BINKLEY BAPTIST CHURCH 1712 Willow Drive, Chapel Hill, NC 27514

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1 BINKLEY BAPTIST CHURCH 1712 Willow Drive, Chapel Hill, NC Dear Binkley Family, Last year, Dr. McFaul told us it was going to be a year where we clarify our identity and determine who we are and who we believe God wants us to be. But did you expect that this "In Between Times" was going to be so active? The huge Homecoming bash helped us remember- wasn't it fun? A study in how we perceive and react to change- wasn't it interesting? Surveys circulated, completed, analyzed, and redistributed to tune us up for our next big adventure. A new mission statement to guide us on our way. And while all that transition work was happening, a surprise vibrant children s music program bloomed under Daniel s leadership. Thank you to everyone, and in particular the transition team, who made this an exciting time at Binkley. In the spirit of all that excitement, the church council and finance committee asked the committees of the church not for a continuation budget, but a Dream Budget. And to their credit, some committees really did dream big! While we haven t yet funded the entire dream budget, we have increased our pledges in a year when many churches are cutting back. Thank you. Give the budget a close read in preparation for our church in conference approval vote on Feb 7th. There are many delightful surprises of which these are a few: We are continuing to care for our ministers by covering health insurance increases, providing continuing education opportunities and sabbaticals. The church now pays a living wage for all staff. Our building may be the single largest outreach to our community. Look closely at the budget and see evidence of how KidSCope now serves needy families in part due to our building. Come by on a weekday night and experience the variety of groups using the building. That said, our building and its systems are aging and heavy usage takes a toll. This budget provides for responsible maintenance contingencies to allow us to continue this ministry. It also provides for improvements in lighting and thermostats to be more responsible caretakers of our environment. This budget includes one more exciting thing that s very hard to see through the numbers some space for God to walk through [Quincy Jones]. The Program Enhancement line is recognition that we are still transitioning and some new and exciting opportunities are going to present themselves next year. This space helps ensure that a fixed budget isn t a deterrent to expanding a program that we feel is where God is leading us. There will be a process announced soon for allocating these funds but for now, just dream of where we can go with that space and be thankful will be nimble enough to get there. My thanks to all those who support the church, financially or otherwise, and to the finance committee for presenting this joy-filled budget. It s my pleasure to serve among you. Steve Jernigan Moderator 1

2 BINKLEY BAPTIST CHURCH PROGRAM OF MINISTRY 2016 / FINANCE REPORT OUR 58th YEAR Page Report Overview from the Finance Committee 3 General Notes on the 2016 POM Budget 4 General Fund Line Item Budget Detail Outreach 5 Pastoral Ministry 6 Christian Formation 6 Music Ministry 7 Worship 7 Fellowship 7 Membership 7 Mortgages 7 Building Maintenance 7 Grounds Maintenance 7 Administration 8 Other Programs & Expenditures 8 General Fund Income Sources 8 History of Giving 9 Financial Report Other Fund Balance 9 Building Fund / Major Maintenance Fund 10 Memorial Funds 10 Designated Funds 11 Working Funds 11 Seymour Symposium Fund 12 Endowment Fund 12 2

