Economic turnaround for churches

From a financial perspective the last four years have certainly been challenging for churches. However, looking at the data gathered across our church customer base, we have noticed a slow but distinct turnaround.

For example, the general tithes and offerings (T&Os) collected by our customers as reported on statements prepared by certified public accountants increased 4 percent between 2010 and 2011. While 33 percent of those churches saw a 5.9 percent average decline in T&Os, the remaining 64 percent realized a 9.2 percent increase.

Geographic and demographic factors were certainly in play. Nevertheless, it is encouraging to see the 4 percent increase after T&Os declined 1 percent between 2008 and 2009, and then increased 1 percent between 2009 and 2010. We should note that we only analyzed the T&Os line.

The next most substantial revenue line for churches is typically the building fund. Often, gifts designated for the building fund are the result of a capital pledge campaign orchestrated in conjunction with a building phase, and therefore may be non-recurring.

Many churches have put building projects on hold due to an unwillingness to solicit pledge commitments and incur debt during a recession and slow recovery.

For example, over the past three years (2010-12) our construction lending comprised only 24 percent of our total church lending. Over the three preceding years, the number was 47 percent. We have yet to see this trend turn around and we expect it will be a couple of years before we return to pre-recession construction levels. Meanwhile, churches hoping to position themselves for physical plant expansion and related borrowings will need to diligently manage the expense side of their operations, stabilize their net cash flow and re-establish their operating reserves.

Many churches were slow to make tough expenditure reduction decisions during the downturn, allowing cash reserves to dwindle to uncomfortably low levels.

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MARK SIMMONS
Mark Simmons is business manager at Christ Community Church, Milpitas, CA.

Nurturing a spirit of generosity

I’m often asked by small business owners whether it is possible to grow their business given current market conditions. I ask them, “What is your market share?” Rarely is the answer greater than 25 percent.

“So then,” I say, “what you are telling me is that there are more than enough customers, you just aren’t winning enough of them.”

he same is true with the kingdom of God. It’s easy to blame the market. But the truth is we live in a sea of lost humanity. We “are the salt of the Earth. But if the salt loses its saltiness” what needs to be done? We “are the light of the world. But if the light is hidden, what good is it?” What is the solution? Is it to blame the market? No, Jesus said, “Go.” Our Savior said, “Let your light shine before others – our communities, where we live, where we work – that they may see your good deeds and glorify your Father in heaven.”

Similarly, many churches are worried about the economic outlook, and to be sure there is plenty to worry about! In some parts of our country unemployment is well over 20 percent. Nationally, household income is said to be down more than $5,000, while prices rise, especially in housing, groceries and gasoline.

Whether we are talking about businesses, churches or families, most are one pay cycle away from disaster.

The time to act is now. I have observed that churches with healthy, well-discipled members tend to do better in hard economic times. Our church has, for many years, developed and nurtured a spirit of generosity in all things. But we were challenged about five years ago to do more in the area of finances – particularly as it relates to equipping our families.

We now have classes that cover every life stage – 13 in all. We leverage the resources of several Christian organizations that specialize in this area. We’ve retired many millions in consumer debt, taught and provided counseling and other support to help our families get on solid, biblical ground. The benefits to our families are tremendous – and the church has benefitted too.

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DENISE CRAIG
Denise Craig, CCA, is chief financial officer of Abba’s House, Hixson, TN.

Staying at the top of your game

Church business administration is a uniquely challenging, yet wonderfully rewarding career and calling.

Most church administrators come to the field as a second or sometimes third career. The positive side of that is they bring experience to the table. It may be experience in business or a completely different field. Any experience working with diverse people in real-life situations, making stewardship decisions concerning resources – both financial and human – are invaluable when it comes to church administration.

To do this job well, the goal must be to achieve excellence and balance between tasks and relationships. To gain the knowledge necessary to perform the tasks required of an administrator well, I studied and sat for the Certified Church Administration certification program of the National Association of Church Business Administration. The program allows you an opportunity to network with other administrators and to learn from other professionals who have been doing this for years. Relationships are an important part of the job. I find that you must genuinely love people and lead them to become better at what they do while encouraging them to become more like Jesus.

Because our world is moving so quickly, largely due to rapid advances in technology, knowledge becomes stale in no time. Church administrators should commit to life-long learning.

All churches, whether large or small, are facing challenges in the days ahead. I think one of the challenges specifically for the megachurch is to ensure things still feel personal, even in the large church environment. Getting people connected to a smaller group within the church and helping them understand the corporate vision and how it applies to their daily lives is critical.

Some people think that church is not “business.” Actually, it is. We are in the people business. We are in the business of multiplying the disciples of Christ here on this earth. We are in the business of knowing and adhering to the laws of our land. We are in the business of being good managers of all the resources God has placed before us. We are in the business of glorifying God in everything we do, because in him we live, move and have our being. This is God’s business, and I’m glad to be a part of it.

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STEVE BRIGGS
Steve Briggs is associate pastor of administration at First Baptist Church, Hendersonville, NC.

Vision is more caught than taught

Three words come to mind when it comes to making vision come alive and making it happen in a local church – communication, communication and communication! If that sounds like overkill to you then that is maybe one reason your church is missing it when it comes to making your vision come alive in the hearts and souls of the congregation.

Once the lead or senior pastor and his team understand the vision God has given for the church, they must be able to state it briefly in a memorable way. Just a few words are ideal.

At our congregation we use one word – Transformation. How are we transformed? By connecting, growing and sharing. Our logo, our signage, our letterhead, our website, our ministries all communicate this simple-to-understand vision. Christ’s plan for his disciples is to be transformed into his image. The preaching pastors must communicate the vision constantly from the pulpit. All publications – your website, your church’s logo, your use of social media – must keep it before the people.

Tell stories in the pulpit and in your publications that relay real life examples of the vision being lived out.

Make sure every area of your church, from children’s ministry to senior adults to recreation to your small group or Sunday school, conveys the same vision. Everyone must be on the same page. The senior leadership and staff of the church bear the responsibility to make sure all ministries under their guidance stay on the same page.

Finally and of utmost importance, the senior pastor, the ministry staff and key volunteer leadership must model the vision in their daily lives. Someone has said, “Christianity is more caught than taught.” Same with vision: it is more caught than taught!

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ERIC SPACEK
Eric Spacek is senior manager of risk management and loss control, GuideOne Insurance, West Des Moines, IA.

Financial and reputational risks

Risk management is evolving in the business world as the enterprise risk management (ERM) concept takes hold and a number of companies have elevated the position of chief risk officer (CRO) to the senior level. ERM looks beyond traditional operational risks to address risks from all sources across the enterprise, including financial risk and reputational risk. Considering that a fair number of churches don’t do traditional risk management particularly well (i.e., it remains unusual to have a volunteer or staff member dedicated to risk management), expanding ERM into the religious community may be a challenge.

Still, it is important for churches to consider how their potential actions, inactions and decisions can present a risk to the ministry from a reputational or community standpoint. Having a board-level liaison who works closely with the executive pastor or senior pastor on addressing the range of risks that churches face can be a positive way of incorporating elements of ERM into the church environment.

