Page 89. It is report no. 4.
We have placed all insurance premiums and required pension contributions for our clergy in the apportionments of the Annual Conference. These apportionments were then sent to each local church on an annual basis. In a model of greater transparency, local churches will now receive the direct bill for their clergy (and, if applicable, lay employee) benefits to accurately see the total cost of the benefit.
Yes, in most cases. The local church will still need to pay the health insurance premiums and pension contributions directly through the billing system, but the apportionment amount of most churches was reduced.
In addition to substantially reducing the AWF Conference budget, many churches will see a reduction in the amount of money they must raise each year. Churches that have not been full participants in the connectional giving system have placed the burden of the cost of their clergy benefits on the other churches of the conference.
For those churches who have not fully participated in the connectional giving system (i.e. funding the cost of their clergy benefits at 100%), it will mean they will now need to raise more money in order to pay the health insurance premiums and pension contributions that sister & brother churches have been paying for them in the past.
The local church will need to place the health insurance premiums and pension contributions for their clergy in their local church budgets.
Let's imagine there are three churches on the charge: Church A, B, and C. Add the total apportionments of all three churches. (A+B+C = X ) Divide A/X for Church A. Divide B/X for Church B. Divide C/X for Church C. The total percentage should be 100. Multiply the total monthly bill by the percentage for each church to determine the amount each church will pay. This formula works the same for health insurance and pension billing.
No. In fact, many Annual Conferences have been collecting health insurance premiums and pension contributions through direct billing for a number of years.
If the local church cannot afford to make the required health insurance premiums and pension contributions for their minister(s), they may need to think about sharing the cost with another church which would also share their minister on the same charge.
The local church can also request to become part-time, which will decrease the amount for pension contributions since the salary would be lower. Part-time appointments may also request to no longer offer health insurance.
A local church should discuss their options with the District Superintendent.
The 2009 AWF Annual Conference, upon the recommendation of the Conference Board of Pension and Health Benefits, voted to change to this method of collecting payments for pension and insurance costs beginning January 2011. The board studied the move for a number of years before bringing the recommendation before the entire conference.
Yes, and this is exactly what we have been doing. However, the number of churches who say they cannot pay their apportionments is increasing, while the number of churches that do pay apportionments has been decreasing. At this rate, only a few churches will be paying for the churches which claim they are unable to pay their apportionments. In order to best fund mission and ministry, a change is needed.
About half of our churches will likely see a decrease in the total cost (apportioned amount + direct bill amount). About a third of our churches will likely see costs remain stable or see a manageable increase. The remainder of the churches likely will see an increase in costs.
For single charges, the billing will be $145 if the pastor is over age 65 and on our MEDSUP plan. The pastor will continue to pay $35 per month.
If the pastor is under age 65 and on our active plan the church will be billed $650 per month until the age of 65 is reached and the clergy person moves to our MEDSUP plan.
There is no pension billing for a retired clergy person.
Until now ,there was no direct billing for clergy benefits. Unless a church had lay employees on our plan there was no direct bill to “go up.” Lay employee participation did not impact the billing process either positively or negatively from the perspective of the local church.
Some churches who have faithfully participated in connectional giving at 100% will find that their direct bill amount has made their overall cost rise. Because there was no direct bill in the past, occasionally churches that were participating in the connectional giving system at 100% were still not actually covering the total benefit cost of having clergy leadership.