wfn.org | Foundation to trim staff, tighten purse strings

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Note #6924 from PCUSA NEWS to PRESBYNEWS:

30-October-2001
01407

Foundation to trim staff, tighten purse strings

Declining budget blamed on weakening stock market, lower returns

by Evan Silverstein

NATCHEZ, MS - A shaky stock market and a subsequent decline in revenues has
prompted a Presbyterian Church (USA) Foundation plan to trim more than 20
positions from its payroll and shave $2 million from its budget.

The Foundation, one of the largest religious philanthropies in the nation,
unanimously approved a 2002 budget of about $18 million - its lowest in four
years - during a meeting of its board of trustees here Oct. 24-27. The
Foundation's spending peaked at about $20 million in 2000.

Officials said the adjustments to the budget and management plan were
necessary because of limited reserves and declining income from management
fees on the $1.6 billion in assets the Foundation holds in trust for the
PC(USA). A large portion of the funds is invested in the stock market, whose
recent weakness has reduced the Foundation's income.

"We've cut expenses enough so that we're balanced, and I think we're well
positioned," said Bob Leech, the Foundation's president and CEO. "We
certainly hope that it (the stock market) comes back up again - which it
usually does, with time.
But in the interim, we're watching our pennies very carefully, as good
stewards of the church's money."

The Foundation receives and manages financial gifts from individuals, as
well as endowments of Presbyterian churches, governing bodies and
church-related institutions. Earnings go to support Presbyterian mission and
ministry.

But giving is down 22 percent from the same period last year, with the
sharpest drop appearing in direct giving, Leech said.

"I think we've done a fantastic job under difficult circumstances of keeping
the budget down," he said. "We want to continue to do that."

Staffing at Foundation headquarters in Jeffersonville, IN, has been reduced
by 15 percent over the past six months, from 155 to 132. The Foundation's
Institutional Services team, which is responsible for providing a broad
range of financial services to church-related institutions and agencies, has
been dismantled.

Four positions for development officers, vacant because of medical
disabilities or retirements, will go unfilled for the time being. Officials
anticipate that reduced staffing levels will be maintained through 2002.

"We have reduced costs by a variety of devices," said the Rev. Phil Young, a
Foundation trustee, "including terminating some staff, changing the way in
which the marketing is done for our investments, and terminating some
investment firms that were not producing for us. That saves us some money."

Young said those savings have made it possible to reallocate funds to "more
productive" areas. He said a proposed move into a new building has been put
on the back burner.

"We're not off as much as other commercial entities are," Young said,
"because we never invested in the hot, high-tech stocks. We were much more
value-oriented than growth-oriented, so we didn't ride it up to the extent
that other people did during the 1990s."

In other actions, the Foundation:

*  Elected Judy Stephens of Springfield, IL, as chair of its board of
trustees for the year 2002. She replaces Ray Tanner, of Jackson, TN.
* Elected Lynwood Battle as vice chair. He replaces Stephens.
* Appointed Tanner and Richard J. Seiwell, of West Chester, PA, as adjunct
trustees.
* Elected Jan. R. Walther, of Jeffersonville, IN, to senior vice president,
effective immediately. She has been the Foundation's vice president of
marketing.
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