FINANCIAL SUPPLEMENT TO THE

2016 ANNUAL REPORT

© 2017 Westminster Presbyterian Church 1502 West 13th Street Wilmington, DE 19806 (302) 654-5214 www.wpc.org

Download the 2016 Annual Report and Financial Supplement at www.wpc.org/communications.

TREASURER’S REPORT

As reported in last year’s 2015 Annual Report, Westminster Presbyterian Church has much for which to be grateful including a solid endowment and a budget that supports outstanding pastoral leadership, a capable staff, and remarkable ministries of mission and outreach. This is all made possible by an active, committed and generous congregation that supports the church with time, talent and treasure.

In 2016, Westminster continued its vital programs, ministries and outreach primarily as a result of ongoing strong financial support from the congregation and the income provided from its endowment. As the Joint Finance Committee and the Session approached creating a budget for 2017 that allocated finite resources in as responsible

and inspired a way as possible, we were blessed with the perspectives and recommendations provided by the report of the Long Range Financial Planning Task Force. This report guided and informed the 2017 budgetary process. Among the key recommendations of the Task Force were the following:

That Westminster review and address its financial management practices related to: o budgeting for the significant capital expenses of our church building; o maintaining staff compensation at equitable and competitive levels; o determining the real costs and efficacy of our wide range of programs.

That Westminster initiate and implement programs for Legacy Giving and capital fund raising;

That the benevolences supported by the budget be determined by a pre-set percentage of pledged and other contributed income; and,

That Westminster continue its efforts to expand its community.

The Joint Finance Committee also adopted a recommendation of the Trustees that in light of low management fees (by market standards), and the resulting increased financial return, it would be wise and prudent to increase the draw from Westminster’s endowment (by one percentage point – from 5 to 6). This decision, which was approached carefully and cautiously (and endorsed by Session) has alleviated some, but certainly not all, of the financial challenges currently facing Westminster.

Statement of Purpose The Joint Finance Committee is a committee of the Session responsible to manage the annual fiscal affairs of the church and to develop an understanding of the financial state of the church within the Session, the Trustees and the congregation.

Committee Members

Dick Jolly, Convener & Treasurer Charles Babcock Jen Barrington

Fred Iobst Mary Lu Pamm Helen Zumsteg

Staff Liaison

Colleen Falasco

JOINT FINANCE COMMITTEE2

2

continued…

Teamwork and determination

The guidance provided by the Long Range Financial Planning Task Force and the Trustees was coupled with a determination by the Joint Finance Committee and the Session to face the reality that previous budgets have included unsustainable elements including:

not adequately funding the Property Fund;

utilizing small surpluses from prior years; and,

allowing for special withdrawals from the endowment (to underwrite the cost(s) of the Session-approved security initiative).

All of this has resulted, as outlined in the January/February issue of the church newsletter, The Westminster Chimes, in perhaps the most important aspect regarding the 2017 budget: that it projects a relatively small deficit (approximately 2.7% or $45,000 from total budgeted expenses of $1,693,545). This is mostly because, as was pointed out to the congregation at the last two annual meetings, the need to fund long-term capital requirements of our building, along with other essential programs, ministries and obligations, exceeds current projected annual income. This is not a new or unexpected challenge.

It is critical to note that the Joint Finance Committee believes this situation to be temporary. First, in accord with the recommendations of the Long Range Financial Planning Task Force, and with the approval of Session, a feasibility study has been conducted to determine how Westminster can best fund the forecasted long-term needs of our property. Second, the budget could be balanced by simply reducing the amount allocated for capital projects. As reported in January 2016, this largely is how the budget has been balanced for the last several years. However, Joint Finance and Session have realized this is not sustainable and that fiscal responsibility requires approval of a budget which reflects both the opportunities, and the challenges, currently faced by our church.

We are fortunate to have a congregation actively engaged in evaluating and overseeing its finances so that the programs, ministries and outreach that are so much a part of our calling are successfully met and expanded. The 2017 budget demonstrates and balances the realities of our current financial challenges during a period in which plans are actively underway to address Westminster’s long-term financial needs. The Session and the Joint Finance Committee are confident that once all of the recommendations of the Long Range Financial Planning Task Force are fully implemented, and the effects of the endowment draw adjustment are completely in place, Westminster will be on a secure and sustainable financial foundation for the foreseeable future.

