Introduction

Fr. Clyde Jarreau could not sleep early in the morning of October 10, 2005. The evening before, he had presided over his parishs monthly finance committee meeting, where concerned parishioners examined the churchs monthly financial statements and provided recommendations to keep the organization on track financially. At the previous nights meeting, a few of the committee members continued to voice their concern that spending was out of control. The churchs bank account balances had fallen sharply for the sixth month in a row, and the committee members were worried that the church would run out of funds sometime early in 2006.

Fr. Jarreau appreciated their commitment to the parish, but he did not need them to remind him of the churchs financial struggles. As the pastor of dwindling, weekly offertory collection figures that he had to publish in the weekly bulletin. With expenses increasing without the additional revenue from collections to cover them, Fr. Jarreau knew that he would have many more sleepless nights if he could not find a way for the church to live within its financial means.

After contemplating the problem over a cup of coffee in the rectorys kitchen, Fr. Jarreau knew that he could not construct a solution to such a big problem by himself. He decided to place a call in the morning to a few of his most trusted advisors on the finance committee. These people had been parishioners at the church for more than 15 years, predating himself by a half dozen or so years. They knew the history of the parish over this time and had seen the financial position deteriorate over the past few years, as well. Fr. Jarreau knew that they would do anything they could to help the parish; he only hoped that he was not reaching out to them too late.

St. Elizabeth Seton Catholic Church

Fr. Jarreaus parish, St. Elizabeth Seton, was founded in 1976 in Daphne, Alabama, a small Gulf town just outside of Mobile. The parish grew rapidly throughout the 1980s and 1990s as a large number of workers from the northern United States moved into the south, chasing both displaced jobs and better weather. Although the church itself is the same size as the original building built in 1976, the parish conducted two successful capital campaigns in the subsequent decades after the parish was founded. The first campaign,

Can you think of any other variables that are not provided in the data set that could be useful in predicting the monthly offertory revenue?

How would you incorporate the data in the exhibit about the holy days into a variable that could be used in a regression model?

Tell me your plan for fitting a regression model that can be used to predict the monthly offertory revenue? For example, which independent variables would you include in your full model?

Exit Forecasting Offertory Revenue at St. Elizabeth Seton Catholic Church - Matthew J. Drake kicked off in 1985, raised funds to build an educational building for religious education classes for children and adults. The second campaign, begun in 1996, enabled the church to build new offices for its staff and parishioner appeared to be unaffected by the capital campaign. Cash Flow Analysis was able to arrange a meeting with his trusted finance By the year 200o, membership in the church was strong, and the cash reserves were rising each month as parishioners gave generously each week. With the crash of the dot-com bubble in late 2001, however, offertory revenue slid in 2002, and a few years passed before it showed signs of any significant recovery. In an effort to revitalize the church and in keeping with the historical 1o-year cycle, Fr. Jarreau spearheaded a new capital campaign toward the end of 20o4 with the goal of raising money to build a new recreational hall for the church. This would enable the parish to hold more fellowship activities, as well as generate additional sources of revenue by hosting wedding receptions and other banquets. Unfortunately for the pastor, these new revenue streams would only begin after the building was completed in early 2007. committee members, John Gust and Charlie Stewart, a few nights later. When they arrived in his office around 7 p.m, Fr. Jarreau wasted no time summarizing the problem facing the church. "Our bank balances have consistently fallen throughout this year. At this rate, it looks like the parish is going to be out of money by this time next year. What do you guys think we should do?" Charlie and John had thought that they were going to have to open Fr. Jarreau's eyes to the church's financial problems in this meeting, but now it was obvious that the pastor understood them all too well. After a brief sigh of relief, Charlie started, John and I have been members of the finance committee for years, and we've got a lot of ourselves invested in this parish. Weve been trying to suggest subtly that the church's spending was getting out of control, but now it appears as if the time for subtlety has passed. We need to drastically rein in expenses. When Fr. Jarreau initially discussed the summer of 2004, several members of the finance committee were worried that many parishioners would simply direct a large portion of their weekly offertory contribution to the new capital campaign. This would severely hinder the church's ability to meet its normal operating expenses. Luckily however, Fr. Jarreau's explanation of the capital campaign had largely convinced the parishioners to support it in addition to maintaining their normal weekly offertory contributions. The offertory figures thus far in 2005 new capital campaign in the Fr. Jarreau recalled their previous concerns but could not reconcile one aspect of the church's financial o that we have a balanced budget each year. They won't accept a budget from us that isn't balanced. How could we be in this situation with a balanced budget?" John chimed in, "Well, Father, the problem seems to be with the budget process itself. In my opinion, we've been doing the whole thing backwards. 7-8/12