By Kirk Petersen
Because of favorable budget surprises and a windfall from a land sale, the Episcopal Church finds itself flush with cash and will establish a prudent level of short-term reserves for the first time in years, according to presentations made to Executive Council.
The council, which met Feb. 21-24 in Oklahoma City, also visited the memorial for the 1995 Oklahoma City bombing; heard about plans to continue the work of Episcopal Migrations Ministries regardless of future government funding; and passed a carefully nuanced resolution opposing the previously reported decision by the Archbishop of Canterbury to not invite the same-sex spouses of bishops to the 2020 Lambeth Conference.
The big financial news was that the sale of a city block of downtown Austin land in January left the church with about $19 million in proceeds after costs and repayment of debt. Chief Financial Officer N. Kurt Barnes said the church is prohibited from disclosing the actual sale price. He also told the council that a $7.6 million balance in a revolving line of credit was retired from the proceeds. All of this implies a purchase price of nearly $30 million.
In addition, while the books are not closed yet on 2018, the church also has a surplus of between $5 and $6 million from the 2016-18 triennial budget. Expenses were below budget because some programs had not started until later than expected, and income was up because of dioceses’ improved compliance with assessments — driven in turn by higher income for the dioceses.
“The good news — the very good news — is that by lowering the percentage, and working with dioceses on the waiver process, and requiring payment, since 2013 we have increased full participation from 44 dioceses to 75 dioceses,” said the Rev. Mally Lloyd of the Diocese of Massachusetts, who chairs the council’s Finance Committee. The church has 111 dioceses.
Ten dioceses had already been granted waivers from the prescribed assessment of 15 percent, and the council approved four additional waivers. The council also rejected a waiver application from the Diocese of Dallas. Lloyd explained that Dallas leaders “said they will move to 15 percent by 2020, but their 15 percent is split between about 12 percent that comes to [the church center] and 3 percent that goes to other ministries of the church of their choosing. The committee felt that the assessment is not a split-able entity.”
Beginning in 2020, dioceses that are not in compliance with the 15 percent assessment and that have not been granted a waiver will not be eligible to receive grants or other funding from the church center.
Finance officials have warned for years that the church has insufficient short-term reserves, and Lloyd said that because of the surplus and the land sale, “for the first time in a long, long time, we’ll have our short-term reserves fully funded.”
The church’s target is to keep liquid reserves equal to three full months of operating expenses, which currently means about $9.5 million — far more than the $5.7 million currently on reserve. After closing that gap, the church will have about $16 million left from the property sale, which will be added to a new trust fund controlled by Executive Council.
The Rt. Rev. Ed Konieczny, a council member and Bishop of Oklahoma, expressed concern that the windfall would be frittered away. “Word’s going to get out to the church that there’s $16 million here, and we’ll be right back where we were, spending a million here, a million there,” Konieczny said, in opposing the trust fund. “We can’t just set this aside and start spending it because we have it.”
Barnes said the spending discipline would have to start with the council. “We have $420 million in investments, and whether it’s a reserve account or not a reserve account, the temptation is to go after it, Lloyd said. “I think the discipline has to start here.”
The land in Austin — a full city block in a prime downtown location — was purchased for about $10 million in 2009 for building a new home for the Archives of the Episcopal Church, which has been housed for years in borrowed space at Seminary of the Southwest, also in Austin.
Council member Russ Randle of Virginia said leaders had been “imminently about to deal with [the archives] for several terms of this council. I’d like to commit to having a final decision in terms of some purchase or other arrangement made for permanent relocation of the archives before the 2021 Convention.”
Presiding Bishop Michael Curry said that target was “very doable.” He asked that the minutes reflect the group consensus that the project should be completed by 2021 and funded with the proceeds of the Austin land sale.
Episcopal Migration Ministries continues to operate in an existential crisis, although its funding for resettling refugees has been extended for 2019. The Rev. Canon Chuck Robertson, canon to the presiding bishop for ministry beyond the Episcopal Church, said he is hopeful that EMM will be able to continue its works as one of nine agencies that contract with the government to resettle refugees in the United States.
However, given repeated policy shifts on refugees and other immigrants, “we are preparing for the exact thing we were preparing for a year ago,” Robertson said. “The situation is just as dire, just as difficult. Nothing has changed in that.”
EMM is working to ensure that it will continue its mission of caring for refugees in some form, even if government funding for resettlement dries out. Two key staff members have been shifted from EMM’s payroll and into relevant departments at the church center, so their salaries will not depend on federal grants. On Feb. 28, EMM will launch Partners in Welcome, a new online portal for churches and others who are committed to supporting refugees.
As for the latest same-sex marriage dispute, Executive Council passed after extensive debate a resolution expressing “concern, regret, and disappointment” about the Archbishop of Canterbury’s decision to exclude same-sex spouses of bishops from the general invitation to bishops’ spouses to participate in the 2020 Lambeth Conference.
The resolution asks “each Bishop, each spouse of a Bishop, and the House of Bishops collectively to prayerfully and carefully consider her/his/their response, choices and actions in the light of these troubling circumstances.”
The tone of the resolution was in sharp contrast to the opening remarks of the Rev. Gay Clark Jennings just three days earlier. Jennings, president of the House of Deputies, said the archbishop’s decision “makes me very angry,” and threatened to consider reducing the Episcopal Church’s financial support of the worldwide Anglican Communion. She declined to make any further comment.
Several members of the committee who drafted the seven-page resolution — an unusual length for an Executive Council resolution — said they would have preferred a stronger statement that called on Abp. Justin Welby to reverse the decision.
Konieczny said the intent was to give the archbishop some space to make that decision without presenting the statement as the official position of the Episcopal Church. Others noted that the council has the option of taking stronger action in the future.