Top agency executives urge sizable budget cuts

The top executives of The United Methodist Church’s 13 general agencies unanimously recommended that the denomination’s general church budget be cut to its lowest level in 16 years.

Under the reduction, if adopted, U.S. conferences would pay the lowest percentage of general church apportionments since the current apportionment formula began in 2001.

The executives propose a bottom-line budget of $599 million for general church funds in 2017-2020. That’s down from the $603.1 million general church budget approved at the 2012 General Conference.

The executives’ recommendation is also down by $12 million from the budget proposal that just received approval in February from General Council on Finance and Administration board and the Connectional Table. Both bodies are responsible for developing the general church budget, and they both plan to vote on the executives' recommendation by early April.

The four-year budget sets the apportionments that support bishops, United Methodist ministerial education and denomination-wide efforts such as the Black College Fund, ecumenical work and Africa University in Zimbabwe. The largest proportion of the budget supports 10 of the denomination’s 13 general agencies. That includes United Methodist Communications, which encompasses United Methodist News Service.

The executives hope the reduction shows support for conferences and local churches struggling with their own financial challenges.

“As local churches and annual conferences continue to cut budgets or hold them flat, we believe that all of the general funds must adjust as we stand in solidarity with United Methodists across the connection,” Gil Hanke said in a statement.

He is the top executive of the Commission on United Methodist Men and convener of the General Secretaries Table, which brings the agencies’ top executives together.

Ultimately, it’s up to the 2016 General Conference to determine the budget for the coming four years. The denomination’s top lawmaking assembly will meet May 10-20 in Portland, Oregon.

Response to concerns

The executives made their recommendation after the Economic Advisory Committee — a group of eight United Methodist economists and other financial professionals who advise the budget process — raised alarms about plummeting U.S. worship attendance.

U.S. average weekly worship attendance dropped by 2.6 percent between 2013 and 2014 — the loss of nearly 76,000 worshippers is the largest in the denomination’s records going back to 1977. At this point, the U.S. church supports the bulk of general church finances for the global denomination.

In 2014, the Economic Advisory Committee recommended raising the general church budget of $628 million. In 2015, the committee reduced its recommendation to $621 million, still an increase over the current budget

But at its late January meeting, the committee urged denominational leaders to consider cutting the budget instead to $595.6 million or an optimistic budget of $604 million.

The executives’ proposal also responds to concerns they have heard from conferences and local churches tightening their own annual budgets.

“We listened to the Economic Advisory Committee,” Hanke told United Methodist News Service. “We also listened to our constituents — people who are active in annual conferences across the country who — like the agencies over the last several years — are making significant cuts to conference budgets.”

Those concerns were on display when the board of the General Council on Finance and Administration, the denomination’s finance agency, and the Connectional Table, which coordinates the work of agencies, each met in February.

Back in May 2015, the two bodies had jointly approved a budget of $611 million. But when the two bodies met earlier this year, members of both bodies pushed back against the budget increase. The bodies reaffirmed the budget, but by a narrower vote.  

“We felt further reduction was in order,” Hanke said. Agency executives have voice but not vote on the Connectional Table.

The Rev. Marc Brown, the Virginia Conference’s director of connectional ministries, was among the Connectional Table members who objected to the $611 million budget.

"I believe the budget request by the general secretaries reflects a thoughtful response to concerns that have been expressed about an increase in the proposed budget," he told United Methodist News Service. "The leadership of the general secretaries is valued and appreciated."

What does this mean for the local church?

Donald R. House Sr., the Economic Advisory Committee chair and an economist, expects the proposed cut will ease the budgetary pressures on conferences.

He does not expect the reduction to have much impact of reversing worship declines.

“Our studies indicate that 90 percent of any reductions in apportionments to the annual conferences will be passed on in the form of reductions in apportionments to the local churches,” he said.

“This reduction from $611 to $599 (million) averages less than a $100 reduction in annual conference apportionments per year for the average church.

“The reduction becomes diluted across so many local churches that it cannot be expected to have any measurable impact on worship attendance, even if the dollars were all spent for the sole purpose of growth.”

However, House does think a lower general church budget will result in a higher payout rate by conferences, which will encourage local churches to give more to their conferences.

In short, cutting the budget just might be good for morale.

In the U.S., the denomination’s finance agency requests apportionments from each conference based on a formula that includes its local church expenditures, local church costs, the economic strength of the conference and a base percentage approved by General Conference.

The General Council on Finance and Administration is asking the 2016 General Conference for the first time to approve a formula for apportionment giving from the central conferences — the seven church regions in Africa, Europe and the Philippines.

Even if approved, the new apportionments likely will not have much budget impact. The finance agency projects that these new central conference apportionments will amount to slightly more than $1 million a year, or about $4 million over four years.

For the agencies, a reduced budget means using fewer funds for their efforts to help local churches and conferences and to carry out the denomination’s missional goals.

But Hanke said he thinks agencies can still make it work.

“The general secretaries collectively and individually have a skill set that brings flexibility to the jobs that they have,” he said. “This makes the job much harder. But knowing my colleagues as I do, I think they will do their best to find a way to provide for each conference, district and local church that asks for assistance.”

Hahn is a multimedia news reporter for United Methodist News Service. Contact her at (615) 742-5470 or newsdesk@umcom.org.