Financial Relief for Church Benefit Obligations

Financial Relief for Church Benefit Obligations


Ross Williams

3/25/2020

Dear Treasurers, Finance Chairs and Pastors,

We have received many questions lately about how the Conference can assist our churches in this time of crisis and great uncertainty.    

Please read what follows on the topics of apportionments, pastoral salaries and a two-month waiver of church benefit billings. 

Please know that the conference staff continues it's mission to support our member churches.  While we are working "virtually" you may reach out to us at our normal office phone numbers and email addresses at any time for assistance.

Sincerely,

Ross

Apportionments:

Apportionments represent your church’s fair share of the Conference budget.  They are an “ask” and not a “bill”.  While we expect churches to pay 100%, there have always been struggling churches who could not do so.  We often get calls asking for apportionment reductions from churches that are in financial distress.  Rather than reducing apportionments, which transfers a church's obligation to all other churches, our approach has been to ask churches to simply do the best that they can.  We therefore ask that your church continue to pay what it can against your 2020 apportionment budget to continue to fund the ministries of the conference.  We cannot do our job of responding to the critical needs of our people in the midst of this crisis without the support of our churches.  We understand that there will be churches who cannot pay what they had intended due to a decline in giving.  Please do the best that you can under these extraordinary circumstances and know that we appreciate whatever you can do! 

A note from Bishop Bickerton regarding Pastoral Salaries: 

As we journey through these uncertain days, it is important for every church/charge to continue your commitment to fully compensate your pastor in the amount agreed upon at your most recent Charge/Church conference.  I have placed high demands on the shoulders of our pastors, as I know you have, in these exceptionally challenging times.  Beyond being able to rely upon their salary, please do all that you can to support your pastor and encourage them to engage in practices that will keep them spiritually, mentally, and physically healthy.  Thank you in advance for all that you do to help ensure that these matters are cared for properly. 

Church Benefits Waiver:  

Beginning with the April 2020 health and pension invoice and extending through and including May 2020, churches will not be billed for pension and health benefits.  
 
Benefit obligations waived include:

  • Employer Pension billings (CRSP-DB, CRSP-DC)
  • Employer Death & Disability billings (CPP)
  • Employer UMPIP contributions (for clergy serving less than 75%)
  • Employer Healthcare billings (HealthFlex Uniform Rate of $1,520/month, $18,240 annually)  

FREQUENTLY ASKED QUESTIONS 
 
1.     How much funding is required to support this initiative and what is the source of the funds?
 
The two-month waiver will require approximately $640,000 for healthcare obligations, $610,000 for pension obligations and $80,000 for death and disability obligations.  Funding will come from undesignated reserves of the Conference Board of Pensions and Health Benefits and the Conference Council on Finance & Administration.   
 
2.     Will clergy benefits or health coverage be impacted in any way by this waiver?  
 
No.  Clergy benefits and health coverage will not be impacted due to this waiver.  
 
3.     Will churches be asked to repay the amounts that are being waived? 
 
No.  Churches will not be asked to repay such amounts. 

4. Will the waiver include billings to clergy for their share of benefits?
 
No.  Clergy are still be expected to pay their portion of health insurance, as well as any dental and vision coverages since churches are expected to continue to pay pastoral salaries. 

5.     Will the waiver include clergy payroll deductions?
 
No.  The waiver does not cover clergy payroll deductions that are made to fund the United Methodist Personal Investment Plan (UMPIP), HealthFlex Premiums, Health Savings Accounts (HSA), and Flexible Spending Accounts (FSA), which include both Medical Reimbursement Accounts (MRA) and Dependent Care Accounts (DCA).  All payroll deductions should remain in place and will appear on your normal monthly bill from the Conference.  It is illegal for any organization to withhold but not remit payroll deductions.
 
6.     Will the waiver impact the W-2s of clergy?
 
No. The W-2s for clergy will not be impacted by this waiver since benefit-related payroll deductions will continue to remain in place.
 
7.     Will the waiver cover UMPIP contributions that churches may be making for lay employees? 
 
No.  The waiver solely pertains to benefit costs of appointed clergy
 
8.  How will the waiver be handled for churches that have pastors that are appointed less than ¾ time (across all appointments) and for whom pension costs are not being billed by the Conference?
 
According to the policies adopted at Annual Conference each year, churches that have clergy serving less than ¾ time (across all appointments) are supposed to be making pension contributions directly to Wespath in the amount of 10.8% of Total Compensation** (or 11.8% if the clergy voluntarily contributes 1%).  Such churches can request reimbursement from the Conference for the actual amount of these contributions (up to 11.8%) for the months of April and May.  Such requests should be made in writing and sent to Ross Williams along with supporting documentation.
 
9. Are “District Hires” or other locally-hired pastors covered by this waiver?
 
No, the waiver only extends to clergy that are appointed by the Bishop.  


** Total Compensation is defined as:
 
Salary, plus either:
 a. 25% of salary if a parsonage is provided

Or

b. Any housing allowance paid