As far as liability risks, I expect the protection of children from abuse by adults and by other minors will continue to be a focal point in the coming years. The Penn State situation placed a renewed emphasis on the importance of having a plan in place to report suspected child abuse to the appropriate authorities.

Many of the liability risks that face churches are not new, such as slips and falls and injuries on the playground. However, some newer risks have emerged including those associated with extreme activities or ministries, such as skate parks, bungee sports and zorbing, the threat of an armed person on premises, and employment and board-related claims.

One factor that presents both a liability risk and a risk to the property is the issue of declining membership in many churches. As the number of attending members shrink, funds become tighter, and churches can begin to struggle to maintain their facility. Sometimes shortcuts necessitated by budget constraints can lead to property damage, such as unrepaired roofs or leaks, leading to further damage or injuries on the premises either due to volunteers attempting to perform work that should be left to professionals or to the property’s overall deteriorating condition.

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SAM S RAINER III
Sam S. Rainer III is president of Rainer Research and senior pastor of Stevens Street Baptist Church, Cookeville, TN.

When big is better

Looking ahead some three to five years I see these things increasing in importance in the church: homegrown leaders, expectations of accessibility, and “big.”

More homegrown leaders. It’s not a new trend. In fact, church researchers have called for local equipping of leaders for a long time. In our globalized society, however, it is becoming even more important. Today everyone has access to the same information at the same time. Podcasts, blogs and sermon videos are ubiquitous.

The best teachers and preachers in the world now broadcast messages for free. Anyone can listen and benefit from excellent teaching – simply take your pick from several great leaders. The problem is applying this teaching to a variety of individual contexts. What is needed are local leaders who understand unique cultural nuances of small towns, neighborhoods and enclaves of larger metropolitan cities.

Many churches will benefit by training and equipping local, homegrown leaders who have specific, lifelong knowledge of their context.

Top church leaders will do better in most cases to train up people from within the church rather than hiring from the outside.
Increased expectations of accessibility. As social media matures (and potentially peaks), followers will expect to connect to leaders through technology. In general, accessible leaders will be viewed more positively than inaccessible leaders. Being perceived as accessible is accomplished easily and quickly by remaining relatively active in social media.

While not every direct message on Twitter demands a response, regular interaction with followers through social media helps a leader be viewed as more approachable when face-to-face interactions occur. Church leaders should take advantage of these easy tools to communicate with their congregations.

Big becomes more popular. While a few may decry the constant focus on larger churches, the reality is the biggest churches are getting bigger at faster rates than churches of other sizes. Many small churches are certainly doing good kingdom work, and the desire by some to highlight this work is noble.

In the next five years, however, the self-generating gravitational pull of the largest churches will grow. In short, the big will continue to get bigger and more popular. Within a five-year window, the growth of multisite megachurches will continue to accelerate. The long-term prospects of this growth are debatable, but big will remain popular for the mid-term.

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JOHN MRAZEK
John C. Mrazek III is executive pastor of Pathways Church, Denver, CO.

Building a ‘MILLENNIAL-FOCUSED’ church

It is already happening in corporate America and now it is creeping into our churches as well! Boomers are not leaving their leadership positions in either place and their continued influence is hampering the ability of Gen-Xers and millennials to create church environments that meet their needs.

That is why my congregation, Pathways Church, is committed to creating opportunities for millennials to experience grace and redemption in their type of nontraditional church venue. More churches might do the same. What does a truly millennial-focused church look like? We believe it is a place that is saturated in community, raw uncensored truth, and missional impact that is very personal. Every generation is naturally drawn towards authentic community within their context.

We find that millennials desire community as they do breathing and demand it in every area of their lives. Small groups are just the beginning at Pathways because every event or project starts with ensuring community is the primary focus.

Secondly, we do our best to leverage technology and personal stories to present truth in as many formats as possible. Sometimes situations really suck and that is the only authentic way to say it! Finally, traditional strategies are not helping us “own” the one-mile radius around our church. Our people really want to interact personally with the homeless and crave missional events that make that possible.

Pathways Church has many local ministry partnerships that put our people on the frontlines of caring and presenting the love of Christ in very tactile way. Millennials are the future of the church and our society. We can’t wait another five or 10 years to begin listening and changing our churches to serve them. It has to happen now or our churches will continue to fade and become irrelevant to a generation that is rapidly running out of godly truth sources and accessible grace.

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MIKE KLOCKENBRINK
Mike Klockenbrink is chief of staff at Lakeside Church, Folsom, CA.

Creating a mountain to climb

I came into my church job from an industrial supply company. And for others who come to church administration from the secular workplace, there are some characteristics that are common to both.

First and foremost, one must be a leader, a listener and team builder. The ability to recognize leaders and collaborate will be key to one’s success. What I recognize today is that while most business executives have one or two specific skill sets, the majority are much more generalists. One must have the ability to put together teams of skilled individuals for the task at hand. This person must also have an appetite to be a learner.

Everything you do is a process. The question is do you have a process for that? What are your key processes that you measure your success by? At a minimum, you should have a process developed for these areas. Bring your teams together to develop a process. This way you have buy in, eliminate a majority of your potential mistakes and increase your probability for success.

When it comes to innovative and forward-looking directions, this goes back to having an appetite to learn and innovate. One must be in touch with technology. I don’t mean they need to be a geek or gadget guru. They must have the desire to explore new tools and technology that are available to them. Consistently ask the question, how can we do this better? This is a time to play, experiment, and ask the question, “What if?

Let’s face it, social media is here to stay. So how do we adopt, adapt and make the most of it?

Today people want to make a difference; they don’t want to just go to church. So how do we create online community opportunities? How can the church go viral within its community? The church must create a mountain to climb.

Why is it when asked the question “What would you do if you knew you wouldn’t fail?” we have incredible ideas or risks that we would take. So what if you do fail, it’s better than not trying at all. For this next year, think big, dream big, go big, or stay home.

By offering multiple giving options, churches take the hassle out of giving and pave the way for members to exercise greater generosity.

If you want to increase your church’s level of generosity, make giving easy. Remove the barriers that keep many people from blessing your church financially.

For Lakeside Church, Folsom, CA, it started seven years ago with an option for its members to set up ACH (automated clearing house) fund transfers through their banks. Their church contributions were debited automatically from their checking or savings accounts on a regular basis. But wanting to provide donors with more giving options, Lakeside took another step to making giving easy and accessible by using the services of FellowshipOne, a Web-based church management software that allows people to manage their online giving anytime, anywhere.

“The initial roll-out was slow and a little cumbersome, but has greatly improved,” says Mike Klockenbrink, chief operating officer. “Many people were skeptics at first and were worried, but today approximately 33 percent of all our giving is online.”

At Seacoast Church in Charleston, SC, there were only a handful of people donating online when the church introduced online giving in 2005. But the percentage has grown significantly since, says Glenn Wood, church administrator. “For 2011 we had some 20,000 individual contributions given online – that percentage was more than 32 percent.”

NewSpring, a multicampus church in South Carolina, boasts a similar experience. Katie Bailey, assistant for strategic giving, says “38 percent of our offering this year have been received online.”

