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Church Financial Update – April 2022

As we begin the second quarter of 2022, this report is provided to give the congregation an overview of our financial situation; both how we finished 2021 and the approved budget and forecast for 2022. In summary, as 2021 finished, we have succeeded in meeting all current financial obligations. Happily, this was accomplished even though we have come through a very difficult time for our church, with diminished member participation in worship, Sunday School, and significant reductions of all other in-person activities.

Finishing 2020 and entering 2021, we had experienced income shortfalls and reduced church attendance -­shortfalls that came with the progressing impact of the pandemic. It was assumed that pledges and gifts would most likely continue to suffer from ongoing reduced worship attendance. Reduced rents and fees for the use of the church buildings by outside groups also were anticipated. Our financial situation has benefitted substantially for the past two years from the availability of the Payroll Protection Plan (PPP) loans by the US Government. The combination of these helped to balance ongoing costs of operation, providing additional cash that enabled us to pay clergy and staff salaries and benefits in 2021 and enter 2022 on relatively sound financial footing.  The combination of the PPP loans and the continuing faithful stewardship of many of our congregation helped put us in this position. This support continued through 2021 and is projected to continue through 2022, based on the pledges we have received so far. As you may have seen in the e-news, our second PPP loan has been forgiven. While this was anticipated, it’s good to have this confirmed.

The following summary statement of 2021 financial results also includes the 2022 budget approved at the Church Council meeting of February 6. The two columns of this report provide an overview of how we finished 2021, plus our budgeted outlook for 2022. Please note that the 2021 results are not yet audited and are subject to possible minor adjustments. Still, we believe the numbers provided are a dependable representation of the ultimate final, audited results.

As we continue through 2022, it also should be noted that some staff reductions will be made during the year. All budgeted expenditures will continue to be carefully monitored and controlled as possible. The current budget anticipates a deficit for the year which will be covered by cash reserves. We are very hopeful that with diminishing Covid restrictions, participation in worship plus other church-located activities will bring a restoration of more historical activities and support.

Although many cost reductions already are planned, several positive changes will occur. Included in the 2022 budget is a very modest increase in salary and related compensation for the lay staff members of our church, who have not received any pay increase in approximately five years. Also, our 2022 total building operating expenses are increased by $23,000. Much of this is related to increased Insurance cost plus the increasing cost of utilities due to the projected return of greater building usage and projections of increasing utility rates.

We hope that this summary overview will help all to understand better our current financial situation and our projected outlook for the coming months. We plan to make information on our status and situation — most likely on a quarterly basis through the balance of 2022 — but will communicate on any special current events or concerns as they occur.

We got through 2021, but we are not “out of the woods” yet. If you have not completed payment of your 2021 pledge, please do that ASAP. If you have not yet made your pledge for 2022, please consider making that commitment.

If you have questions or concerns, please feel free to contact me at (919) 345-4708 or jmadden1@nc.rr.com.

John Madden

Chair, Finance Committee


Highland United Methodist Church
2021 Actual vs. 2022 Budgeted
 2021 Actual   2022 Budgeted
     Pledged Contributions  $          733,944  $          756,280
     Non-pledged Contributions             159,142             106,478
     Total Contributions             893,086             862,758
Other Funding
     All Other Income Sources – HCC Shared Income, Rental Fees, etc.             190,224             190,600
     US Government Payroll Protection Plan Loan             155,000                  –    
     Total Other Funding             345,224             190,600
Total Income           1,238,310           1,053,358


Ministry Expenditures  
     United Methodist Shared Ministry & Outreach Funds             148,901             142,723
     Total Clergy Compensation & Benefits             263,382             220,530
     Children’s & Youth Ministry*               99,084             106,971
     Music & Worship Ministry*               90,157               91,669
     Other Ministries & Outreach*               55,270               67,293
     Total Ministry Expenditures             656,794             629,186
 Other Expenditures
     Staff Benefits (Insurance, Retirement, etc.)               92,696               88,468
     Office & Administrative Expenses*             145,412             145,347
     Property Expense & Maintenance*             269,693             305,688
     Total Other Expenditures             507,801             539,503
Total Expenditures           1,164,595           1,168,689


Net Surplus/(Deficit)  $           73,715  $        (115,331)
*Line items include the corresponding salaries.