Saturday, December 22, 2018

Plunging Stock Market May Exacerbate Grace Church’s Financial Woes

With recent stock market activity showing some striking similarities to the market crash of 1987, and the double whammy of a possible partial shut-down of the federal government, Grace Episcopal Church may well enter 2019 in dire financial condition.

As I stated in previous posts, when factoring in depreciation and amortization, Grace has been running an annual deficit for many, many years. That trend, together with several related factors, has spelled a perfect storm in the making for quite some time. These factors include:
  1. An aging parish population.
  2. A costly physical plant.
  3. A wildly overpaid rector who often appears to place his own perceived self-interest ahead of the church.
  4. Decades of slipshod governance.
  5. Facially faulty financial reports.
  6. A rubber-stamp vestry largely controlled by Bob Malm.
  7. A refusal to save for the future.
  8. A culture that of denial and avoidance that has allowed the church to avoid dealing with these pressing issues for much of Bob’s tenure as rector.
  9. American culture, in which church membership is no longer normative, and where young people increasingly oppose organized religion.
  10. The hypocrisy of church hierarchies, including that of the Roman Church, and the Episcopal Diocese of Virginia.
Now, with the stock market appearing poised to tank, the church faces several challenges:
  1. Year-end gifts of appreciated stock likely will be reduced.
  2. Parishioners on fixed incomes will find it difficult to maintain current pledging levels.
  3. Families directly or indirectly dependent on the federal government will face financial constraints.
  4. Investments, including the Grace Trust, which is heavily invested in the stock market, will lose value, thus reducing church revenue.
  5. Banks that might otherwise be willing to lend to the church will seek to reduce risk in the event of another major recession.
All this, of course, ties into the loss of public confidence caused by Dysfunctional Bob and Sugarland Chiow’s rather disastrous foray into court, continued misconduct and conflict within the parish, the departure of Fanny Belanger, the fact that Dysfunctional Bob will retire in the not distant future, and Bob Malm’s smear campaign against members of his own parish.

Grace church surely is poised for big problems over the next few years.