Leaders of the Seventh-day Adventist world church are keeping an eye on expenditures as the church begins to feel the effects of the economic downturn.
On February 12, the church's Administrative Committee (ADCOM) voted to continue several restraints on spending, though no employee layoffs were announced. An almost complete hiring freeze continues at the US-based world headquarters, with only the most essential positions being filled when they become open.
According to Robert E. Lemon, Adventist Church treasurer, the church's world church headquarters has US$294 million [€ 233 million] in cash and investments. This includes working capital of 40 percent of one year's operating expenses, restricted and allocated funds committed for specific projects, endowment funds and the extraordinary tithe received in 2006 and 2007, the majority of which has been allocated to various initiatives. Most of the funds are in fixed income investments, or bonds, but a portion is in equities, or shares of stock in companies.
The unrealized and realized losses for 2007 totalled US$16.4 million [€ 13 million] and the interest and dividends amounted to $6.6 million [€ 5,23 million], giving a net negative return on US$294 million [€ 233 million] in investments of US$9.8 million [€ 7,8 million], or approximately 3 percent.
Lemon reported that in 2008, nearly US$71.5 million [€ 56,6 million] was remitted as tithe from the church's North American region. That's down four-tenths of one percent (.4) from 2007, but excluding the "extraordinary" tithe received by several conferences in 2007 it represents an increase of eight-tenths of one percent. Most of that increase came during the first three quarters of 2008.
Lemon noted that in looking at tithe receipts for the last quarter of 2008 -- compared with the same period for 2007 -- tithe from North America is down 2.55 percent. The tithe, giving 10 percent of income, is according to the Old and New Testament a form of "stewardship" that God requires of Christians.
Mission offerings from North America last year totalled nearly $23.8 million [€ 18,85 million] down 1.68 percent year-to-year over 2007. Again, the last quarter of 2008 showed the greatest decrease: 5.77 percent.
Tithe and mission offerings from other divisions saw substantial growth last year: US$20.8 million [€ 16,46 million] in tithe versus $17.7 million [€ 14 million] for 2007, and US$44.7 million [€ 35,4 million] in mission offerings, up from US$38.1 million [€ 30,15 million] the year before.
During the past year there have been tremendous fluctuations in exchange rates, Lemon noted. During most of 2008, he said, this has favoured the world church's headquarters: Of the US$9.7 million [€ 7,68 million] increase in tithe and mission offerings from outside the North America, US$4.6 million [€ 3,64 million] came from changes in the exchange rate used to convert from the local currency into a weaker US dollar. But as the US dollar has strengthened in the last few months, it has dramatically decreased the funds coming to the church's headquarters.
"The strengthening of the US dollar is very positive for the church," Lemon said. "We welcome it, as it gives more appropriations to the divisions and institutions outside the US. But it also reduces the dollars received by the [world church headquarters]."
He added, "Not all reports are in, but we estimate a 5 percent decrease in (global) tithes and offerings for the last three months of 2008."
Lemon reported the church's headquarters operating budget is under the cap. It was US$35.3 million [€ 27,95 million] in 2008, and it will be US$35.6 million [€ 28,2 million] in 2009. He said the annualized savings on the currently unfilled budgets would be over US$1.6 million [€1,27 million].
If a 5 percent decrease in tithe and offerings continues, Lemon said the effects would be considerable. To the World budget, it would represent a loss of US$8 million [€ 6,33 million] per year; to the headquarters' Operating Cap (the maximum authorized to be spent at the church's world headquarters), the decrease would be US$2 million [€ 1,6 million] annually.
Lemon expressed appreciation to church headquarters staff for their understanding in these difficult times and thanked the members, many of whom are personally affected by the economic downturn, for their continued faithfulness to the Lord. [Editor: Mark A. Kellner. AdventistWorld and Christian B. Schäffler, APD]
