Commission on Finance News

Meeting — June 7, 2018

2018-08-14T13:52:00.000-07:00

Diocese of Rhode Island

Commission on Finance

Meeting, June 7, 2018

St. Luke’s Church, East Greenwich

Present: Robert Batchelor; The Rev Erik Larsen; James Segovis; Stephan Sloan; The Rev. Peter Tierney.

Also present: Dennis Burton; Joan DeCelles; The Rev. Canon Linda Grenz; The Rev. Edwin Hallenbeck; Richard Sellers; Richard Sayer, Esq. (telephone).

Guests: The Rev. Patrick Campbell, Rector; Ted Daly, Treasurer, Church of the Redeemer.

The meeting was called to order at 5:05 p.m. by Chair Tierney, who offered an opening prayer.

Minutes of May 3, 2018 were approved as distributed. Notes of changes in COF: Mr. John Candon, guest at May 3^rd meeting was presented by the Bishop and approved for COF membership by Council for term ending in 2020. A letter of resignation was received from Sarosh Fenn resigning due to time constraints. His resignation was accepted. Fr. Tierney stated that the Bishop will appoint Robert Bergstrand (former COF member) to complete Mr Fenn’s term to 2018 convention. It was noted that this is Secretary Hallenbeck’s last meeting, thanks for his service was expressed by the Chair and those present.

Finance Report for May was reviewed by Mr, Batchelor. Moving through the second quarter of the year noting most numbers are remarkably near budget. Charities campaign income is lagging, DIT data is updated thru February. The report was received.

Apportionment Aging. Income from churches remains strong with two exceptions, and one experiencing a cash flow problem.

Church of the Redeemer, Loan Application. Fr. Campbell and Mr. Daly joined the meeting. An Application for a $12,000 loan for painting the church exterior. It was noted the Church has an outstanding loan which will remain in place. Several questions were raised and discussed. The question of a single bid from a previous painter for inside work was reviewed. Following discussion it was Moved, Seconded and Voted (4 Yes, 1 No) to approve a Loan of $12,000 for 5 years at

3.0% with DIT security, the existing loan to remain until completion. Guests left the meeting.

ECC Solar Farm. Mr Burton presented a proposed Term Sheet agreement with RER Energy for development of an 8-10 megawatt solar array field to be built on two tracts of approximately 25 acres each on remote areas of ECC property. Mr. Sellers reviewed the competitive selection process resulting in the selection or RER Energy as the working partner for the project. Over several weeks and drafts prepared

the Term Sheet. Several matters are of special importance:

• Lengthy discussion of details and rate structure.

• The ‘off-take’ arrangement – virtual net metering rate.

• Project is mostly invisible from the camp and road, based on rev.iew of original ECC deeds

• Court has granted OK for income producing projects.

• Time is provided to resolve matters that arise as project progresses.

• The aim of the project is to support ECC and permit it to remain viable.

Following lengthy discussion and consideration, it was MOVED, Seconded and Voted, to accept and approve the terms of the proposed solar project between the Diocese of Rhode Island and RER Energy on approximately 50 acres of the ECC property, substantially as outlined in the Term Sheet presented to the Commission and to be attached to the Minutes of this meeting, hereby authorizing review and approval of final transaction documents by the Chancellor for the Diocese and execution by the Bishop or his designee and review by the COF of final term language.

CFO Report. • ECC developments, an open house and Board meeting will be held June 9^th to introduce the Solar Farm project. A $5,000 grant for camperships has been received from The Champlin Foundations, enabling further applications, and a $5,000 grant has been received from the June Rockwell Levy Foundation.

• Mobile Station land sale is waiting for sign off by Global Inc

• Hallworth House is now paying its land lease rent money to the Diocese monthly.

• May House needs a cement cap over the previously cleaned up tank removal ($7,800).

Grace Church has completed a loan application for $36,950 to complete 2017 apportionment payments. Following discussion it was MOVED, Seconded and Voted to approve a Loan of $36,950 to Grace Church, Providence for 5 years at 3.75%, starting July 15^th.

The Old Narragansett Church is in need of exterior painting due to age and deterioration. A low of two bids for $28,000 was submitted. Funds are available from the Old Narragansett Church reserve fund. It was agreed to complete this work with available funds up to $30,000.

Diocese of RI Draft 2019 Budget. A preliminary first draft budget for 2019 was distributed by Mr. Burton. Key matters in this draft:

• Again split into Apportionment and Non-Apportionment segments.

• Non-Apportionment income will level out.

• Apportionment contingency is getting tighter.

• Goes to zero or minus $141k in 5 years.

• Need a zero deficit budget plan.

• Key question is; what to do with Solar Farm income.

Drafts for August or later for forwarding to Council and Convention.

St. Peter & St. Andrew Church. Canon Grenz submitted an update status report that is very helpful. It is clear continuing a presence in that section of the city is important. Needed actions include:

• Preparing a grant proposal to CDC.

• Come to COF with a carefully prepared loan request.

• Complete previous approval of proceeds of sale of houses with expected reductions for legal and survey costs.

• 2018 Apportionment be reviewed and charged to house sale proceeds.

• Work up a Business Plan reflecting existing conditions

• Secure firm costs for renovation work on Rectory to prepare for rental.

Discussion of planning agenda topics for August meeting, to be annotated by the Chair.

