Frequently Asked Questions (updated 5/26/21)

We welcome your questions related to logistics, legislation and budget. These questions and answers will help us prepare for a strong collaborative effort when we meet virtually this month.

What hours will the virtual conference be held?

May 24 from 9:00 a.m. – 12:30 p.m. & May 25 from 8:30 a.m. – 12:30 p.m.

When does registration open?

Registration is now open until May 15. Voting members can register here.

How can a visitor register for Annual Conference? I am especially interested in the Memorial Service as my husband, a retired elder, passed away February 2, 2021. I would be interested in other sessions too, including the ordination service. 

You can watch the service via livestream here.

Can you tell us about how many people are watching the May 5 info session?

We had in total of 293 watching – 283 attendees, 5 panelists/presenters, and 5 staff members.

What legislation will be discussed at this session?

All legislation can be found here.

How does this impact legislation from Annual Conference October 2020 Legislation and other proposed legislation in future years that future annual Conferences may want to change?

Regarding the allocation of property funds (III, G), it’s important to note that the allocation of the four funds noted only kicks in when all other funds achieve their targets outlined on the chart at the end of the legislation. CFA believes re-building these funds to the targets is a priority and will establish the allocation of funds to hit the targets which we believe is achievable by 2026 as noted. The Annual Conference is able to submit legislation at any time to alter these allocations; the legislation outlines CFA’s recommendations.  We will amend the legislation as follows:

In order to rebuild the funds, the distribution of the Investable Property Proceeds to the various funds will follow the plan established by CF&A until the funds other than the four funds listed below have reached their targets (“Funds allocation steady state”). After that, the allocation will be done on the basis of Annual Conference legislation with respect to use of property proceeds.

The steady state allocations expected based on current legislation is:

• Harvest Mission Fund – 50%
• Strategic Disciple Making Fund – 20%
• Retiree Health Care – 15%
• Property Redevelopment Fund – 15%

Would an amendment to our rules and/or out nominations report be required to provide that the GNJ pre-conference workbook and the GNJ conference journal include the full membership of each agency, board, and committee, along with their service term limits – instead of publishing only the current nominations?

The nominations committee will ensure that after annual conference, all elected leaders and members of agencies will be published in the conference journal.

I have a question which came up during Annual Conf session 1. Page 44, Church Closures. Five additional church closures were mentioned but I couldn’t get all the information. I would like to see a complete list.

SKY Mt. Fern – In legislation
GN Jersey City – Bethany Browne – In legislation
DB Centre Grove – In legislation
SKY Eldred VERBAL AT AC – To be closed 9.12.2021
GS West Deptford – Verga Welfare – VERBAL AT AC
CAP Freehold – Silom VERBAL AT AC – To be closed 5.31.2021
RV Dunellen UMC VERBAL AT AC – To be closed 9.30.2021
CA Atco – ELM UMC – VERBAL AT AC

Where can I find more information about the budget?

• The GNJ Financial Report can be found here.
• A list of FAQs regarding shared ministry and the 2021 budget can be found here.

When will the report from the independent team related to the conference’s financial situation be available?

An update on the independent team’s report is expected in the week of April 19.

Who authorizes the use of funds to cover shortfalls? Or is it just done by the GNJAC Treasurer as needed?

When there are insufficient funds to cover budgeted items, a budget manager may decide how to manage the shortfall by reducing some or all items with the budget he or she manages. A budget manager may not take funds from other areas or overspend their budget. If additional funds are needed during the budget year, only CFA may approve redirecting income or using surplus.

We have recognized that our policies and procedures in the past were not as tight as they needed to be, nor was the delegation of authority. To remedy this, our policies and procedures are being updated, including a “GNJ Designated Fund Policies, Processes and Procedures,” which is being brought as legislation to the May conference. The full document was distributed with the IFT report on 4/21. The legislation establishes a new GNJ Fund Committee and defines the fund procedures, including: purpose designation, oversight, administrator and disbursement protocols. I encourage you to read the full document and participate in the May 5 information session for further discussion.

Under the section discussing GNJ Fund Committee, part A, can you add language so that income sources are included from other sources in an effort to avoid miscalculations?

The GNJ Fund Committee is to report at least twice a year to each of the above agencies the state of each GNJ designated fund including balances, sources of income and disbursements made toward approved uses (as defined in this policy), progress towards the fund goal amount, and recommend to the Board of Trustees and CF&A policy updates as needed.

Do the findings of the IFT report impact any financial statements submitted by GNJ to Federal or State authorities (e.g. tax statements, annual reports, etc.) over the years? If yes, have these statements been corrected?

