More Episcopal Church budget laments

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Lots of reactions, none particularly good, from Episcopalians concerning the statement on the proposed budget.


Most of these entries come from comments on the Cafe articles “Weakened addition: proposed budget does not add up” and “Executive Council meeting in Salt Lake City“.

Susan Snook begins:

The fact that something as important as the draft triennial budget could be so filled with errors speaks volumes about how dysfunctional our budget processes are. Reform is desperately needed – the way we spend our money is too important to be subject to errors like this. I suppose the good side of it is that the outrageous problems with this budget (increasing administrative costs in a time of budget-cutting, at the expense of mission) got enough people riled up that I believe that real change may finally be on the horizon.

Ann Fontaine wrote:

This is my understanding — the Executive Council did not get a budget with line items in it until the night before Council was supposed to vote on the budget. Up to that point all conversation was about priorities, abstractions, and rough assignments of numbers in broad categories.

Then after they did vote on a line item budget, the Church Center posted to the extranet a budget that took about about 40 percent of the 800 line items and replaced them with language saying that this line would be allocated in consultation with the executive team. (does anyone know who is on that team?)

Snook again responds, this time to the statement that, for now, the budget can’t be correct due to “Canons of the Church”:

I’m thinking they can’t issue a “corrected” budget for two reasons: no one really knows what the correct budget is (witness the confusion over how much the Formation budget was really supposed to be: $1 million? $1.9 million? some other number?). And, the “corrected” budget would not be balanced. Restoring the known errors would take it out of balance by millions of dollars. It is a judgment call to figure out what to cut to compensate for the restorations, and EC can’t make the judgment call at this late date. So they are kicking the can down the road to PB&F, which gets to do the dirty work.

Needless to say, this is all evidence of an extremely dysfunctional budget process. Very, very disheartening.

Tom Ferguson (aka: Crusty Old Dean) wrote an extended blog entry on the “Official Budget Statement”:

3) And the jewel in the crown: “Finally, the amount of $286,438 for Formation and Vocation is an error…the actual number was lost in the complex process of combining the 15% and 19% cases the Executive Council used to build the draft proposed budget. The budget was adopted and Executive Council adjourned before the error was discovered. Questions have been asked regarding what the ‘real’ number might have been. Council members…suggested something in the range of $1.9 million. Other knowledgeable persons suggested $1 million. PB&F will need to address this matter at General Convention. Restoring funds to Formation and Vocation will require taking funds from other places.”

This is utterly incomprehensible on at least three levels.

Level 1: Are they really, honestly, truly telling us they presented a budget with a variance of up to $1.7 million, seen by perhaps over fifty people (staff and elected representatives of this church like the Executive Council), many of whom openly questioned the size of this cut, and nobody seemed to know this was an error.

In fact, this cut was defended by those who cited a survey conducted which showed that Vocation and Formation was something identified which should be done at the diocesan or local level (Crusty Old Dean has disputed this whole concept in other posts).

I am just at a loss as to how this could have happened without some kind of massive system failure. Which leads to level two..

.

Level 2: This shows a problem with the budget system we have. Funds now have to be found because of this error from elsewhere in the budget? Because the Executive Council and the staff that put this budget together screwed up so royally, the onus is still on fixing the $286,000 figure that they mistakenly approved? Are we that beholden to a budgeting process that Vocation and Formation becomes the fatted calf of this story, the one that gets slaughtered as a result of decisions made by other people? Could we not take the $1.2 million surplus you “found” in Development and apply it here!

Level 3: Lack of accountability oozes through this entire process, as evidenced in some of the language here. Wasn’t clear if the spreadsheet “would correct” the error in addition. The real Vocations and Formation number “was lost.” The budget “was adopted.” These things didn’t just happen. The number didn’t lose itself. The column didn’t add itself wrong. The Council adopted a flawed and inaccurate budget. And somehow COD doubts that anyone will be held accountable for this at all. We will all be told mistakes were made, we could play the blame game and live in the past, or we could move forward. True, in a sense, but also words which can be used to paper over incompetence and dysfunction.

I have been saying ever since I watched the 2009 budget fiasco that the process for putting the DFMS budget together is broken. It is marked by lack of transparency, and lack of clarity in how it reflects our mission and budget priorities. It is undemocratic, since the final budget is presented to the floor of Convention with the only option to accept it or else.

It’s fair to say there is lots of confusion and frustration, whether one is part of Executive Council (see some of their responses) or not.

The Cafe’s Jim Naughton gets the final observation (before I leave this to new comments):

The budget process last triennium was worse than the budget process this time around. It might be worth figuring out why this happens. I don’t think it can be attributed to free floating structural issues. At some point, some specific people take or don’t take some specific actions. Possibly for the best of intentions. Possibly for reasons of which we are unaware. I think it would be useful for the church to have more information in this regard.

