Putting a Price on Values

I started a Government Budgeting and Finance class this semester for my MPA program, and so far it has actually been pretty interesting. Apparently everyone who does the program dreads taking this class because finance and budgeting is dull, boring stuff. But the professor has really thrown down the gauntlet and made the class interesting to start off with.

He began class by declaring, “Budgets are not just numbers. Budgets are reflections of values.”

In the past, he said, when people still used checks, he would announce, “Someone give me your checkbook register and in 15 minutes I’ll tell you what you value.”

That thought has stuck with me this past week as I’ve chewed on it and processed it. It didn’t sit well with me at first, because my first thought was, “If you looked at my household budget, the number one recipient of our money is Wal-Mart. And I don’t really ‘value’ Wal-Mart.” In fact, I value a lot of things more than buying cheap Chinese crap at Wal-Mart.

For instance, just to take one small example, I value reading more than I value stuff at Wal-Mart. But I hardly spend anything on books because I get most of them from the library.

But then I got to thinking about it again… and maybe that does reflect some value choices at a deeper level.

Maybe it shows that I value saving money over going to, say, Safeway and getting slightly higher quality stuff.

Maybe it shows that I value feeding my family more than I value owning books that I could read again at my leisure.

So maybe my budget is reflective of my values after all.

We budget $100 a month for eating out or going to the movies. Maybe this shows we place a pretty low value on eating out. Or a higher value of eating in.

We budget some money each month to go to a local church, or to projects like Kiva or World Vision. That certainly speaks to our values.

So maybe the professor has a point. He went a step further to say that “Budgeting is the means by which we transmit abstract thoughts and values into action.”

If we say we want to pursue the abstract value of a “safer community,” for instance, then we adjust the budget in order to hire more cops, buy patrol cars, implement curfews, etc.

The flipside then would be: if we say we want to pursue a “safer community” and do not spend that money pursuing it, then we don’t truly hold that value after all. We’re just paying lip service to the idea.

So my questions to you this morning are these: is the professor correct? Are budgets reflections of values? Do they show us what we truly value in life? Do we really “vote with our wallets,” to borrow an old phrase?

And if so, what does your budget say about you? What does your organization’s budget say about it? What does your church budget or business budget say you value? For instance, does your church say they value missions, but then actually only give a tiny percentage toward missions?

Is it time to adjust a budget in order to value some different things?

On Church Budgets

It’s the end of the calendar year. Which means it’s not only the holiday season, but for many churches it is also budget season.

We were attending our usual church last Sunday and received a copy of the proposed 2011 budget. Despite being a staff member of this church for five years and seeing more or less the same budget numbers all that time, something immediately stood out to me this year.

The budget was broken into two main categories: operating expenses and ministry. Operating expenses included all the organizational, institutional kind of stuff: staff salary and stipends, facility rental, phone lines, advertisements, etc. And ministry budgets included everything that went toward doing ministry: food, supplies, books, meetings with people, volunteer support budgets, trainings, and that kind of stuff.

What stood out to me was the percentage breakdown of those two categories: around 85% for operating expenses and around 15% for ministry expenses (I don’t have the paper in front of me, so I’m working off my best memory — those are close ballpark figures).

Maybe it was the labels of the two categories. Maybe it was seeing it in print after not taking part in the budget process. I don’t know what it was. But I just kept thinking over and over again, “There’s got to be a better way to do this!”

And please, please understand this is not a knock against this church whatsoever. Pretty much every church budget looks like this. In fact, in a recent LifeWay survey, they revealed that on average, 87% of church budgets went to things that would fall under “operating expenses”. That only leaves an average of 13% for “ministry”.

So I’m not saying this church budget was bad. Not by any means. In fact, it’s perfectly normal.

But that is what’s got me thinking: what if normal isn’t the best way to do things anymore?

Shouldn’t there be a way for more than 13% of our church budget to be designated as “ministry”?

And yes, those labels are somewhat of a misnomer. Ministry takes place in the facility on Sunday mornings, which is provided by the operating expenses portion of the budget, for example. But not all of those line items can be explained like that.

There’s simply got to be a better way to do and to fund church, doesn’t there? Shouldn’t there be a way to free up much of that money to go directly to Kingdom efforts instead of operating expenses? To tell people to spend their money on the poor, the sick, the diseased…? To give people the freedom to buy mosquito nets or malaria medicine or clean water or fund a local crisis pregnancy center or adopt a child… rather than propping up an institution? Or am I just completely off base here?

Not that institutions are inherently bad. They’re not. I’m not saying the current way is bad and we need to make it good. I’m just wondering if there’s a way to make the current way better. And that means upsetting the traditional way of church budgeting. So I’m just throwing stuff out there to get the conversation started.

To change the status quo, though, is going to require some really tough and big decisions by church leaders.

For example… wouldn’t it be a lot better if, instead of having 25 evangelical churches in a single small town, we had, say, five? Or less? Wouldn’t it be better if existing churches could join together like that, pool resources, and share the costs of facilities and utilities and phone lines and all that kind of stuff?