No, the IFT did not find any misstatements in our financials. Our financials are audited by a third party accounting firm every year as required by GCFA and have been in compliance with GAAP reporting.

Why do we not include the budget the items that are spent from the Strategic Disciple Making Fund, largely at the discretion of the cabinet?

These grants are included in the 2021 budget as part of the overall “Congregational and Leadership Development” line item. At the time of the 2021 budget, the committees responsible for the details had not met to work through the details by line item; they were given a total and worked the details to that total after the fact. The final # for 2021 is $80,000. Until we see a positive trend in collections vs. budget, the expense is being managed to 70% of the budget ($56,000).

In the reports, it is indicated that since 2014 our true available cash has diminished. The report does not go back to indicate the role of the new conference center in getting tot his point. At that time we were told that the new building was paid for without a mortgage, by expended about $3.4 Million (by the Trustees to repay the $3.4 million loaned to the conference from the Pensions), plus the value of the old office building, plus approximately 1/2 million dollars that was returned to our conference as a dividend on our health insurance, instead of rebating that 1/2 million to the churches, plus other smaller sums of money. Given the conference financial crunch and the reduction in staff, is this now the time to consider selling that building and making less expense arrangements for accommodations for the conference headquarters?

There are members of CFA who recall the MRC was purchased by using “surplus funds”, not GNJ designated funds (i.e. Harvest Mission Funds). There are no current plans to sell the building but this could be discussed at a future CFA/Trustees meeting who can report back to the Annual Conference.

We were promised a report regarding retiree health insurance. In the proposal for the proceeds of sale from our closed churches, retiree health care is given 15%, with 50% for the Harvest Mission Fund and 20% for the Strategic Disciple Making Fund. That raises the following question, “Is the commitment to continue the retiree health insurance subsidy a commitment to maintain at least the coverage provided under the current Medicare Advantage plan, and if not, what cuts are contemplated to be made in the program if 15% doesn’t fund the program in a way that provides at lest the current level of coverage?

The Board of Pensions are reviewing options in both the active and the retiree healthcare plans as the current generous plans of coverage are not sustainable in both cases; they will be holding information sessions on May 12, 2021.

The investigation team found that all records were audited and found to be within acceptable accounting procedures. In order to give us a reason to have confidence in our system, why is that not highlighted in the information being sent out, since there were issues raised about a “forensic audit?”

While GAAP standards were adhered, as we did highlight, the IFT made it clear that GNJ had “a series of breakdowns in the areas of policies, processes, procedures and people.” All of which need and will be prioritized and addressed.

How can we count on transparency in handling our finances, when the “team” investigating are unknown, the full report is not being made available to the churches, and we have failed to clearly acknowledge that no-one is guilty of misconduct, in this simple record of overspending the cash that was truly available for disbursement?

Firstly, regarding the anonymity of the IFT … unfortunately, one of the team member’s name was somehow leaked and that persons’ spouse inappropriately received a call inquiring about the report before it was released; this unacceptable behavior resulted in the team’s request to remain anonymous which CFA agreed to. If the IFT had said they wanted to be anonymous at the time when they were appointed, we would have appointed someone else. But they made their request for anonymity as a result of events as they unfolded. We could not do anything but respect their wishes especially as we are very grateful for all the time and energy they put into this. A synopsis of the IFT report has been prepared and will be distributed to the churches shortly. Further, IFT report does not give GNJ a clean bill of health – they in fact said “There is not one specific reason how or why this occurred, but a series of breakdowns in the areas of policies, processes, procedures and people.

The Independent Financial Review Team looked at the budget shortfall as related to underbillings for health insurance. However, no mention is made of an investigation into the other portion of the shortfall, as originally described, related to GNJ’s inability to collect shared services fees from our related non-profits. Why is that and what is the status of the investigation into that dimension of the problem?

The IFT did not have to investigate this as it was clear that the budgeted income could not be paid by the Mission Partners (they did not have the income), nor were agreements in place from the respective Boards.

A special annual conference, a three-month investigation, eleven pages of reporting, and a single information session hardly seem an adequate basis upon which to rebuild financial trust in the annual conference following a crisis of this magnitude. What additional steps are planned to rebuild the trust of clergy and congregations in the system?

We recognize trust is earned over time and lost very quickly; it will have to re-built through time and actions. CFA, the Board of Trustees, the Board of Pensions and the new CFO are committed to implementing the recommendations made by the IFT. Some items have already been addressed (new invoice approval policy, new travel & expense policy and new fund legislation being presented in May); others will take time.

Not only were we instructed not to share the report but the report document is actually protected so it cannot even be printed for our own review. Should that be changed?