3 FINANCE REPORT As we continue through the process of transition, there is a great deal to celebrate at Binkley! There is a sense of energy and vitality among Binkley members. We are welcoming new members. We have increasing interest in Sunday and Wednesday programming, choirs and worship. At a time when many churches have faced significant staff and budget cutbacks, Binkley has been able to maintain active outreach activities and expand programs. The Finance Committee s role is to suggest to the church how we can use the financial resources that are available to best support the various ministries of Binkley. This recommendation takes the form of a Program of Ministry Budget for It is our hope that you will read this document carefully so that all members and friends of Binkley can engage in the conversation about how to best use the resources at hand. Recap of 2015: Several factors combined to allow us to maintain a strong financial status in Members and friends fulfilled pledges and building use income and undesignated gifts were higher than expected. Strong giving combined with an office staff position vacancy and underspending in several areas resulted in a positive fund balance at the end of the year. The Finance Committee and Church Council will recommend at the February 7 Church in Conference that we use a portion of the 2015 fund balance to: 1) establishment a Program Enhancement Fund to promote innovative programming and/or outreach projects and 2) increase reserves to meet future challenges (see page 9). Looking ahead to 2016: We face several challenges as we seek to maintain the ministries of the church. 1) We have an aging structure that requires significant maintenance, upkeep and repair. Our facility supports congregational activities, the Binkley Preschool, KidSCope, and many community groups. While we were able to accomplish several major projects this year (see page 10), it is expected that there will be ongoing issues with roof repairs, failure of older HVAC systems (including the units serving the sanctuary) and other building needs. 2) We are very grateful that contributions from members and friends of Binkley have remained steady (see table page 9). As a congregation, we will need to be creative as we strive to grow programs, attract new members and consider staffing models in the face of increasing fixed costs (energy, supplies, health insurance, etc) and the possibility that the rate of rise in fixed costs may be greater than the increase in giving in the future.** We will need innovative solutions that promote sustainability and stability for Binkley s financial health in order to maintain essential ministries. The Finance Committee is excited to work with members and friends of Binkley, the Transition Committee, Church Council and our ministerial staff as we chart our future. Wayne Price, Budget Director - on behalf of the Finance Committee: Don Willhoit, Chair; Mark Walters, Treasurer; David Green, Financial Secretary; Sue Schroeder, Audit Committee; Curt McLaughlin and Jim Wilde, at-large members; and Dale Osborne, staff liaison. 3

4 FORMAT FOR THIS REPORT This report is organized as follows: Pages 5-8: Program of Ministry for 2016 (Operating Budget) Pages 8-12: Operating Fund Balance, Building Fund, Memorials, Designated Funds, Seymour Symposium, Endowment Fund GENERAL NOTES ON THE 2016 POM BUDGET OUTREACH AND MISSION MINISTRIES (page 5) Binkley's Outreach program involves individual outreach by members and friends of Binkley as well as support for projects and organizations within our church, our local community, the world. We fund these organizations through the yearly Outreach Budget line items (see lines 8-50). In addition, several special offering are held each year to raise funds for special outreach programs. In 2015, these included: One Great Hour of Sharing, Christmas Eve Offering, World Missions offering, Pastor s Discretionary Fund and others (see Designated Funds, page 11). Finally, Binkley facilities continue to serve as a community center by providing space to many local non-profit organizations and a "Home" for the Binkley Preschool, Meals on Wheels and a new partner, KidSCope. CHRISTIAN FORMATION MINISTRY (page 6) This section includes program expenses for various Christian Education Programs such as Church School, VBS, Youth Programing and others. MUSIC MINISTRY (page 7) This section includes program expenses for children s and adult music programs, instrumentalists as well as instrument maintenance. MORTGAGE (page 7) Our mortgage balance is $321,493. It is financed at 4.25% through 08/05/2018. The projected payoff is February BUILDING MAINTENANCE (page 7) Maintaining our facility for church programming and as a welcoming community center requires allocation of budget expenditures to cover cleaning costs, electricity, water, sidewalks and maintenance costs. Some of these costs are defrayed by the groups who use Binkley for a fee (see GENERAL FUND INCOME, below and page 8). OTHER PROGRAMS AND EXPENDITURES (page 8) Binkley grants sabbatical time to all ministers. The 2016 budget includes a line item to fund the sabbatical reserve (see Designated Funds below). General Contingency funds are allocated to pay for unanticipated expenses that may arise during the year. GENERAL FUND INCOME SOURCES (page 8) Pledges, previous year: these are 2015 pledges that are contributed during Non-pledged: contributions from members/friends who choose not to pledge. Undesignated: any cash in the offering plate (gifts that cannot be linked to a person). Birthday Bank: A Binkley tradition members and friends give $1 for every year of their life on their birthday. Building Use: Some groups use Binkley free of charge (e.g. Binkley Preschool, Christmas House, Meals on Wheels), some use the facility at a reduced charge (e.g. 12-Step groups, Peer Learning) and other groups are charged a full fee to use Binkley facilities. These fees are included in the General Fund and help offset cleaning costs, electricity, water, sidewalks and maintenance costs. 4