The meeting was adjourned at 7:45 p.m. with cake enjoyed by all.

Respectfully Submitted

Edwin F. Hallenbeck

Secretary

Next Meeting: August 2, 5:00 p.m. or as called.

Meeting — May 3, 2018

2018-06-11T07:15:00.000-07:00

Diocese of Rhode Island

Commission on Finance

Meeting, May 3, 2018

St. Luke’s Church, East Greenwich

Present: Robert Batchelor; The Rev. Erik Larsen; James Segovis; The Rev. Peter Tierney. Also present: Dennis Burton; The Rev. Canon Linda Grenz; The Rev. Edwin Hallenbeck. Guest: John Candon;
The meeting was called to order at 5:10 p.m. by Chair Tierney, who offered an opening prayer.
Minutes of March 1, 2018 were approved as amended, the Minutes of April 5, 2018 were approved as distributed.
Finance Report for April was reviewed by Mr. Batchelor. At this point early in the year finances are close to budget planning, Some accounts that run unevenly throughout the year, such as ECC low activity in the winter are at variance.
Apportionment Aging. There are two churches significantly behind, others routinely paying, some a month or two behind. The two that are behind were discussed at length.
* Sts. Peter and Andrew. This is a very complex situation needing careful review in 2018. We are already paying utility costs for three buildings that have been condemned and are in the process of being sold, this matter must be completed. The Rectory needs major updates and repairs, the Rector has retired and a new clergy team is beginning activity. It was agreed to track all closing costs to be paid from proceeds of the sale of buildings. Following a lengthy discussion it was agreed that a special working committee is needed to work with remaining parishioners, clergy, the community to consider issues, budget needs, possible courses of action. Messrs, Batchelor, Burton and Segovis agreed to work on this group which must be broader than COF. It was MOVED , SECONDED and VOTED to recommend to Diocesan Council that a special St’s Peter and Andrew Working Task Force be established to create and assist in developing the church so that it may become a viable presence in an otherwise unserved area. Persons to serve on this TF are noted above as well as The Rev. Susan Carpenter from Diocesan Council. It was further MOVED, SECONDED and VOTED that the proceeds of the sale of buildings at St’s Peter and Andrew, less closing costs to be determined, be placed in the DIT for application to be determinded at a later date.
* St. Georges, Central Falls. It is uncertain if the congregation will be able to regroup this year. The Diocese is subsidizing it and has for at least a decade. A key is lay enthusiasm and support, especially from other parishes. Our question is where do we put our energy and resources? This depends in part upon what works, noting that resources are limited, even while needs are great. This matter needs extended ongoing discussion. Attention needs to focus on defining what may work and how it may be fostered.
CFO Report, Mr. Burton.
• A Financials Variance Analysis Report was distributed, stating items not on budget. This early in the year this information will become useful for tracking emerging issues.

• Budget development for 2019. Mr. Burton is serving as temporary Chair of the Program and Budget Committee. He outlined the planned schedule for the year leading to Convention.
• ECC Solar Farm. National Grid has accepted the proposed line feed. Next are legal matters, court approval for land use, zoning and town approval and the negotiations with RER for contract arrangements. The Project Team with PR assistace are at work.
• Diocesan Investment Trust Board met recently and is working on revisions to the working trust agreement.
• Capital Budget Planning. Primarily focused on the Diocesan Campus a draft plan was submitted for discussion outlining in broad form needs for all buildings and detail for the Cathedral and Diocesan House – see handout. It was agreed this is a major project . The matter is referred to Diocesan Council with a suggestion to establish a special Task Force, with representatives from Council, COF, an architect and a contractor. The lingering issue is how to finance whatever is agreed upon as essential work.
• Grace Church. A meeting with the Wardens stated they will pay the remaining apportionment due with a Revolving Loan, formal terms to be arranged, with no DIT pledge. While an affirmative vote was taken, there were no documents application or final numbers available at the meeting.
• Grace Church Cemetery. Noting the concerns discussed in previous meetings it was suggested that consideration be given to pooling the cemetery funds available for all cemeteries to see if there are any options available.
• Mobile Station Land Sale, 389 Elmwood Ave, Providence is in legal negotiations with two outstanding issues, handicap access and parking.
• ECC Champlin Foudations Grant. A campership grant for $5,000 has been received initiating access to other funding. A request has been submitted for a Nursing Station and a new Boys Bathroom.

The meeting was adjourned at 7:15 p.m.
Respectfully submitted Edwin F Hallenbeck Secretary.
Next Meeting: June 7, 2018. 5:00p.m.

Meeting — April 5, 2018

2018-06-05T12:19:00.000-07:00

Diocese of Rhode Island

Commission on Finance

Meeting, April 5, 2018

St. Luke’s Church East Greenwich

Present: The Rt. Rev. Nicholas Knisely; Stephan Sloan; The Rev. Peter Tierney.

Also present: Joan DeCelles; Dennis Burton; The Rev Canon Linda Grenz; The Rev Edwin Hallenbeck.

Guest: Richard Sellers, Consultant.

The meeting was called to order at 5:05 p.m. by Chair Tierney, who offered an opening prayer.

Note: There was not a quorum present, therefore this was an information session only with no votes taken.

The Minutes of The meeting of March 1, 2018 were received, but not voted upon.

