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LCC releases financial analysis of restructured synod

June 22, 2017 No Comment

Restructuring-Process-sqCANADA – Lutheran Church–Canada (LCC) has released a financial analysis explaining the proposed budget for the church in the event it adopts the restructuring plan proposed by LCC’s Commission for Constitutional Matters and Structure (CCMS).

The analysis, prepared by LCC’s Treasurer Dwayne Cleave, predicts a budget of $3.5M in a restructured synod—a significant reduction compared to historic levels. “It must be clearly understood that this is a much more modest program than our Synod constituency has been accustomed to in the past,” notes Cleave, “but it is an honest reflection of the current financial realities.”

The smaller budget is reflective of current giving trends in LCC, as mission remittances from congregations to Districts and LCC are in a multi-year decline. “In the past, the Districts managed this deficit by either drawing down on their reserve funds or by relying heavily on unpredictable investment returns,” Cleave notes. But, he continues, as such funds are neither inexhaustible nor always predictable respectively, “it is critical that the proposed administration have a spending budget that reflects the funding being provided by the congregations.”

The diminished congregational giving means a necessary reduction in spending in various areas of synod’s work including international missions, domestic missions and congregations in transition, theological education, and financial services. These reductions are mitigated, however, through cost savings to be found in a restructured synod. In particular, Cleave highlights a savings in administration costs of approximately $400,000 annually compared to historic levels.

There would also be projected savings of more than $480,000 in a twelve-year period by moving to a four-year convention cycle, as the CCMS’ proposed structure calls for. Savings in these and other areas will help to minimize expected new costs, such as those associated with the regional pastor position.

Altogether, the $3.5M budget is significantly smaller than that historically spent by the Districts and LCC collectively—a change Cleave explains is necessary. “Going forward LCC will need to be very strategic in its deployment of capital because it is clear that our congregations cannot support everything we are trying to do now” he writes. “The funding LCC ultimately receives must be deployed where it is expected to achieve the most good for the Kingdom of God.”

Download the financial analysis here in PDF: Commentary to LCC Budget (After Restructuring) -Finalized

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