Metropolitan Community Churches

In Attendance:

Rev Dr Cindi Love, Executive Director

Rev Elder Nancy Wilson, Moderator (for part of call)

Connie Meadows, Assistant to the Moderator

1. Weekend Meeting Overview

The Board had a joint meeting with the Board of Elder’s on Friday, September 14 to review Elder’s work plans and the corresponding budget items. On Saturday, September 15, the Board began the 2008 Budget discussion with Rev. Elder Nancy Wilson and Rev. Dr. Cindi Love. The budget discussion was finished Sunday morning, September 16, and the remaining agenda items were completed Sunday afternoon.

2. 2008 Budget Discussion

a) Contingency Reserve Update

$400,000 from the proceeds of the building sale was placed into a contingency reserve, which is being held with an additional $3M in the Merrill Lynch Investment account. Due to decreased July and August tithes, funds from the contingency reserve have been used to help cover the past two months of operating expenses, resulting in a reserve balance of $220,000. The Executive Director anticipates that we will need to use the remainder of these funds between now and the end of the year unless there is a significant increase in tithe income or significant spending cuts. $125,000 is in escrow for the capital gains tax on the property.

The Executive Director recommended that we adopt spending cuts for the balance of 07 and for 08, and that, as savings are achieved, the reserve be replenished before any additional programming is authorized. The Board unanimously agreed with these two operating principles. First the Board discussed how to achieve these objectives in 08, then for the balance of 07.

b) Possible areas of reduction for 08.

The current working budget for 08 is $3,300,000. A conservative income estimate for 08 is $2,874,500. The Board does not feel comfortable adopting a budget that would exceed $2,800,000. Below are some recommendations for reaching $2,800,000.

1. Responsiveness and availability of data is critical to managing costs and should be improved.

2. Discipline and well-defined parameters will help keep travel costs in line.

3. CRI needs to be assessed, and then a reformulation/recommendation needs to come back to the Board – estimated time of 6 months.

4. The interim/transitional ministry is a must and has experienced great success over the past few years. We need a strategy about who is going for training, for example every pastor going into our 40 churches in transition should get second course training. Criteria for training needs to be defined. Is there a way to consolidate CRI and transitional ministry?

5. The Executive Director is working with the teams for Latin America, Eastern Europe and HIV so that they raise the money they need for their work. We will fund only salary and benefits for the staff/personnel out of general funds. They will need to raise 2/3 of their funds during the first quarter of 08 in order to fund the remainder of the year.

6. $226,000 in savings needs to be achieved through a reduction in work force and other salary/benefit adjustments. Insofar as possible, these adjustments need to be made so it does not destabilize the Elders and their assistants. For example, the Elder’s made it clear that they would hope there will not be reductions in healthcare benefits.

7. In the past, there has been a policy preventing Elders from raising money for particular areas of ministry (as opposed to the general budget). The Board hereby eliminates this policy.

8. Salaries and benefits will be paid for persons involved in the following programs, but all other expenses fall outside the 2008 budget and must be funded from specific contributions to those programs:

Children & Youth

Eastern Europe

Latin America

HIV/Drug Literacy

Mother of Peace

MCC GLSEN

PAD

Global Justice (Jamaica, World Pride, Gay Men’s Health Conference, etc)

9. HIV, Latin America, Global Justice and Eastern Europe will have travel funds available in order raise money.

10. Church Planting and CRI in 2008 will cost $38, 500. The Board recommends reassessing these programs from a holistic, strategic viewpoint.

11. Travel moratorium in first quarter will save $24,500.

12. Public report of tithes will promote transparency, keep member congregation’s fully informed about the extent to which sister congregations are keeping our mutual covenant, and encourage many to keep current with their tithes.

13. Annual cost for fund development position, admin assistant and accountant is $250,000. The Board authorizes that up to $250,000 from the Merrill Lynch investment account can be used to fund these three positions in 2008. It is our hope that the fund development could raise $250,000 in the first year, which would be us in a break-even position. We believe these three positions are critical to our ability to generate new revenue streams to help relieve some of the pressure on the budget.

14. The Board suggests that a love offering be taken during an Elder’s visit – not for travel but for ministry areas.

15. Recommend raising the fees for regional conferences, fully understanding that this might not be possible in certain regions. Also, consider combining conferences. For example, could we ask region 2 to combine its conference with regions 3 and 5 in 2009? These are just some examples of where $20-30K savings could be obtained.

16. The Moderator is going to explore options for raising $250,000 a year for three years until our Fund Development operation is in full swing.

