Parishes Collaborate To Find Ways To Save A Million
Published: November 10, 2011
You know those envelopes that come in your mail monthly? Well, here’s an idea: Try getting them every other month to save your parish money.
That small change can save a few thousand dollars.
That’s just one idea being offered to parishes to save cash in a lousy economy.
And that’s not the only way. Parishes and Catholic schools are making sure that expenses for things like trash hauling are in line with the going rate, not just relying on the good will of a parishioner or long-term business arrangements.
More than $1 million in savings has been identified by the auditor hired by the archdiocesan Strategic Sourcing Committee as a voluntary review of parishes is wrapped up. About 80 percent of parishes have participated in the program.
“There’s nobody out there throwing money away,” said Mike Powers, who is the auditor looking at parish expenses. “They just never have the time to look at the bills.”
The savings likely won’t be huge dollars in most parishes, but he estimates the money saved equals income from one extra collection a month.
The cost-cutting program came out of the work of the Strategic Sourcing Committee, one of the subcommittees of the Archdiocesan Planning Committee. The subcommittee was asked to reach out to parishes to identify how expenses line up with other parishes and show where they are overpaying for services.
Committee leaders would not identify the churches or schools where parish money has been saved because they had assured priests and business managers of confidentiality. Another lure to get participation was to make the program voluntary. Pastors and finance committees can accept or reject any recommendations from the auditor.
Bulk purchasing for deeper discounts is a common business practice, but it hasn’t been common in the archdiocese where each parish and school is autonomous. Each school and parish signs individual contracts with the power company, Internet providers, trash haulers and other services.
Paul Maggard, chairman of the Strategic Sourcing Committee, said the system puts pastors and business managers at a disadvantage when it comes time to negotiate contracts.
“We were all over the charts on best practices,” he said.
Maggard said his committee has no mandate to impose the savings program. Leaders at each parish and school decide whether to adopt the recommendations.
Initially, pastors and school representatives hesitated at participating. But people were more interested when they learned that savings stayed with the parish or school, he said.
Powers, who retired after a career in business finance, developed a list of 12 common expenses he scrutinizes. After 18 months of doing this, he can see pretty quickly when the expenses are out of line.
The common expenses are electricity service, natural gas, trash collection, janitorial supplies, janitorial services, phone/Internet, technology support, armored truck service, heating and air conditioning, security, credit card processing fees and parishioner envelope mailings.
Parish business managers are professionally minded but are pressed for time to review all the expenses, said Powers, a parishioner at St. Brigid Church, Johns Creek, who runs his own company, Financial Solutions Atlanta.
Powers said he has developed contacts with different utilities to ask them to review a questionable billing.
For instance, a parish building wasn’t classified at the correct electrical usage rate. It was overpaying. He talked with the utility to revisit the issue and got the church building set at a lower rate.
And sometimes, he has been able to get credit worth tens of thousands of dollars from the utility company for the facility paying too much.
Powers said after seeing bills for several months, he can quickly figure out if parishes are overpaying. At one place, he noticed a parish paid to have its trash hauled away three times a week. It’s rare to have that much trash, so he poked around a bit to find it was an old practice that had been adopted without being reviewed. The savings cut the trash expense by nearly $4,000 a year.
Another example is cleaning supplies. Some parishes have stayed with the same vendor for years and haven’t priced out things like disinfectant, toilet cleaners and soap. He said one parish paid more than $100 for a supply of disinfectant when he knows vendors selling the same products 30 percent cheaper.
“Those kind of things creep in,” Powers said.
With this new system, the parishes and school can negotiate better contracts with savings, Maggard said.
“Our goal was to get to a million, and we just got to it,” he said.