Minutes — October 14, 2014

Diocese of Rhode Island

Commission on Finance

Meeting, October 14, 2014

Higgins Room

Present:  Robert Batchelor; Robert Bergstrand; Dennis Burton; The Rt. Rev. Nicholas Knisely; Michael Lofaro; Stefan Sloan; The Rev. Joyce Thorne.

Also Present: Joan DeCelles; Canon Elizabeth Fornal; The Rev. Canon Linda Grenz; The Rev. Edwin Hallenbeck; Ronald Turnbull.

Guests: The Rev David Lucey, Chair, Program and Budget Com. St. Mark’s, Warwick: The Rev. Susan Wrathall, Rector; Shirley Kolarik, Treasurer.

The meeting was called to order at 10:04 a.m. by Chair Lofaro, with an opening prayer by Bishop Knisely.

The Minutes of the meeting of September 9, 2014 were approved as distributed.

Financial Report for September was reviewed by Mr. Batchelor, noting the Balance Sheet accounting is running well and may be found at the end of the report. Revenue and Expense Report shows that expenditures are lagging in some categories, expected to catch up by year end. Staff is still researching ways to tighten up and shorten the report document.

Apportionment Report was distributed in two forms. The first showing all churches, the second showing in greater detail all churches not current in apportionment payments. Currently there are 22 months of arrearage compared to 33 months in 2013. The new Report is  viewed as useful and both Reports will be available for the time being.

Revolving Loan Fund Report states all loans outstanding and payments through September. This view is very helpful and will be available monthly.

Draft Policies: Major Gifts Policy. Canon Grenz stated that The Episcopal Church has created draft language appropriate to TEC church structure and she hopes to have this available by our next meeting. Transfer of DIT Funds is a more local matter and Mr. Batchelor will continue to work on draft language.

Travel Funds. It was noted that the Bishop’s Travel fund is now over expended due to the high cost of the unusual expense of the House of Bishops meeting in Taiwan. At the same time more funds are allocated to General Convention than will be needed next year. Following discussion it was Moved, Seconded and VOTED to move $8,000 from Triennial General Convention Expenses to Bishop’s Travel. There was one abstention from this vote.

2015 Draft Budget. Chair of the Budget Committee, The Rev. David Lucey reviewed the proposed budget in some detail, noting why some items had been shifted to new locations and why some figures had been shifted either up or down, The budget for 2015 is balanced at a total of $3,820,055. Following a lengthy discussion and a number of questions is was Moved, Seconded and VOTED to commend the 2015 Diocese of Rhode Island budget to Diocesan Council for consideration and forwarding to Diocesan Convention. Following the vote a question was raised regarding churches that are overspending endowments in some cases to pay apportionment. This resulted in a discussion concluding that this problem is as much a cultural/political matter as it is dollars, needing a change in awareness and willingness to address the matter and make changes. Ongoing discussion will be needed.

St. Mark’s, Warwick Revolving Loan Request. Guests from St. Mark’s noted above joined the meeting and reviewed the need for completion of roof repair and complete redoing of the church parking area. Both matter were reviewed in detail, noting receipt of $8,750 in insurance recovery on the roof project. It is anticipated the projects will proceed immediately. It was suggested that a reduction of 0.75% on the interest charge could be made if the church places its current reserve funds in the DIT with a pledge to the value of the loan. The guests left the meeting.

Following a brief discussion it was Moved, Seconded and VOTED to Approve a Revolving Loan of $41,000 to St. Mark’s Church, Warwick at an interest rate of 2.25% or 1.50% with DIT pledged funds and forward the matter to the Standing Committee for their consideration.

Depreciable Assets Policy. Mr. Batchelor offered a draft policy statement stating how the Diocese treats long-lived assets costing $3,000 or greater. It is strongly recommended that this policy be adopted and followed by parishes and missions so that such properties are treated consistently. Following discussion it was Moved, Seconded and VOTED to adopt the Depreciable Assets Policy for the Diocese of Rhode Island and commend the same to all Parishes and Missions for their use. Once effected this policy will be posted on the Diocesan Website available to all.

Next Meeting. Due to the November 11 Holiday it was agreed the next COF meeting will be November 18, at 10:00 a.m.

The meeting was adjourned at 11:45 a.m.

Respectfully submitted

Edwin F Hallenbeck

Secretary

Minutes — September 9,2014

Diocese of Rhode Island

Commission on Finance

Meeting. September 9, 2014

Higgins Room

Present:  Robert Bergstrand; Dennis Burton; The Rt. Rev. Nicholas Knisely; Michael Lofaro; The Rev. Joyce Thorne.

