About That Elephant

See Part One of this Series Here:  Deck Chairs.
See Part Two Here:  Will the Real Subsidiarity Principle Please Stand Up?


In our continuing series about how to spend The Episcopal Church’s money strategically, to empower mission, ministry, and evangelism, today we are addressing the burning question:

• What should we NOT be spending money on?

I will try to restrain myself from gleefully rubbing my hands together.  So many living room elephants to choose from – so little time!

Look, we don’t have enough money to do all the things the Church Center has done in the past.  Where to cut?  Two major arguments have been advanced:  cut governance (because it is too costly and cumbersome), and cut program (based on the subsidiarity principle). 

What huge white-elephant category of expenses is being ignored by both the anti-governance and the pro-subsidiarity arguments? 

Administration.  Administration at the Church Center is getting a free pass.

A few weeks ago I did an analysis of the proposed budget that divided it into 7 categories: the five Marks of Mission categories, and two additional categories: (6) Administration and  (7) Governance.  Since then, I have refined my analysis.  Some folks have rightly pointed out that the five Marks of Mission categories don’t include a classification for Other Good Things – like ecumenical relations, which everyone agrees should be done at a churchwide level and which aren’t really administrative in nature.  (I had included these costs in administration because there was no Marks of Mission category to put them in.) 

Therefore, I have added two new categories to my analysis:  (8) Building Religious Relationships (including ecumenical relations, Anglican Communion relations, and Federal Ministries); and (9) Stewardship & Leadership Development (including the Development Office, Congregational Vitality, Transition Ministries, the Office of Pastoral Development, etc.).  With these two new categories, the proposed churchwide budget breaks out as follows (if you would like to see my calculations, please email me at susansnook@thenativity.net):

Anglican Marks of Mission                                                 Amount         Percent

1. To proclaim the good news of the Kingdom                $  2,283,270      2.15%

2.  To teach, baptize, and nurture new believers               $     286,438      0.27%

3.  To respond to human need by loving service               $26,428,618     24.91%

4.  To seek to transform unjust structures                          $  4,600,551      4.34%

5.  To sustain, renew life of the earth                                  $     106,470      0.10%

Not included as marks of mission, but categorized as:

6.  Administration                                                                 $46,823,109    44.13%

7.  Governance                                                                      $12,298,810    11.59%

8.  Building Religious Relationships                                    $  5,207,010      4.91%

9.  Stewardship and Leadership Development                   $  8,067,497      7.60%

Do you see what I see?  After all is said and done, the glaring enormous over-inflated budget item is not Christian Formation, not at all.  It is Administration.  When pared down as noted above, it comprises over 44% of our churchwide budget. That doesn’t even count the cost of General Convention!  


Yes, Administration is the same category of expenses that gives us a finance office that costs over $7 million to run and can’t add a budget spreadsheet up correctly.  (I am sorry to have to point out the obvious.  I would rather be churchy-nice and not point out or ask for accountability for expensive mistakes.) 

It is also the same category of expenses that brings us an office building in Manhattan, the most expensive real estate on earth, based on that old Eisenhower-era hierarchical corporate headquarters model.  Based on the proposed budget, the costs of operating that piece of real estate are:

            Debt Service                                                  $ 8,700,000

            Facilities Management                                 $ 6,443,156

            Offset by Rental Income                              ( 4,050,000)

            Net Cost                                                        $11,093,156

I do not understand why we are going after Program Expenses before we go after the hyper-inflated costs of administration at the Church Center. 

Here’s what I propose: 

• Sell, lease, or otherwise dispose of 815, and look for a more economic alternative elsewhere, such as using vacant space at cathedrals, seminaries, etc.  This will take some time, so it won’t save us money immediately – we need to understand this.  But there’s no more time to dither about it!  Do it!
• Reduce the asking to the dioceses, and cut the total budget to $101 million (right now it stands at $106 million, counting the Development Office error explained here – it is a deficit budget of $1.25 million). 
• Require that administrative expenses comprise no more than 35% of the 2013-2015 churchwide budget. That’s a significant decrease from the current 44% of the budget. In 2016-2018, the administrative percentage would be required to drop to 30%.  The phase-in allows some time to study the situation and make adjustments necessary.  (Note: the percentages depend on the way I have classified administrative expenses: for instance, I have included Communications, part of the cost of the PB’s office, etc.  If you quibble with the way I have calculated administration, fine, but if we change that, we need to change the percentages too.)
• Freeze salaries at the Church Center.  The proposed budget includes across-the-board salary increases of 3% per year.  How many folks working for local churches get that kind of guaranteed raise these days?
• Look into outsourcing certain departments like Human Resources, streamlining personnel in administrative departments, or other strategies for reducing administrative costs. 

Yes, we can also streamline governance expenses.  I am skeptical of the idea of holding a Special Convention (very expensive and unlikely to produce real change unless it is preceded by a real visioning and change process), but I certainly believe that we can “sunset” some CCABs and significantly reduce the expenses of others.  And we can consider ways to reduce the cost of General Convention itself, such as allowing much work to be done beforehand, electronically, or reducing deputation size. 

However, we cannot count on any cost savings for these possible changes in the current triennium, because they would require a constitutional convention, and no changes would take place this triennium. 

What we can do, right away, is address the unacceptable level of administrative expense at the Church Center.  We can make a real decision to sell 815 and move to a less-costly alternative, and we can realign our staffing structure, outsourcing some departments and streamlining others.  

We can do it because it’s worth it.  Because you and I aren’t writing those pledge checks every week so we can maintain  $46.8 million of administrative expenses.  We’re writing them because we believe in the mission, ministry, and evangelism of this church.  What we have is worth sharing, and it’s worth spending money on – strategically.  But not on elephants.  


Stay Tuned for Tomorrow's Post: Empowering Mission.