NewSpring introduced online giving to its members in 2005 “to tear down a barrier for giving since people don’t typically carry cash and checks,” says Bailey. Recently, the church added more giving options through SecureGive kiosks and PayPal.

“Online giving works because most people use debit or credit cards to complete their transactions in their everyday life,” says Bailey. “Giving is no exception.”

Online giving also helps reduce hours spent counting and entering donations, which then helps eliminate data entry errors, adds Klockenbrink.
Another important benefit for churches is that giving is stabilized, says Nicole Vander Meulen, MinistryLINQ’s marketing and communications specialist. “A church is able to plan strategically, anticipate budget ebbs and flows and, ultimately, fuel its mission.”

Web-based online giving
Giving through a church website is safe and easy. But churches need to find a reputable database software provider to help them track ministry statistics such as contributions and membership, and ensure safe and efficient transactions. Churches will also need a merchant account provider that will take care of credit and debit cards processing.

Donors click on the “Online Giving” button on their church website and follow simple steps to create an account and set up giving schedules that fit their needs.

When choosing an online database system, Bailey says every church should make sure that whatever giving software they choose integrates well into their accounting software.

“Using tools that aren’t connected to your church management software leads to silos and disconnected data, causing donors to fall through the cracks,” says Steve Caton, Church Community Builder’s vice president for sales and marketing.

Online giving and online payments through the Church Community Builder software is a simple process – collecting only the necessary information, thus eliminating barriers to new givers and streamlining the process for regular givers. It allows the church to provide multiple giving options, such as ACH payment processing, credit/debit cards, and one-time or recurring gifts. Donors can control their own contribution strategy and schedules as well as gain real-time access to their giving commitments and year-to-date activity.

“Because a congregant can create and manage their own recurring contributions, the management workload for church staff is diminished as is the embarrassment for a donor if they must reduce or discontinue their recurring contributions as a result of financial hardship,” says Caton.

Ease and accessibility also are among the features of EasyDraft, a fully integrated system with reporting and refund capabilities. Steve Contino, chief operating officer, says EasyDraft uses a consultative approach when working with churches, “and we listen to them so we can suggest the products that we feel will work best for them.” Contributors can store multiple checking and credit card accounts so they can choose how they want to pay for different contribution types.

“No need for on-site IT staff, as we host the secure site, manage the site and support the church for free, allowing churches to serve while we handle all the processing,” says Contino. And when ministry leaders need assistance, Contino says they have access to friendly live agents.

To use the services of EasyDraft, churches will have to fill out a questionnaire and provide their logos, colors and payment options. Equipment is not needed for web-based solutions. A typical set-up cost is a one-time fee of $150 and includes free customer service for the life of the relationship.

If a church is interested in further increasing its revenue through online giving, it can choose a merchant account provider that offers a referral program. One example is Holy Processing, a subsidiary of Capital Merchant Solutions, Inc. (CMS). A church can sign up as a reseller, and for each business that signs up for a merchant account that is referred by the church, CMS will give the church 20 percent of the profit from the processing for each business. The church will also get an up-front referral fee.

“This extra money can be used to feed the hungry, provide clothing, provide shelter, build youth programs, build ministries and build churches,” says Jeremiah Davis, vice president of Holy Processing.

On-location giving
Online giving is a first step in a congregation’s digital giving plan, says Marty Baker, founder of SecureGive, a turnkey digital giving solution providing online, kiosk, iPad and mobile phone options. A common next step, adds Baker, is installing a giving kiosk. Baker says having a kiosk in the church property allows members who are prompted to donate while at church to give easily, enabling the church to receive donations throughout the week.

Baker is also the founding and lead pastor of Stevens Creek Church in Augusta, GA. When the church launched its SecureGive kiosk, Baker says the administrative team could not figure out why donations were coming in on Tuesdays. It turned out that a women’s small group was meeting at the church, and the kiosk provided them a way to make a donation during the week. “It is not uncommon for people to stop by the church during the week and make a donation at the giving kiosk,” says Baker. “When giving is convenient, people give more.”

Baker says churches that use kiosks have reported increases in excess of 40 percent of new donors to the church.

Another huge benefit of a giving kiosk, Baker adds, is the savings in bank fees. Because a SecureGive kiosk uses a retail merchant account (and not an e-commerce merchant account used by Web-based online giving service), it means people are physically swiping their bank card and keying in their PIN to complete the transaction. Baker says retail or card-present transactions will save the church money in processing fees.

Yet, when it comes to flexibility and multiple applications, Qgiv claims it’s the only kiosk that allows both donations and multi-event registrations on the same unit. For example, church members can make a donation, purchase tickets to an event or register for the latest bulletins in one transaction.

Todd Baylis, president of Qgiv, Inc., says Qgiv is the first complete tablet-based kiosk in the donation market. The kiosk head, he says, can be quickly disconnected for mobile and portable use, and is self-contained with an iPad card reader – enabling it to be used anywhere on location with internal battery power. The kiosk also includes 3G wireless, which means that payments can be processed anywhere. Baylis says churches have been able to use the kiosk at outdoor events, such as bake sales and picnics.

Qgiv provides flexible payment options so that churches can customize their donation preferences. But if a church is concerned about the use of credit cards, Baylis says the kiosk can be locked to ACH/eCheck only.

“Our technology establishes an ease of donating not provided by any other charitable donation company or website,” says Baylis. “By providing on-location, secure and card-ready options, Qgiv takes the hassle out of giving, paving the way for patrons to increase the frequency and oftentimes even the dollar amount of their gifts.”

Based on year-over-year transaction volume and metrics from a random sample of Qgiv’s faith-based clients, Baylis says statistics for January-August 2011 to January-August 2012 show a 34 percent increase in online donations.

Mobile giving solutions
While kiosk machines meet a need, often a big drawback is they can be expensive because of the cost of the hardware, and there are usually additional costs associated with these devices, says R. Wayne Steiger, president/CEO of FlowPay Corporation.

FlowPay is a payment-processing technology company that offers online, on-site and mobile giving solutions. It also provides on-site check conversion.

“There is no longer any excuse for a person not to give,” says Steiger. “You cannot say you forgot your checkbook or don’t have any cash, because you don’t need to have either; plus everyone today has a cell phone.”

Steiger says the mobile phone will become the primary means most people will use to give their tithes and offerings.

One of the biggest mistakes churches are making today, says Steiger, is that they are demanding people to give the way they want to receive instead of the way people pay. This holds especially true for those under the age of 30 – who, says Steigler, give the least or don’t give at all.

“If you offer a way for them to begin to give, and they give a bare minimum of $10 each week, the cumulative result at the end of the year is impacting,” says Steigler.

Getting churches mobile-ready to fully engage with today’s generation is the goal of Your Mobile Church. Its Mobile Wallet service enables churches to collect tithes and donations in any amount via text message. “We make it easy to connect with and collect from anyone who owns a cell phone anywhere, at any time,” says Dana Simons, CEO of Your Mobile Church.

Building a relationship with their donors and becoming a part of their “mobile routine” are benefits that Your Mobile Church provides to its clients, says Simons. She adds that not only can churches provide their members the option to donate in any amount; they can also integrate donating with a routine of regular text messages, a visit to the app to access a sermon or submit a prayer request, or simply an automated text message reminder to securely confirm a weekly tithe.

