50/50 GIVING: QUESTIONS AND ANSWERS

1. Why did the Diocese of Newark decide to go to the 50/50 giving approach?

a. To have a system of diocesan giving that was consistent with our beliefs about individual stewardship.

b. To have a closer relationship between parochial and diocesan finances, under 50/50 giving the diocesan budget increases or decreases based upon increases or decreases in overall parochial income.

2. How was the decision made?

The decision was made by the 1989 Diocesan Convention to be implemented the following year. The Convention approved the new system unanimously without debate. Prior to the decision by the Convention, there were numerous opportunities for input from both congregations and individuals.

3. How does the system work?

Every congregation and the diocese has a goal of giving one dollar of income outside itself for every dollar of income spent inside itself - 50/50 giving. Within the goal of giving 50% outside itself every congregation has a goal of giving 25% of its income to the diocese and 25% of its income to other outreach. The diocese in turn has a goal of giving 25% of its income to the National Church and 25% to other outreach.

4. How are congregations and the diocese supposed to work towards the goal?

Every congregation and the diocese was supposed to start where it was in 198 , that is the first step in making the first pledge under the new system was to calculate the percentage of income going to outreach and the percentage going to the diocese. Then every congregation was asked to give an additional 1% of its income each year as it moved towards the 50/50 goal. The diocese was to do the same thing in terms of its giving to the National Church and other outreach.

5. What rules and penalties are there?

Very few. Under 50/50 giving every congregation is to make its pledge to the diocese for the following year by December 1, this is a canonical requirement. The pledge is to consist of a percentage pledge and an estimate of the dollar amount to be given. The percentage pledge is to be a firm commitment, the dollar estimate is just that an estimate that will be higher or lower depending on actual income.

One of the basic expectations of 50/50 giving is that no congregation will reduce its percentage pledge. If a congregation's finances are such that the elected leadership feels that it must reduce its percentage pledge it is expected that this will be done through prior consultation with the diocese. It is also expected that any congregation giving less than 10% of its income to the diocese will give the full percentage increase to the diocese. Once a congregation is giving 10% of its income to the diocese it is the congregation's choice as to how to allocate the increase.

6. How can a church make a pledge by December 1 when the budget isn't set until late December or January?

This is a practical question that is really at the heart of theory of the 50/50 giving approach. Under this system the pledge can be made prior to preparing the parochial budget. The only firm commitment is the percentage pledge, the dollar estimate is just that and can change as the actual results come in. Any vestry or executive committee knows or should know the percentage of income going to outreach or the diocese. Under this system these groups should decide no later than the November meeting the extent to which the percentage of income going to outreach can increase. The treasurer or the finance committee also has to make an estimate of the next year's general purpose income. The percentage pledge multiplied times the income estimate gives the estimated dollar pledge.

For most churches the largest portion of income comes from pledges. The need for pledge data in preparing income estimates is another reason that every member canvasses should be completed earlier rather than later. But the lack of pledge data or any other kind of data should not delay making the income estimate and the diocesan pledge. It is an estimate not a firm figure, at the very least use the current year's budgeted income.

This is really at the heart of the 50/50 system because the whole concept of proportionate giving is based upon the idea of committing a percentage of income outside of ourselves and then using what is left to meet our responsibilities. This sounds scarier than it is, the difference between the current year's giving and a higher level for the next year is relatively insignificant in terms of total dollars. If a church has $100,000 in general purpose income, an additional 1% is $1,000, for $150,000 it is $1,500 and for $200,000 it is $2,000. In the course of any year churches have to make adjustments of that magnitude in their budgets as a matter of course.

7. If the dollar pledge is just an estimate how are churches to make pledge payments?

The diocese sends out bills based upon the dollar estimate, that is each church will be billed 1/12 of the dollar estimate. However, churches can make pledge payments in a number of different ways including the following:

a. At the end of each month take the general purpose income received, apply the percentage pledge to that amount and pay the result to the diocese.

b. Pay the billed amount each month and then adjust with the final payment that can be made in early January.

c. Pay an a monthly amount of the church's choosing that can be adjusted in the final payment.

The diocese prefers that at the end of the year the churches owe the diocese money, not vice versa. If this does occur the over payment can be credited to the next year if the church so notifies the diocese.

At the end of each year diocesan pledge reconciliation forms are sent to every congregation. This form should be submitted once the church closes its books for the year. The data on the form is used in the annual reporting of diocesan giving which is published in the VOICE.

8. What income is subject to the percentage pledge?

General purpose income less any income received from the diocese such as mission investment or ACTS/VIM or Ward J. Herbert grants.

General purpose income is basic undesignated operating income which would normally include pledge and plate, undesignated investment income, rental income net of expenses and other undesignated income. Remember that designated income is income designated by the donor not by the vestry or executive committee.

9. What is Outreach giving?

Outreach giving is the money given by a church outside of itself where the church does not expect any tangible benefit to itself from the gift. This includes giving to the diocese and any other outreach cause that receives parochial income. Funds spent on evangelism would not be considered outreach because the church hopes to generate tangible benefits in the form of new members who will turn commit time, talent and treasure to the church.

10. How has successful has 50/50 giving worked since inception?

The basic conclusion is that 50/50 giving works, 40% of our churches have increased the percentage pledge by 1% or more and only about 15% have reduced the percentage pledge during that time. Unfortunately 44% of our churches have not increased the percentage pledge at all suggesting that there is some idea that the 1989 percentage is cap not a base. Some of these churches may have increased the percentage going to other outreach reach, but analysis of parochial report data suggests that this is not widespread.

11. How has the diocese done in terms of its outreach giving?

The diocese reached its goal of giving 25% of general purpose income to the National Church a number of years ago. Prior to 1996 the diocese had only modest success in increasing the percentage of income going to other outreach. To remedy this and to model appropriate practices for congregations, the Diocesan Council committed that beginning in 1996 an additional 1/2 of 1% of income would go to other outreach each year.

The National Church is currently changing its system of diocesan giving to a new approach which ultimately calls for all dioceses to give 25% of income to the National Church. The witness of our diocese in making our system work has played a role in this change.

12. Why is the goal for congregations 50% when it is only 10% for individuals?

We believe there are differences between individuals and institutions that make different goals appropriate. Very few individuals in our diocese tithe while most of are churches and the diocese are already giving 10% or more of income to outreach. Discussions through out the Episcopal church including past general conventions have focused on the 50/50 goal. As it result it seems appropriate that we try this approach rather than our own more arbitrary approach.