Designated Funds: Giving Policy

To designate or not to designate, this has been the question.

I've had several churches in the past while ask about the proper handling of Designated Funds; that is donations given for a specific purpose.

Question:  can we change the designation of funds that have come in for a specific purpose?

Answer:  No, Yes & Maybe.

No, if you have already accepted a designated gift you cannot change the designation.  When received, it becomes a legal obligation of the church to disburse it for its designated purpose.  The only way to change the designation would be to appeal to the courts.  In most cases, this is not cost effective.

Yes, if you have a Designated Giving Policy in place prior to receiving a gift then the church may redirect funds to other purposes if they are no longer required or are needed for other projects of the church.  This policy must be communicated and can be done by printing the policy on the tithe envelopes. 

An example of this statement can be as follows:

“When any given need has been met, or where projects cannot be reasonably carried out the donor agrees that designated gifts may be used where needed most.”

A couple of things to remember.  Gifts received prior to adopting a Giving Policy will still need to be used as designated.  Once the policy has been set in place, council should determine the approved projects of the church and communicate that these will be the only projects the church will accept designated funds for.

Maybe, designated gifts may come in that are for a ministry area of the church that is already funded through the operating budget.  Examples would be youth, children, adult, Alpha, missions, etc.  In this case, designated funds that come in can be used to offset the budget of ministry costs. 

The church could choose to use the funds over and above the budget, or use it to reduce the amount from the budget.  If the gift is not fully used up in the year the remaining balance should be carried forward to be used in the next budget year.

Whatever way the church decides, may you be blessed in your givings and receivings!


Useful Quote of the Day:  We shall never have more time. We have, and always had, all the time there is. No object is served in waiting until next week or even until tomorrow. Keep going... Concentrate on something useful.
Arnold Bennett