MEETING MINUTES: Council on Finance and Administration on Mar. 10, 2022

by | Aug 11, 2022 | Finance and Administration, MEETING MINUTES

Minutes of Zoom Meeting on March 10, 2022

Matt Ashley, Randy Bowman, Anne Green, Bishop Grant Hagiya, Matt Kuss, Daniel Landesman, Rob Lee, Kay Pitt, Anabel Quijada, Anthony Tang, Scott Whitmire, Ann Williams, and Steve Ziegler.

Scott opened the meeting at 10:00 a.m. and offered a prayer. The agenda was fixed as presented.

The minutes of the 12/16/2021 CFA meeting were approved unanimously.

GCFA Update
General Conference has been postponed until 2024. Jurisdictional conferences are projected for either July or October for election of new bishops (if legally permitted without General Conference). The general church budget allocations for 2023-2024 were reduced 9% from original levels.

Foundation Update
They had good returns last year, but the markets have been down significantly so far this year. They are completing their 2021 audit now. They have a Board meeting next week to discuss expanded services in 2022. They financially supported the Cal-Pac/DSC Coaching efforts coming in 2022.

Claremont School of Theology Update
CST received an unfavorable court ruling in January. CST has appealed to give them time to negotiate a property sales price with the Claremont consortium of colleges. CST may seek binding arbitration to set that sales price. We have extended the due date for our $500,000 loan to CST from March 2022 to September 2022 to give them time to complete these negotiations.

Boy Scouts of America (BSA) Update
A Bankruptcy Court hearing is scheduled for next week. Included in that hearing will be a $30 million settlement agreement for the entire UMC denomination. If approved, our portion of the $30 million settlement will be $208,000 ($20,000 of which was paid in 2021).

2021 Audit
The audit is complete except for recording the effect of the 12/31/2021 actuarial valuation report for post-retirement medical obligations. That actuarial report should be received tomorrow, so we should be able to draft the financial statements (likely including subsequent event disclosures regarding CST and BSA) and wrap up the audit by the end of this month.

12/31/2021 Financial Update

  • We fully paid 1 month of 2021 apportionments for all churches, and the churches paid 82% of the other 11 months. The result was an overall apportionment receipts level of 84% for the year. We budgeted receipt of just 75% for the year.
  • General fund operations had an operating surplus of $75,000 despite deficits from payment of our general church apportionments at 101% of the lower GCFA budget, payment of 1 month of apportionments for all churches in the Conference, and COVID-impacted losses in our camp and retreat ministries. These deficits were more than offset by good apportionment receipts, significant investment earnings, an unfilled Director of Connectional Ministries position, and reduced travel, operating efficiencies, and lower staff costs in many areas of ministry.
  • We had $3.1 million of cash reserves at year-end. That was slightly higher than the previous year and $2.6 million above our minimum target.
  • As a result of good investment earnings in 2021, we had $2.0 million in our loan guarantee fund at year-end. The outstanding balance on our 3 guaranteed loans was $1.4 million. Only the Santa Cruz Valley UMC loan had any delinquencies last year.

02/28/2022 Apportionment Receipts
Like last year, the Conference fully paid one month (8.3%) of 2022 apportionments for all of our churches. Our churches paid another 8.0%, resulting in an overall apportionments receipt level of 16.3% for the first 2 months of the year. That was 1.1% below last year’s level, so we have a bit of catching up to do.

Payment of 2022 Q2 General Church Apportionments
We unanimously approved payment of our 2022 Q2 general church apportionments at 101% of the lower 2021-2024 GCFA quadrennial budget. That will result in a general church apportionment payment of $218,000 this month.

Cash Investment Considerations
We will consider possible reallocations of our invested cash reserves at our next meeting in August.

2023 Conference Budget
A motion was made, seconded, and approved unanimously to recommend to the annual conference a 2023 budget of $5,560,615 as proposed by the Covenant Council. This budget is the same as the 2022 budget and includes increases in some ministry areas, a reduction in the unpaid apportionment allowance from 25% to 20%, and use of $41,000 of cash reserves.

2023 Compensation for Level 1 Exempt Employees
Level 1 exempt salaries were approved last year at $102,265 for 2022. A motion was made, seconded, and approved unanimously to recommend that these salaries be increased for 2023 by the lower of 6.0% or the change in Conference Average Compensation (as calculated by Wespath based on compensation data as of 01/01/2022 compared to 01/01/2021).

Other 2023 Recommendations for 2022 Annual Conference Session
We unanimously approved all other 2023 recommendations for annual conference to be the same as the 2022 recommendations, with the exception that the maximum daily meal allowance be increased from $40.00 to $44.00 per person.

Randy Bowman Retirement Effective 03/31/2023
Scott formed a sub-committee to work on recruitment efforts to find Randy’s replacement. He will chair. Kay, Steve, and Matt will also be part of the sub-committee. Any other interested CFA members should contact Scott. Scott will also try to recruit a representative from the Covenant Council. We will plan to work with GCFA’s Human Resources department on a fee basis. The plan would be to begin recruitment efforts late summer, with the goal of having the new Conference Treasurer/Director of Administrative Services in place on 01/01/2023 (to provide 3 months of overlap).

Mid-Year Housing Allowance Resolution for New East District Superintendent
Will be done via email before June 30.

Request to Sell Episcopal Residence
We unanimously approved the request to sell the current episcopal residence, with sales proceeds designated for future episcopal housing needs (housing allowance and/or home purchase).

Next Meeting
Our next full CFA meeting will be via Zoom from 10:00-11:30 a.m. on 08/11/2022.

There being no further business, Anthony closed us in prayer and Scott adjourned the meeting at 11:20 a.m.

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Author: Randy Bowman

Finance and Administration Assistant Treasurer
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