In 2014, the year our conflict began, the church had 525 households and 317 pledging units. Total pledge income was about $850,000; there always is some wiggle room due to the late payment of pledges and pledges not fulfilled. Thus, the average pledge was approximately $2,681.
Since then, the number of pledging units has continued to fall, while the average pledge has trended upward, consistent with other churches in the diocese. In recent years, the average pledge has bumped up to roughly $3,600, while the total number of pledging units continues to fall.
As things stand, the church hopes to pull in 220 pledging units, although 200 pledging units is a more likely number, and quite possibly not even that many. Thus, pledge income will probably end up between $700,000 and $720,000. But even with the church’s optimistic forecasts, best case is pledge income of $792,000–a far cry from past years. And many of the families that have been stepping up their pledges are clearly tapped out, with limited ability to increase their pledges further.
That doesn’t leave much room. Fixed building costs are going to remain about $150,000 annually, and likely higher as the physical plant continues to age. Additionally, should the church go ahead and hire a full-time assistant rector, it will be difficult to get total compensation costs much below $600,000. Throw in an 8 percent pledge to the diocese and guess what—we’re at roughly $814,000, which with income from the trust, investments, and cost sharing with the school, is pretty much everything. Nothing left to cover the costs of a loan for the HVAC, to save for the future, or to cover unexpected contingencies.
Of course, part of the problem is the church’s current cost structure. In this day and age, when a church can hire a full-time rector with an Mdiv and a PhD for $100,000 all-in, paying Bob Malm almost $200,000 a year is questionable, at best, particularly given his feckless job performance — not to mention that damage he’s caused to the church and its reputation in the larger faith community through his efforts to suppress criticism.
At the same time, it’s hard to justify three additional full-time positions with full indirects, when in this day and age, so many churches use part-time employees. That’s not to say that current staff don’t do a good job—it’s just that few churches these days have any full-time employees other than the rector, and for many, even the rector is part-time or bi-vocational.
Where things get really ugly, though, is when one looks at the financial implications of the school. Producing little benefit to the church, the 50/50 split on utilities and other currently non-fungible expenses works strongly in the school’s favor. Coupled with years of Chris Byrnes’ empire building and rather lopsided approach to cost-sharing, and even with Patti’s much more collaborative approach, it’s a tough sell for many parishioners.
Freed from the school and Dysfunctional Bob’s current bloated cost structures, here’s what expenses would likely look like:
|1 FT rector, including indirects||$140,000|
|1 PT music director, including indirects||$45,000|
|1 PT parish admin, including indirects||$45,000|
|1 PT accountant, including indirects||$40,000|
|1 PT assistant for pastoral care, including indirects||$22,000|
|1 PT assistant for family ministry, including indirects|| $22,000|
|Facilities, including repairs, insurance, utilities (this is a generous number, too)||$100,000|
|Outreach (not including diocesan pledge)||$60,000|
|Optional: PT sexton with indirects||$20,000|
As you can see, the current combination of a 1970’s-vintage staffing model and the overhead associated with the school basically doubles the church’s cost structure, at a time when every indication suggests that church revenue will continue to fall in the coming years.
Several additional factors also suggest that, if Grace is going to survive, a more modern cost structure needs to be envisioned. These factors include:
- The fact that church membership no longer is normative in American society.
- The lack of saving from current revenue for the future.
- The church’s token efforts at growth and increased membership.
- The discomfort Americans have with clericalism, and the profoundly negative effects clericalism has had on the parish.
- The cavalier attitude towards church administration under Bob Malm, in which the entire approach for much of his tenure has been laissez-faire. Not good when dealing with other people’s donations.
In addition, the church’s lack of transparency regarding decision making, budgetary issues, and other important matters offers a powerful disincentive to younger members to give at levels consistent with those of previous generations.
In the meantime, the rapidly dwindling number of pledging units have done an admirable job of stepping up to the plate as people leave the church and stop pledging. But this trend should, in itself, cause alarm, for it is part of a very predictable pattern that occurs in dying churches.
In short, Grace’s current cost structures and its approach to governance simply cannot continue over time.