When your Budget wont

1. BUDGE Making the Hard Financial Decisions When your Budget wont

2. Balanced Budget How to find ways to prepare and maintain a realistic & BALANCED school budget despite: • Decreased enrollment, • Increased operating expenses, • Financial hardship and • A lack of commitment to Christian Education.

3. Introduction • What is the Current Enrollment? • What is the Projected Enrollment? • Will you end the year in the red or the black? • Can you afford to keep everybody on staff? • Will you upgrade any books this year? • Will you increase the tuition and/or the church subsidies? • How much of the back tuition can you collect before the end of the year?

4. Decreased Enrollment If you don’t know why your enrollment is down - No amount of money will save you. WHY?!?!?! Why?!?!

5. Decreased Enrollment • Reputation/Perception – • Ask what is and fix what you can fix • Faculty and Staff – • Qualifications, Gossiping, Attitudes • Outdated Curriculum – • Plan of action to update • Old Buildings and Equipment – • Plan of action to repair and replace • Old Rumors – • Don’t encourage them • No Extra Curricular Activities – • Get some. If have some already Play up what you do have.

6. Decreased Enrollment Since the origin of their denomination in the mid-1800s, Adventists have promoted Christian education as a means to acquire knowledge from a Christian point of view. Training young people for the mission of preaching the good news of salvation to others was and is one of the main engines for the development of a fast-growing international K-20 system of education. While Adventist church membership has been increasing in North America, where the church originated before expanding overseas, enrollment in Adventist K-12 schools has been consistently declining since the 1980s. Factors influencing enrollment in Adventist K-12 schools: A review of the literature By Gus Gregorutti, doctoral student at Andrews University, 2007

7. Increasing operating expenses • An over extended “Indian Summer” • A extremely cold winter • Old building or buildings • Outdated equipment • Curriculum Updates • Food cost • Teacher/Staff raises • U.S. Post Services increase rates • Office Supplies

8. Financial Hardship • Job loss • Parents are losing their jobs. • Appropriations are getting smaller • Unions and/or Local Conferences are reducing education appropriations • “Deep pockets” are drying up • People who use to donate before don’t anymore • Church subsidies are getting smaller • Don’t have children who attend school. So they don’t see the need to give or want to reduce

9. New Sources of Income • Grants • Remember “free money” is never free. Read the fine print and make sure your governing body is in agreement. (Grants, donations) • Different “deep pockets” • There are members in your church who will never give a dime, unless you personally ask them. • Recruit from churches with children • Invite the children who don’t attend to something that showcases the school. • Visit churches who don’t have children in the school • Take the children’s program to the churches who have no direct connection to the school.

10. A Lack of Commitment to SDA Christian Education • The parents of today didn’t enjoy their SDA Education experience, so they don’t send their children . • The quality of education is sub par or is “the same” as the public schools, so why pay? • I don’t like Teacher Y or Principal X, so I don’t want my children to be taught by them. • I went to public school and I turned out fine. • I’d rather invest my money elsewhere.

11. A Lack of Commitment … Shane Anderson “How to Kill Adventist Education” writes it this way… Think of it this way: Do we really believe that there are large numbers of passionate, highly committed Seventh-day Adventists-who also just happen to think that a school that would teach their children that that very same Adventism is not worth considering? Of course not. Surely what we’re seeing here is a lack of commitment not just to our schools or other institutions, but to Adventism itself. Here is the core of our current crisis.

12. According to Harold Lee, former president of the Columbia Union Conference, a comparative study between Adventists and 28 other Protestant denominations reveals that “members are giving [money] far less today than in the past. In 1968 giving was at 10.8 percent of after-tax income. By 1996 it had declined to 4.5 percent. This decline represents a 58 percent decrease in the portion of income being given by church members. . . . Church members are voting with their feet and with their dollars.”1 Shane Anderson “How to Kill Adventist Education”

13. Budgets – Why do we need them? • Determine how to get out and stay out of debt • Build an Emergency Cash Fund • Set & prioritize financial goals • Be a smarter consumer • Learn to live within your means • Live on less money, so you can work less • Pay your bills on time • Meet your school’s changing financial needs • Reduce stress • Distinguish between wants and needs • Stop making ends meet by borrowing • Sleep at night

14. Budgeting 101 Budgeting lies at the foundation of every financial plan. It doesn’t matter if you’re living paycheck to paycheck or earning six-figures a year, you need to know where your money is going if you want to have a handle on your finances. Unlike what you might believe, budgeting isn’t all about restricting what you spend money on and cutting out all the fun in your life. It’s really about understanding how much money you have, where it goes, and then planning how to best allocate those funds. Jerry Vohwinkle – Money Financial Planning http://financialplan.about.com/od/budgetingyourmoney/tp/budgeting-101.htm

15. How to Create a Budget • Identify your Needs • Students, Staff, materials, facilities … • Identify your Wants • More students, Extra curricular activities, larger buildings, the latest technology • Identify your Income • Tuition, subsidies, grants, donations • Identify your Expenses • Salaries, utilities, maintenance, curriculum materials • Study Previous years for possible trends • Does an election year make people nervous

16. Who are the StakeholdersWho should have input? • Business Manager/Treasurer • Principal • Finance Committee • School Board • Constituent Church Pastors • Parents/Guardians • Local Conference

17. Top 5 Budget Busters • Staffing/Salaries • Pay increases, benefits • Building Upkeep and Maintenance • Repairs, replacements • Curriculum and Program Updates • New textbooks, software, science, testing • Administrative Cost • Office supplies, meetings, classroom materials • Utilities and Day to Day Operating • Gas, electric, food service, landscaping

18. Presenting the Preliminary Budget • Remember it’s not personal • Be prepared to go back and make major changes at least 3 times. • Ask for suggestions • Take notes • Share the hard-making decision with larger body, but make sure they have all the facts.

19. Budgets are NOTwritten in… It can be.. • Adjusted • Modified • Tweaked • Reworked • Sliced • Slashed

20. BIG Money vs. Little money

21. Big Money or Little Money • Whether you have a money tree in the back yard • An envelope hidden under the mattress. • An alumnus who just loves their Alma Mater • A faithful church member whose belief in Christian Education far exceeds their monthly $10.00 donation Christian Education

22. It all comes down to careful money management EXPENSES INCOME

23. Review • Look at the factors that affect or impact your budget • enrollment, economics, operating expenses, attitude towards your product • Understand the basics of budgeting and why you need to budget. • Needs, Wants, Income, Expenses and History Budgeting 101

24. Get input from the Stakeholders • Proverbs 11:14 - Where no counsel is, the people fall: but in the multitude of counselors there is safety. • Proverbs 15:27 - Without counsel purposes are disappointed: but in the multitude of counselors they are established. • The first budget usually gets sent back • Budgets will need to be adjusted several times before it makes sense and finally gets voted. • Good money management skills are NECESSARY • Regardless of the amount of money on the tree or under the mattress

25. In Conclusion… • Budgeting is no easy task. • It takes skill, knowledge, patience and MUCH PRAYER!!!! • Check your personal financial commitment to God. • You can’t and shouldn’t do it alone. • Establish a network with others in the same position, but with greater success. • BEFORE YOU START, Ask for the guidance and wisdom of the Holy Spirit.

26. HAPPY BUDGETING!!