That is correct, it is protected and that will not be changed. CFA upon recommendation from the Independent Financial Team is not circulating the document.

It was a long-standing policy, not a secret, that we were using a portion of the surplus included in the annual budget to meet the widespread, popular goal of meeting our full General Church apportionments. But, we seem to be indicating that it was not well-known across the Conference despite being reported each year in the Pre-Conference Booklet.

While people did know GNJ supplemented the General Church apportionments, we do not believe there was anyone aware that in 2020 and likely in other years as well that it was coming from program designated reserves such as the Harvest Mission Fund. The Harvest Mission Fund was designated for GNJ congregational and leadership development.

At the October session, I had asked what the remaining surplus was. I was told by the then-CF&A President that we had none. There was no need to sensationalize that fact since we all knew we were in the midst of a global pandemic and economic dislocation. But, in January we are told that we had $7.5 million in October and it was estimated that we would have $12 million when the books for 2020 were closed. Is that a difference of the overall billables versus the Shared Ministries Budget?

As you know, we collect 30-40% of shared ministry in November and December. So as of October 2020, harvest mission funds had been used to fund cash flow needs of GNJ and were at a low ebb. After that, GNJ had a strong 2020 year-end (with $1.4 million more shared ministry than expected and $1 million from the sale of a property). So now with all 2020 entries complete, the 2020 year-end cash balance across GNJ (investment accounts and TD bank operating account) is $13M. As discussed separately, we will be working on a summary to report the property sales proceeds.

Many churches have older congregants with limited incomes. Has Conference leadership considered reduction of Conference-sponsored initiatives to help the local churches for the next 5 years?

Yes. First, in January GNJ cut its budget by $3MM and in addition planned to subsidize our churches by approximately $4 million over the next four years. GNJ now expects to subsidize billings at least through 2023, possibly longer if healthcare costs increase more than expected. Second, the Journey of Hope plan is reducing billables and shared ministry giving in low income communities.

Have you said we have roughly $30M of cash on hand or $13M?

The cash balance across GNJ, including investments is $13M.

Is there any news on lowering our Health Ins costs to churches by switching carriers or will that be discussed at another listening session?

Yes. The Board of Pension has worked hard to find savings for the conference; the details will be shared at the 5/12/21 information sessions.

We understand that the previous treasurer is working as the CFO of another. Has this information been shared with them? Is it ethical for us to allow this to potentially happen there? (As he was such a key part of the reporting and work with GNJ while this was happening).

GNJ was not asked for a reference. The January CFA report was publicized across the denomination and GCFA and other annual conferences had access to the report.

The report details a lack of oversight of the CFO/Treasurer by CF&A. It does not address the responsibilities of the Resident Bishop in this matter. As outlined in paragraph 415.2 of the Discipline, bishops are called to: “provide general oversight for the fiscal and program operations of the annual conference(s).” How would the Financial Review Team characterize the Resident Bishop’s role in the current crisis?

First, I would not use the word “crisis” to describe our current situation; we are not in a crisis as we discovered the issue and reacted quickly to avoid one. It is notable that the IFT did not say anything about the Bishop’s role or lack thereof with respect to the current circumstance. As I said in my communication when I sent out the IFT report, GNJ is a big family. When a problem is discovered, it is important to fix it – and relatively less of a priority to assign “blame.” So let us try to answer this question in that spirit.

The BOD in Para 415.2 does give the bishop general oversight responsibity in fiscal matters. But the same BOD assigns very specific responsibilities in other places. In para 612 it assigns supervision of the treasurer to CFA and further says “CFA is to develop, maintain and administer a comprehensive and coordinated plan of fiscal and administrative policies, procedures and management services for the Annual Conference. Likewise in Para 639 it assigns specific responsibility to BOP and in Para 2512 3a and 3c to the BOT.

The Bishop is an ex-officio member of CFA i.e., “with voice” but no vote and has been a very valuable input to CFA in past and present deliberations by speaking out on important issues – like the need for a consolidated budget and for management budgets. He like all of us was unaware that we were spending so much more than we were taking in. Since CFA, BOP and BOT is often chaired by people who are not at the MRC on a daily basis, it is important to get information directly from the Bishop. So, going forward, we are planning to request the Bishop to submit a quarterly report to CFA that will detail his assessment of the financial situation at GNJ including any concerns he has about anything of a fiscal nature. This report will need to be formally reviewed by CFA and any steps that are warranted taken and minuted. Doing this will be good for the GNJ family.

What is the per participant cost for the current retirees at 2021 rate and what will it be in he proposed 2022 plan?

The per participant cost to GNJ in 2021 is $355.71 per month. The 2022 cost will be $260.71 per month.

