St. Timothy's Financial Funds
Where's the money and what is it used for?
The time, talent and tithe contributed by its parishioners are the lifeblood of any church, and St. Timothy’s Episcopal Church is no exception. Four funds comprise the St. Timothy’s financial resources; they are:
At the annual meeting of the parish each January parishioners approve an operating budget for the year. The Finance Committee, appointed by the Rector and approved by Vestry, is responsible for developing a realistic budget, to prepare it for submission and to be able to explain it in detail and as a whole to those attending the meeting. The Committee determines anticipated revenues, based chiefly on results of the most recent Every Member Canvass, completed late the year before; it estimates expenses based on (1) recommendations of the staff, the wardens and volunteers who head various programs, on (2) commitments already in place and (3) on recent history and experience. The budget, once adopted, becomes the guideline for measuring incoming revenues and controlling expenditures. Currently, the budget approximates $735,000, 95% of which is derived from pledge and plate offerings. At least quarterly throughout the year the Administrator publishes in The Crossbeam and on line a summary of actual performance for the period and year to date against budgeted revenues and expenses. Because up to a third of budgeted revenues are normally received in the final two months of the year, quarterly reports throughout the year are likely to show deficits (expenses exceeding revenues) even though revenues for the year have been budgeted to exceed expenses. The church maintains a checking account with PNC Bank to process incoming revenues and to handle payment of salaries and expenses; with approval of the Administrator the bank invests amounts accumulated in excess of current requirements in a money market fund or other low-risk short-term investments. As required by the National Episcopal Church, the Administrator deposits all revenues, not only those budgeted, into the Operating Fund when received and subsequently transfers them to other funds (Memorial, Music or Endowment) as designated by the donor.
The church maintains a Memorial Fund, invested in a savings account at PNC Bank; interest earnings on this account, which normally totals about $5,000, are minimal. The fund comprises contributions of parishioners and their families and friends primarily in memory of deceased loved ones; some donors also give moneys in thanksgiving for an event or to honor a person for his/her special achievement. The church uses this fund primarily to cover the cost of purchase and repair of items supporting worship: communion ware (chalices, cruets, linens, etc.), vestments and other altar furnishings of a permanent or semi-permanent nature. The cost of wine and communion wafers for the Eucharist is considered a budgeted expense and is paid for through the Operating Fund, not the Memorial Fund. Parishioners donate moneys to cover the cost of altar flowers.
In the mid-1980s the Rector appointed a committee to organize a campaign to acquire a pipe organ for St. Timothy’s. It engaged a consultant, examined the works of a number of organ builders, some of international reputation, and chose from among them Charles M. Ruggles to design and build a tracker-action organ for the church. In addition to installation of the organ, the project included some major building changes, chiefly replacing the carpet with a hard-surface floor to improve the acoustics. A capital campaign raised the funds to cover the cost of the organ and building improvements related to it. In addition to payments of parishioners’ pledges, made at the beginning of the Campaign, the Fund received a number of memorial gifts throughout the several years leading up to final installation of the organ in early 1993. After the church had made all payments related to the project, a balance of approximately $40,000 remained. This became the initial funding for the Music Fund as it currently exists. Through additional contributions, principally memorials, the book value of the fund has grown to over $57,000. Before the steep decline in the stock market, the value of the Fund peaked at $85,000; current market value approximates book value. The assets of the Fund have been invested with a broker. Vestry has approved a resolution calling for reinvestment of earnings until such time as the principal is large enough to generate sufficient income to fund major portions of the music program of the church. Earnings of the Fund are, therefore, being reinvested.
PNC Advisors, a department of PNC Bank that manages the Consolidated Growth Fund of the Diocese of Southern Ohio, is custodian and manager of St. Timothy’s Endowment Fund as part of the Diocesan fund. The Fund has a current book value of $149,000, representing bequests and contributions received since its inception in the early 1970s. Although current market value exceeds book value, it is considerably below the high of about $270,000 it reached in late 2007. In 2008 the church formed a Planned Giving Committee, the purpose of which is to organize an effort to encourage parishioners to leave a legacy to St. Timothy’s as they plan the current and future management of their estates. The Committee, comprising six members who will serve three-year terms, two of which will expire each year, has set up goals for the ultimate use of earnings generated by the Endowment Fund. The Committee will organize a program to familiarize parishioners with the benefits of planned giving, both for the church and for them and their families. It will encourage parishioner to undertake serious estate planning, with guidance by professionals, and encourage them to include the church in their wills and charitable remainder trusts, designate St. Timothy’s as the owner or beneficiary of a life insurance policy or IRA, give appreciated property to the church, make a life income gift, etc. Earnings generated by the Fund will be reinvested, as they have been to date, until the principal has reached a level, the earnings from which will support a major program. The Committee will encourage parishioners to focus on the church’s outreach ministries, its youth programs, including missions, and its music ministry or to support a ministry especially important to the individual. Future use of the Fund’s earnings will be chiefly for these purposes but will be available for maintenance of facilities should the need arise.