Even more fun with parochial reports
(Or: is it Possible to Have Too Much of This Stuff?)
By Canon for Mission Finance & Operations Louis Fuertes, June 2019. Click here for PDF of this article.
When I served as a parish Treasurer, there were a number of times when Vestry colleagues wondered how our parish was doing relative to parishes that were somehow similar to ours. The desire for comparative context -- understanding how we were doing compared to other parishes – was a curiosity I also shared with them.
If you had had similar wonderings about your parish, the Parochial Report information submitted can provide you with context on how your parish compares to others on a number of financial metrics.
It must be said at the outset that ECCT parishes vary considerably on many fronts, but two very obvious differences are;
- In the size of the congregation and
- In the financial well-being of the communities in which our parishes are located
In the comparisons that follow, we have addressed the difference in size of the congregation by presenting financial and stewardship information on a “per Average Sunday Attendee” basis, which will normalize for size of the congregation. We will correct (at least partially) for differences in the financial well-being of the congregation by sorting key data against the median household income of the city or town in which the parish is located, as estimated by CityData.com.
To start, let’s consider the total contributions per average Sunday attendee for 2018. The amount of a parish’s total contributions (including pledge fulfillments, loose plate collections and regular financial support from individuals and families that did not pledge) is reported on line 3 on page of page 3 of the Parochial Report and the number of parishioners on an average Sunday is reported on line 7 of page 2 of the parochial report. The chart below shows total contributions per Average Sunday Attendance (“ASA”) for ECCT parishes in 2018 versus the Median HH income of the city or town where the parish is located. The dashed red line is the best fit line for these data points.
[To determine if your parish’s blue dot is above or below the dotted red line, divide your reported Pledge, Plate & Regular Support amount (line 3, page 3) by your reported Average Sunday Attendance (line 7, page 2) to establish the vertical location of your parish’s dot, and its horizontal location can be determined based on the median HH income for the city or town in which your parish is located according to CityData.com (I suggest Googling “[name of town where your parish is located] CT City Data”, and scroll down a few lines to find the estimated median household income for your town. If your parish’s blue dot is above the dashed red line, then it is doing better than expected, but might still have opportunities to improve, so read on! If your parish is on or below the dashed red line, you should definitely read on.]
While the contributions/ASA for ECCT parishes increase somewhat as median household incomes in towns served by ECCT increases from around $35,000 to $200,000, there is tremendous scatter around this general “up and to the right” relationship. In fact, some parishes that are in communities with median household income levels under $100,000 report significantly higher contributions/ASA than parishes with median household incomes greater than $100,000. What’s up with that?
What’s up with that is that the data reported on ECCT parishes’ Parochial Reports indicates that factors that parishes can influence directly have a bigger impact on per parishioner contributions than does the income level of the towns in which parishes are located.
- The best fit model for explaining differences in per parishioner contributions based solely on community income levels explains only 27% of the variation in per parishioner contributions…
- …while a model including both community income levels and three quantifiable measures of fundraising proficiency explains over 95% of this variation.
The three measures – pledge participation, higher/lower than anticipated average pledge amounts and pledge fulfillment/regular support – are all derived from Parochial Report data. They are presented below, all plotted versus the estimated median HH income levels of the cities/towns where parishes were located. The fact that some parishes serving low income communities are doing a great job along these dimensions explains away almost all the scatter in the chart above.
The first of these dimension -- “pledge participation” -- defined as the number of pledge cards received (reported on line 1 of page 3 of Parochial Reports) divided by average Sunday Attendance (again, line 7 from page 2 of Parochial Reports and “ASA” in EpiscoSpeak). This measure is shown on the vertical axis of the chart below, portrayed as a function of the median HH income of the city or town where the parish is located.
Three observations can be made about this chart:
- First, there is enormous variation in the degree of pledge participation among ECCT parishes, from less than 50% for half a dozen parishes (e.g., a parish in this group with ASA of 100 would have received fewer than 50 pledges in 2018), to more than a dozen over 125% (e.g., a parish in this group with an ASA of 100 would have received more than 125 pledge cards in 2018).
- Second, the large number of parishes with pledge participation over 100% seems odd at first, but it reflects the fact that individuals and families that attend church irregularly can be an important component for a parishes’ pledging community.
