wfn.org | NCC Executive Board Reinforces Fiscal Accountability

[CAROL_FOUKE.parti@ecunet.org (CAROL FOUKE)]

National Council of the Churches of Christ in the USA
Email: news@ncccusa.org  web: www.ncccusa.org

Contact: NCC News, 212-870-2227

15NCC3/1/2000
FOR IMMEDIATE RELEASE

NCC EXECUTIVE BOARD REINFORCES FISCAL ACCOUNTABILITY,
RECEIVES PROGRESS REPORTS, EXPRESSES SENSE OF NEW BEGINNING

 February 29, 2000, NEW YORK CITY - "Tough talk" 
reinforcing the need for financial austerity was accompanied 
by expressions of hope and a sense of new beginning as the 
National Council of Churches' Executive Board held its first 
meeting since last November's sweeping restructure of the 
50-year-old ecumenical organization.

 Encouraging words threaded their way throughout the 
February 28-29 meeting, beginning with Ambassador Andrew 
Young's opening meditation on Hebrews 12 evoking the 
ecumenical leaders of the past 50 years and affirming that 
"we will measure up to the challenges of this day."  

 Others praised the more temporal achievements in 
cutting budgets, simplifying structures and, as Bishop Paul 
A. Stewart of the Christian Methodist Episcopal Church, 
Birmingham, Ala., put it, "making the NCC more effective in 
light of the funds we have."

 The Rev. Wesley S. Granberg-Michaelson of the Reformed 
Church in America, New York City, bringing the final report 
of the Transition Management Team (established last October 
to develop structural and staffing plans to ensure 
sustainability and order in the NCC's life), said, "There is 
reason to be encouraged about the future..At this juncture 
we believe the organizational life of the Council is 
becoming stabilized and well ordered."

 "We've stopped the financial hemorrhaging," affirmed 
Dr. Bob Edgar, NCC General Secretary.  "There's a new wind 
blowing through the NCC."

He, his staff and the Council's officers detailed a 
score or more of steps taken since November to ensure 
financial accountability and control; standardize personnel, 
travel and other policies and practices; cover the 1999 
year-end accumulated deficit estimated at $4 million, and 
ensure a deficit-free year 2000 with a budget that begins to 
build back the NCC's depleted financial reserves.

 They also proposed a reorganization in which the NCC's 
work would be carried out through Church World Service and 
Witness, the General Secretariat and a new Mission Cluster, 
to encompass education, justice, public witness and unity 
program areas.  All are responsible ultimately to the NCC 
General Assembly, the Council's highest legislative 
authority made up of official delegates from the 35 member 
communions.

 While the specifics of restructure, including 
resolution of how Church World Service's financial 
management and administrative needs can best be met, will be 
the focus of the Executive Board's May meeting, the Board in 
February set Mission Cluster priorities for the next 12 to 
18 months (see sidebar, to follow).

Action on Year 2000 Budget, Change in Fiscal Year

 NCC Treasurer Philip Young, a Presbyterian from San 
Rafael, Calif., presented to the Board a proposal to change 
the NCC's fiscal year from the calendar year to July 1-June 
30.  This will enable the General Assembly to receive a more 
timely audit at its November annual meetings.  The Board 
approved.

 Effective July 1, 2000, the change has a second, more 
immediate advantage.  It allows the NCC's consolidated 
budget for calendar year 2000 to function as an interim 
budget for the first six months of the year 2000 as the 
Council restructures.

 The Board received the year 2000 budget and specified 
that it "be a guideline for fiscal oversight until the next 
meeting of the Executive Board in May 2000," when the NCC's 
Administration and Finance Committee is to bring a new 
budget for the fiscal year 2000-2001 for approval.

 Although meant to be used for just six months, it is 
written as a 12-month budget to better enable review and 
analysis.  It projects total expenses of $71,281,583 and a 
year-end revenue over expenses of $386,562.  

 The Church World Service and Witness portion of the 
budget ($62,789,530 in total expenses) represents a $9.1 
million (17 percent) increase over 1998 and a $9.4 million 
(18 percent) increase over 1999.  The remaining $8.5 
million, shared by the General Secretariat and Mission 
Cluster, represents a $3 million (26 percent) decrease from 
1998 and a $5.9 million (41 percent) decrease from 1999.

 "A program matrix is carrying out the ministry 
according to your directives," Mr. Young said in presenting 
the year 2000 budget to the Executive Board.  "All 
restrictions on funds are respected.  There will not be 
'authorized but unbudgeted' expenses in the year 2000.  
Reductions in staff have been made.  They were painful.  
They are now behind us."  (Twenty-seven titles were cut, 
with nine staff separations required.  Some affected 
positions were vacant when cut or encompassed more than one 
portfolio.)

 Last November, the Executive Board mandated a 10 
percent "set aside" from two funding streams, the Ecumenical 
Commitment Fund (contributed by member communions) and 
Common Support Services transfers (contributed by the NCC's 
program units for centrally provided services including 
administration and communication).  The savings are to be 
used to begin to restore the NCC's depleted reserves.

 "That 10 percent reduction is anticipated in the 
budget, although it's not in a line item," Mr. Young said.  
The Executive Board voted to reaffirm its demand for the 
"set aside," asking that it be represented clearly in a line 
item in the fiscal year 2000-2001 when it is brought for 
Board approval in May.

 "We can't have another year when expenditures exceed 
income," said Dr. Belle Miller McMaster of the Presbyterian 
Church (U.S.A.), Avondale, Ga., who made that motion.  "I 
believe the year 2000, under Bob Edgar's leadership, is a 
new beginning and a great hope.  It's also a very vulnerable 
year," she said.  "We must build back the reserves.  The new 
General Secretary can't rebuild the NCC unless we get our 
financial house in order."

Coverage Report: 1999 Year-End Accumulated Deficit

Dr. Edgar reported on funds raised to cover the NCC's 
1999 year-end accumulated deficit estimated at $4 million.  
The shortfall resulted from "authorized but unbudgeted" 
expenses that included $2.4 million in management consulting 
fees since March 1998, a one-time contribution of about 
$550,000 to the NCC's Pension Fund to cover a payment missed 
several years ago, and overexpenditures in several 
departments in the General Secretariat.  Commitments as of 
February 27 included:

 * $805,576 already in hand from NCC member communions.

 * an additional $1,134,299 pledged from NCC member 
communions, some of it contingent on other NCC member 
churches' commitments.

* $1,453,000 from Church World Service to cover its 
portion of "authorized unbudgeted NCC costs for Pappas 
consultants, pension plan consulting, legal costs, other 
insurance consulting, and unbudgeted temporary help."  

 * $137,867 from the Burned Churches Fund to defray the 
costs of the special examination of the program.

* $358,590 recovered from various parties in the final 
settlement in the NCC's pursuit of funds lost in what proved 
to be fraudulent securities issued in the name of the 
Prague-based Banka Bohemia.

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