“Donors may receive an email or text message on their phone with a request to support a cause, and rather than going home, browsing the church’s website and entering their credit card information, they simply send a text message to make their donation,” Simons says.

And they can give from anywhere in the world, notes Jen DeLaPorte, chief of business development at iGivings, LLC. iGivings has designed a mobile app platform that allows users to give from their phones. “They can be in church, on a beach, in an airport, hospital, or they can even be at church without their wallets and still be able to give their tithes and offerings,” says DeLaPorte.

A great value to churches, adds DeLaPorte, is that the iGivings app can help build their community and feeling of connectedness that makes members want to be generous when the church body is in need.

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Before getting into online giving

• Plan merchant fees into your budget. Online giving is not free.
• Shop around for a merchant supplier. Fees can be negotiated.
• Develop a plan on how you are going to respond to questions and concerns from your contributors.
• Talk to other churches in your area that are doing online giving to get their perspective.

— Mike Klockenbrink, COO, Lakeside Church

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What to watch out for

Churches should be careful not to overpay for simple services. Shop around, start small and don’t get locked into a long contract. You can always change or add on services as needed.
— Jeremiah Davis, VP of Holy Processing, Capital Merchant Solutions, Inc.
In today’s busy society, the fewer steps or hoops churches ask their congregation to go through to give, the more likely they are to do so – and on a regular basis.
— Todd Baylis, president, Qgiv, Inc.
If a church were purchasing an online giving tool, it would be important to make sure that it integrates with mobile technology. The iGivings app connects with the merchant account the church already has in place to provide seamless integration and ease for not only the church member, but the church staff as well.
— Jen DeLaPorte, chief of business development, iGivings, LLC
When choosing an online giving solution, the product needs to be simple and secure. If the process is too complicated, people will not complete the transaction.
— Marty Baker, SecureGive founder
A church would not want a payment service provider who also provides payment services for adult websites, or provides payment services for illicit activities.
— R. Wayne Steiger, president/CEO, FlowPay Corporation
When shopping for an online giving tool be sure to look for a solution that offers options for donating from a phone, so each member of the congregation can give on-the-go.
— Dana Simons, Your Mobile Church CEO

People want to know more about where their charitable contribution is going.

It has been four years now since the great economic adjustment of our generation. It was a perfect storm of a crash in the equity market and the housing market. Historically, we have had adjustments in the equity market and adjustments in the housing market, but we have not had large simultaneous adjustments. And, unlike other significant market adjustments, we have not yet seen a recovery. The impact has been far reaching.

A lot has been said about the impact on churches. In reality, about one-third of churches are up from 2008-2009, one-third are down and one-third are flat. Despite what many may say, the economy is not the main reason for that, except in a few cases. The downturn in the economy may have accentuated the effect on some, but internal factors actually have a lot more to do with the downturn in giving.

The bigger effect of the economic adjustment has been on the mindset of givers. As the people in our churches think about their giving, their paradigm has shifted. Prior to 2008, money was “easy come, easy go.” Don’t worry so much about where you give it because you can always make more. Not true anymore, because our hard-earned dollars are harder earned than ever before. As a result, donors are now much more careful in where they want their money to go.

If you are planning an accelerated giving initiative of any kind – annual giving, capital funds, ministry venture capital or legacy giving – there are new realities in play. To optimize the success of any giving initiative will require taking these realities into account.

Increased vetting of giving options. People are a lot more careful where they give in the post-2008 era. The tendency is to give more money to fewer, carefully selected choices. Givers will vet their charitable options according to criteria they have established, which will include, among others, transparency of financial disclosure and stewardship of resources. For example, does the church or ministry organization do a good job of stewarding financial resources?

Portfolio management perspective. This one is huge. Prior to 2008, we saw this among high-capacity givers. Now we are seeing it at all levels. People are investing (i.e., giving) to churches and ministry organizations where the highest “ROI” is perceived. ROI is defined as impact. In other words, what results is the church or ministry organization getting? The big shift is that givers will move money from those they perceive to be “low performers” to “higher performers” in terms of impact. Churches cannot assume their people know; they have to make sure they have told the church’s story well and have clearly demonstrated the impact of their ministry.

Reducing debt is popular – at least for now. This is the after-effect of seeing what debt did to people in the crash. For years, church members have had low motivation toward giving initiatives that were focused on reducing or eliminating debt. But now, reducing or eliminating debt is seen as a real positive and givers are motivated to invest in it.

Transparency about finances. Historically, churches have not disclosed a lot of financial information. However, people now want to know more about where their charitable giving is going. They want to know how the church is doing – income statement and balance sheet. Churches do not get a pass on this, especially among younger donors.

Jim Sheppard is CEO and principal of Generis, a consulting firm in Atlanta, GA, dedicated to accelerating generosity for churches and ministry organizations. Sheppard is co-author (with Chris Willard) of the newly released book, Contagious Generosity: Creating A Culture of Giving In Your Church. www.contagiousgenerosity.com, www.jimsheppard.net

Some churches don’t have a clear vision and others don’t teach biblical stewardship.

Steve Walker, pastor of Canyon Hills Community Church in Bothell, WA, walked up to the pulpit one Sunday and announced that the church wouldn’t be taking an offering.

“All our needs are met,” he said. “You all know the blessing of giving. God will give you direction so that whatever you planned to give today can be given to someone else in need.”

While this isn’t always the opening message every Sunday, the revenue needed to fund the $4.8 million budget for the 2,600-strong church often had been more than sufficient. In the past three years, Canyon Hills has experienced per capita giving of more than three times the national average, double-digit growth and record giving.

Why churches are doing well
How are large and growing churches raising the income they need to keep pace with the needs of their members and communities? And, why do some fall short and trend further away from their historical high-revenue points? As George Barna referenced in his book, How to Increase Giving in Your Church: A Practical Guide to the Sensitive Task of Raising Money For Your Church or Ministry, many pastors still ask, “Is there really enough money available today to complete the tasks given to us in Scripture?”

According to Kregg Hood of AG Financial, there is a pattern that correlates to churches that experience good giving results. “Actually, we are seeing numerous churches doing well in the current recession,” he says.

Hood notes five distinct characteristics of these churches: “In every case, the leadership is solidly pro-generosity, and the pastor is leading the charge. There is a proper blend of faith in God to provide, and frequent but not an overly abundant biblical teaching about finances (tithing, getting out of debt.) There is also an emphasis on practical discipleship and creative marketing. Yes, communication does matter.”

Why churches fall short
In my work with churches over the years, I have found common denominators in congregations that fall short of their giving revenue:

Church members can’t identify what their church is about. Revenue is strong where the members can specifically articulate the unique characteristics of their church. If members cannot describe what it means to belong to their church, they are disconnected and less inclined to give.

The church has no clear vision. People will give and invest if they understand where you are taking them and they resonate with that value and experience. When people can clearly identify with the church’s mission and vision, they are quick to become supporters.