Also present: Joan DeCelles; Canon Elizabeth Fornal; The Rev. Canon Linda Grenz; The Rev. Edwin Hallenbeck; Ronald Turnbull.

Guests:

Holy Trinity, Tiverton: The Rev. John Higginbotham, Rector; Karen Corr, SW.

St. Augustine’s, Kingston: Jane Grenier, Treasurer; The Rev. Linda Grenz.

The meeting was called to order at 10:05 a.m. by Chair Lofaro. Bishop Knisely offered an opening prayer.

The Minutes of the meetings of June 10, 2014 and June 13, 2014 were approved as distributed. The Secretary noted one typo in each which will be corrected with a final copy forwarded to Ms. DeCelles.

Financial Report for August was reviewed by Mr. Turnbull. Most items are at or near budget. Further simplification of the report by omitting columns makes it more readable. Some additional suggestions were offered.

Review of Revolving Loan Fund. It was noted that St. Columba’s has made no payment to date, while the loan was made in May. Churches are not currently billed for payments due. It was suggested a billing process be designed and initiated. Canon Grenz reported on recent meetings with representatives from Washington Trust, during which favorable interest was expressed in making commercial loans available to Episcopal churches on terms similar to the Revolving Loan Fund. This would work well for churches with established financial experience, leaving the RLF available for churches experiencing difficult circumstances. There are one or two churches with current RLF loans that might be encouraged to shift to Washington Trust. Canon Grenz will follow up. Conversations were also held with Thrivent Credit Union exploring how they might be of assistance to Episcopal churches.

Apportionment Report. With a small number of months of arrearage, only two churches are three or more months behind. The most behind is St. George’s, Central Falls, 6 months in arrears. They are also behind in salary reimbursement to the diocese. Reviewing further, in 2013 St. George’s also still owes $3,986.25 in apportionment and $3,500 in salary recovery, a total of $7,486.25. Further discussion indicated payment of either item is unlikely, therefore. It was MOVED, SECONDED and VOTED to write off St. George’s, Central Falls 2013 debt to the Diocese of $7,486.25 as noted above, as a Bad Debt.

Revolving Fund request, Holy Trinity Church,  Tiverton. Fr. Higginbotham gave a summary of the requested funds to convert three furnaces from oil to natural gas for a significant cost saving. Details were reviewed and a number of questions answered. It was noted that no endowment is currently in the DIT, which, if pledged, could reduce the loan rate. The request is for $18,500 with specific quotes available. A related issue noted is a heavy use of endowment funds. There is a clear need for strategic planning toward a sustainable level. The guests left the meeting.

Revolving Fund and Grant request, St. Augustine’s Church, Kingston. Ms. Grenier gave a summary of the project, stating the Church is actually two buildings built at different times with five different levels of working space. There are some external ramps that do not meet ADA standards. The project focus is making levels as accessible as possible meeting ADA requirements. The project will be carried out in two stages, the first immediately, and the second, interior work in winter when students are away from school. A grant of $10,000 is requested from the mission church accessibility and safety fund, and a Revolving Loan Fund loan of $10,000, timing to be negotiated as the project proceeds. DIT funds will be pledged to secure an interest rate reduction. Additional funds needed are being raised within the parish. The guest left the meeting.

Holy Trinity Church. The request was review by the COF with the following action:

It was MOVED, SECONDED and VOTED to approve a RLF loan to Holy Trinity Church of $18,500 for 5 years at 2.25%, with an option to reduce the interest by .75% with a pledge of DIT Funds. It was further stated that Dennis Burton representing the COF meet with parish leadership and the Vestry to discuss the concern about strategic planning and working toward financial stability.

St. Augustine’s Church. The request was reviewed by the COF with the following actions: It was MOVED, SECONDED and VOTED to approve a grant to St. Augustines Church of $10,000 from the mission church accessibility and safety fund, and further VOTED to approve a RLF loan of $10,000 for 5 years at 1.5% with a DIT pledge.

May House projects. Mr. Burton reported all projects are completed. He noted work on the driveway is needed, as well as reseeding disturbed areas. He was asked to proceed with these needed items.

Diocesan House Building Needs. Canon Grenz reviewed several needs, and was asked to proceed with study of how best to carry them out. Key matters are upgrading the HVAC system and providing vertical accessibility. It was noted that a portion of the Diocesan House upper parking lot retaining wall collapsed overnight. Insurance coverage will be sought and study of how best to repair the damage.

The meeting was adjourned at 12 noon.

Respectfully submitted

Edwin F. Hallenbeck, Secretary                      Next meeting: October 14, 2014 at 10:00 am