said one major financial problem for the NCC is that 17 of the 35 member communions are not supporting the NCC. Furthermore, the 1999 ecumenical commitments to the NCC were $100,000 lower than those made in 1998.
“My concern is that we may not get the normal funding,” Young said. “Perhaps our projections for income to the ecumenical commitment fund may not be realistic.
“We must simply have the support of all denominations. The half of them that have not come to our aid, must do so.”
Black said cash flow is critical. Unless the money comes in as anticipated, the NCC will have “to draw down our investments or cease being a viable agency.”
The NCC investment portfolio was once $15 million, but is now only $3 million. And while Black suggested that there might be further drawdown, Young said all of the $3 million is restricted and cannot be used to underwrite operating costs. Most of the investment money was sidetracked to cover deficit-spending, which totaled $6 million in the 1999 fiscal year. In addition, member communions made deficit-commitment contributions to help balance the books.
The Presbyterian Church (USA) made the largest deficit reduction contribution – $500,000 – while some in the United Methodist Church have given verbal commitments of $700,000. But the Methodists have paid only $82,000 and the remaining $618,000, which has been recorded in the 1999 financial statement even though final approval has not been given, is unsure. Young said he expected the Methodists to live up to their promises.
The greatest concern by Young and Black, however, focused on the financial participation of member communions.
“That is an absolutely essential priority,” Young said. “We are dependent on those dollars when we go to foundations,” which are less likely to provide grants if nearly half of the NCC’s members don’t support its budget.
In October, the NCC’s Finance and Administrative Committee reported that the projected budget deficit for the first six months of 2001 was $1.8 million. The executive board instructed Edgar to prepare a January-June budget that would cut costs 38.4 percent.
Budget figures presented at the Nov. 14 meeting of the executive board show budget cuts of nearly $1 million. Young told The Layman that the budget was reduced by $800,000 shortly after the board’s October meeting, but that he was not sure where those cuts were made.