The pastor was not taught biblical stewardship, and so it isn’t taught to the flock. Again, in Barna’s How to Increase Giving in Your Church, he explains that as he “ … studied the best fund-raising churches in the nation, it was obvious that the practical, no-holds barred preaching and teaching of the biblical principles of stewardship, and relentlessly holding the Body of believers accountable to those truths in appropriate ways, were cherished distinctives of these families of Christians devoted to growing … ”

For Canyon Hills’ Walker, it’s just part of the church’s DNA. “We’ve always been really committed to teaching stewardship regularly throughout the year. People who love to give, love to hear sermons and messages on giving. People who are generous know the tremendous blessing of giving, and want to do more. For  people who don’t give, we don’t mind upsetting them. We want them to rethink why they are fearful of trusting God with their finances. We simply try to confront that confusion and unbiblical way of thinking. If we convert a few more each year, that’s our goal. We’re going after their heart, and where their treasure is, is where their heart is.”

It’s amazing that some churches do not teach about stewardship or giving, nor do they even take an offering, and somehow they expect that people know what to do.

Members who are earning far below their potential are left to fend for themselves. In his book, Generous Living, Ron Blue references “financial problems” as the second of seven inhibitors to giving (the first being the spiritual foundation and knowledge of the believer). If the church is intent on discipleship, it seems appropriate that churches equip their members to be free of debt and discover their income potential. Financial management and career coaching are key to helping church members steward their talents and resources.

The focus of the church continues to be that of making disciples, but that is not something that a church does “to” its people, but rather “with” its people. The more engaged and stewardship-equipped congregants are, the stronger the financial picture.

John Savage is a partner in OneAccord Partners, Bellevue, WA. www.OneAccordPartenrs.com/NFP

By Bryce Collman

When Fellowship of the Parks Church in Keller, TX, provided online giving to their members “we improved our overall annual giving by 104 percent during a time when our congregation only grew by 65 percent. In 2007 we began accepting ACH transactions and added credit and debit cards in 2010. Electronic giving has increased a total of 575 percent since we first started our program,” reports Doug Curlee, executive pastor.

Online giving has also stabilized the church’s weekly giving trends when experiencing reduced attendance during holiday weekends “This year July 4 fell on a Sunday which impacted our weekly attendance. We would have experienced a greater decrease in our tithes had our members not established recurrent electronic giving,” says Doug Walker, senior pastor.

Be responsible
While Fellowship of the Parks accepts all forms of online giving they ask their members to use their credit cards responsibly to eliminate the risk of debt accumulation. This is true for many who use cautionary language on their websites to encourage responsible giving. Other churches prefer to eliminate that risk altogether. In doing so are they also eliminating the benefits associated with online giving? A statement from Gateway Church in Southlake, TX, says: “Because Gateway Church firmly believes that people should not go into debt in order to give to the Kingdom, we do not accept credit card donations.”

When a church decides not to accept credit cards for online giving they are echoing the trend currently experienced in American households. According to NACHA (last April) and Nilson Reports (last February), there were 75.16 billion non-cash transactions placed in the U.S. during 2009. The breakdown of this total shows 24.96 percent ACH, 26.876 percent credit card and an overwhelming 48.164 percent debit and pre-paid card transactions.

This trend is further illustrated when looking at the online giving patterns at Cross Timbers Community Church in Argyle, TX, which receives “28.4 percent of our overall giving electronically and continue to increase this percentage annually,” says Todd Helgesen, stewardship pastor. While all forms of giving are  accepted “12.7 percent of funds are ACH, 33 percent credit cards and 54.3 percent debit cards,” Helgesen says.

Most merchant services companies offer ACH (electronic check) services which allow members to establish one-time or recurrent transactions online. Ardent Giving Solutions recently introduced an additional debt-free option: “Debit Card Only Giving” for online transactions. “Debit Card Only Giving” blocks credit card transactions when giving online, via kiosk and wireless solutions. When a member attempts to give using their credit card they will receive an error 
message.

Error messages can be personalized by the church and displayed in donor management software. Giving reports can be automatically downloaded into compatible software solutions or manually imported into others. Ardent Giving Solutions developed “Debit Card Only Giving” to help churches who embrace a debt-free philosophy but who want to provide their members the opportunity to give using a debit card without having to accept credit cards as well.

By choosing to accept ACH or debit cards only, a church not only establishes a debt-free culture but experiences the added benefit of lowering transactional costs.

ACH transactions costs vary from a transaction fee only to transaction fee plus a percentage. When researching rates, the highest transactional cost quoted per $100 tithe was $1.50.

Lower transaction rates
Debit card transaction rates are lower than credit card rates. Visa and MasterCard charge “interchange rates” based on transaction type and card type. Visa and MasterCard services are provided to churches through merchant service companies who charge an additional “mark-up” to the interchange rate. While wholesale cost is not the final expense due to the “mark-up,” it serves to provide a baseline to uncover your potential partner’s profit margin on each transaction. Since pricing on debit card processing has a lower interchange rate, a church should expect to experience lower overall cost when accepting debit cards only.

Every company has different fee structures for all forms of processing. It is best to compare companies by factoring both transactional costs with any other fees associated to understand total overall expense. It is also important to note that though your software company may partner with a specific merchant services company, you may find cheaper costs elsewhere while still enjoying the benefits of automated reporting.

When establishing an online giving program, the goal is to choose services that would be most used by your members and match your church values at the lowest cost and provide tools that will help your ministry thrive.

Bryce Collman is founder and CEO of Ardent Giving Solutions, Cincinnati, OH.  www.ardentgivingsolutions.com

Building costs decline as much as 23 percent over three years ago, while major gifts are ‘back in play.’

Is this the time for a church to be building? Jobs are being lost and families are rethinking their pledges to their church’s budget. Even as many are having difficulty with their own home mortgage much less be financing their church’s new home, one person in the building trades says the present time is “an incredible opportunity for the faith-based building sector.”

David Hatton of Churchworx sees it from the point of view of a dedicated churchman and one who’s worked many years in the building trades, focusing on church construction.

“Building a church project in these ‘uncertain’ economic times is both a very smart use of God’s money,” he says, but — and here’s the clinker  — “requires an extraordinary vision, faith and leadership from the church’s pastor, staff and members.”

Value for the dollar

Hatton, who is based in Texas, says that projects in Dallas and Houston are experiencing a “total project delivered” cost decline of 19 to 23 percent today against 2007. “That translates into the fact that for every dollar spent, a church will realize $1.30 worth of total project in-place value,” he says.

That’s the dollar number that First Baptist Church of Dallas is using as they begin a capital campaign this spring and look to breaking ground in July on a $130 million project that is the largest, by far, church project in this country if not the world.

The $6 million overall project cost for Crossroads United Methodist Church in Oakdale, PA, near Pittsburgh, is small by comparison, but no less challenging for the congregation in these times. Senior Pastor Steve Cordell says that “obviously, the economic climate was on everyone’s mind. We knew that people’s assets had been deeply impacted by the falling stock market and uncertainty over jobs.”

The church of 1,100 has five live services and two video venues and the facility has reached capacity. But they have a vision of having 10 campuses “and the congregational excitement about our opportunities in Mozambique was growing,” Cordell says.

