More Budgeting blah, blah, blah

Another wrinkle to the whole budgeting philosophy is the area of designated contributions. It is a fact that in our North American Culture we favor giving to a tangible project rather than to give to an organization. We may give a regular monthly amount to a church or an organization, but we don't give sacrificially to a "general fund". An announcement of an event, project or initiative will cause us to dig deeper and give more to see the goal accomplished. I'm not saying that I think that this is right or wrong; I am only stating observed behavior.


Because of this behavior pattern, churches and non-profits have seen the need to allow designated giving so people can give to a specific project. As with nearly everything, this has its good and bad points.

The good is that the donor can be sure that his gift goes to what it was intended for, and the project goes forward as gifts come in to fund it. The down side comes when an organization becomes so fragmented in its income structure that the accounting and reporting of funds and expenditures becomes very cumbersome and confusing. Also, there are times when a gift for a project go unused for a long time because there are not sufficient designated funds to begin or complete the project.


A couple of years ago I was involved with an organization that received a $50,000 gift designated to build a new facility. It was a generous and substantial gift, but a new facility would cost approximately $500,000 and there were no other contributions for that project. The result was that other projects went begging and money was actually borrowed to meet operational expenses while the $50,000 sat unused and untouchable due to the restrictions of the donor.

I assume that some of the reasons donors like the designated giving approach are that a) we are afraid that "excess" funds will be used or wasted, b)we like to fund things that resonate with us, and c) we like to have some sense of control over our gifts. Many will "reward" a pastor by giving generously or "punish" him by withholding giving when things aren't going well.

If undesignated giving lends itself to abuse by the organizational leaders, designated giving can lend itself to abuse by donors. A number of years ago, we had a man in our church who received quarterly distributions from an investment. He didn't like the fact that the pastor received a percentage of the tithe and offering as part of his compensation package and didn't want the pastor to "get a cut" of his distribution, so he would designate his "tithe" (designated tithes are not tithes at all) to one or several departments in the church. While the departments appreciated the gift, the donor lost out on the blessing of being obedient in giving by giving in such a way that he blocked an outcome that he didn't like.

In my perfect world, people would give as the Lord led them and would just give to the church to be used where needed most. Church leadership would have an understandable and transparent budgeting system with no opportunity for misuse of funds. Departmental fundraisers and special offerings would not be necessary for normal operations. But we obviously don't live in my perfect world, so how to we do the best we can while living where we are?

I'll get there in a future post.