By Archdiocesan Staff
As the Archdiocese of Agaña charts a new course toward becoming a better diocese operationally, pastorally and spiritually, we’re committed to doing a much better job of sharing information to you, our faithful, and the community in general.
Thank you to all people and groups who have shared their feedback and ideas. Thank you to the faithful for your work and contributions.
For the past several months, the archdiocese has presented information about our finances, administration, and restructuring in numerous ways. We have strived to be very transparent in explaining the financial storm that it is in, as well as its depleting reserves.
Last week’s Umatuna Si Yu’os presented a picture of our current financial condition. It listed our overall assets, liabilities, and net fund balance. The same pages showed how much we have spent thus far in legal expenses related to the series of sexual abuse lawsuits.
As the heart of operations for our archdiocese, the Chancery Office has an important role in the administration, management and support of our Catholic schools, parishes, ministries and services, which are equally important. The Chancery’s operating budget was listed, including projected revenue sources, projected expenditures and operating expenses.
Part of the Chancery’s role is to set standards, provide oversight and internal control, while providing support and assistance to our parishes, schools and organizations. We greatly appreciate the help we receive from individuals and groups throughout our archdiocese. Together, we’ll move forward beyond these difficult times and bring our archdiocese into the 21st century.
The recent increase in parish assessments and introduction of new school assessments are being implemented after more than a month of meetings with clergy, parish finance councils, and school principals.
Parish Assessment: Old and New Formulas
Catholic dioceses across the country fund basic operations related to the administration of their faith communities through parish assessments, which are canonically mandated. Each parish is assigned a monthly assessment – or certain percentage of funds – that go support and sustain operations, functions, and services of their chancery. Please see data tables shown.
The former parish assessment formula was based on 2011. The work back calculation was based on a 10% assessment on assessable income. The standard deduction varied from $15,000, $10,000, and $5,000. However, the actual collection or parish payments were short by $160,000 each year with an accumulated shortage of collection of $960,000 for the past six years. The past formula was found to be complex and not equitable among parishes because of varying adjustments.
The new current formula is based on 20% assessable revenue. The 20% standard deduction is allocated for 10% standard deduction and 10% capital improvements which are in direct proportion to the revenue and size of the parish.
Revenue figures were based on gross from June 30, 2016 fiscal year closing without exclusion. Exclusion is not considered based on various factors, i.e. parish assessment collections falling short for the last six years, no incremental change in the past years in consideration of inflation and rising cost, inconsistent revenue accounting and timeliness of recording.
While the numbers take in account many variables, the Archdiocesan Finance Council decided to identify a starting point to the base assessment in reaching the $2,561,377 needed budget to support Chancery operations and cover its debts services and trade payables in arrears.
It is recognized that the parish and school assessments imposed are steep and will require a budget shift. The new assessments may require schools and parishes to reallocate resources and find creative approaches to meet the obligation. The Chancery will help.
To help plan and incorporate increases in expenditures, the Chancery provided assistance to schools and parishes through standard templates for budgets in 2017-2018. The Chancery’s Finance and Accounting Office staffers made themselves available and will continue to assist parishes and schools by providing on-site guidance and coaching in the budget review process.
New Parish Assessment Effective July 1, 2017
The illustration below shows a comparative a parish assessment summary including the old assessment, actual collections of the old assessment, and the new assessment. The total collection target from the parish assessment is $1,071,026 with an average of 186% increase in assessment per parish.
The archdiocese is committed to revisiting the formula-based revenues to classify included and excluded revenues subject to parish assessment.
New School Assessment and Annual Catholic Schools Office Fee Effective July 1, 2017
The school assessment comes in two parts. The first fee is based on a student population assessment of $25.00 per student annually. Funds derived from the fee will be dedicated to covering operations of the Catholic Schools Office, which provides direct administrative support to the schools. This office has historically operated without direct funding by the schools. Instead, the Chancery has long covered its deficit averaging about $87,000 each year.
The Catholic Schools Office manages our school district’s federally-funded grant programs under the U.S. Department of Education. They take the lead in training, implementation, overview and reporting of the grants which have provided thousands of dollars in resources and materials to our schools for many years.
The second part is the monthly school assessment which was also calculated based on student enrollment. Funds from this assessment will help the Chancery Office in general, inclusive of the services, support and assistance it provides to our schools. The assessment is at $12.00 per student based on the September 2016 student enrollment report. For many years, there was no reallocation of costs, and by covering those expenses. The Chancery had limited capacity to expand its reach with mission-driven programs.
Next time: Future issues of the Umatuna Si Yu’os will depict the staffing pattern and organizational structure of the Chancery. These pages will present information on initiatives taken, short-term and long-term projects, training and presentations that have been completed, and a line-up of training for the fiscal year as part of our strategic planning.
Archdiocesan Finance Officer Josie Villanueva, Director of Communications Tony Diaz and Umatuna Si Yu’os Editor John Michael D. Pineda contributed to this narrative.