5 Notes on specific line items (column H) are on page 9. 5

6 Notes on specific line items (column H) are on page 9. 6

7 Notes on specific line items (column H) are on page 9. 7

8 Notes on specific line items (column H) are below. 8

9 OTHER NOTES FOR SPECIFIC LINE ITEMS % increase in Outreach 2. 2% salary increase 3. Amount needed to make up for increased health insurance cost for Will charge to HIA reserve account - Several years ago, the American Baptists dropped the group health insurance plan that was available to Binkley staff. The Salaries and Benefits Committee and the Finance Committee made recommendations on changes to the Health Insurance section of the Binkley Personnel Policy. The new policy was adopted by the Church Council and put into effect in October Binkley is providing a Health Insurance Allowance (HIA) to permanent staff, based on the age-specific rates of the BCBS Blue Value Gold 1000 plan. Staff members are not required to purchase the BCBS plan, but may use their HIA to procure a plan that best fits their needs. 5. Add $5400 for KidSCope + 2% increase; Note Building Use (line 190) is also increased by $5400 to cover cleaning costs. 6. Increased based on needs assessment 7. Grants for program enhancement (funded from Fund Balance) % increase in expenses pledges (see pledge history above) 10. Several members/friends who pledged in 2014 contributed without pledging in HISTORY OF GIVING (amount contributed by members/friends who pledged) Year Number of Pledges TOTAL GIVEN $ 608, $ 565, $ 593, $ 609, $ 600, $ 557, $ 613, $ 602, $ 610,000 (pledged) OTHER FINANCE REPORT MATTERS 2015 YEAR END OPERATING FUND BALANCE: The year-end balance from the Program of Ministry budget does not carry forward, but accrues to the Operating Fund Balance. Several factors combined to allow us to maintain a strong financial status in Strong giving and high building use income combined with lower expenses due to an office staff position vacancy and underspending in several budget areas resulted in a positive year-end contribution to the Operating Fund Balance of $39,779. The Finance Committee and Church Council will recommend at the February 7 Church in Conference that we use the a portion of the 2015 fund balance to: 1) establishment a $10,000 Program Enhancement Fund to promote innovative programming and/or outreach projects and 2) transfer $20,000 to the Major Maintenance Reserve (see below) and 3) create a $10,000 Supplementary Contingency Fund to meet future challenges. After these transfers, there will still be a sufficient balance on hand to fund day-to-day operations. FINANCE REPORT OTHER FUNDS 9

10 Other funds approved by the Church Council, include Building Funds, Designated Funds, Endowment Fund, Memorial Funds, and the Seymour Symposium Fund. Year-end balances in these funds to carry forward. A listing of the activity in these funds follows: BUILDING FUNDS: Includes several special purpose funds for support of church facilities. Balance Receipts Expended Balance Description 12/31/ /31/2015 Building Fund Furniture & Equipment Fund 1,707 1,707 Landscape Fund 881 6,000-6,881 The Major Maintenance Fund is a particularly important reserve fund used to maintain our facilities. A number of HVAC systems and roofs were replaced as part of the Church Home for the 21 st Century capital program over 10 years ago. The reserves need to be increased to prepare for the aging of these systems. The allocation from the 2016 Budget to the Major Maintenance Fund is $20,000, the same as the previous two years, and will be supplemented with a contribution of $20,000 from the Fund Balance (see page 9). Priorities for 2016 include replacement of HVAC systems and payment for roof repairs completed in the past few months. Below is a detailed history of the Major Maintenance Fund. MAJOR MAINTENANCE FUND HISTORY Year Allocation Transfers in Expenses Balance ,000 10, ,000 20, ,000 6,000 24,000 Sanctuary organ repair ,000 1,664 18,463 17,201 Rm 17 carpet, Lounge & Sunroom HVAC systems ,000 8,650 18,551 Narthex A/C, kitchen roof, tool shed roof ,000 2,819 10,490 20,880 Pave north driveway ,000 23,760 17,120 Kitchen roof repair, Meals on Wheels sidewalk ,000 2,550 13,616 26,054 Ed Wing HVAC, driveway patch ,000 30,825 37,646 39,233 Roof, Painting, Floor, Sidewalk, Water Fountain ,000 20,000?? Roof repair for FH and over pastors offices, HVAC? MEMORIAL FUNDS Memorial Funds are gifts that may or may not come with restrictions on use. Any unrestricted memorial funds that are unexpended at the end of the year are transferred to the Endowment Fund. Balance 12/31/2014 Receipts Expended 10 Balance 12/31/2015 Nettie Wilburn Memorial 5,000 5,000 Memorial Service Receptions Memorial Fund (T/F endowment) 4,117 n/a n/a Memorial Fund Balance - 61,449 3,857 57,592 Memorial Wall Plaques 1,769 Transfer to Fine Arts Fund 500 Transfer to Rose Garden Account 1,588 50th Anniversary Fund (Historical Records) 3,387 3,387 Berkut Children s Library Capital Fund 3, ,703 Berkut Children's Library Book Fund

