As an educator, I feel everyone should know the basics of nonprofit finances. This is in large part because I consider the nonprofit sector — especially smaller membership nonprofits like UUCPA — to be one of the bulwarks of democracy. Totalitarian regimes hate small nonprofits and other voluntary associations, so when you see a society with a robust nonprofit sector, that’s a pretty good indication of a strong democracy. Since smaller nonprofits depend on volunteers to oversee finances, this implies that one of the basic skills of democracy is nonprofit finances.
This in turns suggests that one of the most important things you can teach your children is the basics of nonprofit finances. To help you out, I’m going to tell you a little bit about how UUCPA spends money, and how we raise money.
Let’s talk about expenses first. The operating budget for UUCPA this year is $723,650 — call it $725,000. 78% of our operating budget goes to staff costs (salary and benefits), and 22% to routine operating expenses (utilities, office, routine maintenance, program. etc.). Because we are a democratically-run organization, UUCPA staff members (our biggest expense) follow the priorities set by the UUCPA members at our annual meetings.
Next let’s talk about income. We’ll spend about $725,000 this year, and about $600,000 of that amount comes from members and friends. About $500,000 of member and friend contributions comes from so-called “pledges,” that is, donations promised at the beginning of the fiscal year by members and friends. Pledges from members and friends provide a chunk of stable income for the year. The remainder of our income comes mostly from letting outside groups use our campus, and receiving donations from them in turn.
So our biggest expense is staff costs. The vast majority of our income consists of contributions from members and friends. Put those two things together, and you can see that we are self-funded, and that means we can use the democratic process to set our own priorities.
As you make your pledge to UUCPA this year, I hope you will take the time to sit down with older children and teens, and help them understand where UUCPA’s money comes from, and where it goes. Help them understand that your family’s contribution allows us to remain a democratically-run organization.
One last thought — if you have not yet become a voting member of UUCPA, you might think about becoming a member now, so you can vote in the annual meeting in March.