wfn.org | [PCUSANEWS] Plan to recoup restricted funds costs approved

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Note #8123 from PCUSA NEWS to PRESBYNEWS:

Plan to recoup restricted funds costs approved
04083
February 14, 2004

Plan to recoup restricted funds costs approved

Administrative expenses to be known as 'contribution to shared mission costs'

by Bill Lancaster

LOUISVILLE - The General Assembly Council (GAC) has approved a revised plan
to recover the cost of administering restricted funds from those funds rather
than pay the costs from unrestricted accounts. The cost recovery is called
"contribution to shared mission costs."

The plan adjusts contributions depending on the entity whose funds are being
tapped. Normally, the amount would be capped at 5 percent, but validated
mission support groups-Presbyterian Frontier Fellowship, the Medical
Benevolence Foundation and the Outreach Foundation-would contribute just 1
percent. The formula also takes into account the various programs' own
administrative expenses. The contribution from Presbyterian Disaster
Assistance (PDA) would be capped at 5 percent of average PDA revenues for the
previous five years.

The plan incorporates changes made after the GAC's meeting last fall, when
the proposal proved controversial. Representatives of the three validated
mission support groups vigorously opposed the measure, saying it would hamper
their fundraising efforts for church causes.

And the Rev. Louis Weeks, president of Union/PSCE Theological Seminary and
the liaison to the GAC from the Committee on Theological Education (COTE),
raised strong objections to paying administrative costs from the Theological
Education Fund (TEF).

After that meeting, GAC staff met with the plan's critics and came up with
the revised proposal.

Dottie Hedgepeth, associate director of theological education, told the
Congregational Ministries Division sub-committee on theology and
worship/spiritual formation that the TEF would barely have been affected in
2003 under the revised plan. Because the TEF paid 4.92 percent in
administrative expenses, she said, the additional levy under the plan would
have been just 0.08 percent, or about $2,000.

Phil Butin, the president of San Francisco Theological Seminary and the
liaison from COTE to this GAC meeting, supported the revised plan on
Wednesday, but on Saturday supported an amendment that would have removed the
TEF from the list of funds from which administrative costs would have been
drawn. The amendment was defeated.

"I'm equally committed to the financial flourishing of the denomination and
to the good of the seminaries, and we need a way of doing this that doesn't
pit one against the other," he said in support of the amendment.

In an interview after the vote, he said he hopes the current debate will lead
congregations to increase their giving for theological education.

Butin had told the theology and subcommittee earlier, "The level of support
(of seminaries by congregations) in the 1960s was 20 to 25 percent of the
seminaries' budgets," but seminaries now "receive very little support" from
congregations through the TEF. He said TEF contributions range from less than
1 percent of the Princeton Theological Seminary budget to 21 percent of the
Johnson C. Smith Theological Seminary budget. He said 78 percent of
congregations don't contribute to the fund, although some give directly to
individual seminaries.

Hedgepeth told the subcommittee, "The goal is to have congregations that
depend on seminaries to provide their pastoral leadership understand that it
is not likely to be paid for by anybody else."

David Hackett, associate director for denominational relations for the
Presbyterian Frontier Fellowship (PFF), said in an interview that he had
reservations about the plan.

"This has been a very hard one for us," he said. "I'm not necessarily feeling
that the conclusions they reached were good ones. We're not sure that the
different percentage rates will come across well for the public. We've
already received some pressure from some other funds that want to be
classified as Frontier mission projects and pay the 1 percent rather than the
5 percent.

"We've also gotten word from some other donors that they will send their
hundred-thousand dollar chunks through other means to recipients" so that the
1 percent won't be taken out.

"I think the bigger question is whether this kind of 'patch' to what has
already been called a broken mission funding system is advisable at this
time," Hackett said. "This could have some negative repercussions."

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