Wednesday, February 27, 2013

New Executive Council Budget Process

At its February 2013 meeting, Executive Council approved a new, hopefully improved budgeting process, to result in the budget to be presented to the 2015 General Convention.  I chaired the subcommittee that developed this budget process, which is outlined below.  A couple of notes:

  • We understand that the Restructure Task Force will probably also be looking at the budgeting process, but whatever changes they propose will not take effect until after the 2015 General Convention.  In the meantime, Executive Council is asked to propose a budget to PB&F for the 2015 GC.
  • A resolution at the 2012 General Convention asked the Standing Commission on the Structure of the Church to look at the budget process.  We are in communication with SCSC, and two of their members served on our subcommittee.  
  • There is some unclarity in the canons as to responsibility for the budget - staff, Executive Council, and PB&F all taking a role.  Executive Council will be looking at the canons, but in the meantime, we believe that we can all work together.
The new budget process and timeline is outlined below. 

Subcommittee Membership List

Executive Council Finances for Mission Group:
The Rev. Susan B. Snook, Subcommittee Chair                  
Ms. Tess Judge, Subcommittee Vice Chair                            
The Rt. Rev. Mark Hollingsworth, FFM Chair
The Rev. Canon John Floberg
Mr. Francisco Quinones

Executive Council Governance and Ministry Group:
Mr. Stephen Hutchinson, GAM Chair

Program, Budget, and Finance:
The Rt. Rev. Stephen Lane
The Rev. Canon Mally Ewing Lloyd

Standing Commission on the Structure of the Church:
The Rev. Canon Paul Lebens-Englund
The Rt. Rev. David Reed

Church Center Staff:
The Rt. Rev. Stacy Sauls, Chief Operating Officer
Mr. Kurt Barnes, Treasurer  

The Subcommittee on the Budget Process was formed by resolution of the Finances for Mission group of Executive Council at its October 2012 meeting.  The FFM members listed above were appointed by FFM to the subcommittee.  Other subcommittee members were appointed jointly by Presiding Bishop Katharine Jefferts Schori and President of the House of Deputies Gay Jennings.

The Subcommittee was charged with reviewing DFMS’ current budget procedures and proposing an improved budget process to Executive Council, to result in the budget that will be submitted to the 78th General Convention.   


A budget is a visionary document.  Therefore, it should be grounded in a high-level vision of what the church should be doing and becoming.  We propose referring to the budget within Executive Council as the “DFMS Budget and Financial Statement of Mission” in order to reflect its visionary nature.
  • A budget is a fluid leadership document.  It is intended to provide guidance about vision and priorities, and resources available to meet those priorities, while leaving enough flexibility to meet changing circumstances.
  • In the largest sense, General Convention sets the vision for the church: for instance, in 2012 Convention gave strong support to the Five Marks of Mission as the basic framework for our future ministries.
  • As the governing board of the churchwide structure when General Convention is not in session, it is Executive Council’s appropriate role to flesh out General Convention’s vision with specifics, and to propose new visionary activities for the future. 
  • Developing a budget should be a process that includes wide consultation with Church Center leadership / staff, and ministry leaders from the wider church. 
  • Executive Council should reach out to others in the church for input about vision and priorities in areas in which they are expert.  Vision and priorities should be considered and proposed by groups that include Church Center staff, Executive Council liaisons, and ministry leaders from across the church.  We have just such groups already appointed:  the Committees, Commissions, Agencies, and Boards (CCABs).

Therefore, we are proposing that we create a visionary / missionary budget process that includes:
  • High-level visioning by Executive Council;
  • Strong input by Church Center executive, finance, and program staff;
  • Early decision by Executive Council on the basic framework for the budget to be proposed to General Convention (e.g., Five Marks of Mission, or some other framework);
  • Early consideration by Executive Council on preferred mechanisms for funding, such as block grants, partnership with dioceses, etc.;
  • Simplification of the way the budget is presented so that it is far more user-friendly and easy to access and understand;
  • Early decision by Executive Council on the diocesan asking formula that will be included in the 2015 Financial Statement of Mission proposal, with liaison work with House of Bishops to increase commitment to the agreed asking formula;
  • CCAB visioning about their particular areas of ministry, in a process led by Executive Council liaisons, with reporting back to Executive Council about proposed vision and priorities;
  • CCAB visioning about their particular areas of ministry, in a process led by Executive Council liaisons, with reporting back to Executive Council about proposed vision and priorities;
  • Consolidation by standing committees of Executive Council of vision and priorities in their assigned areas of oversight, including staff assistance in assigning proposed financial numbers to the identified priorities;
  • A leadership role by the Church Center finance staff and the Finances for Mission group in bringing all the financial requests together and creating a Financial Statement of Mission proposal to bring to Executive Council;
  • Significant advance work on the Financial Statement of Mission proposal, so that a draft budget can be released to the public well in advance of the deadline for handing it over to PB&F, and comments and changes can be considered before the proposal is finalized;
  • Attendance at each Executive Council and Finances for Mission meeting by at least one representative of PB&F;
  • At least one joint meeting with PB&F representatives during the triennium, to work on the Financial Statement of Mission proposal;
  • Transparency throughout the process, so that the public is well informed throughout of the decisions being made;
  • Ongoing consideration of large decisions that may affect future expenditures, such as the question of relocating the Church Center away from 815 Second Avenue. 