If we have people in the General Church who return to GNJ for whatever reason less than five years before retirement, what happens to them for retiree health? That might create a disincentive?

Clergy serving within the General Church have an opportunity to enroll in the Conference’s health insurance plan. If the clergyperson does not enroll in the plan, they will be required to have the 10 years of full-time service prior to retirement.

You mentioned a savings of $19M for the retiree health plan. Over what time span?

The $19M is the reduction in the long-term retiree health care liability as of 1/1/2022 based on the proposed changes.

Any thought to providing incentives for participants to choose less expensive active plans?

The HealthFlex Exchange offers six medical plans which include two HRA plans, three HSA plans and the B1000. Per Wespath’s analysis, in no case is a participant better off in the B1000 plan. It is advised participants educate themselves, by reviewing the available resources and utilizing the Alex Counselor tool. Information sessions will be available in the Fall.

I want to clarify how HSA will be paid if plan is less than there is a shortfall…By church to conference to HSA or directly to HSA?

The HSA personal contributions are deducted from the clergy/laity salary by the local church and remitted to the Conference. Wespath will bill the Conference for the participant contributions.

It is my understanding that all pastors are required to take their health insurance through the conference. Our Pastor serves two Churches, and the cost to each Church for her health insurance is $8,250 for a total of $16,500 per year. Considering she is actually able to obtain health insurance through her previous employer, having to take the insurance through the conference is a huge burden to our Churches that seems to be unfair when it shouldn’t have to be. Can someone explain why this additional burden to the Church is required?

The blended rate was established to relieve appointment challenges, therefore, the Waiver of participation rate was added so that all churches with full-time clergy share in the responsibility of health costs and prevent the church from experiencing a significant increase from waived health premium to having the blended rate premium.

Currently, our monthly statement does not break down any costs for dental, vision, or basic health plan. I am enrolled in both dental and vision. the premium credit is $6.04. Does that mean the dental and vision are covered under the one “Health Insurance” amount that we are billed each month?

Depending on the participant’s plan of choice, they may have an excess premium credit; hence, the local church will not see these billings. The excess credit will pay toward the cost of dental and vision. If the premium credit doesn’t cover these premiums, any remaining balance will be billed to the church to deduct from the participant’s paycheck.

I would just like clarification. If you retire with less than 20 years of FT service are you completely ineligible for the retiree health plan or is there a prorated benefit?

This is correct with one exception, if a participant is 62 on July 1, 2021 and have at least 7 years of service, they have an option to healthcare in retirement with costs incurred to the participant.

Can you explain again about the 2%? Pastors and staff under the healthcare will no longer have the 2% deducted from their salary starting January 2022 but may be paying under the health care package they sign up for in the Fall.
The proposed changes replace the 2% of salary with pastors instead paying toward the cost of the plans premium. Only two plans offer an excess premium credit. The four remaining plans will have premium payment responsibility. Any amount over and above the Conferences allotted premium credit will be reflected on the church’s billing statement. The church may deduct the premium from the participant’s paycheck and remit to the Conference along with other elective benefits such as dental, vision, FSA, HSA.

But the church pays the same amount regardless of active plan selection?

The church will pay the blended rate regardless of the participant’s plan choice.

Where can we examine the different plans available?

The plan comparison document may be found on the website. Information sessions will be held in the Fall prior to Annual Election to go over the plan options.

Is it possible to give a Spanish, Korean and English education seasons?

The Board of Pension/Health Benefits will discuss this further to find the best possible solution.

How much might be out of pocket from the pastor? Currently if average salary is $50,000 it is $1,000. How much more might it be?

As an example, if choosing the C2000 plan, a participant with a family plan will pay $3,000 annually. A single participant would pay $1,152 annually. As we stated, education on selecting the most cost-effective plan for the participant is critical. It is advised participants educate themselves, by reviewing the available resources and utilizing the Alex Counselor tool. Information sessions will be available in the Fall.

A follow-up question regarding the prescription coverage for retirees: We currently pay a $20 copay for our mail order prescriptions (depending on the formulary schedule), so I don’t understand what it means to say our cost is going from $0 to 10%.

The $0 to 10% is specifically for Part B drugs. Part B drugs are specialized drugs which include, but not limited to, immunosuppressives, anti-nausea, inhalation solutions, hemophilia clotting factors, antigens. Most of the participants will remain unaffected by this change. For the more common drugs, the Conference will move from Formulary H to Formulary G. Some drugs will remain at $10 in Tier 1, Tier 2 will be 20% to $45, Tier 3 will be 20% to $90.

Where can I learn more about the plan?

A comprehensive overview of the plan can be found here.