During recent months I have experienced the emergence [or perhaps the re-emergence] of the 80 Percent Budget in congregations. These types of budgets are being impacted by several factors. Two primary factors are the current economic situation, and high fixed costs in the areas of personnel and facilities.
The 80 Percent Budget comes about this way. Congregations, in response to the economic crisis, are lower their budget by an average of 20 percent to 80 percent of either their 2008 budget or their intended 2009 budget. To do this they have not been able to simply adjust soft spending on programs, missions, ministries, and activities. They have had to adjust hard spending on personnel and facilities. The adjustments on all areas have been difficult. The adjustments in personnel have tended to raise the intensity of conflict in the congregation.
By default congregations are experiencing an 80 Percent Budget in a second way. The total indirect cost for personnel and facilities now amounts to 80 percent or more of the budget. Many congregations are able during typical years to contain the total cost for personnel and facilities at or below 70 percent of their budget. This is generally healthy. If congregations ever allow the total cost for personnel and facilities to rise to 75 percent they begin strangulating their ability to do programs, missions, ministries, and activities. If this percentage ever rises to 80 percent or more of the budget, then the small amount left for soft spending is like making bricks without straw.
In other ways congregation are experiencing the 80 Percent Budget. However, these two are enough to think about for now.
How is your congregation doing with its budget during 2009?
