CHURCH PLANTING GROWTH PROJECTOR

Transcription

1 September 2014 CHURCH PLANTING GROWTH PROJECTOR Church Planting Growth Projector 1

2 PROCEDURES FOR BUDGETING EXPENSE The Church Planting Growth Projector is an amazing tool to assist you in developing your church plant budget. There is a level of preparation required before you log in and enter your information into the Growth Projector. The following is a guide to assist you in the preparation and development of your church plant financial budget, with the primary focus on expenses. The following guide will walk you through the Church Planting Growth Projector questions regarding expenses, identifying the ingredients you will need to consider in order to complete the Growth Projector questions. Before we begin there are a few parameters that we must address. First and foremost, this document assumes the conviction that Finances should follow Ministry and not the other way around. This means in order to develop a solid, meaningful and useful financial budget there must first be a Ministry Plan. We believe that ministry and finances are like a heartbeat. When there is rhythm, we have a greater opportunity of matching our budget plan with God s vision for our ministry. Secondly, we must take time to define our Pre-Launch Budget. We will define Pre-Launch Budget as the budget which includes all the cost associated with the Planter s entrance to the field through the time that the church begins to meet for worship services as a launched entity. We must recognize that in year one, we may have Pre-Launch expenses that may not be reoccuring in years 2 through 5. Thirdly, we will be breaking down the Expense Budget into the following categories: - Personnel Expenses - Operations/Administrative Expenses - Ministry Expenses - Reserves As you proceed through this guide, you will see a picture of the Growth Projector screen as it appears online, followed by the Growth Projector question and the information in the icon i in the top right corner of the Growth Projector screen. Following this information will be the details behind the questions to assist you in preparing to develop your ministry budget. Church Planting Growth Projector 2

3 QUESTION #5 Question #5: For years 1-5, what are the estimated personnel expenses? Click on the icon i in the top right hand corner for additional information. Personnel expenses can be one of the biggest expenses and can increase by 10 percent each year. Personnel expenses include salary and benefits for anyone paid through the church budget. As stated above, personnel expenses include anyone who is paid through the church budget. Note that the payment of 1099 contract employees will not be included in the Personnel Budget (i.e. worship players pay will be included in the Worship Budget). If the staff member is bi-vocational, only his pay which is provided by the church directly should be included in the personnel budget. Unless a staff member is paid or supported directly by an entity other than the church, all of his/her compensation should be included in the Personnel Budget (even if it will ultimately be offset by indirect support coming from separate entities to the church). Church Planting Growth Projector 3

4 QUESTION #5 Here are the ingredients we must consider when developing the Personnel Budget: - All church-paid staff; full-time and part-time - Staff wages (any cash compensation but does not include ministry reimbursements) - Minister housing allowance (approved by the church leadership) - Church paid benefits (health insurance, life insurance, dental insurance, eye care and retirement contributions); some of these benefits may include a co-pay by the employee. Only the church s portion of the benefit premium is included in the Personnel Budget. - Any church-paid cost associated with staff relocation - Payroll taxes Minister s Housing Allowance In calculating your personnel expenses, you must take into consideration ministers housing allowance per the IRS rules and Church policy. A ministers housing allowance is always a part of their compensation. Per the IRS rules, a minister can deduct the cost of his living quarters as it relates to his/her tax base. Items that can be included in a ministers housing allowance is his/her mortgage (interest and taxes only), utilities, home repairs, etc. You should always look up the most current IRS rulings for ministers housing allowance prior to calculating the housing allowance. The ministers housing allowance is not subject to federal income taxes. Personnel Benefits Personnel benefits include health insurance, dental insurance, eye care, life insurance, disability insurance and retirement contributions. In many cases there is an employee co-pay associated with these premiums. Only the portion of the premium that is paid by the church and only the portion of church contribution to an individual s retirement fund are recorded as personnel expenses. At this time, we should have clarity as to what the ingredients are for the Personnel Budget. Now, it is time to look at your start up team and determine the Personnel Budget for year 1. Remember year 1 may have some expense due to start up that may not be reoccuring. You will need to review your church growth projections to develop a plan for years 2 through 5 as to what positions and when you will add personnel to support the growth of the church. You will also need to take into consideration salary increases in years 2 through 5 based on performance and the cost of living which can depend on the region of the country in which you live. Church Planting Growth Projector 4