ECC Solar Farm Analysis. Presentation and discussion by Dennis Burton and Richard Sellers based on the report “ECC Solar Project: Next Steps.” The report was prepared with the support and assistance of the Advisory Committee most of whom have extensive experience with solar project planning and operation. Key points are:

• Frequent meetings of Solar Advisory Committee.

• Legal issues identified and addressed.

• Max size of 10 MW DC established.

• Ten potential Partners interested, 6 bids solicited, shortlisted 4 companies, 2 finalists.

• Extensive analysis of 2 finalists with expert assistance, data in report.

• Recommend next steps: Negotiate MoU with RER by end of April, prepare alternative process in case negotiations fail.

The Report was received with interest and several matters were discussed at length. The same Report was made at Diocesan Council April 4, 2018 and was referred to Council Executive Committee for final approval with the understanding it would be reviewed by COF. Those present agreed with this process of decision. Mr. Sellers left the meeting.

COF Report. Mr. Burton:ce.

• St. Peter and Andrew apartments. An analysis of three options was distributed, indicating the best choice is to sell the apartments to Gemma property Management. It was agreed this appears to be the best option. Dennis will follow up details. A business plan will be needed for St P&A church and plans for how best to prepare the Rectory for occupancy, see below.

• Mobile station land sale, 389 Elmwood Ave, Providence is still in negotiation, with most concerns settled.

• Grace Church, Providence. A meeting was held with the present and former Sr Wardens for updates. The Cemetery situation needs study, the Diocese is willing to receive a proposal for what might be done.

• Edwards Homes. An audit is needed of the financial status of the Homes so the bookkeeping can be brought over to the Finance Office. Bookkeeping can be brought over to the Finance Office per agreement with Hallworth House to provide accounting and administrative services to the Edwards Homes. The accounts are presently part of the Hallworth House financial structure.

Finance Report of March 2018 was reviewed briefly by Ms. DeCelles stating there were no significant variations. It was noted that the Variations Report begun in 2017 was very useful and might be used again this year.

Apportionment Aging Report. Churches are up to date except for several that run a month late and the two that are expected to be problems throughout the year.

St. Peter & Andrew Church, Providence. Canon Grenz reported that May 1^st has been established as the retirement date for the Rev. Joyce Penfield, Priest-in-charge. Canon Grenz has met with the Wardens to consider changes needed. They are revising the budget to consider funds needed for the church to function in 2018.

The meeting was adjourned at 6:20 p.m.

Respectfully submitted

Edwin Hallenbeck

Secretary

Next meeting: May 3, 2018. 5 p.m.

Meeting — March 1, 2018

2018-06-05T12:14:00.005-07:00

Diocese of Rhode Island

Commission on Finance

Meeting, March 1, 2018

St Luke’s Church, East Greenwich

Present: Sarosh Fenn; The Rt. Rev. Nicholas Knisely; The Rev. Erik Larsen; James Segovis; The Rev. Peter Tierney.

Also present: Joan DeCelles; Dennis Burton (by phone); The Rev. Canon Linda Grenz; The Rev. Edwin Hallenbeck.

The meeting was called to order at 5:00 p.m. by Chair Tierney, who offered an opening prayer.

The Minutes of the meeting of February 8 were approved as corrected.

Finance Report of February 28 was reviewed by Ms. DeCelles. Some accounts reflect timing matters, even though some adjustments in income and expense budget variations have been reflected. Several observations were noted, none of significance. The Report was received.

Apportionment Aging Report. Most churches are paid current except those that pay a month late or the three expected problem churches.

CFO Report. Mr. Burton:

• Solar Farm Project (ECC). Met with all applicants for project management and reviewed proposals in detail. Selected two as finalists, now doing a more detailed review with visits planned to existing sites. Hope to have a final selection by late March or early April. Legal concerns are under review. Met with Town of Glocester, some adjustments may be needed. Financial issues will need review at a near term CFO meeting.

• Mobil Station land, 389 Elmwood Ave. Providence sale, attorneys will meet soon to review language of the P&S agreement. Expected completion of sale in May.

• Annex Building, N. Main St. Hallworth House has vacated the site. Reviewing possible rental to a new tenant.

• Program and Budget Committee is meeting soon to review work schedule for 2018.

• ECC has submitted grant proposal to Champlin Foundations for camperships. If granted will establish eligibility for capital funding grant.

• Edwards Homes. Transfer of bookkeeping from Hallworth House to the Finance Office is in process and expected to be completed soon.

• Hydroponic Farm Project (ECC). The team has reviewed this project with great care and recommends suspending it until after the Solar Farm project is completed. This will allow for more bids and zoning approval management. It is anticipated it may be restarted in about a year.

Planning for Mission Churches.

This discussion was initiated by the St’s Peter & Andrew request for utility funds, and the approval of $5,000 per month for 6 months of funding by Council, with a request that COF work on a plan to address such issues. It was noted that St’s P&A is under new leadership and should be considered as a restart church situation. There are about 35 persons attending who may be the core of a restart. The immediate concern is what to do with the three houses that cannot be occupied at this time. A developer has offered to purchase the three buildings for $205,000. It was suggested that this needs to be explored to consider other options. It was agreed to discuss this with the developer. Bob Bergstrand has been asked to oversee the Rectory remodel.

