Excess Budget funds stake sweep

[russellhltn]

While I think Johnshaw has some valid points, I think the bigger issue is that big ticket items were shut down for 2-3 years while the church worked to keep funding at pre-pandemic levels.

In my stake I doubt if there were any big-scale Youth events for 2-3 years. The annual regional singles conference didn't happen (or was strictly virtual) for 3 years. Even if events were held they probably had a low turn out.

[rknelson]

It appears that the budget sweep was based on total allocation of funds to the stake including wards. A small amount was pulled from our stake today. You can find it under "Income and Expense details" / "Budget Allocations" labeled as "Collect 2022 budget excess funds as per PBO notice (15 Jan 2023)". For example (numbers used for clarity only): if the total allocation for the stake and all units in the stake for 2022 was $20,000 then 50% of that would be $10,000. So any amount over $10,000 on 31 December in the stake budget (not including ward budgets) is swept out. In this example, if the stake budget ended the year on 31 December 2022 with $11,000 then in 2023 you will see the Q4 allocation (posted on 5 January in our stake) and a sweep with the negative $1000 (posted 17 January in our case).

[barkeraj]

Our stake had been saving up for a Trek that we had previously done every 4 years. The funds needed for that exceeded the 50% of 2022 budget allowance. We called in to ask if there are exceptions and received the following:

A letter was issued to Local Units from the Presiding Bishopric on January 15 communicating a review of 2022 budget balances and the return of excess budget funds as requested in the previous notice dated December 7, 2022.

For stakes with a December 31, 2022 budget balance exceeding 50 percent of the total 2022 annual budget allocation (meaning if their current balance is larger than 50% of what they received in the year), the excess amount will be swept by church headquarters to reduce the overage. After the adjustment is made, a stake will retain 50 percent of the total annual budget allocation given to the stake in 2022, in addition to all allocated amounts received or projected for 2023.

There are some funds that stakes have planned for specific activities for the next year, such as trek or larger stake activities. While this need has been taken into consideration, it has been determined that the remaining 50% of the allocation that will stay in the stake and the entirety of the 2023 allocations, should be sufficient to cover costs of most activities, bearing in mind the counsel from the General Handbook of instruction that if necessary, leaders should reduce and simplify activities to stay within the allowance. Most activities should be simple and have little or no cost (Section 34.6). For this reason, there will be no option for units to request a retention of budget funds. Units should continue to use available budget funds to support stake and ward organizations.

We just got this this morning so are still reeling from the implications. We are only a few months away from the Trek and lots of wheels are already in motion, but it seems there is no recourse with the "there will be no option for units to request a retention of budget funds" statement. No clue what we are going to do, but hopefully this helps others who have come with similar questions.

[russellhltn]

but it seems there is no recourse with the "there will be no option for units to request a retention of budget funds" statement. No clue what we are going to do, but hopefully this helps others who have come with similar questions.

The stake president can still discuss it with their coordinating council. However, the prospects for an exception doesn't look good.

BlairEsplin indicated a significant part of the cost of his trek was coming from a church-owned trek center. I'd think there would be room to discuss that in the council. Especially if those charges pretty much forces the need for an exception.

[BrianEdwards]

If these "church-owned trek centers" are truly the budget-busters for treks, it will be interesting to see if stakes still use them this upcoming year. Either all stakes will fall into this category of not having enough funds after the sweep to pay what these centers charge, or some stakes will still have enough funds to do Trek there. Then the question becomes why that is the case? Are they just squeaking in under the threshold due to less total youth participating in their stake? Or are they doing fewer days? Or are there other ways they've simplified?

For those of us far away from church-owned properties, we generally have to pay to use whatever facilities we select for the Trek, and the "thousands of dollars" range doesn't seem unreasonable.