5 QUESTION #6 Question #6: For years 1-5, what are the estimated administrative expenses? Click on the icon i in the top right hand corner for additional information. Administrative expenses include rent, mortgage payments, office expenses, etc. Catalysts and church planters should work together to create a separate spreadsheet that details administrative expenses. The Operations/Administrative expenses are simply designed to support the Ministry Plan of the church. The Operations/Administrative expenses will include all the cost necessary to serve, to support, to enhance, to maintain, to utilize and to secure our ministry and its God-provided tools. The following are the ingredients for a sound Operations/Administrative Budget. Each one of these items should be a separate line item on your budget. This will allow you to more accurately track your expenses. Church Planting Growth Projector 5

6 QUESTION #6 - Utility Expenses: will include electric, gas, water and sewage. If renting a facility, you can contact your local providers and they can give you historical cost to assist you in your estimates. If you have a new building or you re unsure of the utility cost, your local providers can provide you with an average cost per square foot. In developing the utility cost for years 2 through 5, contact your local provider and ask them for historical rate increases. This will give a fair idea of how to plan. - Office Supplies: will include copy paper, staples, paper clips, markers, staplers, pens, pencils and any other supplies that are generally utilized in the office. - Printing and Postage: expenses would include printing and postage for any and all types of correspondence, including items like contribution statements, year-end W2 s, birthday cards, church special events flyers, etc. - Telephones: expenses include land line and cell phone expenses incurred by the church - Leased Equipment: expenses include copier machines, fax machines, computers, servers, postage machine, media equipment (audio and video) and any other equipment leases. When leasing equipment, take into consideration the terms of the lease agreement and the options to purchase the equipment. Note that if you ever return a copier or fax machine, be sure to erase the hard drive as it may contain confidential information. For example, social security numbers, phone numbers, addresses, etc. - Graphics Expenses: include any cost associated with graphics for Sunday or Wednesday church services - Cleaning Supplies: include supplies purchased and used for the purpose of periodic cleaning of the building or grounds. For example, chemicals used to clean the church bathrooms or to pressure wash the exterior of the building. - Video & Audio: expenses include equipment purchased to support Sunday or Wednesday services, Children s Ministry services, Youth Ministry services, CD s and DVD s, etc. - Publicity & Advertising: expenses include flyers, post cards, billboards, yard signs, radio advertising, TV advertising, newspaper advertising, apparel such as team shirts with church logo, etc. - Food Service: expenses are associated with the church and provide meals or snacks for church wide gatherings, church meetings, special events, Sunday morning coffee and donuts, etc. If your church has a kitchen, the cost of the food and general supplies will apply to this category but not personnel cost. Church Planting Growth Projector 6

7 QUESTION #6 - Meetings, Office & Storage Space Rental: expenses include rental fees associated with the location in which you are holding your church services, rental fees for any office space you are occupying and rental fees for any storage space you are utilizing. - Property & Commercial Liability Insurance: this expense is designed to protect and cover the repair and/or replacement of your facilities and the content in your facilities in case of an accidental or natural disaster. The Commercial Liability insurance is designed to protect the church and its leadership from claims of injury, property damage and negligence in related church/business activities. The annual premiums will be posted in this portion of the budget. Note that it is an acceptable and advisable practice to seek a broker when searching for this type of insurance. Also, the broker can assist you in planning for years 2 through 5 as it relates to potential premium increases. - Stewardship: expenses include offering envelopes, contribution statements or online giving fees. - Vehicle: expenses include gas, oil and maintenance for church owned and/or leased vehicles. - Software Cost: includes expenses associated with the purchase of software membership, license and renewal fees. Generally this is software used for membership services, attendance tracking, contributions and finance. - Subscription: expenses include newsletters, magazines and online fees. - Travel & Reimbursement: expenses could include hotel, rental care, meals, airline tickets and/0r personal car mileage expenses. The expenses would be reported here whether it s been charged directly to the charch or you will be reimbursed for the expenses. - Leadership Development Cost: expenses include cost associated with developing your church staff and lay leaders. It may include leadership retreats, formal training seminars, rental space for training and training materials, etc. - Contract Services: expenses may include cost like security system, security personnel, pest control, HVAC preventative maintenance contract, a firm to perform background checks, etc. - Building & Grounds Maintenance: expenses will include all expenses for materials associated with repairing or maintaining the buildings and grounds. Personnel expenses will not be included. For example, replacing light bulbs, gas and oil for lawn mowers, chemicals for treating the lawn and shrubs, replacing ceiling tiles, etc. Church Planting Growth Projector 7