He admits that the $6 million cost was “rather daunting for a church with a $1.25 million general budget.” Working with Generis campaign experts, they took their project in two phases, and the first phase was a huge success. “We surpassed our goal of $750,000 over one year by receiving pledges of $1.2 million, with 90 percent of the church participating,” Cordell says.

Several things made the difference for this church’s success, says Cordell: obvious facility need, communication of the need over a year, strong buy-in to the overall vision, a momentum and unity in the congregation — and God’s grace.

Brad Leeper of Generis says that the phasing in of plans makes sense for some churches. “Because most churches will be unable to secure lending for a larger project in the short-term, some of these churches are using a smaller giving season in a campaign to tackle a portion of the project to prepare for the larger project hopefully in the next year.”

Taking first step

Crossroads, for example, decided on the two-stage Mission Expansion Project that allowed them to make progress toward their goal without incurring any debt — in fact, reducing the debt. They bought the property, started a new campus, covered soft cost preparatory work, furthered their work in Mozambique, and did some debt retirement.

Not moving ahead on the project, and not phasing in the work, has another impact, says Brad Leeper. “The other option is to remain silent before the church and that silence will get a church no further down the road with their mission.”

Lifepoint Church in Fredericksburg, VA is just five years old with 650 people, including children, attending in school facilities, where the school district is raising their rental rates a flat 10 percent for every 12 months they occupy the school, meaning that before long the church has to move.

Executive Pastor Jeremy Pickwell says “we knew what God wanted to do in the Fredericksburg area, and we simply used deductive reasoning to reach a timeline.” But, he notes, “The timeline just happened to fall in the middle of one of the worst recessions on record.”

Still, Pickwell says they saw the “opportunity cost.” Interest rates were historically low, “and with input from Cogun and Bank of the West, we quickly realized that commercial real estate loans are beginning to reset and vacant ‘big box’ buildings are becoming more prevalent and affordable.”

No doubt on timing

In the end, he says, when the decision was made there was zero doubt about the timing. “Our goal was $1.5 million,” he says. “God’s economy allowed us to see commitments of more than $2.4 million. Obey what God says, he is in control.” Says Generis’ Brad Leeper, “Rather than purchasing land, paying it off, then building — a five-year course perhaps — they are purchasing empty retail space at a discounted rate and then raising funds for the renovation. They can secure greater square footage and get into the building much sooner and without the expense of the infrastructure that raw land requires.”

While Pickwell says that God is doing something special, he affirms that “there is a difference between faith and foolishness.” The church is looking now for a new space. “We needed to be in a financial position to be a real candidate to purchase a building” and have begun their Accelerate campaign, he says.

When it comes to running capital campaigns, Leeper believes that “major gifts are back in play.”

“I have seen six gifts greater than $1,000,000 and several greater than $250,000. High capacity donors, while having a very high bar for the project credibility, have an increased interest in standing in the gap in this season.

“Not all people are losing money in the recession. Some are making good money and have surplus to share. The standards for giving are more demanding and the church leadership must be very well prepared to have a series of conversations with a higher capacity donor.

“Two years ago, a pastor could have one conversation about a gift and be done. One and done. Now plan on multiple conversations with a much more detailed plan for their gift,” Leeper says, “The higher capacity donor conversations are much more complex,” he says.

On the financing side too, banks are more careful than ever, with new formulas to determine loan options. “Increased cash reserves, lower debt ratios, smaller percentages of expenses in the human resources category, and other factors are much more demanding,” Leeper says.

“I often have a church brag that they are debt free, and while debt free is good, banks look more carefully at excess cash flow. Does a church have the cash flow margin to provide debt service? This factor is much more in play than ever before,” he says.

Marianne Berlan of Bank of the West says it a little differently. Her own institution has not changed its lending criteria, nor curtailed its lending activity, she says. “We continue to evaluate loan requesters based on a church’s historical cash flow, including recently implemented or ongoing capital stewardship campaigns,” she says. BOTW has “never found it appropriate for a church to rely on growth to meet their debt service requirements.”

She notes that the institution has nearly $1.2 billion in loans outstanding and has no delinquencies.

So a good time to build? While some churches may choose to postpone building plans, Stephen McSwain, senior vice president at Cargill Associates, says, “A church that can postpone its building plans is probably not the church that should be building when the economy is in better shape. What should drive any building plan is, first, the call of God, and second, the need itself.

“A church that follows those two criteria will not only be able to build but will be able to manage any residual debt and, ultimately, pay for the new facility.”

The right question McSwain says is not should a church build, but “What is God calling us to do and is there any way we can do what God is calling us to do and avoid building?”

Ronald E. Keener

By David Holland

Nestled in South Florida’s sun-drenched Fort Lauderdale area, Church by the Glades had two problems as it headed into the year 2008. One of the challenges was the kind of issue most pastors would love to face. The other problem was much less desirable.

The happy challenge facing Pastor David Hughes and his congregation was space-related. The young church was growing wildly and seemingly couldn’t add services fast enough to accommodate all the new families and individuals that were choosing to call the church “home.”

Significantly, this boom wasn’t a result of “transfer-growth” in which mature Christian families move to a more appealing church. The vision of the church was to reach unreached and unchurched people, and that was precisely the type of individual that was fueling this church’s membership explosion.

Best way to grow

By the spring of 2008, the church was holding five main services in its 900-seat ministry facility on the weekend and wrestling with a decision about the best way to accommodate the growth and touch more lives. The traditional approach was to simply build a bigger auditorium and expand the educational space for children and youth accordingly. An alternative some media-savvy churches have pursued in recent years is to establish satellite campuses in locations away from the main church and push overflow growth toward those sites.

Ultimately, after much prayer and deliberation, the leadership of Church by the Glades decided to do some of both. They settled on a hybrid approach that called for building a new 2,000-seat worship center and expanding their preschool area, while also funding the establishment of the first of the church’s many anticipated satellite campuses.

Such bold plans tend to come with hefty price tags. In this case, once the architects, planners and builders had their say, the projected need was $16 million. That’s where the other challenge emerges.

By early 2008, the booming South Florida housing market had gone bust. A staggering number of homeowners suddenly found themselves “underwater” where their mortgages were concerned as a massive wave of foreclosures swept over the area. Furthermore, by April, Florida was facing its highest levels of unemployment since 1976. This ethnically diverse church found itself in the heart of one of the hardest hit areas in the entire nation — right along with Detroit, Las Vegas and sections of California.

Daily headlines shouted of economic gloom and consistently predicted additional financial hardships on the horizon. Each evening’s newscast seemed little more than a long litany of dark stories about mortgage defaults, business closings and layoffs.

The leadership of Church by the Glades confronted an obvious question: “Did it make any sense to push forward with a capital campaign in the midst of such widespread economic turmoil and pervasive uneasiness?”

Abundant fruit

Again, after much prayerful deliberation, the consensus answer was “yes.” The need was too great; the fruit being produced among the people of the congregation too abundant, the God they served too powerful to be deterred by fear. The church engaged fundraising consultant The Gage Group for its capital campaign.

Still, for the leaders of Church by the Glades and the team they had assembled, the question became, “In the middle of this crazy environment of fear and scarcity, how can we help move people into a spirit of generosity and trust?”

