From the Worldwide Faith News archives www.wfn.org
COUNCIL PROPOSES CHARGING ADMINISTRATIVE COSTS
05 May 1996 12:58:55
95088 COUNCIL PROPOSES CHARGING ADMINISTRATIVE COSTS
TO ALL CONTRIBUTIONS
by Alexa Smith
LOUISVILLE, Ky.--By a 27-26 vote, the General Assembly Council moved to
charge administrative costs against designated gifts to the Presbyterian
Church's governing bodies -- a giving category traditionally exempted from
Pushed by the Rev. John Fife of Tucson, the March 12 vote amended the
report of the Council's Dollar Distribution Task Force (DDTF). The task
force began its work in 1993 to develop more uniform policies for
DDTF chair the Rev. D. William McIvor of Seattle described the
amendment as the "single biggest change" in the proposed financial
document, which is now on its way to the General Assembly.
It will go to Cincinnati as part of a proposed three-pronged financial
package, which includes a report on per capita and one on funding the
church's 16 synods.
Other proposed DDTF changes, while they may "take some getting used
to," according to McIvor, have more to do with standardizing procedures and
changing nomenclature (such as "directed" instead of "restricted" funds and
"shared" instead of "unrestricted" dollars) than real alterations.
As approved by the Council, the amendment states "essential
administrative costs of carrying out the whole church's programs and
mission are also to be shared fairly by the whole church," just as per
capita provides an equitable way to share ecclesiastical, legislative and
judicial costs in the church's life.
It goes on to propose that a governing body may apply a charge "not to
exceed an agreed-upon percentage" against all basic mission support,
including unrestricted and restricted gifts.
Fife framed his argument as one of accountability, saying: "The
problem is, those [who give] only directed support do not pay any of the
costs for us to be a responsible institution. ...
"Those costs," he said, are now paid by congregations like his own,
who do not restrict their giving. Fife said donors "are able to understand
there are some basic costs" entailed in processing gifts, such as payroll
Among those who opposed the amendment, the Rev. Walter Ungerer of
Kokomo, Ind., argued that meddling with tradition may do "damage" at local
levels. "I will," he said, "frankly, have a difficult time interpreting
this to my people."
Presbyterian Church (U.S.A.) Foundation president Larry Carr cautioned
the GAC against the measure because, as he said, "donors don't like it,"
even though it "may be fair." Fife pointed out that Carr's argument is
contrary to the Foundation's own practice of applying a service charge to
"And the record of the Foundation," Fife said, "is obviously not a
Chief financial officer G.A. "Pat" Goff said unified giving once paid
overhead for all financial administration but is no longer doing so. He
said a 5 percent fee has been applied to some restricted dollars (such as
special offerings and some endowments) during the past two years to cover
auditing, legal and accounting costs.
"John is trying to get us in [a place] where all funds pay for
themselves," Goff said.
McIvor said charging administrative overhead costs to directed dollars
came up frequently in the DDTF work -- but a majority did not support its
inclusion in the report.
Other proposals in the report include:
* standardized procedures to collect, report and audit funds at
presbytery and synod transmittal sites and an established schedule for at
least quarterly reports from the General Assembly
* commendation of "validated mission" (programs or projects approved
by a governing body) that includes a statement that all governing bodies
need not endorse or fund it
* explicit acknowledgment that any gift, shared or directed, will be
credited to the giver's mission support commitments
* use of restricted funds first for approved budgets, then applying
unrestricted funds to fulfill the budgets
* resolving conflict over budgeting processes "openly among all
# # #
For more information contact Presbyterian News Service
Presbyterian Church (U.S.A.), Louisville, KY 40202
phone 502-569-5504 fax 502-569-8073
E-mail PCUSA.NEWS@pcusa.org Web page: http://www.pcusa.org
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