Discussion continued looking at the Mission Churches as a group. There are three categories at present:

a) Small churches, basically self-sufficient.

b) Transitional Churches, previously Parishes, needing upgrades.

c) Subsidized Churches, i.e. restarts with goal to become self-sustaining.

There are clear examples of each category. It was suggested we might be able to provide for up to two years for churches needing assistance. However, there is no strategic criteria for providing such assistance. In addition to St’s P&A, Church of the Beloved and Church of the Advent are the most uncertain at present. All three are in strategic locations with questionable viability. It was agreed to work further on both the issue and the three churches. This will remain in the COF agenda under Old Business. This discussion reviewed current circumstances and identified matters for further consideration. No decisions were made other than the need for further discussions.

The meeting was adjourned at 6:15 p.m.

Respectfully Submitted

Edwin F Hallenbeck

Secretary

Next meeting: April 5, 2018. 5:00 p.m.

Meeting — February 8, 2018

2018-06-05T12:11:00.000-07:00

Diocese of Rhode Island

Commission on Finance

Meeting, February 8, 2018

St. Luke’s Church, East Greenwich

Present: Robert Bachelor; The Rev. Erik Larsen; James Segovis; Stephan Sloan; The Rev. Peter Tierney.

Also present: Joan DeCelles; Dennis Burton; The Rev. Edwin Hallenbeck.

The meeting was called to order at 5:00 p.m. by Chair Tierney, who offered an opening prayer.

The Minutes of the meeting of January 11 were approved as distributed.

Finance Report of January 31 was reviewed by Mr. Batchelor. He noted that the year end numbers for the DIT had not yet been entered on the balance sheet awaiting review by the auditors. He reminded the COF that the reduction of ECUSA pledges from 18% to 15% is significantly less than the DORI income reduction resulting from the Apportionment reduction from 18% to 15% resulting in income reduction and budget reductions. Not all numbers in the report are fully up to date.

Apportionment Aging Report appears large as billing began late for January and many churches did not pay for January until early February, so the report looks worse than it is.

CFO Report: • Solar Farm project (ECC). The Application to National Grid for line access has been submitted. Six valid bids have been received for project management and are under review.

* Hydroponic Farm project (ECC). Continues to need work and refinement, with many details to be considered. So far both projects are proceeding without major hurdles.

• Grace Church, see previous Minutes re concerns. Bishop met with the Rector to consider recent developments. It was agreed and announced at the Annual meeting that Grace Church will pay apportionment at the stated Diocesan rate effective 1/1/18. There is still concern about the GC deficit going forward, and the recent Cemetery issues in the news. Further discussion may be needed.

• Mobil Station 389 Elmwood Ave. Providence, sale to Global Moble is at a draft Purchase & Sale agreement stage. The Agreement is under review to assure complete indemnification from leakage. Expected completion in late spring.

• Edwards Homes, previously managed by Hallworth House will be shifted to the Finance Office for all financial matters to free HH for addressing internal concerns.

• Hallworth House issues continue to be problematic and a matter of concern.

• ECC strategic planning continues in process of implementation. A grant submission to fund construction of new bathrooms along with Camp Nurse space is underway. Discussion has begun with the Champlin Foundations to support camperships (scholarships). A marketing Plan is in effect.

• St’s Peter and Andrew, see previous discussions, is forecasting an $86,000 deficit budget for 2018, with planning unclear at this time. Strategic Providence location, needs careful study.

New Business

Cash Management. Mr. Batchelor reminded the COF of our commitment to place cash balance funds in income producing position when possible. Following a brief discussion it was Moved, Seconded and VOTED to transfer $180,000 from the checking account to the DIT Cash Fund effective immediately.

To accommodate the Bishop and Canon to the Ordinary it was agreed to hold the next meeting on March 1^st at St. Luke’s Church

The meeting was adjourned at 7:10 p.m.

Respectfully submitted

Edwin F Hallenbeck

Secretary

Next Meeting: March 1, 2018. 5:00 p.m. St. Luke’s Church.

Meeting — January11, 2018

2018-06-05T12:05:00.000-07:00

Diocese of Rhode Island

Commission on Finance

Meeting, January 11, 2018

Present: Robert Batchelor; The Rev. Erik Larsen; The Rev. Peter Tierney.

Also present: Dennis Burton; The Rev. Edwin Hallenbeck.

The meeting was called to order at 5:00 p.m. by Chair Tierney, who offered an opening prayer.

The Minutes of the meeting of December 7, 2017 were approved as distributed.

Finance Report was reviewed by Mr. Batchelor noting that not all December 31, 2017 items were entered at the time of this preliminary yearend report. All bad debt actions have been recognized, and apportionment writeoffs recorded. No significant audit adjustments are anticipated. The statement is fairly accurate, subject to additional adjustments.

Apportionment Aging, December 2017. Four churches were stated as outstanding as of 12/31/17. Two have since paid, the remaining two are due one month and are expected to pay shortly.

CFO Report, Mr. Burton: • ECC projects, both the Solar Farm and Hydroponic Farm projects are preceeding, with difficulty securing three bids for the Hydroponic project, it was agreed that two bids may have to be sufficient for this project. The application for power access to National Grid will be submitted on January 12^th. Work continues on full operational proposals.

• Sale of Mobile station land to Global Mobile, the term sheet has been accepted, and a purchase and sale agreement is in preparation. It is anticipated the sale may be completed in late spring.