3

A good omen: rainbow arched over Westminster

The Joint Finance Committee wishes to thank Debbie Brown for her outstanding service and leadership during her time as Church Administrator. We were sorry to see her leave her position in September but we extend our best wishes for success in her new position in Baltimore. We also extend a welcome to our new Director of Financial Operations, Colleen Falasco. Colleen is off to a great start, working hard and learning quickly. Westminster is fortunate to benefit from her many skills and talents.

4 2017 BUDGET DETAIL Description 2017 Budget Detail Description 2017 Budget Detail

  

Net Current Year Pledges 1,021,989$             HVAC Maintenance / Repair 21,000$                   

Current Year Over Pledge 50,000$                  Building Maintenance / Repair 34,000$                   

Endowed Pledges 19,000$                  Total Maintenance Expenses 55,000$                   

Prior Year Pledge Payments 32,617$                 

Total Pledged Contributions 1,123,606$             Flowers, Easter, Xmas Decorations 7,000$                     

Music ‐ Youth and Handbell 800$                        

Contributions Unpledged 100,000$                Worship Supplies 2,500$                     

Loose Plate 12,000$                  Music ‐‐ Adult Choral and Inst 8,350$                     

Special Gifts ‐‐ Memorials, etc. 20,000$                  Worship Living Mosaic 4,939$                     

Total Other Contributions 132,000$                Professional Soloist 22,140$                   

Guest Preachers 500$                        

Miscellanous Income 2,000$                    Stephen's Ministry 1,200$                     

Facilities Use Income 25,000$                  Membership & Evangelism 3,500$                     

Weddings 500$                       Stewardship 3,700$                     

Prior Year Surplus 30,579$                  Session Activities 2,000$                     

Total Other Income 58,079$                  Hospitality 5,500$                     

Audio‐visual Aids 500$                        

Trnsfrs‐Endowment Fnds ‐ Unrestricted 307,755$                Congregational Life (Deacons) 2,870$                     

Trnsfrs‐Endowment Fnds ‐ Mission 27,530$                  Total Programs 65,499$                   

Total Endowment Fund 335,285$               

Curriculum and  Resources 2,855$                     

Total Income 1,648,970$             Supplies for CE 1,000$                     

CE Leadership 1,500$                     

Salaries ‐ Ordained Staff 154,454$                Vacation Bible School 250$                        

Salaries ‐ Office & Clerical 224,666$                Adult Education 1,500$                     

Salaries ‐ Programs 205,442$                Special Events 500$                        

Housing ‐ Ordained Staff 27,000$                  Youth Music Education 3,000$                     

Total Salary Expense 611,562$                180 Youth Fellowship 11,000$                   

Family Events  750$                        

Pastors' Pension/Death/Disability 21,775$                  Total Christian Ed 22,355$                   

Lay Staff Death/Disability 3,853$                   

Lay Staff Pension Contribution 14,802$                  Chimes & WWW 12,910$                   

Social Security & Medicare 32,502$                  Web Site/ Monitors 4,500$                     

Workers' Comp Insurance 3,000$                    Advertising 350$                        

Staff Healthcare Benefits 30,067$                  Total Communication Expenses 17,760$                   

Pastors' Healthcare Benefits 48,085$                 

Mileage and Travel 4,000$                    Copier Expenses 17,000$                   

Benefit Administration 4,000$                    Paper 2,700$                     

Professional Dev. ‐ Ordained 4,000$                    Office Supplies 2,900$                     

Professional Dev. ‐ Non Ordained 4,000$                    Computer Maintenance 9,700$                     

Telephone & E‐mail 7,800$                     

Total Benefits 170,084$                Banking Fees 855$                        

Postage 7,960$                     

Total Staff Expenses 781,646$                Miscellaneous 3,000$                     

Audit 10,250$                   

Salaries: Facilities 153,787$                Staff Training 1,500$                     

Benefits: Facilities Workers Comp 3,000$                    Total Administrative Expenses 63,665$                   

Benefits: Facilities Social Security 11,765$                 

Benefits: Facilities Medical 29,535$                  Total Benevolences (see page 7) 183,866$                 

