wfn.org | COUNCIL PROPOSES CHARGING ADMINISTRATIVE COSTS

[PCUSA_NEWS@ecunet.org]

27-Mar-95

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 
such fees. 
 
     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 
churchwide giving. 
 
     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 
and audits. 
 
     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 
gifts. 
 
     "And the record of the Foundation," Fife said, "is obviously not a 
signficant deterrent." 
 
      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 
involved parties." 
                              # # # 
 
 

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