The church initiated what some call a “reverse offering.” As one local newspaper headline described it after the fact, “Local Church ‘Passes the Plate’ to Give Away the Offering.”

In the weekend services of May 10-11, the church passed out envelopes containing cash to each individual in attendance. Those envelopes contained varying amounts ranging from $5 up to $1,000. The rules of the exercise were that each person was on their honor not to spend the money on themselves. Nor were they allowed to simply give the money back to the church. They were to pray for guidance and use it to meet a need in the life of another person.

The resulting effect on the congregation was nothing short of phenomenal. The church created a special Web site (www.MyGoBigStory.com) in which members could post their thoughts and experiences about the exercise.

When the capital campaign officially launched in the autumn of that year, even as the national recession was intensifying, the response from the congregation was remarkable.

The church has received more than $11 million in pledges from the church body. And an initial offering raised more than a half million in cash.

As a result, the church is moving quickly and confidently forward with its plans for expansion. And not a moment too soon. Church by the Glades recently added a seventh service to its weekend schedule!

David Holland is a freelance writer in Dallas, TX. [www.DavidAHolland.com] [www.churchbytheglades.com]

When Crossroads Christian Church in Corona, CA, accumulated $500,000 in debt — in addition to falling behind on their mortgage payments — financial ruin and foreclosure seemed imminent.

“Our loan was delinquent and the pastor at the time was avoiding communication with our credit union,” says current Senior Pastor Chuck Booher. “We were weeks away from forcing Evangelical Christian Credit Union to take action.”

The church hit a new low when funds designated for an orphanage in India were instead used to bring the checking account back into the black. They were behind in every payment and utility companies were threatening to shut off water and electricity.

Financial management lacking

According to Booher, Crossroads found themselves in this position largely because of a lack of good financial management. “There wasn’t a budget,” says Booher, “The church just spent money — sometimes up to $50,000 more a week than what was brought in.” And then tithes dipped.

Worst of all, the financial situation was kept a secret from both the church body and the elders. Booher is convinced that, if the pastor had come clean, the church would have rallied around him and they wouldn’t have gotten in so deep. “At any point,” he says, “honesty and transparency would have pulled the church out of it.”

In spite of the financial downward spiral, Crossroads came back from the brink of disaster and is now a beacon in its multicultural community. Recovery began when Booher — pastoring another church at the time — was asked to step in as pastor at Crossroads. He declined initially, then asked for financials to pray over when summoned again.

When Booher learned that there weren’t any financials available, he began to understand the seriousness of the situation. He accepted the position, and his first act as pastor was to disclose the truth of the financial crisis to his congregation.

Then he worked relentlessly to get the church out of debt. “We took out a third mortgage on our mortgage to pay off debts and to guarantee our mortgage payments for the immediate future,” says Booher. “Then we rallied the church. The amazing thing is, in 40 days $550,000 of past due debt was paid off.” It was even more amazing when one considers that the average age of the church community is only 35.

Three steps to rescue

Booher explains how the new leadership at Crossroads closely followed three critical steps to guide the church through the process of getting out of debt:

“First, we got the key leaders together and explained everything in writing and verbally. We were ready to answer any questions and instituted a spirit of transparency.

“Second, we created a higher level of accountability. Our executive pastor now meets monthly with three elders and goes through all of our expenses. An outside CPA also comes in monthly and goes over financials with the elder board. And I meet with the head of the accounting department monthly to see if they are concerned about anything questionable.

“Third, we told our church family, ‘Don’t give to the problem. Give to the Lord.’ Out of love for God, our congregation brought in $600,000 over their regular tithes in a 40-day period. We paid off our debt and instituted a strict budget,” Booher says.

Today, Crossroads ministers to more than 6,000 people every week — an increase of 2,000 people from a year and a half ago. They hold six different services, including three in the Worship Center, a chapel service, a satellite service in Lake Elsinore, and a service in Spanish.

Booher attributes the growth of the church to a spirit of truth embodied by the leadership. “God is honored by truth. That means having transparency within the body of believers. Great leaders communicate — and people will trust you enough to give,” he says.

Bethany Plumb has a background in banking and marketing and has been writing for more than 10 years for Evangelical Christian Credit Union (ECCU), Brea, CA. [www.eccu.org]

In this video (www.eccu.org/resources/videos/2009/crossroads-christian-church), Pastor Booher shares how God brought Crossroads Christian Church from death’s door to a vibrant, flourishing ministry.

By William G. Enright and Richard Klopp

People of faith are renowned for their charitable generosity. Amidst what economists are calling the “Great Recession,” giving to religion is the one subsector of charitable giving that grew in 2008. While charitable giving as a whole decreased from 2007 to 2008 by 2 percent (-5.7 percent when adjusted for inflation) and individual giving dropped 2.7 percent (-6.3 percent when adjusted for inflation) contributions to religion increased by 5.5 percent (+1.5 percent when adjusted for inflation).

This good news regarding religious giving comes as no surprise. In the 12 recessions since 1967, religion is the one subsector least affected by the economy with religious giving — when adjusted for inflation  — declining but 0.1 percent. It is estimated that about 50 percent of all household giving goes to religion with most of that money going to local congregations and parachurch organizations. In times of economic crisis the local congregation remains the primary recipient of household giving reflecting what sociologist Robert Wuthnow calls “the local focus of American religion” as the local church is viewed as an extension of one’s home and family.

Amidst the good news there are storm clouds building on the horizon demanding our attention. The landscape of religious giving has changed significantly in the last 15 to 20 years. While religion continues to receive the largest amount of charitable dollars, religion’s piece of the charitable pie has shrunk from nearly 50 percent in 1995 to 33 percent in 2007. Between 1987 and 2004 giving to religion as a share of household income fell on average 30 percent for faith groups from the Mormons to Evangelicals to Mainline Protestants to Catholics.

Despite significant growth in real per capita income over the 20th century, the average percentage share of income given by Christians to religion declined from 1.2 percent in 1963 to 0.9 percent in 2000 with one in five American Christians giving nothing to church, parachurch or nonreligious charities. The upshot is that while the dollars given to congregations may increase each year, most congregations do not appear to be keeping pace with inflation.

Reasons for shift

What sits behind this seismic shift in religious giving? From both our research and our conversations with hundreds of clergy and congregations, three observations emerge.

First, the demographics of American religious practice are changing with fewer people claiming a religious home and church attendance waning. Ironically in all our studies on giving it is people who attend church once a month or more who are two to three times more generous in all their charitable giving than those who attend less frequently or not at all. The correlation between regular church attendance and generous giving cannot be underestimated.

Second, the generational shifts relative to religious giving and religious practice are significant. When we compare the Silent Generation (those born from 1929-1945) with the Boomers (those born from 1946-1964) and Generation X (those born from 1964-1981) there is a 37 percent  decline in the number of people who give to religion and a 42 percent decline in the number of those who attend church regularly. Ironically, among those who do give to religion and attend church with regularity, there is an increase in the religious giving of the Boomers and Generations X compared to the Silent Generation. In short, while the generosity of those committed to religion remains, high the numbers of those who are religiously inclined is declining.