Please note that there is some lack of clarity about budget roles and responsibilities in the canons.  The GAM standing commission of Executive Council, under the leadership of Steve Hutchinson, will work during this triennium to identify and propose any needed canonical changes. 

It is acknowledged throughout this process that although there is a clear handoff of the proposed budget from Executive Council to PB&F during the February before each Convention, the budget is not finalized until it is passed at General Convention.  PB&F customarily seeks out information and clarification from Church Center leaders, Executive Council, and the wider church during the months leading up to Convention, as well as at the hearings at Convention itself. 

Below is a proposed timeline that addresses how the budget process would unfold under this proposal.  


February 2013:  Executive Council begins overall visioning process, possibly using some of the processes from the Art of Hosting.  Questions to be addressed:
  • What is the state of The Episcopal Church today and what are our dreams and hopes for its future?  Where does God seem to be leading our church?  What kind of ministries and actions will help us realize our hopes & dreams? 
  • What is the appropriate role of the churchwide structure in encouraging ministry and church development, and what is the appropriate role of diocesan / local structures?  What should the churchwide structure be doing?
  • What will be the framework for the 2015 proposed budget?  Five Marks of Mission?  Other goals and objectives? 
  • What are the priorities for the budget? What ministries are of particular importance at this time? This question will be considered initially by Executive Council at the February 2013 meeting, and refined after input is received from staff and CCAB leadership.
  • General guidelines for this budget process (i.e., this document) to be proposed for approval by Executive Council.
  • Executive Council and staff liaisons to CCABs will be given initial instructions as to their role in helping guide CCABs through a budget discernment process.  Further training to be provided via email and conference call during April.
  • Executive Council will issue a news release to the public about the proposed budget process, and a more detailed request to CCABs, informing them of their increased role in setting budget priorities.
  • Executive Council will review and approve specific qualification and application guidelines for receiving General Convention funding.  It is expected that applicants will provide clear and measurable objectives and priorities so that accountability for the use of grant funds is possible.

April 2013
  • Executive Council and staff liaisons to CCABs will receive additional, more detailed training in guiding the CCABs through a vision and priorities discernment process.  Training will include the process to follow and the exact questions to be asked in setting priorities. CCABs will begin work in May on creating budget priorities for their areas.

June 2013:  Executive Council meets, considers additional questions:
  • How and when will the leadership of TEC provide input as to direction and goals for the budget? (What current work needs more time to develop? What ineffective work should sunset? What new work needs to be begun?) 
  • Church Center staff who are not associated with CCABs would provide dream budget requests to Church Center finance staff.
  • What are the preferred mechanisms for funding programs? (Grants, matching funds, collaboration between TEC / dioceses?)  Staff/budget implications?
  • What are the preferred mechanisms for funding programs? (Grants, matching funds, collaboration between TEC / dioceses?)  Staff/budget implications?
  • What should be the diocesan asking formula for the 2015-2018 triennium?  What is the strategy by which we will engage the church in that discussion?

September 2013
  • Deadline for CCABs to submit budget priorities to staff.  Staff liaisons will work with Church Center finance staff and the Chief Operating Officer to assign financial numbers to the identified priorities.  Initial financial requests will be submitted to the Standing Committees of Executive Council associated with each CCAB.
  • Representative(s) from Executive Council to attend the House of Bishops meeting Sept. 19-24 to discuss the proposed diocesan asking for the next triennium, and encourage commitment to meeting the requested asking.

October 2013:  Executive Council meets and considers the following:
  • Any unresolved questions from the above discussions at Executive Council to be considered at this meeting. 
  • Executive Council liaisons and staff to make initial reports to Standing Committees about the budget priorities received from CCABs, and the associated financial requests.
  • All financial requests, including those of Standing Committees of Executive Council, to be provided to Church Center finance staff.

February 2014
  • Finance staff reports to FFM on an initial draft budget, taking into account the input from the CCABs. “Dream budget” document created.
  • Executive Council is notified of totals and begins to consider how priorities already identified should be addressed.  Which requested areas should be given higher priority?  What ongoing projects could be eliminated or reduced? 
  • Executive Council reconsiders the following questions:  what are the priorities for the budget? What ministries are of particular importance at this time? (Youth and young adult, empowerment ministries, church plants, enterprise zones, etc.)  This question was considered initially by Executive Council at the February 2013 meeting, and will be refined now that input has been received from staff and CCAB leadership.
  • Note that the open question on the location of The Church Center and the move away from New York will greatly impact the budget. This question will be considered as part of the ongoing decision and budget process. 

February to June 2014:  Finance staff takes Executive Council priorities and constituent group requests and creates budget proposal using Executive Council input on priorities.  Draft budget is brought to FFM at June 2014 meeting.
  • A joint meeting with PB&F should occur at either the February or June 2014 meetings, to review budget assumptions and to consider any suggested changes from PB&F.
  • Executive Council and staff liaisons work further with CCABs to inform them of initial budget decisions and work with them on any requested changes. 

June 2014:  FFM considers staff draft in detail.  FFM approves a draft budget.  Provides info to Executive Council so that Standing Committees can work on their budget areas during the interval between June and October, and submit any requested changes in time for the October meeting.

October 2014: Executive Council discusses draft budget proposal, considers whether priorities have been addressed, makes any necessary changes, and approves a draft proposed budget.  Draft budget released to public and opened for comments.

February 2015:  Comments on draft budget considered and final budget proposal approved and handed off to PB&F.