Diocesan Revenues are derived from voluntary parish pledges, interest from investments and withdrawals from related restricted funds, and miscellaneous other income. Pledges from parishes make up approximately 67% of the annual revenue; income from investments 23.6%; monies from restricted accounts about 9%; and the remaining 0.4% from miscellaneous operating income. The Diocesan budgets for the past 10+ years have been in the range of $2.0 to 2.2M. (The budgets for 2019 through 2024 will be at a higher amount due to special expenses – the Diocesan search and transition process, and the Diocese pledged support for the Chanco capital campaign.)
Diocesan Expenses fall into five broad categories: Wider Church, which is giving to The Episcopal Church (the 2019 budget amount meets the 15% asking); Ministries within the Diocese, which includes parish development, youth and college ministries, Christian formation, outreach, Latino and other missions, and Diocesan transition; Communications, which includes the expense associated with having a Communications Officer and related communications expenses; Governance, which includes costs related to conduct of our Annual Council, Provincial Synod support, attendance at General Convention, House of Bishops participation, and Standing Committee and Executive Board business; and Bishop, Staff, and Support, which covers costs associated with the Bishop and Diocesan staff and related business expenses.
The Diocesan revenues have remained relatively flat since 2008 at just above or below $2 million. The cumulative effect of inflation for the 10-year period January 2008 to January 2018 is over 17% (US Department of Labor Statistics), and the actual spending power of the Diocese has decreased substantially. Issues of concern include lack of funding for an assisting Bishop, additional staff positions, and program development. Also, to be considered is the withdrawal and use of income from investment funds, currently at 4 to 5% which is slightly higher than the norm of 3 to 4%.
Parochial Giving in the Diocese of Southern Virginia
Dating back to the early 1970’s, concerns about decreased giving to the Diocese led to the adoption of a series of canonical changes. In 1974, a canonical change included mandatory parish assessment for Diocese operating costs, with voluntary giving toward outreach and voluntary donations. An improvement in relationships between parishes and the Diocese resulted in an increase in parish giving, leading to another canonical change in 1979 and a return to voluntary giving. 1982 saw another change – although voluntary giving remained. Parishes were expected to pledge a recommended apportionment of estimated costs of Diocesan operations. If a parish did not pledge to the recommended apportionment level, a written explanation of why it was unable to do so was to be sent to the Treasurer.
Parish pledging and giving declined from around 13% of parish plate and pledge revenues in the late 1980’s to about 7% in 2004, where it has remained until today. Parishes have been requested to pledge to the Biblical standard of giving, the tithe (10%), and about one third give at that level.
While total annual parish plate and pledge revenues have remained relatively steady at about $21M for each of the past 10 years, with total parish pledges to the Diocese between $1.4M and $1.5M annually, membership has declined by approx 21% and average Sunday attendance has declined by 19% over the same period. Costs, however, have continued to rise, and both parishes and the Diocese are dealing with these budgetary issues. Changes will be inevitable. Other sources of revenue may need to be explored in order to reduce the percentage of the budget that is dependent on plate and pledge revenues in the future.
The Diocesan Stewardship Commission was formed in 2016 to assist parishes in their efforts to improve giving. Recent concerns about the long-term financial viability of the Diocese resulted in the formation of a Mission Share Task Force, which has been charged to explore affirmative approaches and to encourage parishes to work towards the 10% giving level.
The recent change in the income-tax laws doubles the standard deduction, thus reducing the need for the majority of people to itemize deductions on their tax returns. This removes the tax benefit of charitable giving for most people and could potentially result in reduced giving at the parish level and a reduced level of pledges to the Diocese. This goes into effect with the tax returns in April 2019, so treasurers (both parish and diocesan) will need to monitor its impact and what can be done to mitigate negative effects on church funding.