8 QUESTION #6 Reserves: This area of the budget will include an amount representing a level of reserves we wish to plan for knowing there will be some unexpected expenses. We recommend that, if possible, even the first year s budget includes some level of reserves. These reserves have the potential to protect the church plant during normal operating slumps in revenue along with financially positioning the church for the future. Now we will begin the Ministry portion of our budgeting process. Church Planting Growth Projector 8

9 QUESTION #7 Question #7: Total percentage of undesignated tithes and offerings allotted for Southern Baptist Convention-Related missions. Minimum requirements are filled in the box on the screen above. If you wish to go above and beyond and give more, please increase these amounts. Click on the icon i in the top right hand corner for additional information. The minimum percent for the Cooperative Program is 6 percent for years 1 through 5 and the minimum percent for Great Commission Giving is 4 percent for years 1 through 5. The percentages can be higher; however, they cannot be lower. Great Commission Giving is money given to Southern Baptist-related missions causes, such as the Annie Armstrong Easter Offering for North American missions, the Lottie Moon Christmas Offering for international missions, state missions offerings, associationnal offerings, networks, etc. Church Planting Growth Projector 9

10 QUESTION #8 Question #8: How much does the church plan to spend on OTHER mission causes, if any? Click on the icon i in the top right hand corner for additional information. Enter the annual amount that will be spent for non-sbc missions for years 1-5. Here you will be addressiong the church s Ministry Plan for missions. These expenses could include the following: - Associational giving - Local partnerships and project expenses - Global partnerships and project expenses - Leader travel expenses - Benevolence Church Planting Growth Projector 10

11 QUESTION #9 Question #9: In years 1-5, what are the total ministry-related expenses including evangelism, outreach, discipleship, worship, Bible study, etc.? Click on the icon i in the top right hand corner for additional information. Enter the total ministry related expenses for years 1-5. Ministry-related expenses include evangelism, outreach, discipleship, Bible study, worship, children s and youth ministries, etc. We will break down the ministry expenses into the following categories: - Worship Ministry - Preschool & Children s Ministry - Youth Ministry - Education and Discipleship Ministry - Outreach Ministry - Local & Global Missions Ministry (which we have already covered in previous screens) Church Planting Growth Projector 11

12 QUESTION #9 Worship Ministry: Worship expenses include the cost associated with the worship experience. These cost would include the following: - Items needed for media and set design not already funded by the prelaunch budget funds - Cost of paying worship players (1099 contract pay) - Stand in Preacher honorariums, if applicable - Purchased worship music to include CCLI fees, purchased videos and worship planning hardware and software - Musical instruments not already funded by the pre-launch budget funds - Baptism supplies - Lord s Supper supplies - Any pageant supplies if applicable Preschool & Children s Ministry: While the pre-launch budget should have funded the equipment necessary for the Preschool and Children s Ministry, we will assemble the budget to capture the cost to operate these ministries. The following are costs we should consider when assembling the Preschool and Children s Ministry: - Consumable supplies such as wipes, paper towels and disinfectant - Arts and crafts supplies - Event expenses such as VBS, Fall Festivals, Children s musical performances, etc. - Curriculum - Printing and office supply costs Youth Ministry: This would include any expenses to operate the Youth Ministry with the exception of any equipment that the pre-launch budget funded. The following are items we should consider when assembling a Youth Ministry Budget: - Curriculum - Event expenses such as Summer Camp, Winter Extreme, etc... - Guest speaker honorariums if applicable - Food and fellowship expenses Church Planting Growth Projector 12

13 QUESTION #9 Education & Discipleship Ministry: Any expenses for ongoing Sunday school or small groups ministry of the church. The following are items we should consider when assembling an Education & Discipleship Ministry Budget: - Curriculum - Food and fellowship expenses - Paid childcare, if applicable - Leader training, development and encouragement - New member orientation materials Outreach Ministry Any expenses associated with the outreach efforts of the church. For example: - Community service events - Printed materials - Food costs associated with feeding the poor - Apparel Church Planting Growth Projector 13