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Mary Ann Hill
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Mary Ann Hill

Jim, you mentioned that people think there is great tension between the HOB and the HOD. Things like the cryptic comments made by the PB yesterday at the Exec. Council meeting about "forgiveness, a search for understanding and letting go" and the the amazingly bizaare email sent out by the Pres. of the HOD on January 29 to the HOD are exactly the kinds of things that lead people to jump to such conclusions. I imagine the obvious and public tension between our esteemed leaders is what leads people equate it with tension between the Houses.

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Michael Russell
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Michael Russell

Here is a canonical amendment to create a time period for the EC to analyze the budget before being required to transmit it.

Title: Amend Title 1.4.5(e); Creating a responsible budgeting timeline

Resolved, the House of Bishops concurring, That Canon I.4.6 (e) is hereby amended as follows:

After the preparation of the budget t The Executive Council shall, prepare a draft of the budget at least six months before the sessions of the General Convention and shall, at least four months before the sessions of the General Convention, transmit to the Bishop of each Diocese and to the President of each Province a statement of the existing and the proposed askings necessary to support the Budget for the Episcopal Church. The Executive Council shall also submit to the General Convention, with the budget, a plan for the askings of the respective Dioceses of the

sum needed to execute the budget.

Explanation:

Budgets need time for analysis and revision. By creating a two month buffer between the preparation of the budget and its transmission to the wider church the Executive Council can gather wide input in the draft budget and ensure that it reflects their best judgment before it is transmitted.

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Liz Zivanov+
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Liz Zivanov+

All of this conversation is crucial toward "fixing" a very broken and dysfunctional system. But two major issues are immediate and tantamount: 1) EC is responsible for and accountable to GC for the budget (I.6.1-6), 2) the correction of the budget needs to be addressed immediately and an "unofficial" corrected working copy needs to be sent to the HOB and HOB.

I hope EC is adjusting its agenda to reflect this urgency. It is their responsibility - anyone else's involvement is delegated by EC, who is still accountable.

The use of the word "can't" is inexcusable in this situation. The constant question must be "How can we make this happen as stewards of TEC?" It is totally possible to do this in a matter of days if it's important enough, and if a smart and creative manager from EC coordinates this effort.

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Ann Fontaine
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Ann Fontaine

I know of 2 people who are no longer with 815 because they dared to question and share what was happening.

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Ann Fontaine
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Ann Fontaine

Of course the staff does not go against the COO - he or she can fire them - Executive Council cannot. Who would you follow when it comes to directives?

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Jim Naughton
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Jim Naughton

Mike, I agree with much of what you say. My sense is that the staff report to the COO. We have had two COOs in a row now who have been antagonistic toward Executive Council. (I am not judging the validity of the reasons for antagonism, just noting that it exists.) I think that puts staff in a difficult situation when it comes to relating with Executive Council. I suspect some on staff were already a little wary of some on council. If you are a staff person with a particular professional expertise, you sort of naturally resist being told what to do by folks who don't have such an expertise. (At least I did when I was a diocesan staff person.)

The question in some ways is how to avoid busybody meddling (which is a sin council can commit against staff) and circle the wagons rejection of expert opinion offered by those not housed at 815 (which is a sin staff can commit against council.)

But, yeah, the budget is a mess, and I couldn't agree more with you when you say: In providing a draft budget to EC at the last moment the staff made it almost impossible to check their calculations or fully absorb what was on the paper. This practice must stop.

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Michael Russell
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Michael Russell

Dear Jim,

I of course do not want to put the sins of the wicked on the shoulders of the innocent and drive them out into the wilderness to die.\

I am not averse, however to asking who dropped the ball on this an then holding them accountable.

Another deeper issue is Institutional Culture, the phenomenon surrounding every complex organization. That culture is largely shaped by long term staff who tolerate the comings and goings of elected people and volunteers. In the wake of ++Rowan's resignation there was at least one article on how he could not penetrate the Lambeth Palace staff culture. I'd submit this is true for 815, just as it is for every Bishop or Rector who takes office. There is wisdom in going cautiously with changing this, but then times come when the only option is to destroy or disperse the existing culture and replace it.

We are now at one of those places. In providing a draft budget to EC at the last moment the staff made it almost impossible to check their calculations or fully absorb what was on the paper. This practice must stop. I am not sure that the staff who then failed to translate the EC's wishes into the distributed draft are clear about how they have sacrificed trust and credibility in this episode. But they have.

Thus part of the restructuring effort, it seems to me, is to break the existing institutional structure and build one afresh. We may not need to change out operational level staff, but it seems to me that supervisory and policy level staff need to be changed with every seating of a new PB at the very least, perhaps more frequently.

Whatever the case, as a Deputy I am not happy with this budgeting procedure for the second GC in a row.

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Dave Paisley
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Dave Paisley

Is it just coincidence that ll of this happens around the 100th anniversary of the Titanic disaster?

As overused as the metaphor has become, all this deck chair rearranging seems to be just one more sign of the decline into irrelevance of one more hierarchical institution.

For so long dioceses have ignored the membership and financial crisis at the parish level, now those chickens are coming home to roost at the national level.

All this thrashing around is just the death throes of an unwieldy, unresponsive, irrelevant superstructure.

