December 5, 2008

34CN: World Church Faces Financial Limitation

World Church Faces Financial Limitations
Travel budgets cut, hiring freeze implemented
BY ANSEL OLIVER Ansel Oliver, assistant director for news, General Conference
capExecutives of the General Conference of Seventh-day Adventists announced financial restraints and cutbacks to deal with the current economic situation, ranging from delaying pay increases and budgeted increases in appropriations to reducing travel budgets and relocating executive meetings. Also, a hiring freeze is in effect.

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WORLD CHURCH CHALLENGES: GC treasurer Bob Lemon addresses the GC staff. {Photo: Brauner/ANN}

The moves come in response to global economies facing declines in stock market value, a credit crunch and increased unemployment rates, realities that could significantly affect tithe and other contributions to local congregations and administrative offices worldwide.

Church finance officers will review the church's budget in mid-February, shortly after new tithe and offerings figures will be available. Leaders emphasized the church was not in a "crisis" mode, but making short-term changes until they have a clearer understanding of where the economy and financial markets are headed.

"We believe that the time frame is not long," said the church's treasurer, Bob Lemon. "If we felt this was going to last 3 to 5 years or was permanent we could look at other changes. But we can cover for a short period of time until we have a clearer picture."

Officers announced the approved measures Monday, November 17, during a special meeting with employees following regularly scheduled worship in the building's auditorium. The news came almost ten days after North American Division officials announced their own changes.

Leaders also said they valued employees' sense of security in their work and would do their "utmost" to protect it. Changes include:
  • Keeping 2009 wages at the 2008 rate for General Conference salaried staff and hourly employees.
  • Normal step increases for those not at the maximum of their pay grade will still be implemented.
  • A 20 percent reduction in travel budget for GC staff.
  • Delaying a $3.5 million supplemental budget for the church's Kenya-based Adventist University of Africa until after a mid-2009 review. The Executive Committee approved the supplement during Annual Council in October.
  • Holding off a scheduled 3 percent increase in appropriations to world Division regions and institutions until after a review in three months.
  • Holding the April Executive Committee's Spring Meeting at the world headuarters instead of the church's Oakwood University in Huntsville, Alabama. While the Executive Committee generally meets outside of Washington once every five years, committee members would already be in Washington for pre-meetings, leaders said. 
  • Shortening the 2009 President's Executive Administrative Council meeting and holding it at the church's headquarters instead of at an offsite location.
  • Delaying the implementation of a document management system

Lemon said future construction of the Hope Channel/Adventist Television Network studio will proceed because of signed contracts, which would be expensive to break. He also announced that the hiring freeze and travel budget reduction would not apply to field staff of the General Conference Auditing Service, an entity that would have to otherwise hire external auditors to complete audits.

The restraints come a month after the Executive Committee voted to give the Administrative Committee the ability to withhold implementation of some aspects of budgets. The Administrative Committee will conduct a major review of the restraints by February 17, with subsequent reports every two months following.
Church finance officers have continually monitored the economy. In September, church investment manager Roy Ryan said the church was not changing its investment strategy, maintaining a conservative, long-term approach for retirement funds."The Lord and His people are immensely faithful, even when they face hardships," General Conference president Jan Paulsen said at the meeting. "So we go into the future with assurance, but at the same time with a sense of responsibility that we will have been prudent and careful. We praise the Lord and are privileged to serve Him, also in difficult times.”