We began the day with a preliminary budget of $3,300,000 and the above mentioned items reduce this to $2,850,000. The Board asks Nancy and Cindy to go back to the Elders and find a way to cut another $50,000 in order to get us to $2,800,000.

Jeff Miner moved to approve the aforementioned modifications to the budget in addition to authorizing the hiring of the three persons mentioned above. Barb Crabtree seconded the motion and it was approved unanimously. Up to $250,000 from the Merrill Lynch account can be used for the three positions without coming back to the Board for approval, with the understanding that as revenue improves priority will be given to replenishing reserves.

c) Recommendations for the remainder of 07.

If we annualize our current financial position, we would be over budget by $500,000 by the end of the year. We are currently over by $385,000. Income is pretty much on target; it is the expenses that are out of line. The Board recommends the following:

1. Moratorium on travel unless ticket is non-refundable, no-exchangeable. For emergency travel consult both Executive Director and Moderator.

2. Moratorium on all discretionary expenses incurred by employees outside their offices, phone, or computers. Exception possible if approved by Executive Director and Moderator.

3. Approval to use cash reserves for operating expenses if necessary. However, the Executive Director will keep a log of cash withdrawn from reserves, and a priority goal is to restore the reserve as soon as possible.

3. 2008 Objectives/Initiatives

a) Segmentation Model

The Board believes that application of an adapted corporate “segmentation” model to MCC operations would greatly increase effectiveness and also help keep operating costs down. We would like to set aside half a day during the March 08 joint Board/Elders meeting to discuss this concept and how it might be applied to MCC operations. The Moderator agreed to reserve a half day on the March agenda, and the Executive Director, Barb, and Connie agreed to hold a meeting in the near-term to begin to pull together data and analysis for that discussion.

b) Investment Committee

This committee agreed to meet once a month with Merrill Lynch. Connie Meadows agreed to sit on the committee and take notes. The committee will update the Board during our monthly meetings. The committee members are Marsha Warren (Chair), Barb Crabtree, Marvin Bagwell, Connie Meadows and Rev. Dr. Cindi Love as an ad hoc member.

c) New Board Appointment

The Elders, who are responsible for appointing Board members, currently have two applicants for the Board vacancy. However, it is the sense of the Board that ideally MCC should strive to achieve a broader range of applicants before making such important appointments. The Board recommended that the Elders extend the deadline period for applications. The Board then brainstormed possible names of people who could be invited to apply.

d) Advisory Committees

The Board discussed whether it should create subcommittees as a way of managing its workload and gaining exposure to individuals who might be good future Board members. Options discussed included the following:

Investment Committee – This committee already exists, but its membership could be diversified.

Audit committee – the objective of this committee would be to liaison with the auditor and oversee the audit process. The committee could also advise on-site operational audits in our local churches when asked to do so. Possible members for this committee would be Barb Crabtree, John Vespa (if willing) and a new person.

e) Senior Housing

A very attractive potential site has been identified for the senior housing project. The Executive Director will meet with Affirmative Equities and the realtors in the next 30 days. When a draft is completed, the Board needs to review the pro forma business plan that is currently being put together. We also need to decide who will sit on the Board of the CCRC.

We agreed that the Board of the CCRC should have a minimum of 5 members, and we agreed that the majority of the Board members should come from the Board. For additional members, we need to look for people who have deep interest in both the ministry and investment potential of the CCRC.

From the Board, Julie and Marvin are willing to sit on the CRCC Board, and John Vespa will be asked. From the Elders, Rev. Elder Nancy Wilson and Rev. Elder Arlene Ackerman will be approached. The Executive Director agreed to serve as an ad-hoc, non-voting member. We then brainstormed possible names of others (not on the Board or Elders) who might be asked to join the CCRC Board.

f) 2008 Board Meetings.

The next Board face-to-face meeting is scheduled for March 7-9; Elders 9-15 in Texas. The Board would like to meet again in the fall. Regarding the March meeting:

March 6 travel day

Meet March 7-8

Joint meeting March 9

Then travel home

g) Planned Giving

The Executive Director briefed the Board on a preliminary proposal from the Sunshine Foundation to partner with MCC in a joint planned giving program which they would be administrator. After discussion, the Board concluded that more detailed information is needed to assess the feasibility of such a partnership. The Executive Director will ask the Foundation to submit a written proposal that fleshes out the details.

4. Meeting Adjourned

The meeting was closed in prayer and adjourned.