Benefits: Facilities Death/Disability 1,646$                   

Benefits: Facilities Retirement 5,990$                    Total Presby Church (USA) Fees 30,131$                   

Electric & Gas 60,000$                 

Water & Sewer 11,500$                  Property Fund 100,000$                 

Safety and Security 14,000$                 

Property Insurance 35,000$                  Total Expenses 1,693,545$              

Pest Control & Garbage 4,500$                   

Outside Cleaning Services 6,000$                    Surplus / (Deficit) (44,575)$                  

Cleaning Supplies 6,000$                   

Grounds Maintenance 27,000$                  Daughtry House 

Parking Space Rental 3,900$                         Total Income 14,400$                   

Total Occupancy Expense 373,623$                     Total  Expenses 14,400$                   

5 FINANCIAL STATEMENT

Westminster Presbyterian Church

Summary of Income and Expenses

2016

PRELIMINARY

INCOME 2016 BUDGET ACUTAL 2017 BUDGET

Current year pledge payments 1,078,239$       1,137,391$       1,071,989$      

Endowed pledges 17,500 16,776 19,000

Prior year pledge payments 44,734 38,538 32,617

Unpledged contributions 132,000 102,829 132,000

Other income 25,500 30,111 27,500

Prior year surplus 28,295 28,295 30,579

Transfer from Endowment Fund ‐ Unrestricted 263,272 263,272 307,755

Transfer from Endowment Fund ‐ Mission 22,587 22,583 27,530

Transfer from Special Purpose Funds 35,000 35,351 0

TOTAL INCOME 1,647,127$       1,675,148$       1,648,970$      

EXPENSES

Salaries and benefits 808,352 735,640 781,646

Occupancy and maintenance 425,456 399,777 428,623

Benevolences 189,542 191,794 183,866

Programs 61,689 60,209 65,499

Christian education 18,750 18,665 22,355

Administrative, communication and other 83,740 83,556 81,425

PC(USA) assessment 31,713 31,713 30,131

Transfer to Ten‐Year Property Plan Fund 27,885 27,885 100,000

TOTAL EXPENSES 1,647,127$       1,549,238$       1,693,545$      

EXCESS OF INCOME OVER (UNDER)

EXPENSES ‐$                         125,910$           (44,575)$           

Daughtry House, net expenses ‐$                         20$                      ‐$                        

6 2016 INVESTMENT PERFORMANCE

PORTFOLIO PERFORMANCE ANALYSIS FOR YEAR 2016

Comments on 2016 Performance The total portfolio, both restricted and unrestricted funds gained 4.59%, net of fees and expenses. The investment of Westminster’s portfolio has benefited from the much lower advisor fees (.05% this year) since changing advisers and investment strategy in 2003 and by consistently maintaining that strategy ever since. Our returns have, per our strategy, mirrored the returns of the global equity and debt markets with considerably smaller amounts being diverted from those returns to pay fund level and advisor level fees. In 2016, Westminster’s Internal Rate of Return (“IRR”) was 10.06% which mirrored closely the IRR of a benchmark portfolio of 70% S&P500 and 30% Bloomberg Barclays Global Aggregate Bond Index.

Starting Assets (1/1/16) $7,541,466

Cash Value of Purchases & Sales $107,004Investments Purchased/Sold ($107,004)Net of Deposits & Withdrawals ($386,332)Dividends & Interest $195,913Management Fees ($4,000)

Ending Assets (12/31/16) $7,887,799

Change in Value of Assets $346,333

7 OUTGOING BENEVOLENCES

Westminster Presbyterian Church Financial Benevolencesbenevolence n. An inclination to perform k ind, charitable acts. A k indly act. A gift given out of generosity