• Hallworth House. Following the December 2017 (see Minutes) discussion the concerns were fully discussed by Diocesan Council. Council voted to approve the new elevator, they want to give Hallworth House a chance to proceed. A $500k deficit is anticipated for 2018. The Rehab unit located in the Annex building closed as of 1/1/18. The HH Board is managing on its own, with the COF monitoring what is happening.

• St. Peter and Andrew, anticipates operating in 2018 with an $83,000 loss. Work is proceeding on creating a plan for developing and/or restarting the church and its buildings in this strategic location. The question the COF needs to consider with care is: Are there other churches with potential issues.

• Re Apportionment Reduction in 2018. Question, is there a role for COF to encourage churches to reduce and stabilize operations with their reduced apportionment cost? The matter needs careful study.

• Suggested ideas. Would it be helpful to prepare a summary worksheet for a church, for the Bishop before his Visitation. Would it be helpful to prepare a list of churches that are facing issues. Following discussion it was agreed that the CFO will prepare an analytical listing of such churches for the March meeting.

New Business. The lease of Church of the Advent with ENRICHri was reviewed by Mr Burton. It ends on May 1^st and will not be renewed because the ENRICHri clients have shifted to northern RI. There was discussion about adjusting the rent for the remaining lease, and Mr Burton was encouraged to work out a reasonable arrangement in view if reduced use of the facility.

February and March meetings both are scheduled for the first day of the month, making statements difficult to be available in a timely manner. The Chair agreed to consider this matter with a view to moving the meeting to the second Thursday.

The meeting was adjourned at 6:00 p.m.

Respectfully submitted

Edwin F Hallenbeck

Secretary

Meeting — December 7, 2017

2018-01-22T13:21:00.000-08:00

Diocese of Rhode Island

Commission on Finance

Meeting, December 7, 2017

St. Luke’s Church, East Greenwich

Present: Robert Batchelor; Sarosh Fenn; The Rev, Erik Larsen; The Rev. Peter Tierney.

Also present: Dennis Burton; Joan DeCelles; The Rev. Canon Linda Grenz; The Rev. Edwin Hallenbeck.

The meeting was called to order at 5:05 p.m. by Chair Tierney, who offered an opening prayer.

The Minutes of the meeting of November 14, 2017 were approved as distributed.

Financial Report. Mr. Batchelor commented on the November 30^th Report, the Balance sheet reflects a reduction in cash as Episcopal Charities grants have been completed. Revenue received is close to plan. Expenses show most lines near budget. A number of December items are expected to settle out by year end.

Apportionment Aging Report. Most churches are paid current with some lagging by one or two months and are expected to complete payments by year end. Three churches continue as problem cases. The first two, St. George’s, Central Falls ($13,546.), and St. Peter and St. Andrew, Providence ($7,674.31) do not have funds available to pay apportionment. It is clear that both churches are experiencing very difficult operating circumstances. Following discussion, it was, Moved, Seconded and VOTED to recommend to Diocesan Council that an Apportionment Adjustment be recorded by year end for St. George’s, Central Falls for $13,546.; and for St. Peter and St. Andrew, Providence for $7,674.31 for reason of inability to pay.

In addition, the case of Grace Church, Providence was reviewed, noting that the COF has determined that the Apportionment Grace Church has been paying in 2017 does not conform to the ECUSA Canons and the underpayment is not in accordance with accepted accounting practice. Audit review of the matter is that it be written off as bad debt for 2017, subject to future collection. It is expected to be paid as they are able. It was Moved, Seconded and VOTED to recognize unpaid Apportionment of Grace Church, Providence of $39,021. as bad debt, subject to repayment.

CFO Report, Mr. Burton.

Hallworth House is a 56 bed long term care Nursing Care facility, established in the early 1960s before the Medicare and Medicaid Federally based systems were created. The HH facility is not well suited for operating within these systems. It is presently experiencing significant vacancies with 40% private payers and 60% third party payers. Building design limits operational efficiency. HH is located on Diocesan land, its Board is elected by Diocesan Council and is within the Diocese of RI sphere of ownership. Over the last eighteen months HH has experienced major changes, low census (occupied beds), Rehab Center in deficit, HH running a deficit which is increasing, building with major capital improvement needs. It has engaged in a Strategic Planning process without significant results. It is clear there are major issues looming in the near future. Nursing Care beds are in oversupply in the metropolitan area, Federal and State Regulations are becoming more stringent. Until recently little current operations data was available to the Diocese. The outlook for Hallworth House is not favorable. It must be noted that HH is part of the Diocese and future changes will have an impact on Diocesan operations, it falls in the “We are all in this together” arena. It was agreed that the Chair of CF and the Vice President of Diocesan Council need to be brought into the picture and that Diocesan Council needs to be informed of the current situation.

2017 Surplus. It is anticipated that an operating budget surplus for 2017 will be similar to prior years in the vicinity of $150,000±. The CFO suggested it might be prudent to consider assigning the surplus as a Capital Improvement Fund. It was agreed the matter needs further discussion in January.

ECC Projects. Following last month’s discussion and approval of initial funding by Council, both the Solar Farm and Hydroponic Farm projects are progressing. Additional personnel have been added to the Task Force, and Consulting Firms engaged in preparing an application to National Grid for establishing a power linkage.

