Challenges prompt major changes in 2021 budget
The Oklahoma Conference is proposing major changes to the 2021 budget, including the elimination of New People New Places funding and CCLI/CVLI coverage, in order to make up for higher general church costs and lower apportionment payouts.
To communicate the reasoning behind some of the budget decisions, four conference leaders compiled answers to questions from the Contact, including Bishop Jimmy Nunn; Rev. Joseph Harris, director of communications; Rev. Derrek Belase, director of connectional ministry; and Randy Compton, conference treasurer. An abridged version of those questions and answers is published below.
Q: What challenges did the conference face in determining the 2021 budget?
A: The main challenge to preparing the 2021 budget was to estimate what revenues we could expect in 2021 and how we could reduce expenses to try and match those expenses. We will have fewer churches contributing fewer dollars to the conference’s 2021 budget due to church closings, uncertain church attendance due to COVID, uncertainty due to the upcoming General Conference in 2021 and churches struggling with their own operating costs.
Many items in the Conference Apportionment budget (approximately 33% of the total) are determined at the General Conference level and then passed down to us at the Oklahoma Annual Conference. Those items reflected a 2.7% increase for 2021. The remaining items in the Conference Apportionment budget total approximately $6.8 million for 2021 for an overall decrease of 3.5% for those items.
Q: How were cuts and changes determined?
A: CCLI/CVLI cuts were determined based on the current rate of apportionment being paid into this line item. Apportionment payout has dropped since 2016 which has resulted in a number of churches receiving the benefit of CCLI/CVLI coverage without paying the apportionment line item. Given this inequity, the expense to the conference is no longer tenable.
Staff reductions were based on reductions of budgets (particularly expenses), ability to consolidate responsibilities, retirements, not replacing staff openings, and reducing as many fixed expenses as possible.
The 2021 budget for Mission and Ministries was decreased approximately 32.6% from $3.1 million in 2020 to $2.3 million in 2021. Almost all of this decrease came from the elimination of the amount budgeted for New People New Places.
There is a bit of “carry over” funding which will allow us to complete any existing New People New Places projects. Unfortunately, we will not be able to receive any new projects. There was no replacement funding offered as a part of the budget. This will mean that the work of New Faith Communities as an entity will become even more important. That group will be responsible for church revitalization, fresh expressions and other work. We will also lean on the Woodworth Committee for mission and racial/ethnic revitalization and new work.
There was $43,800 set aside of racial/ethnic ministry in the NFC budget and that amount was moved directly to MLCC, increasing the budget for MLCC by 25% year over year. MLCC will now be in the lead when it comes to racial/ethnic revitalization, but will be working in partnership with New Faith Communities. There is also a set aside portion of the Woodworth funds for racial/ethnic work. Total funds available for racial / ethnic ministries will increase, which signals a new day for the conference in these areas.
Q: What sort of financial practices or controls were put into place that will help improve future audits, and why were they not in place before?
A: Several new financial practices and internal controls have been implemented during the year in the Conference accounting office. Among these items were:
Timely reconciliation of all bank accounts, investment accounts, apportionment revenues.
Proper oversight and approvals for all disbursements.
Increased interaction with the interim treasurer ensuring documented oversight in the daily accounting matters of the Conference.
Improved period closing procedures to ensure proper cut-off of expenses and revenues.
We are in the process of designing new reports which will help better manage the Conference financial matters.
Q: What do you think delegates should keep in mind when voting on the 2021 budget?
A: The budget has been prayerfully gone over by groups of clergy and laity in our conference and was approved by CFA, priority has been placed on our mission as United Methodists and the ministry of the local church, and General Church apportionments by Discipline cannot be changed by the Annual Conference.
Watch the virtual report from CFA at www.okumc.org/2020reports. Read the full report from the CFA on page 114 of the pre-conference workbook. A detailed list of the proposed 2021 budget is on page 120.