Council of General Synod approves deficit budget

TorontoThe Council of General Synod (CoGS) on Nov. 16 approved the 2009 General Synod budget, but not without dissent from some members. Although pruned by $1.3 million, the budget still projects a deficit of $745,639, with revenues anticipated at $8.6 million, and expenditures at $9.4 million. CoGS, the church’s governing body between General Synods, also approved a motion recommending to General Synod in 2010 “that there be no deficit budgets for the work of General Synod after the year 2012.” The budget presented by the financial management and development committee (FMDC) of General Synod came under heavy fire from some members who questioned why they were being asked to approve a proposal that they said was short on details and excluded them from the consultation and decision-making processes. CoGS received a consolidated income and expense summary that showed cuts to some departments at General Synod, but did not provide details on their implications for programs and staff. The summary also presented budget forecasts for 2010 to 2013 that showed deficits of $500,000 in 2010 and $100,000 in 2011. It also included a plan for “renewed philanthropic initiatives” aimed at achieving a balanced budget by 2012.”How do we go about approving a budget we have no details of?” asked Canon John Steele, diocese of British Columbia. “We can’t own the budget unless we know what the budget is doing.” The diocesan bishop of Edmonton, Jane Alexander, said she was “uncomfortable” about being asked to take responsibility for “a different way of budgeting for our church,” adding that her own diocese had once gone bankrupt “because of philanthropy budgeting.” (The projected deficits total $1.4 million from 2009 to 2011, assuming that the forecast revenues are met, which include anticipated income from the work of the newly constituted philanthropy department) Bishop Alexander added: “On the one hand you say you want our input, but we’re told ‘we can’t give you this information; just trust us.’ …This is a huge thing we’re being asked to do. There’s a lack of financial statements for a decision that will tie us into budgeting for the next five years.”On the recommendation of Archbishop Fred Hiltz, primate of the Anglican Church of Canada, CoGS voted to go in camera to hear management team give “in broad strokes” where the cuts were going to be made. Still, some members were not convinced. “I do feel obliged to speak against the motion,” said Canon James Robinson, diocese of Calgary, who noted that in recent years CoGS has received assurances of a balanced budget and new money coming from Letting Down the Nets, a stewardship and gift-planning initiative. “Now, we’re in a position of very serious accumulated deficit. It’s a rather frightening concept what situation we may be in.” Last year, CoGS approved a 2008 budget that already projected a net operating loss of $1.3 million. An undesignated bequest of $4 million from the Dashwood estate helped bridge the deficit, the seventh in as many years. Deficits have ranged from $430,000 to $1.4 million. Mr. Robinson lamented that CoGS wasn’t given enough time to examine the budget, noting that his synod gives members “a courtesy of a few weeks to digest this kind of information.” He said, “I feel it’s been too rushed…A budget of this magnitude deserves some thoughtful, prayerful consideration.” He also questioned why only one budget paradigm was being presented to CoGS. Under the approved budget, the financial management and treasury department sustained the worst cut; a reduction of $433,400, to $1.57 million in 2009 from $1.99 million in 2008. The communications and information resources department has the next highest budget cut, a reduction of $265,121 to $1.02 million in 2009 from $1.29 million in 2008. There was no discussion about potential staff layoffs, but at the end of the meeting, CoGS included as part of its summary that “budget decisions were made, conscious of the impact that the decisions will have on valued staff.” Archbishop Hiltz said the FMDC and management team had precisely avoided issuing a detailed budget because “when you go into line by line, we’ll be in conversation about people and program.” In response to a written question from a member as to why there was more money allocated for the Anglican Journal than the faith, worship and ministry department, the chair of FMDC, Monica Patten, responded, “We want to be clear that, in fact, programs are not in competition with one another.” She said that FMDC and management team did not do “flat-line cutting,” but considered “what can be reduced without affecting in a very negative way programs, and mission and ministry.” She said that, although FMDC recognized that the deficit was still very high, “if we removed more than that in a single year, we were at great peril that we would go so far and in such depth of cuts that we would undermine the possibility of ministry and mission that we want to do and are called to do.” Management team has until Nov. 30 to make a final decision about the allocation of resources based on criteria identified by CoGS.Ms. Patten explained that the 2009 shortfall would be partly bridged by negotiating a cash option on General Synod’s remaining piece of property at 600 Jarvis Street, which is expected to bring in $425,000. Under an agreement with the developer that bought the site of its old offices, General Synod had an option to either move the Anglican Book Centre back into a new condominium to be built on that site or to sell that space. (In 2006, CoGS approved a recommendation authorizing management team to negotiate the cash option to help bridge a projected operating deficit of $476,712 from the 2007 budget. Management team later decided not to exercise this option, said General Synod treasurer Peter Blachford, when sought for clarification by the Anglican Journal.) The rest of the 2009 deficit will be funded by undesignated legacies. “The glass is always half full for me,” said Ms. Patten, as she urged CoGS to approve the proposal. “I know this ship is not sinking. But it would be misleading if we don’t say we face difficult challenges. No one is to blame. It’s not about finger-pointing; it’s sharing responsibility and solutions.”On the issue of budget consultations, Ms. Patten said, “I absolutely agree about the importance of cross-committee consultation. How to do it more effectively needs to be addressed.” Asked whether CoGS can, canonically, approve a broad consolidated budget without specific details, Ms. Patten said, “We have confirmed in the canons that it’s CoGS’ responsibility to confirm the budget…It is management team’s responsibility to work out the line-by-line details.”Management Team and FMDC have cited the following as major factors for the deficit: A decline in diocesan giving and in donations to the Anglican Appeal, a loss in investment income resulting from the current economic downturn, the elimination of projected budget revenues from unsubstantiated undesignated legacies (the finance department used to include in budgets projected income from wills based on average amounts of previous years), the initial establishment of a new philanthropy department at General Synod, increased travel costs, and increased costs of undertaking all missions and programs directed by General Synod and CoGS. Diocesan proportional giving is projected to decrease $173,000 in 2009. It decreased by $79,711 the previous year.The economic crisis “is very serious and it’s going to last awhile,” said Ms. Patten, adding that economists are not predicting a “modest turnaround” until the last quarter of 2009 or early 2010. But she said, “I have a hunch that we in the faith communities may be able to successfully inspire the giving of those who believe in the Gospel and in the work that we do to bring justice. Under the approved budget: ?The partnerships department sustained a cut of $140,980. It’s share decreased to $1.86 million in 2009 from the previous year’s $2.0 million;?Indigenous ministries was cut by $34,193, to $447,125 in 2009 from $481,318 in 2008; ?Grants to the Council of the North, a grouping of financially-assisted dioceses, remained at $2.3 million, in keeping with General Synod’s decision in 2007 affirming that they “continue at no less than the current level for the next five years;” ?The house of bishops had its budget reduced by $46,200, or to $95,800 in 2009 from $142,000 in 2008;?The primate’s office had a slight increase of $29,290, or to $440,990 in 2009 from $411,700 in 2008;?The faith, worship, and ministry department’s budget was reduced by $61,299, or to $447,401 in 2009 from $508,700 in 2008; ?The Anglican Journal, which is part of the communications and information resources department, took a cut of $137,953, to $458,747 in 2009 from $596,700 in 2008. The other services under this department received a cut of $127,168. ?The financial and information technology services under the financial management and treasury department took a cut of $270, 400, while its property management services was reduced by $163,000;?The general secretary’s office received a $460 increase, or to $664,060 in 2009 from $663, 600 in 2008;?The archives, which falls under the general secretary’s office, saw its budget increase by $102,774 because of projects related to the Indian Residential Schools Settlement Agreement.