Sale of Land. Sale of the land at 389 Elmwood Ave, Providence to Global Companies, LLC is proceeding with preparation of a Term Sheet with special care for indemnification of environmental liability.

Old Business:

Holy Trinity, Tiverton, Revolving Loan Application, see previous discussions. Revised planning and capital campaign giving data has been submitted and reviewed and the Bishop met with the Rector and Vestry. The new data is viewed as providing much better support for undertaking the proposed loan. Following discussion, It was Moved, Seconded and VOTED to recommend to the Standing Committee a Revolving Loan of $30,000. over 5 years at a rate of 3.25% to Holy Trinity Church, Tiverton. It is suggested to Holy Trinity that placing loan fund security in the DIT would decrease the interest rate .

New Business

St. Peter and St. Andrew, Providence Revolving Loan. Further discussion of issues at St. Peter and St. Andrew note that the church is almost at a standstill with less than a dozen parishioners. It will need a true restart in order to become a fully functional church, with many side issues. Among issues is an outstanding Revolving Loan the church is unable to pay. It was Moved, Seconded and VOTED to restate the St. Peter and St. Andrew, Providence, Revolving Loan outstanding of $31,432. as a bad debt against the Revolving Loan Fund and to refer the matter further to the Standing Committee.

Depreciable Asset Threshold. Mr. Batchelor reviewed the current maximum of $3,000 that may be depreciated in one year. Changing costs of equipment and building costs suggest an upgrade for this figure. It was Moved, Seconded and VOTED to change the Diocesan Policy for the threshold of Depreciable Assets from $3,000 to$6,000, and that church Treasurers be so infirmed.

Star Street property. The small parcel of land on the North side of Star Street and East above a parking lot area used by Hallworth House has again been asked about for purchase by a neighbor. Mr. Burton is following the lead with the assistance of the Treasurer Mr. Batchelor.

DIT Management. It was reported that the revised Board of the DIT Fund is carefully reviewing the management and oversight of how the funds are managed on a day to day and long range basis. It is suggested other similar funds appear to be receiving better returns.

David Terry. It was reported that David Terry, former member of the COF, and a patient during a recent illness at Hallworth House, died on November 27^th. His funeral will be Saturday December 9th at St. Augustine’s Church, Kingston. RIP.

The meeting was adjourned at 7:05 p.m.

Respectfully submitted

Edwin F. Hallenbeck

Secretary

Next meeting: January 4, 2018 at 5:00 p.m.

Meeting — November 14, 2017

2017-12-08T07:38:00.000-08:00

Diocese of Rhode Island

Commission on Finance

Meeting, November 14, 2017

St. Luke’s Church, East Greenwich

Present: Robert Batchelor; Sarosh Fenn; The Rt. Rev. Nicholas Knisely; The Rev. Erik Larsen; Stephan Sloan; The Rev. Peter Tierney.

Also Present: Dennis Burton; Joan DeCelles; The Rev. Canon Linda Grenz; The Rev. Edwin Hallenbeck.

Guest: Richard Sellers, Consultant.

The meeting was called to order at 5:05 p.m. by Bishop Knisely, who offered an opening prayer.

Organization of Commission. The Bishop appointed The Rev. Peter Tierney as Chair of the Commission. Mr. Batchelor agreed to serve as the Commission representative to Diocesan Council.

The Minutes of the meeting of October 10, 2017 were approved as distributed. A copy of the Resolution of Thanks for Chair Lofaro was circulated for signature by all present.

ECC Solar Farm and Hydroponic Farm. Mr. Burton introduced Richard Sellers, who has served as project consultant to consider if such projects are appropriate and possible for land at ECC not presently in use. A presentation was made outlining the work to date, including risks and potential for economic gain. Following lengthy discussion, it was Moved, Seconded and VOTED to recommend to Diocesan Council that a formal Feasibility Study be undertaken for a Solar Farm project and a Hydroponic Farm project at the Episcopal Conference Center and that $50,000 be allocated from the 2017 surplus funds for this purpose.

Mr. Sellers left the meeting prior to the Vote.

Financial Report. Mr. Batchelor commented on the Report of October 31, noting nothing unusual and that all bills are paid. He forewarned the COF that in December it will be necessary to review with care and act on unpaid apportionment from three churches.

Apportionment Aging Report. Eight churches are more that one month in arrears. All but three are expected to complete payments by year end. As noted above by Mr, Batchelor problems relating to St. George’s, Central Falls, Grace Church, Providence and St. Peter’s & St. Andrew’s, Providence will need review in December as they are significantly behind.

CFO Report. Mr. Burton reported on the continuing negotiations for the sale of Mobile Station land at 389 Elmwood Ave, Providence. The remaining issue is use of parking area by the previously sold adjacent church. Mr. Burton was encouraged to complete the sale.

Old Business: • Holy Trinity, Tiverton, Revolving Loan Application. A revised Business Plan to support the loan was submitted and reviewed. The plan was viewed as relatively unrealistic. It was agreed not to approve the loan request at this time as further questions remain unanswered. Staff will discuss the matter with the Rector.

• St. John’s, Newport, Revolving Loan Application has been withdrawn for further study by the church.

