Annual Parish Finance Report
On the day of Pentecost, the Apostles gathered in the upper room. “And suddenly there came from the sky a noise like a strong driving wind and filled the entire house in which they were. And they were filled with the Holy Spirit… and the Spirit enabled them to proclaim.”
The day of our Baptism is considered our experience of Pentecost. Like the Apostles, we too have been filled with the Holy Spirit to proclaim the good news. But not only that, in Baptism, we have become members of God’s Family, the Church, charged to go and make disciples of all nations baptizing and teaching everyone all that the Lord taught us. As a Church, that has been our task, to make the Kingdom of God present in the here and now.
The past eight months have been quite a challenging time. Masses and other liturgies have been suspended due to COVID-19. Things have changed. Our worship moved from in person to live stream. Our parish office closed, and we depended on modern technology to continue our ministry to the Community. Thanks be to God we had already done the hard work to have technology in place before the pandemic hit.
In April, it was very clear that the pandemic would linger longer than expected. All Parishes have been instructed to reduce their expenses a minimum of 25%. Because of that, Fr. Brendan and the staff had to make some difficult decisions. Staff members have been laid off and a few had their hours reduced. We also had to cut back on supplies and other events. I am grateful to Fr. Brendan, Penny Warne and the Finance Council for their work to ensure our Parish remains financially healthy.
Each year, we are asked to provide a financial report to the parish which is part of this letter. The numbers speak for themselves as they paint the picture of the last Fiscal Year 2019- 2020.
Due to your continued generosity to the parish, we exited the 2019-20 fiscal year with $3,145,309 in total income which was about 1% over budget. We were very fortunate that Sunday Collections, gifts and donations were higher than budget by over $65,000. We received a $100,000 unrestricted donation in January 2020 and several large donations in June 2020. The Golf Tournament netted $14,600 after splitting the net proceeds with the school. Thanks to the generosity of you, our Parish members, we also received a rebate of $43,897 from the Annual Diocesan Appeal.
With regard to total operating expense, we exited the fiscal year with a small surplus before consideration of the unbudgeted non-operating expense noted below. The overspend in expenses is many small amounts across all categories of expense. The $162,074 in non-operating expenses consists of a deficit for Village House Operations and an unfunded pension liability. The unfunded pension liability is prepared by an independent actuary firm hired by the Diocese of San Jose. The value must be recognized on the balance sheet and income statement in compliance with generally accepted accounting principles (GAAP). This amount has been updated to the 6/30/20 balance given by the Diocese of San Jose.
Without these non-operating expenses, Holy Spirit exited FY 2019-20 with a net operating income of $34,978. Many thanks to the Parish Staff for their continued dedication in these difficult times. And many thanks to you, the parishioners of Holy Spirit, for your continued support and generosity.
As we move into this new fiscal year, we continue to control our expenses but they rise each year by a small inflationary percent. In addition, until COVID passes, we will continue to operate in a very difficult environment.
The Diocese of San Jose has recommended a reduction in the budgeted amount of weekly Sunday collections to 85% of pre-Covid amounts due to the in-person Mass restrictions. We are fortunate we have not seen a decrease in Sunday offerings since the majority of our Collection offering is through online methods, bank drafts and many parishioners still mailing weekly envelopes. We felt a 5% reduction was prudent for this year’s budget and allowed us to produce a balanced budget. We have made changes in other sources of income from Parish Programs, Gifts, Donations, Fundraising and some other areas of income that have brought us close to the Diocesan expectation of an overall 15% decrease in income while maintaining a balanced budget.
Now moving to Operating expenses, we are projecting a balanced budget for 2020-21. In April of last year, Holy Spirit Parish reduced staffing by 25% which was required by the diocese. We have carried this staff reduction into this new fiscal year. Additionally, we decided not to hire a direct replacement for Penny Warne’s position right away. We have also budgeted the priest’s salaries at pre-COVID rates so that we can safely restore their reduced salaries when requested by the diocese. Working with the staff and facilities, we have reduced these expenses to account for a closed office and a work from home accommodation. We have scaled back services required during the shelter in place orders. We have reduced operating expenses by 12% from last year. Facility expenses are up a small amount due to the requirements to operate under COVID requirements.
Again, I would like to take this opportunity to thank you all. To those who faithfully mail in your donations each week, thank you! I applaud all those who responded to our online giving appeals as Online giving accounts for over 60% of our weekly income. In the coming weeks, we will begin communication on a 2020-21 Stewardship appeal.
And finally, I want to thank those who have specifically contacted me asking what you can do to financially assist the parish during these challenging times. Your concerns are greatly appreciated and any gifts over regular, consistent financial stewardship are welcomed.
As always, please be assured of my continued prayers for you and your loved ones, and as we enter the last portion of 2020 let us do so with faith and confidence that through God’s grace, we shall come through it all.