Draft $143 million churchwide budget plan for 2025-27 advances with no change to assessments on diocesan income

By David Paulsen
Posted Jan 10, 2024
Patty Downing

The Rev. Patty Downing, chair of the Joint Budget Committee, leads her committee in an initial assessment of the budgeting process for the 2025-27 cycle. Photo: David Paulsen/Episcopal News Service

[Episcopal News Service – Linthicum Heights, Maryland] Halfway through the second day of their three-day meeting here, the members of The Episcopal Church’s Joint Budget Committee acknowledged a breakthrough: They had closed a final $1.5 million gap between the church’s projected expenses and income for 2025-27 and had produced a balanced budget.

The process, however, was far from over. Next, the committee will seek approval for its plan from Executive Council at the end of January. Council can either accept or alter it, and then it will be presented to the 81st General Convention for final adoption when it convenes in June in Louisville, Kentucky.

The $143 million draft plan, which the committee endorsed in a final vote on Jan. 9, would not increase the amount of money the church draws annually from the returns on its $167 million unrestricted investment portfolio. At least one member of Executive Council has argued for using more of the investment returns to support the church’s mission and ministry priorities.

The committee’s draft also would maintain the church’s current 15% assessment rate on diocesan income. The assessments are the largest revenue source, 64%, of the churchwide budget. Some dioceses are expected to ask General Convention to cut the rate to as low as 10%, which the committee estimates would create a $12 million shortfall in the three-year budget.

Changes to either income line could dramatically alter the church’s financial conditions as it prepares to welcome a new presiding bishop, who is due to be elected at General Convention in June and begin a nine-year term in November. Executive Council previously set aside more than $2 million for the new presiding bishop, including to pursue “strategic adaptive realignment of our institutional structures” and “an audit of current Episcopal Church staff.”

The Joint Budget Committee incorporated that potential realignment in its draft budget plan, which calls for the new presiding bishop to oversee additional cost reductions totaling nearly $3.7 million through a staff restructuring meant to “resize” or “right-size” churchwide operations. The presiding bishop will have flexibility on the timing and form of those reductions over the next three years; church leaders expect retirements and attrition to account for much of the reduction.

For now, the draft plan counts 140 full-time equivalent staff positions that will be funded by the churchwide budget.

The Joint Budget Committee is organized as a committee of Executive Council, the church’s governing body between meetings of General Convention. The committee’s members are appointed by the presiding bishop and House of Deputies president, with Executive Council’s approval.

A mix of bishops, other clergy and lay leaders from eight of The Episcopal Church’s nine provinces – 13 total voting members – serve on the Joint Budget Committee. It is chaired by the Rev. Patty Downing, a priest in the Diocese of Delaware. Some committee members, like Downing, also serve on Executive Council.

This is the committee’s first time overseeing the development of a triennial budget under a new streamlined process that was adopted in 2022 by the 80th General Convention. It held four listening sessions in November and December before finalizing its budget draft during the in-person meeting Jan. 8-10 at the Maritime Conference Center in suburban Baltimore.

“It’s been very gratifying to see how many people have engaged in our listening sessions,” Downing told Episcopal News Service during a break in their meeting. The new process allows one entity to shepherd the budget from start to finish, though Downing said there remains much uncertainty around the committee’s role through General Convention and afterward.

The presiding bishop nominees won’t be announced until the spring, Downing noted, and “there’s a lot of time between now and General Convention” for mission and ministry discussions that could have budget implications. After approving a draft plan and presenting it to Executive Council, the committee will have no authority to make changes before it is presented to General Convention – though Executive Council may make its own changes. This is different from past cycles, when a committee of General Convention had more time to update the draft.

A final online hearing, or listening session, is scheduled for May 22, and an in-person session will be held in Louisville on June 22.

After the 81st General Convention, the Joint Budget Committee will be empowered to adjust the adopted 2025-27 budget in response to General Convention resolutions that call for additional spending. The committee will determine which measures will and will not be funded from a limited pool of money set aside for those resolutions. The committee’s in-person meeting to conduct that work has been scheduled for September.

After that, the cycle will start over with the creation of a new Joint Budget Committee, which will begin drafting a 2028-30 plan.

“God help the next budget committee,” Maine Bishop Thomas Brown said at one point, during a discussion of the revision process.

“That’s what we said the last time,” replied the Rev. Mike Ehmer, a committee member from the Diocese of Northwest Texas. Ehmer chaired the former Joint Standing Committee on Program, Budget & Finance that developed the 2023-24 budget plan.

At this week’s in-person meeting, the Joint Budget Committee focused much of its time on the final steps of balancing its budget proposal. Members conferred with various department heads to identify specific budget lines where a combination of spending cuts and revenue increases would eliminate the $1.5 million shortfall that remained at the start of the week.

The committee, for example, trimmed one line related to racial reconciliation initiatives by $20,000 a year after learning that funding in other lines was sufficient. Adjustments to the legal budget related to outside counsel and travel would save an additional $30,000 a year. Another expense, related to the church’s asset map, was reduced by $15,000 a year, and the committee accepted a departmental suggestion to lower the requested amount for church planting from $564,000 a year to $500,000, keeping it in line with past funding levels.

House of Deputies President Julia Ayala Harris, who spoke to the committee on Jan. 9 by Zoom, offered to reduce her office’s budget request by nearly $100,000 over the three years, reflecting savings in communications and meetings with her Council of Advice.

The committee also finalized an estimate for funding the newly created Episcopal Coalition for Racial Equity and Justice. It is due to receive $2.3 million in 2025-27, equivalent to 10% of the church’s budgeted draw on its unrestricted investment funds.

Executive Council previously approved $300,000 for 2023-24 to help launch the coalition, intended as a voluntary network of dioceses, parishes, church institutions and individuals dedicated to improving the church’s uneven track record of prioritizing racial reconciliation and healing.

The largest final adjustment to the draft budget was an increase in rental revenue. One floor of The Episcopal Church’s office building in New York has been vacant since the Haitian consulate moved out in 2022. An early version of the 2025-27 budget plan included no revenue from that space, so the committee added $500,000 each in 2026 and 2027 in anticipation that a new tenant might be found.

– David Paulsen is a senior reporter and editor for Episcopal News Service. He can be reached at dpaulsen@episcopalchurch.org.