2016 Operating

Funds Budgeted

2016 Operating

Funds Spent

2016 Additional Benevolences

from Designated

Gifts* Total

2017 Operating

Funds Budget

Backpacks Project -$ -$ 4,953$ 4,953$ -$

Burton House 12,000$ 12,000$ 300$ 12,300$ 12,000$

Christmas Boxes Project (WPC) - 552$ 3,367$ 3,918$ 1,500$

Church In The World 18,575$ 18,645$ 21,169$ 39,814$ 17,930$

Covenant Network 500$ 500$ -$ 500$ 500$

Delaware Futures 3,792$ 3,792$ 670$ 4,462$ 4,562$

Earth Care Congregation 850$ 800$ -$ 800$ 850$

Emmanuel Dining Room 4,000$ 4,000$ 595$ 4,595$ 4,000$

Family Promise 5,000$ 5,000$ 889$ 5,889$ 5,000$

Food Bank Of Delaware 1,000$ 1,000$ 251$ 1,251$ 1,000$

Friendship House 16,000$ 16,000$ 5,549$ 21,549$ 16,000$

General Assembly 2,000$ 2,000$ -$ 2,000$ 1,500$

Habitat For Humanity 10,000$ 10,000$ 1,332$ 11,332$ 10,000$

Hanover Food Closet 4,000$ 4,000$ 3,508$ 7,508$ 4,000$

Homeless Security 2,700$ 2,920$ -$ 2,920$ 2,700$

LCS FAITH Center Contribution 32,000$ 32,000$ 150$ 32,150$ 30,000$

LCS Food Pantry 4,000$ 4,000$ 2,888$ 6,888$ 4,000$

Meeting Ground 6,000$ 6,000$ -$ 6,000$ 6,000$

Mission Trips -$ 1,043$ 1,043$ -$

Neighborhood Assistance 2,400$ 2,523$ -$ 2,523$ 2,400$

New Life Furnishings 2,500$ 1,725$ 325$ 2,050$ 1,500$

One Great Hour of Sharing (OGHS) -$ -$ 17,309$ 17,309$

Presbytery 36,000$ 36,000$ -$ 36,000$ 33,000$

Saturday Breakfast Club 10,000$ 11,693$ -$ 11,693$ 9,250$

Urban Promise Scholarship Fund 5,000$ 5,000$ -$ 5,000$ 5,000$

Sojourners Place 3,500$ 3,500$ 2,817$ 6,317$ 3,500$

Urban Mission Committee 475$ 895$ 500$ 1,395$ 424$

Urban Promise 7,250$ 7,250$ 8,894$ 16,144$ 7,250$

TOTAL 2016 BENEVOLENCES 189,542$ 191,794$ 76,509$ 268,302$ 183,866$

* Additional financial benevolences are made possible from donations directed for specific purposes. These funds come fromSession-approved fundraisiing and unsolicited donations.

Each year, Session approves fund raising efforts for specific purposes. Also, throughout the year, the church receives donations where the donor asks Westminster to use the funds to support a specific benevolence or ministry of the church. In some cases, the donations may carry over to future years depending upon the needs in the community, the timeframe of the project, the size of the donation and when the funds were received. In most cases, funds donated for specific purposes at the end of the year will carry over and be used or distributed in the following year. Below is a summary of the funds received during 2016 for specific purposes.

8 2016 INCOMING FUNDRAISING & DESIGNATED GIFTS

© 2017 Westminster Presbyterian Church 1502 West 13th Street Wilmington, DE 19806 (302) 654-5214 www.wpc.org

Download the 2016 Annual Report and Financial Supplement at www.wpc.org/communications.

Backpacks Project 4,920$ Bazaar 7,999$ Burton House / Helen Greene Fund 10,300$ Chad Miller Mission Fund 3,055$ Christmas Boxes 1,305$ Christmas Eve 29,877$ Church in the World 505$ Congo 1,623$ Daughtry House 20$ Delaware Futures 4,674$ Disaster Relief (Syria) 85$ Discretionary 2,250$ Emmanuel Dining Room 545$ Family Promise 920$ Friendship House 750$ Global Gifts 2,916$ Guatemala 4,166$ Habitat for Humanity 445$ Hanover Food Closet 768$ James and Audrey Bennett Memorial Fund 4,315$ Mission Trips 12,690$ Music Fund 34,802$ Neighborhood Assistance 10$ New Life Furnishings 1,450$ One Great Hour of Sharing (OGHS) 17,874$ Plant Sale 501$ Peace Drum Project 725$ Saturday Breakfast Club 6,570$ SERRV 250$ Sojourners' Place 300$ Souper Bowl of Caring 715$ Stephen Ministry 400$ Urban Mission 300$ Urban Promise 686$

Total 158,710$