Because to be quite honest, I can’t really tell one evangelical church apart from another in the town I’m in anyway. What if they joined forces and shared these facilities costs (which account for an average of almost 25% of the total church budget)? Pool resources. Divide costs. It just makes sense to me. Wouldn’t that be a smart move for the Kingdom of God?

What if pastors worked part-time instead of full-time? Many of the blogs I follow have hit on this subject in the past several months, pointing to surveys, studies, and anecdotes that show that the old way of having a full-time pastor just isn’t working anymore. Bivocational ministry seems to be more and more popular. What if we had pastors who were bivocational with a missional Kingdom purpose, knowing that a bonus secondary benefit of that decision would be to free up budget money for ministry? The last couple years I was on staff at a church I was bivocational and it was the best move I ever made in ministry. I absolutely loved it.

Operating budgets of churches continue to explode all over this country, skyrocketing to record levels. And all the while, the average church attendance across America is declining in every major tradition (evangelical, Catholic, and mainstream).

Maybe one of the reasons is what we’re spending our money on.

What do you think? Is the status quo okay? Do we need to fundamentally change church budget strategies? How would you set up a church budget?

On Church Budgets

It’s the end of the calendar year. Which means it’s not only the holiday season, but for many churches it is also budget season.

We were attending our usual church last Sunday and received a copy of the proposed 2011 budget. Despite being a staff member of this church for five years and seeing more or less the same budget numbers all that time, something immediately stood out to me this year.

The budget was broken into two main categories: operating expenses and ministry. Operating expenses included all the organizational, institutional kind of stuff: staff salary and stipends, facility rental, phone lines, advertisements, etc. And ministry budgets included everything that went toward doing ministry: food, supplies, books, meetings with people, volunteer support budgets, trainings, and that kind of stuff.

What stood out to me was the percentage breakdown of those two categories: around 85% for operating expenses and around 15% for ministry expenses (I don’t have the paper in front of me, so I’m working off my best memory — those are close ballpark figures).

Maybe it was the labels of the two categories. Maybe it was seeing it in print after not taking part in the budget process. I don’t know what it was. But I just kept thinking over and over again, “There’s got to be a better way to do this!”

And please, please understand this is not a knock against this church whatsoever. Pretty much every church budget looks like this. In fact, in a recent LifeWay survey, they revealed that on average, 87% of church budgets went to things that would fall under “operating expenses”. That only leaves an average of 13% for “ministry”.

So I’m not saying this church budget was bad. Not by any means. In fact, it’s perfectly normal.

But that is what’s got me thinking: what if normal isn’t the best way to do things anymore?

Shouldn’t there be a way for more than 13% of our church budget to be designated as “ministry”?

And yes, those labels are somewhat of a misnomer. Ministry takes place in the facility on Sunday mornings, which is provided by the operating expenses portion of the budget, for example. But not all of those line items can be explained like that.

There’s simply got to be a better way to do and to fund church, doesn’t there? Shouldn’t there be a way to free up much of that money to go directly to Kingdom efforts instead of operating expenses? To tell people to spend their money on the poor, the sick, the diseased…? To give people the freedom to buy mosquito nets or malaria medicine or clean water or fund a local crisis pregnancy center or adopt a child… rather than propping up an institution? Or am I just completely off base here?

Not that institutions are inherently bad. They’re not. I’m not saying the current way is bad and we need to make it good. I’m just wondering if there’s a way to make the current way better. And that means upsetting the traditional way of church budgeting. So I’m just throwing stuff out there to get the conversation started.

To change the status quo, though, is going to require some really tough and big decisions by church leaders.

For example… wouldn’t it be a lot better if, instead of having 25 evangelical churches in a single small town, we had, say, five? Or less? Wouldn’t it be better if existing churches could join together like that, pool resources, and share the costs of facilities and utilities and phone lines and all that kind of stuff?

Because to be quite honest, I can’t really tell one evangelical church apart from another in the town I’m in anyway. What if they joined forces and shared these facilities costs (which account for an average of almost 25% of the total church budget)? Pool resources. Divide costs. It just makes sense to me. Wouldn’t that be a smart move for the Kingdom of God?

What if pastors worked part-time instead of full-time? Many of the blogs I follow have hit on this subject in the past several months, pointing to surveys, studies, and anecdotes that show that the old way of having a full-time pastor just isn’t working anymore. Bivocational ministry seems to be more and more popular. What if we had pastors who were bivocational with a missional Kingdom purpose, knowing that a bonus secondary benefit of that decision would be to free up budget money for ministry? The last couple years I was on staff at a church I was bivocational and it was the best move I ever made in ministry. I absolutely loved it.

Operating budgets of churches continue to explode all over this country, skyrocketing to record levels. And all the while, the average church attendance across America is declining in every major tradition (evangelical, Catholic, and mainstream).

Maybe one of the reasons is what we’re spending our money on.

What do you think? Is the status quo okay? Do we need to fundamentally change church budget strategies? How would you set up a church budget?