- Third, pledge participation is not closely related to the median HH income for the cities and towns in which ECCT parishes are located. Many parishes in communities with incomes below $100,000 report great success in this measure, while some parishes in higher income communities have that lovely phrase “opportunities for improvement” going forward
Which of these dots represents your parish? How is it doing on the pledge participation front?
As second dimension is whether the average pledge amount is higher or lower that the amount that should be expected given the income of the communities in which the parish is located. The dashed orange line is the expected average pledge amount for ECCT parishes based on the data they submitted for 2018 (Line 2 from page 3 divided by line 1 from page 3). If your parish is substantially above the dashed orange line, life was good in 2018. If it was at or below the line, an opportunity for improvement (that delightful phrase again!) awaits.
The third and last dimension worth mentioning is absolutely a creature of the categories listed on the Parochial Report. It is derived by dividing total contributions (again, including pledge fulfillments, loose plate collections and contributions from non-pledging individuals and families, which is referred to in the Parochial Report as “Regular Support”) by the total amount pledged (line 3 of page 3 divided by line 2 of page3. I refer to this ratio as of “Pledge Fulfillment/Regular Support.” This is clearly a cumbersome title but it is arguably illuminating, depending on what the ratio comes out to be for a parish.
- If the ratio turns out to be less than 1.0 (as was the case for 18 parishes in 2018), the total of contributions (from pledge fulfillments, plate collections and contributions from non-pledging families and individuals) is less than the amount pledged, which points to a noteworthy pledge fulfillment issue given normal pledge fulfillment rates (90 – 98% for many parishes) and the total contributions/total amount pledged ratio for all ECCT parishes combined (typically around 1.15), suggesting that loose plate and regular support from non-pledgers typically equal about 20 – 25% of the amount pledged.
- If, on the other hand, the ratio of total contributions/total amount pledged is over 1.3 (as it was for over 20 parishes in 2018, including three parishes for which the ratio was over 2.0) it is an indication that the parish does a remarkably good job in generating financial support from parishioners who do not formally pledge their financial support.
Ideally, the Parochial Report would provide a separate line for how much of the total contributions from parishioners was from pledge fulfillments, a line for loose plate and a line for regular support. However, as they are all reported together on line 3 of page 3, we are left with the need to conclude if this ratio is low, it’s due to a pledge fulfillment shortfall, and if the ration is high, it is because of success in generating regular support.
The results for 2018 are shown in the chart below. The dashed green line shows the average of total contributions/total amount pledged for all ECCT parishes in 2018 (which was 1.14). Note the arrows at the top of the chart, pointing to the ratio of total contributions/total amounts pledged which were (literally) off the chart on 2018.
If one creates a best fit relationship for the influence of community income levels, pledge participation, above/below expectation average pledge amounts and the impact of pledge fulfillment and/or higher than usual regular support levels, one can predict quite accurately what the total contributions per average Sunday Attendee was in 2018 as shown in the exhibit below. The dots which are not closely clustered along the diagonal line have other strengths or shortcomings not reflected by the measures used here. However, the four factors outlined above explain 96% of the variation in contributions/average Sunday attendance.
Parochial Report data provides much richer information about the sources of variation in contributions than they provide for operating expense comparisons. The one source for benchmarking your parish’s operating expense is shown below. The vertical scale (total operating expense) can be found on Line E on page 3 of the Parochial Report and the horizontal axis (average Sunday Attendance) can be found on line 7 of page 2. The data shows that operating expenses generally increase as the size of the congregation increases, but there are substantial differences in the expenses for a congregation of a specific size. There are many possible reasons for these variations
- Staffing model differences is probably the most important of them,
- But the size and age of the church buildings and the scope and extensiveness of program ministry expenses are also likely contributors to the scatter in the exhibit below.
Unfortunately, Parochial Report data provide no guidance to breakdown the causes of variations in operating expenses other than size of the congregation. For the last bit of fun with Parochial Reports, which of the blue dots in the chart below represents your parish? Are you happy with where on this scatter plot your parish is located?
Is the chart above too crowded to find your parish? Here’s another for parishes with ASA less than 150.
Here’s hoping that this information for peer ECCT parishes will give you a sense of how your parish compares to others on a number of measures that affect financial performance. This information might give you a sense of what your parish’s financial management priorities for the remainder of 2019 and 2020 might be. It might also give us some payback for the time and energy we put into reporting and analyzing this information, and added incentive to make our parochial reports as accurate as possible!