ECC DIT Funds. Mr. Batchelor reported on his careful review of ECC funds currently held in Nine (9) separate DIT accounts, several of which are quite small. He proposed combining several funds into 4 Funds [Scholarship Fund; Capital Improvement Fund; ECC Endowment Fund] The Elizabeth Campbell Fund will remain unchanged. The aim is to simplify accounting and use of income with clearly stated use for each. It was Moved, seconded and VOTED reclassify ECC Funds in the DIT according to the analysis presented by the Treasurer.

Vacancy. It was noted that there is an appointed by the Bishop vacant position on the COF. All present were encouraged to suggest names to the Bishop of persons with financial management experience and interest.

Meeting time. Jim Segovis, the new member elected at Convention, is unable to meet on Tuesdays. It was agreed to meet on the first Thursday, subject to room availability at St. Luke’s.

The meeting was adjourned at 7:00 p.m.

Respectfully submitted

Edwin F. Hallenbeck

Secretary

Next Meeting: December 7, 2017 at 5:00 p.m.

Meeting — October 10, 2017

2017-11-27T11:05:00.002-08:00

Diocese of Rhode Island

Commission on Finance

Meeting, October 10, 2017

St. Luke’s Church, East Greenwich, RI

Present: Robert Batchelor; Sarosh Fenn; The Rt. Rev. Nicholas Knisely; Michael Lofaro; Stephan Sloan; The Rev. Peter Tierney.

Also Present: Dennis Burton; Joan DeCelles; The Rev. Canon Linda Grenz; The Rev Edwin Hallenbeck.

Guests: Church of the Ascension, Cranston: The Rev. Michael Coburn, Rector; Susan Wright, Senior Warden; Richard Burlingame, Treasurer.

Church of St. John the Evangelist, Newport: The Rev. Nathan Humphrey, Rector; Christopher Moe, Budget Chair.

The meeting was called to order at 5:00 p.m. by Chair Lofaro. An opening prayer was offered by Bishop Knisely.

The Minutes of the meeting of September 12, 2017 were approved as distributed, with one abstention by a member who was not present at the meeting.

2018 Budget. The complete draft budget was distributed and reviewed by Program and Budget Chair Fr. Tierney. Major changes are dropping the Canon for Program, Canon Fornal is moving from current role to part time Director of Episcopal Charities on a consultant basis, and eliminating the Development Office personnel and replacing staff with consultants as needed. It was noted that the proposed reduction in apportionment from 16.5% to 15,5% will reduce apportionment income by about $108,000. Extensive analysis of projected parish apportionment income indicates current estimates are reasonably accurate for the next two years. Later years will require further study. The budget plan is that reducing apportionment will strengthen parish finances. Following additional discussion, it was Moved, Seconded and VOTED to approve and recommend the 2018 Diocesan Budget to Diocesan Council for further consideration.

CFO Report. Three matters were reported:

• Canon Grenz outlined issues at Sts. Peter and Andrew, Providence, now a mission church functioning under Diocesan jurisdiction. There is no plan in place to address current concerns or working toward the future. The Church owns three houses that have been rented as apartments. Issues in the buildings has resulted in nonpayment of rent by occupants. Review of building conditions, including a building engineer indicate serious deterioration to the point where they should no longer be occupied. Tenants are in the process of vacating. City tax, insurance and utility bills are accruing and need to be paid with no rental income. The Vicar is retiring with no income for a replacement. It is a difficult situation that will be considered as a new start-up. Use of Reserve Funds will be needed to cover existing needs. It was Moved, Seconded and VOTED to recommend to Diocesan Council that the Diocesan Reserve Fund be allocated to pay for City taxes, insurance and utility costs at Sts. Peter and Andrew Church, Providence, specific amounts to be determined.

• Mr. Burton reported that there are three firm bids for the Mobile Station land at 389 Elmwood Ave. Negotiation is in process to complete the sale in the near future. Details of the conditions of sale are complicated by several factors, they should be resolved soon.

• The ECC Solar Farm project development continues. National Grid has confirmed its power grid can accept the anticipated power generated. The acreage is available. Financial analysis is underway. An alternate hydroponic farm option is also being considered. There is an option to consider selling electricity directly, making ECC electricity available to churches at a discount price.

Church of the Ascension, Revolving Loan Application. Guests from the church joined the meeting. A completed application was received for review requesting a loan of $50,000 for five years. Fr. Coburn and Mr. Burlingame reviewed the church proposal and recent history evolving as a bilingual church including dual participation on the Vestry. With little maintenance and no improvements an upgrade to the heating system is essential. A much smaller upgrade of the boiler for the attached rectory was completed recently, which is now rented. The main boiler for the church will be converted to gas and replaced. Income from a small capital campaign over the life of the loan will enable repayment. Several questions were answered. The guests were thanked and left the meeting. Following discussion, it was Moved, Seconded and VOTED to approve a loan of $50,000 at 2.5%, including a .75% reduction for pledged DIT funds, over five years, and forward the action to the Standing Committee for further consideration.

Apportionment Aging Report. At September 30, 11 churches were one or two months behind and not viewed as a problem. Five churches are three or more months behind and need to be watched with care. Two churches are significantly behind and viewed as unlikely to complete payments for 2017.