11 Berkut Interest 234 Guest Minister Fund Total 17,334 71,005 DESIGNATED FUNDS Designated funds hold contributions or Budget allocations that are designated for a specific purpose. Examples include special offerings, the Pastor s Discretionary Fund and special project funds (Refugee Resettlement, Music, Green Projects, etc). In addition, some funds are set aside for future needs (Sabbatical Reserve and Transition Expenses for example). Program Balance 12/31/2014 Receipts Expended Balance 12/31/2015 One Great Hour - 4,839 4,839 - Christmas Eve Offering 2,986 6,123 2,986 6,123 World Missions Pastors' Discretionary Fund 6,803 13,411 16,823 3,391 Congregational Health Ministry Fine Arts 2, ,236 Green Projects Fund 3,915 2,000 3,045 2,870 Handbell Restoration Fund Interfaith Council - food programs Local Outreach Gifts 1,389 1, ,234 Music 2,681 12,680 7,199 8,162 Refugee Resettlement Fund 2,342 1,897 1,500 2,739 Binkley-Barbee s Chapel Yard Sale Sabbatical Reserve 4, ,093 McFaul Severance - 8, ,500 Transition Expenses - 28,000 18,849 9,151 TOTAL 29,999 36,475 WORKING FUNDS The following funds are working funds for recurring events or activities. Left over balances at the end of the event carry over and are available for use the following year. Balance 12/31/2014 Receipts Expended Balance 12/31/2015 Youth Retreats 1,309 13,724 13,508 1,525 Heifer/Habitat Trip Family Ministry Retreats - 4,136 4,136 - Women's Retreats - 5,740 4,120 1,620 Prime Timers 110 1,677 1, Easter Labyrinth - - Wednesday Night Programs 600 1,438 1, Children s Choir 1,725 1,725 Total 2,519 4,565 11

12 SEYMOUR SYMPOSIUM FUND This fund was created to honor the progressive ministry of Robert E. Seymour to fund an on-going celebration of his life and ministry that explores the Role and Responsibility of the Christian Church in Today s World. The Seymour Symposium Fund is currently invested in the American Baptist Foundation s blended fund portfolio. The Fund balance at the end of 2015 was $18,221. Previous Symposia: 1993: Racial Reconciliation James Forbes 1999: Faith, Belief and Moral Authority Will D. Campbell 2004: Faith, Peacemaking and the New World Disorder - Joan Campbell, Gary Dorrien, Charles Kimball, & David Price 2009: Liberal Christianity and Social Ethics: Past and Present - Gary Dorrien, Reinhold Niebuhr Professor of Social Ethics, Union Theological Seminary 2014: Righting Wrongs: Justice, the Church, and Public Discourse - Billy Barnes, Professor Gene Nichol, Rev. Dr. William J. Barber, II, Baldemar Velasquez, Delores Bailey, Charles Coble, Verla Insko, Howard Lee, Maria Palmer, and David Price. ENDOWMENT FUND The Endowment Fund is an investment in the future of Binkley Church and its ministry. Church members are encouraged to consider bequests to Binkley in their wills. The Endowment Committee is available for advice on a plan of giving that suits your financial objectives. Committee members are: Daniel Guy (Chair), Nancy Cheek, Wayne Price and Jim Wilde. When making memorial gifts, many members designate the Endowment Fund as the recipient of the memorials. Income from the fund is made available for special project each year. In 2014, the fund met the requirements for making distributions in The Committee sought and evaluated proposals from committees and members for use of the available distribution. Projects approved by the Committee and the Church Council included the purchase of toys and furniture for the Education Wing and materials for constructing sound absorbing panels in the Fellowship Hall. Unspent funds are returned to the Fund. Start Contributions Expenditures End Balance Transfers Balance Operating Account 3,549 10,633 7,655 6, Distribution 3, , Distribution 7,655 1,220 6,435 Money Market 56 SECU Shares Vanguard Fund 58,076 58,159 AFB Fund 122, ,398 TOTAL ASSETS 184, ,127 12