[rknelson]

For our stake, 95% of trek costs are for 3 items: Food, Costs for the camp, and transportation. We have hired school buses which are expensive, but less than the cost of fuel for the many members driving mini-vans. Most members would donate time/vehicle/fuel, but that did not seem appropriate when using school buses was cheaper than the fuel. Coach buses have toilets and air conditioning, but cost twice as much, so we have never used them. We have held some treks closer, but then you have costs for handcarts or handcart maintenance (some stakes/members have purchased them and rent them as a way to share costs without any profit). Finding a location with usable trails and getting permits is not trivial in our location. I suspect youth Treks are going to diminish as a stake activity with FSY taking their place. FSY is not cheap either, and probably actually costs significantly more than a trek if you count costs that are covered by headquarters in addition to the amount paid by wards and families. In my opinion FSY has a greater spiritual impact on youth than a trek. Treks do provide a good experience and help many youth learn they can do hard things.

[russellhltn]

Handbook 20.6.2 says fund-raising is allowed for "One annual extended Aaronic Priesthood camp or similar activity" and "One annual extended Young Women camp or similar activity."

In my mind, a trek is similar to one annual extended camp for those groups.

If budget can't be saved up to cover it, that's one option.

[BlairEsplin]

So far nothing has been taken from our stake account. Perhaps they haven’t gotten to it yet or if the total stake budget allowance is taken into consideration including wards, perhaps our stake does not have an excess surplus.

Our stake has a four year budget cycle. We have different expenses each year on a four year cycle. Money not spent on low cost activity years is saved for the high cost activities years. Last year I projected the Stake budget out for ten years to make sure we would still be solvent in ten years or if we need to reduce spending. The budget projection indicated that we need to reduce expenses somewhat. Those projections included saving carryover funds. If any of the funds given to the stake are taken away from us then major changes will have to be made. I don’t see why if on average a Stake spends all of its funds over a period of four years there should be any concern for excess carryover.

My advice to the wards of our stake following the December 7th letter was to plan their 2023 spending to ensure they do not have excess carryover by the end of the year. We are given a budget allowance so we can have activities. There’s no point of being frugal and saving money if it’s going to be taken away.

My advice to my Stake Presidency and wards going forward will be to prepay any possible high cost activity expenses on a low cost budget year rather than relying on budget carryover. For example, trek supplies that are non perishable such as buckets, journals, paper products, disposable eating utensils etc. could be bought on a non trek year. Perhaps trek center fees could be paid in advance and the bus company who busses us may accept pre payment. Then the trek expense left to pay on trek year would mostly be just food.

[BlairEsplin]

I’ll add that the Church owned Trek Center charge for our last trek was approximately $5,400 for three days. Food was our biggest expense but when divided by the number of people in attendance it was quite reasonable per person.

Beyond Stake activities, our stake also has to pay a number of “Regional assessments”. Things such as the regional family history center, regional humanitarian center, the Church booth at the State Fair etc.

[BlairEsplin]

It appears that the budget sweep was based on total allocation of funds to the stake including wards. A small amount was pulled from our stake today. You can find it under "Income and Expense details" / "Budget Allocations" labeled as "Collect 2022 budget excess funds as per PBO notice (15 Jan 2023)". For example (numbers used for clarity only): if the total allocation for the stake and all units in the stake for 2022 was $20,000 then 50% of that would be $10,000. So any amount over $10,000 on 31 December in the stake budget (not including ward budgets) is swept out. In this example, if the stake budget ended the year on 31 December 2022 with $11,000 then in 2023 you will see the Q4 allocation (posted on 5 January in our stake) and a sweep with the negative $1000 (posted 17 January in our case).

I added up our accounts and it looks like the total carryover for all units in our stake is approximately equal to the total budget allowance for all units in the stake. The majority of the carryover is in the ward accounts. Using the formula you outline the carryover in the stake account is nowhere near 50% of the total stake budget allowance and therefore therefore would not be subject to being taken back. How are they going to handle large carryovers in ward accounts since that’s where most of it is held?