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Kurt Wiesner
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Kurt Wiesner

Michael & Jim: Just wanted to say that I really appreciate this back and forth conversation between you two. It is very helpful to me (and my guess to others) in discerning what is going on.

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Jim Naughton
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Jim Naughton

Mike, I think you have put your finger on the important issue. I just want to make sure that staff who are faithful servants of the wider church don't become collateral damage in what I think is basically a conflict between the PB and her key advisors, and the clergy and lay leaders of the council.

I think as a church we have what is basically an admirable tendency not to create scapegoats and assign blame. We also have a desire to understand our organization as a family system, a la, Ed Friedman. In some instances, I think these tendencies keep us from holding people accountable for their performance. We got abstract "dysfunction" , "systemic this, systemic that," when we should get specific. I think it is important to understand, in detail, how this fiasco unfolded. Because it isn't the first time. And if we don't get to the bottom of it, it won't be the last.

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Michael Russell
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Michael Russell

Jim, I agree with your statement and it mirrors my concern. Who works for whom? If elements of the staff do not understand and respect our polity, we should wish them well in their next position.

Although Bp Sauls as the COO has been silent about the budget debacle on his watch, given his pre-emptive position taking on restructuring, perhaps he feels some right to make the budget too? Surely the lack of staff cuts is indicative of some self serving action among the staff.

Whatever power struggle is going on between leadership and/ or between leadership and staff needs to get itself settled. But one thing out to be clear...the staff is hired to implement what the elected and appointed leadership order.

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Bill Carroll
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Bill Carroll

Jesus wept. We ought to be reducing staffs and funding ministry networks and/or devolving ministry to dioceses. These networks should be given objectives and funds with some flexibility but accountability for meeting the objectives. The budget should be simpler and the process fully transparent and Churchwide. EC needs to be reconfigured and slimmed down.

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Jim Naughton
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Jim Naughton

I take your point about that, Mike. I think that people are under the impression that there is great tension in the church between the House of Bishops and the House of Deputies. I don't think that is the case. I think as the events surrounding the budget indicate, the great tension is between Executive Council and top level staff people at the Church Center--the executive team, I guess you could say. I think this is a principled dispute over who has authority over what. But, as in many such disputes, it has become messy.

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Michael Russell
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Michael Russell

Thanks for the correction, Jim. Perhaps the chairs of PB&F should be drawn from the EC to eliminate one level of possible transmission error. None the less, Ms Pollard and Bp Lane's sense of what EC passed and EC's view seem at odds. It seems incumbent on them as chairs to know what EC directs and instruct the staff to produce it. Their letter excuses the staff from producing an accurate document for our consideration.

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E B
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E B

I was just re-reading the news from DioVa about the settlement with Truro, and one thing that struck me was the lack of meaningful communication at all levels in the church. This seems particularly the case around the budget.

In many cases, there may be good reasons why details can't be provided. But when that is the case, it's important to share as much as possible, to tell folks if additional information will be forthcoming, when they information will come out, and how that information will be distributed.

For an example of finance-related communication that does not impart information, consider the following bland statement apropos Truro: "The parties had already agreed on division of the tangible personal property held by Truro Anglican." Does that mean that these items went to Truro? The diocese? Were these items sold at auction? How can we learn more? This after millions spent on litigation.

To be clear, I have no doubt that the Diocese made a well-reasoned, fair decision. And in a hierarchical organization such as TEC, folks can hold their cards close to the vest if they wish to do so. But this lack of transparency leads to unease and makes it difficult to support decision-making within the church, since we cannot even tell what decision was made.

Here's hoping for greater transparency within TEC, especially around budget and our forward-looking strategy.

Eric Bonetti

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Jim Naughton
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Jim Naughton

Mike, you have some good points here. But Diane Pollard is a volunteer and a deputy.

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Michael Russell
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Michael Russell

Were I Ms Pollard I would not want the GC folks discussing her office's incompetence, subterfuge or sabotage of the budget for the next two and a half months. Despite her assertion that, apart from math errors, this is the budget EC authorized, it appears EC disagrees. At the moment we have no discussable budget and so EC is holding the bag for this canonical breach which is actually a staff failure.

When I ran printing presses there was a sign over the presses that said, "If you don't have time to do it right the first time, how do you have time to do it over?". In a matter of this gravity, Ms Pollard and her staff should refrain frm making excuses, and produce the document the EC authorized, or at least a corrected document we can discuss. To hide behind the canon is bunk. The present document is of zero value, and so official or not, as a Deputy I need to see a document that bears some semblance of reality.

This whole debacle reinforces for me the need to do radical surgery on the institutional culture of 815's policy level staff. The budget we pass can do this by dramatically cutting staff and rebuilding a leaner fresher one. Conveniently for the existing staff the bunkum budget doc doesn't do any staff cutting, while presenting a total mess on program. I favor pushing program to more local levels, because centrally produced programs are only rarely locally inspiring. But to do that in the bunkum budget and not cut staff is so transparently self serving that it would be humorous if not so banal.

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