To use a trite but true phrase, there is 'good news and bad news' from the Conference regarding our financial picture. Because 'the Conference' is not a thing apart from you, local churches and pastors, it is important that we share both elements of the news with you as this new year begins.  As you read this, please know that drawing attention to the finances of the Conference in no way diminishes your Conference staff and leadership's caring about and awareness of challenging  financial realities in local churches in these times.  However YOU are the Conference---132 local churches and hundreds of pastors---and what we do together for and with one another is vital ministry along side that which we do as each local church on its own.  So here is the news:

The GOOD NEWS:
Our congregations stepped up strongly in 2008, giving $25,900 more to Our Church's Wider Mission than in 2007 and $10,400 more in per capita than in 2007!  AWESOME!   Of our 132 congregations, 97 congregations gave in 2008 compared to 90 in 2007.  All of this speaks well of the strong commitment our churches have to our covenant community as the Southern California Nevada Conference.   As you know in your local settings, with rising costs of everything---particularly health insurance---flat levels of giving are equivalent to a decrease in giving. Thus this growth is much to be celebrated.  Hallelujah for this good news and on behalf of your Conference covenant partners, thank you to every local church leader and pastor who led the way in this growth!

MORE GOOD NEWS:
In 2007, the Conference received $6,117 from 60 individual donors but at the close of 2008 we had received $7475 from 45 individual donors.  Hallelujah and thank you to every donor who went 'above and beyond' in supporting the work of the wider church. (Additional gifts still welcome but will show for 2009!)

The BAD NEWS.
Sorry to be the bearer of the hard news but we must reiterate here what was made clear at the June 2008 Annual Gathering and while the 'bad news' is not new and not solely the product of the current economic downturn, not surprisingly the situation has become more challenging since June.  Even with the growth in giving described above, contributions from local churches and individuals is not sufficient-and has not been sufficient for some years---to pay the frugally managed basic operating costs of the Conference. 

Let's review that history.  For the last 4 years, this Conference has been spending beyond its basic income (from OCWM and per capita giving from local churches plus individual donors) in amounts ranging (in different years) from $63,000 to $206,000.   That deficit has been drawn from the wonderful and significant funds made available to the Conference through the sale of closed church properties---which had been dedicated, through the strategic plan, to funding other Conference functions (the Administrator for Search and Call and Special Projects and Conference Ministry Assistants); funding new church development and church vitality projects; funding youth young adult ministry; and funding staff and projects for 'building community in diversity'.   Great things have happened in this Conference because of your decisions as a Conference and your Conference Board of Directors in all of those expenditures.  However the funds are now severely depeleted and there is not enough remaining to continue the deficit draw that has subsidized the basic operations of the Conference.

At the 2008 Annual Gathering, a 2009 budget was approved that included a deficit of $154,351 to be drawn from those other funds to support basic Conference operations.  Though cautioned by leadership, the budget was approved by the delegates based on what was then thought to be a legitimate expectation that two additional pieces of property would be sold, perhaps even within 2008 or 2009.  Then the real estate market fell still further and those properties have not yet sold---there has been interest in one that may sell this year and the other may not be sold until late 09 or even  2010.  Plus both have reduced greatly in value from previous high expectations so that even when sold they will not yield what had been anticipated over the last several years and upon which anticipation many decisions were made.

In order to maintain cash flow, the Cornerstone Fund granted the Conference a loan that has been partially drawn upon.  When the properties sell, that loan will need to be repaid. Expenses for development of the second property (to facilitate sale) will need to be paid.  And several commitments to new churches will need to be fulfilled, though at reduced levels.

So what is the 'bottom line' of all of this history and news?  It is now clear that the limit has been reached and the Conference can no longer depend on property-funds to cover deficit budgeting in support of the basic conference operations.   Period.  As you can see from the basic figures here, that means two things are needed: income growth and spending reduction.

Your excellent Conference Board of Directors will meet on January 24 to make some difficult decisions about mid course reductions in 2009, possible income growth strategies, and to begin work on plans for the years ahead.  After the January 24 meeting, you will receive a letter (online and by mail) that will explain the decisions made and the issues remaining that will likely come to you in the Annual Gathering June 5-6.   Please be prayerful for your Board of Directors and watch for their letter.

In the meantime, dear friends in Christ, we will continue to SHINE in God's Epiphany grace.  Even facing economic difficulties, our local churches are doing vital teaching, community and advocacy ministries.  And your Conference continues to support local churches in pastoral searches, during times of conflict or crisis, and much more.  Thank you for all you do locally and as this Conference-you are a blessing to God's world.

In Christ,

Jane Fisler Hoffman