General Ministry Budget Questions & Answers
I see that we had a surplus of $15,060.65 at the end of 2021 in our General Ministry Budget. Where does that money go, and how is it used?
Yes, thanks to your generous financial support of First UMC in 2021, we did have that surplus at the end of the year. Thank you for the question. There are two ways answers to this question:
1. The money stays in the church checking account, and is essentially the beginning checking account balance on January 1, 2022, just like the beginning balance in your personal checking account on January 1, 2022.
2. First UMC, however, doesn’t use a check register like you might on your personal checking account. Instead, the church uses the General Accepted Accounting Practices (GAAP) for Non-profits. Using GAAP, Alma Carlton, our Financial Secretary, prepares two reports at the end of each month for our General Ministry Budget: 1) The Analysis of Revenues and Expenses for the General Ministry Budget, and 2) The Balance Sheet for the General Ministry Budget.
1) The Analysis of Revenues and Expenses for the General Ministry Budget shows the income and expenses for every budget category so far for the year, and at the end of the Analysis, it shows the difference between how much income we received and how much we spent. These amounts vary each month, and some months the net total is positive and some months it is negative. Of course, at the end of 2021, the net total was positive thanks to your generous support of First UMC’s mission and ministry.
2) The Balance Sheet for the General Ministry Budget shows the end-of-month balance from the Analysis of Revenues and Expenses as well as other balances in our restricted funds and reserve funds. The end-of-month balance is called “Excess Cash Received.” Most years when the Excess Cash Received is positive at the end of the year, that amount remains in the church’s checking account, but is moved to a line on the Balance Sheet called “Excess Operating Capital,” where on paper it becomes a reserve account to cover future shortages. For 2022, however, the Finance Committee decided to put these funds in the General Ministry Budget as income to partially replace the one-time grant we received in 2021 from the Payroll Protection Grant from the Federal Government’s COVID-19 relief program.
Didn’t we have three one-time grants as income in the 2021 budget? How are we going to make up for that income that is no longer available?
Yes, we did have three one-time grants for income in the 2021 budget. I already mentioned the Payroll Protection Grant which provided $29,000 in 2021. We also received $20,000 from the Eddie Smith Youth Fund and the remaining $37,200 from the original Children, Youth, and Family Fund to help support the new co-pastor position. This amounted to $86,200 in income which isn’t available in 2022.
To make up for this difference in 2022, the Finance Committee is including the 2021 $15,000 net positive as General Ministry Budget income for 2022. In addition, the Finance Committee has decided to make the Children, Youth, and Family fund a permanent fund to use as needed, and has set a goal to raise $100,000 in 2022 for this fund through Second Mile Giving. The goal is to use $35,000 of this fund as income for the General Ministry Budget in 2022 with the remainder set aside for future Children, Youth, and Family needs. Finally, the Trustees and Endowment Fund Team along with the Finance Committee plan to use $32,000 of the income earned over the last few years in the Permanent Operating Fund as income for the General Ministry Budget, pending approval by the Church Council / Charge Conference on January 30, 2022. This total is $82,000, which when combined with anticipated pledged and non-pledged income, is enough to project a balanced budget for 2022. We will have to work hard to raise it all, but every dollar raised will help First UMC fulfill our God-give mission to be alive in Christ, united in nurturing fellowship, and reaching out to share God’s boundless love.
You mentioned Second Mile Giving just now. What is Second Mile Giving again?
Our mission of First United Methodist Church in Lexington, NC is that: We are each alive in Christ, united in nurturing fellowship, and reaching out to share God’s endless love.
One of the many ways that we as individuals, as groups in the church, and as the church as a whole can live out this mission is through our financial giving. Our financial gifts to the church support the current, day-to-day ministry goals of the church, and they support the long-term ministry goals of the church. Our day-to-day goals and our long-term goals are related, but can be defined in different ways. In the Stewardship Committee, we’ve been working over the last year to more clearly define and understand how we financially support our current day-to-day ministry goals and long-term ministry goals.
The Stewardship Committee has come up with two simple phrases to help us better understand how our financial gifts support the church’s ministries, both day-to-day and long term.
These phrases are “First Mile Giving” and “Second Mile Giving.”
First Mile Giving supports the General Ministry Budget. First Mile Giving comes from active church members and friends through our weekly, monthly, or yearly giving through the church offering, and has an immediate positive impact on First UMC’s ministries and mission.
Second Mile Giving supports our First UMC Ministry, Endowment & Trust Funds along with Capital Improvement projects, select Ministry projects such as disaster relief, the Memorial Fund, the Pastor’s Discretionary Fund, and other funds that are set aside to be used for specific purposes. Second Mile Giving comes from church members, from groups within the church, and the First UMC extended family. Second Mile Giving provides a long-term positive impact on First UMC’s ministry, as every gift provides income for years to come and establishes a legacy of support for the giver.
You’ll hear more specifics about First Mile Giving and Second Mile Giving throughout the year. But to summarize, think about it this way, First Mile Giving is your regular offering to the church, and Second Mile Giving is your response to special appeals as you are able.
Grace and Peace,
Rev. Kirk Tutterow