Church of St. John the Evangelist, Newport, Revolving Loan Request. Guests from the church joined the meeting. A completed application was received for review requesting a loan of $150,000 for five years. Fr. Humphrey outlined the loan request projects, including work on several aging buildings and landscape revisions to provide accessibility. An objective is to complete all projects soon rather than continuing to expend $30,000+ per year, use that money to repay the loan. The proposed work has several projects, some clearer than others. The churches financial structure and plan was not clear and a number of questions were raised with some unanswered. There was a lengthy discussion. The guests were thanked and left the meeting. Following additional discussion, it was Moved, Seconded and VOTED to defer action on the request until November and to request responses to financial questions raised and ask the church Treasurer to be present at the next meeting.

Holy Trinity Church, Tiverton, Revolving Loan Request, cont. See discussion on September 12, 2017 Minutes. A smaller loan of $30,000 has been discussed, however no written material has been received changing the request or describing any change in the scope of the project. It was agreed to defer further discussion to November and request any changes in writing.

Finance Report. Mr. Batchelor briefly reviewed the September 30 Report, noting that there are no major matters outside budget expectations. The Analysis of Variance sheet distributed by Mr. Burton notes a number of accounts where number do differ from budget. As of 9/30 the net is an under expenditure of about $227,000.

Resolution of Thanks. Bishop Knisely Moved: Very special thanks to Chair Michael Lofaro for his service as Chair of the Commission for the past four years. During that time the work of the Commission has proceeded with increasing strength and diligence, attention to detail, calling upon the wisdom and experience of Commission members and Diocesan staff. His work is deeply appreciated and will be missed as his term expires at Convention. A rising vote of thanks was extended by all.

The meeting was adjourned at 6:50 p.m.

Respectfully submitted

Edwin F Hallenbeck

Secretary

Next meeting: November 14, 2017. 5:00 p.m.

Meeting — September 12, 2017

2017-11-27T11:03:00.000-08:00

Diocese of Rhode Island

Commission on Finance

Meeting, September 12, 2017 St. Luke’s Church, East Greenwich

Present: Robert Batchelor; Sarosh Fenn; The Rev. Erik Larsen; Michael Lofaro; Stephan Sloan; The Rev. Peter Tierney.
Also Present: Dennis Burton; Joan DeCelles; The Rev. Canon Linda Grenz; The Rev. Edwin Hallenbeck.
Guests: The Rev, John Higginbotham, Rector; Sam Hester, Senior Warden, Holy Trinity, Tiverton.
The meeting was called to order at 5:00 p.m. by Chair Lofaro. An opening prayer was offered by Canon Grenz.

The Minutes of the meeting of May 9, 2017 were approved as distributed. Note: there was no meeting held June 13, 2017 due to a severe storm.
Finance Report for August. The full report was distributed. Several matters were noted. The DIT data is now being updated to market value on a quarterly basis, keeping it current. A separate Variance Analysis report is prepared stating items that are significantly off budget with a brief explanation. At this point Income is over budget by $68,526. Operating expenses are $203,816 under budget. It is expected this will move closer to budget by year end. Cash flow in bank remains high.
Apportionment Aging Report. A number of churches are one or two months behind similar to previous years, One is six months behind due to personnel issues, now catching up. Three churches are significant problems. St George’s, Central Falls has made no payments. Sts. Peter & Andrew, Providence has major issues is now three months behind. Grace Church, Providence continues to pay at its own formula and is projected to underpay by $39,021.
Grace Church, Providence. Mr. Burton reported on recent conversations. The new building is near completion and ready to open for use. It is now necessary to implement planning and activities for its use and income producing capabilities. It is expected this will require a three year cycle of activity. Discussions are under way about how to accomplish this and the financing needed. It was suggested the COF discuss this further at its next meeting.
CFO Report. Mr. Burton reported. •Church of the Advent, Coventry developed an oil tank leak in July requiring immediate cleanup of a significant spill of over 400 gallons. Cost of remediation was $56,000 to which must be added $3,600 for replacement tank. •The Mobile Station land at 389 Elmwood Ave, Providence has two potential buyers. A team of appraiser, broker and surveyor is working with the Chancellor to negotiate sale, noting the area has environmental sensitivity. •Solar Farm at ECC concept is under intense study to determine detail requirements and approvals needed. •Several items needing future attention have been identified for later discussion.

Commission on Finance — Minutes, September 12, 2017 Page 2 of 2

Holy Trinity Episcopal Church, Tiverton, request for Revolving Loan. Rev Higginbotham and Mr. Hester joined the meeting. An application for a $50,000 loan over eight years was received. It was stated that loans may not exceed five years. There followed a lengthy discussion regarding: budget implications for the church; should endowment funds be placed in the DIT to secure a lower interest rate; what are current investment return rates? Should the church consider rearranging the project to a smaller loan amount to keep monthly payments at a level it considers prudent. It was noted that the capital campaign undertaken this year has already paid for some improvements. The questions discussed need further study. The guests left the meeting.
Further discussion by the COF clarified questions to be answered. It was agreed to defer action pending answers and possibly a revised application.
Program and Budget Major Changes. Fr. Tierney distributed a sheet of major budget changes anticipated at this time. The biggest change is reducing apportionment from 16.5% to 15.5% which will drop Diocesan income by about $108,000. This will need to be made up mostly by reducing expenditures. Several possible changes were noted, none final. More definitive data will be available in October. Further study is needed about specific needs and costs for capital items.
The meeting was adjourned a 6:57 p.m. Respectfully submitted
Edwin F Hallenbeck
Secretary
Next meeting: October 10, 2017 at 5:00 p.m.