This month in Stewardship: July
June 24, 2018 by Robyn Davis Sekula
At this point in your church year, you’re a little bit more than halfway done. It’s time to think about church budget, and how much you might need in the coming year.
Stewardship teams need to consider this because you will need this information to help set a stewardship campaign goal, and you’ll want to distribute an attractively presented narrative budget to your congregation.
Your church is likely quite experienced and skilled at setting a budget. What we want to address is how to share that budget with your congregation in a way that invites their participation and helps them understand what their pledges actually support. That format is a narrative budget.
For the spiritual side of this topic, please read Olanda Carr’s terrific column here. This column is dedicated to the “nuts and bolts” of how narrative budgets work.
Line item vs. narrative budgets
A line item budget is what you see most commonly in the corporate world, and it is still used at most churches. You’ll see expenses such as photocopying, electricity, HVAC maintenance, etc., in a church budget, as well as salaries and benefits for pastors and employees.
Narrative budgets take a different approach. Narrative budgets break up the expenses of the church into simple, easy-to-understand categories. To create a narrative budget, you’ll need to know the overall budget of the church. It will also help to have assistance from the church staff and pastor.
How narrative budgets work
Essentially, a narrative budget takes the expenses of the church and divides those expenses into various buckets. Those buckets for most churches are outlined below.
Worship: The weekly church service. Add into this category anything that relates to worship, including the amount of time the pastor spends writing a sermon and preparing for worship, the music program rehearsals and salary for the choir director and organist, bulletin preparation and cost of photocopying the bulletin. For example, if the pastor spends 20 percent of their time preparing for worship each week, 20 percent of their salary, benefits and housing allowance would be placed in that category.
Congregational Life: Activities for the whole church. If your church has an annual picnic, those expenses for dinnerware and food would go here, along with a portion of the staff’s salary that is usually spent preparing for this event.
Mission: Anything that has to do with the church’s outreach into the larger world. If your church supports Presbyterian World Mission or has a partnership with a church in another country, the costs related to those activities would go here, along with a portion of staff time it takes to administer these missions.
Community Life: Ministry that relates to the local community. If your church hosts addiction and recovery meetings, the cost of hosting those meetings, including the portion of the electric bill or sexton’s salary associated with preparation and clean-up, should be in this part of the budget.
Education: Your church school, Sunday School, adult education classes, and Vacation Bible School go here. Costs associated with each, including staff time spent in preparation or during that time, goes here, too.
Operations: The costs of operating the church during the weekday office hours would go here. This would include probably most of the salary of the receptionist and a large portion of utilities.
Building related expenses: For building repairs, and for the salary of the sexton or janitor. Snow removal fees in winter as well as any maintenance or landscaping for summer would go here.
Switching to narrative budgets
During the first year you use a narrative budget, you may also want to provide a line-item budget and keep it available for anyone who asks, perhaps in the church vestibule, available for pickup as desired. Keep a few copies around as the budget becomes a topic of consideration around the church. Robert Hay Jr., a Ministry Relations Officer for the Presbyterian Foundation, reports that the first year his church switched to a narrative budget, a few members picked up a copy of the line-item budget in addition to the narrative budget. The next year, no one picked any up.
Narrative budgets can help your congregation see what the church is really doing with the gifts it receives from members. It shows that your congregation is about much more than keeping the doors open. You’re creating enriching worship experiences, providing education and reaching out into the world to be the loving arms of Christ. It’s so much more than paying bills, and there is no better way to show it than with an attractively presented narrative budget.