The charitable giving of Boomers and Generation X is also more entrepreneurial, which means that they are less inclined to give to help congregations meet an institutional budget and more energized by causes that invite their participation with measurable benchmarks and a focus on effectiveness while addressing real human need. Traditional religious organizations and congregations appear to be challenged and ill at ease with the entrepreneurial giver.

No longer can congregations and religious organizations expect all donors to slide their feet into a prescribed institutional shoe. When it comes to fundraising, one size shoe no longer fits all donors. Rather, it is the congregation and religious organization that must discover how it can slide its foot into the donor’s shoe it if is capture the generosity of the entrepreneurial donor.

Third, the silence of the pulpit on money matters actually discourages generous giving. The taboo of money talk leaves clergy shy when it comes to talking about money, and laity squeamish about money talk in the church as our consumerist culture dupes many into equating self-worth with financial-worth. When clergy do talk about money and the faithful use of possessions, studies show that it is but once a year during the annual financial drive or when the church is asking for money; which means that all too often money talk comes across as a scold.

The moral issues

Meantime, people in the pews yearn for pastors and priests who will help them wrestle with the moral quandary of money: how much is enough? How much is too much? How do we balance needs with wants? At what point does the acquisition of life’s comforts cross the intersection into the accumulation of luxurious stuff? How does one integrate work into their faith?

Amidst the altered landscape of religious giving, how then might we talk about money and go about fundraising? The answer is not found in the newest stewardship campaign fad or fundraising gimmick.  The annual stewardship campaign and the periodic capital campaign, while necessary, are ultimately little more than icing on the cake. If congregations are to address the financial challenges they face they must learn how to bake the cake by creating a congregational culture of generosity.

Three ingredients are essential for a congregation intent on baking the cake of cultural generosity.

1. Clergy must learn how to talk about money matters and the faithful use of possessions with theological integrity and personal ease apart from any attempt to raise money.

2. Clergy and lay financial leaders must extend the practice of the fine art of pastoral care to the individual donor as they nurture discerning and thoughtful giving.

3. The creation of a culture of generosity begins with leadership: laity and clergy, and a governing board committed to fiscal transparency and institutional accountability as they provide the congregation with the leadership it deserves  while affirming the worthiness of the congregation to receive the gifts and goodwill it desires.

William G. Enright is director and Richard Klopp is associate director of the Lake Institute on Faith & Giving at the Center on Philanthropy at Indiana University. [www.philanthropy.iupui.edu]

By Eric Spacek

Bad weather, vacations and illnesses can cause parishioners to miss church services during the year. While some people will make up their missed donations, many won’t. That’s where electronic giving, or e-giving, can help.

E-giving enables church members to “set it and forget it.”  This allows contributions to continue automatically, regardless of members’ weekly attendance.

For church members, e-giving is all about convenience. As more and more of the population pay their bills online, they become used to the with-a-click simplicity of electronic payments. It’s only natural that parishioners want to extend this convenience to their tithing.

Church staff also benefit from e-giving. Electronic contributions mean fewer envelopes to open, less manual accounting and reduced chances for errors, and yes, even fraud.

How does it work?

E-giving is very simple for both church members and staff, particularly as more and more people get used to the process. Here’s an overview:

Through a simple form, a church member pre-authorizes the church to have his or her contribution automatically debited from a checking or savings account. The church member can typically choose to have the contribution deducted weekly, semi-monthly, monthly or even annually.

Once the church receives authorization for an electronic funds transfer (EFT), it sends the payment, via electronic file, through the automated clearing house (ACH) network with instructions to move it from one bank account to another. The church’s bank account is credited, and the parishioner’s account is debited the same amount.

The first step to setting up an e-giving program is selecting a reputable, quality EFT service provider. While many banks provide EFT services, there are specialized EFT processing companies in the market as well. [See sidebar below.] Regardless, you’ll want to consider the following two main factors when making your decision:

Security — Before signing up for electronic giving with any institution, make sure the program offered is safe and secure. Have the bank or EFT provider supply detailed information on the security measures in place to prevent fraud or other unauthorized use.

Also, discuss the number of EFT transactions they process in a given day or week, and find out the error rate. Ask about any previous breaches in security.

Cost — Ask for detailed information in advance about any and all fees. Fees for EFT programs vary widely, so your church should get information in writing about any start-up fees, monthly access fees, per batch or per transaction fees and so on.

The best services will have minimal (or no) start-up fees and low transaction fees. While many church management software packages already include ACH capability, find out if you’ll need to buy additional software to begin your e-giving program.

Before selecting an EFT provider, do your homework. Check with the Better Business Bureau in the state in which they are domiciled. Churches have been involved with electronic giving for several years now, so the EFT provider should be able to supply a list of other churches that have utilized their service. Follow through and contact those churches as references.

Seek indemnity

Once your church has chosen its EFT provider, the provider typically sends a service agreement for the church to sign. Read this document carefully. One protection your church may want to consider is a clause in which the provider agrees to indemnify the church (hold it harmless) for any losses stemming from the use of the provider’s EFT system.

It’s not uncommon for EFT processors to turn this language around and require the church to indemnify the provider.

While EFT systems are secure and incidents of breaches to the system rare, no system is entirely fail-safe. Consider having your church’s attorney review the agreement if you have any questions.

The best practice is to require that all authorizations to start, stop or change a person’s electronic giving be put in writing and signed by that person. This will help avoid any misunderstandings or disputes with church members down the road.

Because parishioners may not think to increase the amount of their electronic tithe from year-to-year, you may even want to consider automatically sending out a new authorization form to each electronic giver at the start of the fiscal year.

Include a note requesting that they sign and return the authorization change form if they would like to change their tithe for the new church year.

Policies and procedures

Be sure to establish clear policies and procedures about your program, but keep them simple. A concise authorization form, along with a one or two page policy statement, should be all you need.

One important item to include is how your church will handle a member’s request to terminate electronic giving. After speaking with your EFT processor about terminations, ensure that your policy leaves the church enough time between a termination request and when it will take effect.

For example, what if a member who is upset with the church calls to cancel an electronic tithe scheduled to take place the next day? Without a policy dictating that it may take up to three business days to cancel an authorization, the dispute with that member could turn ugly when the debit takes place as scheduled.

With this new form of financial transaction taking place at your church, make sure its financial policies and procedures are up-to-date, especially your internal controls. A second person should review the electronic giving program, and it should be included in your church’s annual audit or financial review.

Finally, review your church’s insurance policy to ensure appropriate employee dishonesty coverage is in place. It’s better to be safe than sorry.

Ready to provide your parishioners with another stewardship tool? An e-giving program may be for you. Do the research and make sure proper safeguards are in place, and you’ll be able to provide your congregation and staff with a time-saving convenience everyone will appreciate.

Eric Spacek is senior church risk manager at GuideOne Insurance, West Des Moines, IA. [wwww.GuideOne.com]

• www.achdirect.com
• www.churchwerks.com
• www.egive-usa.com
• www.egivingsystems.org
• www.e-tithes.com
• www.etransfer.com
• www.paysimple.com
• www.smartpaymentsolutions.com
• www.vancoservices.com

• Convenience for parishioners
• The possibility of increased contributions
• Timely contributions
• The ability of the church to forecast future contributions
• Less work for office staff and/or volunteers