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Leaders say financial outlook is promising

Leaders say financial outlook is promising

e-Review Florida United Methodist News Service

Leaders say financial outlook is promising

By Kitty Carpenter | June 18, 2010 {1186}

LAKELAND — Although not fully recovered from the economic downturn of recent years, things are getting better — much better.

With the theme song from “Indiana Jones” in the background and a montage of well-known clips of movie characters celebrating victories, Mickey Wilson told lay and clergy members that “although we aren’t fully recovered, things are getting better — much better.” Photo by Dave Summerill. Photo #10-1480. Click on picture for larger photo or view in photo gallery with longer description.

That was Mickey Wilson’s assessment as he began his report from the Conference Council on Finance and Administration July 11 at the 2010 Florida Annual Conference Event.

Wilson, who servers as treasurer and director of administrative services for the Florida Conference, acknowledged to the nearly 1,800 lay and clergy members gathered at the Lakeland Center that churches are still experiencing economic challenges. But making what he described as “sometimes difficult decisions” has produced positive results, he said, and conditions are improving.

The most dramatic, Wilson said, has been in the area of the conference’s revenue and expenses. In 2008, expenses exceeded revenue by $10.7 million. Additionally, the conference experienced a loss of $11.6 million in investments from the downturn in the stock market.

In 2009, the situation reversed. Revenue increased by $14.3 million to $57.9 million, with expenses decreasing by almost $5 million to $49.4 million.

“The long and short is, last year we lost $10.7 million, and this year (2009) we made $8.5 million — a $19 million turnaround,” Wilson said, followed by applause from members. The cause, he said, was primarily an uptick in the stock market.

And although the number of churches paying 100 percent of their connectional giving, or apportionments, dropped from 407 in 2008 to 366 in 2009, the percent of apportionments paid fell only a little more than 1 percent, from 80.3 percent to 79.1 percent.

The total membership reported by churches also declined, by 3 percent from 302,497 to 294,935, but average weekly attendance rose by 2 percent, from 144,149 to 146,855.

Insurance program remains strong

News from the conference’s Ministry Protection committee was also positive.

Property insurance premiums have decreased nearly $7 million since 2007, Wilson noted, and loss prevention reserves increased to $5.7 million in 2009 from a negative of nearly $1 million in 2005, with $1.6 million added last year.

Wilson says a lack of strong hurricanes in the past several years helped reduce premiums. That also gave committee members time to negotiate with insurance carriers and look for “innovative ways to control costs, while providing quality coverage,” he said. 

Today, the conference insurance program is held up as a model to other United Methodist conferences, Wilson added. He credits a group of leaders he calls “visionaries on CF&A (finance committee)” for structuring a mandatory conference-wide insurance program that provides the coverage needed, something that hasn’t always been available.

After Hurricane Andrew — a Category 4 storm the National Hurricane Center calls one of the most destructive U.S. hurricanes on record — hit South Florida in 1992, property insurance for many churches was unaffordable or unobtainable. Yet the United Methodist Book of Discipline, the law book for the denomination, requires local church trustees to adequately insure their churches from all risk. That was a difficult task after Andrew, which caused $26.5 billion in damage in the United States — $1 billion of it in Louisiana and the rest in South Florida, according to the National Hurricane Center.

Since 1995, when members of the conference voted their approval of a conference-wide program, “every church and mission, every camp and retreat center, has been adequately insured,” Wilson said. 

That’s not been without some challenges, he added. The program accumulated less than $3 million in reserves during its first 11 years, Wilson said, and the storms that hit Florida in 2004 and 2005 exhausted those funds, making it difficult to settle more than $50 million in claims.

The current program, Wilson said, insures more than $2 billion in properties, more than 700 vehicles, 242 preschools and schools, 8,500 employees covered by workers’ compensation insurance, thousands of volunteers, local church-affiliated ministries, and comprehensive coverage for conference camps and retreat ministries, the Florida United Methodist Children’s Home and district offices.

Clergy health care remains priority

With the average age of Florida’s clergy at 54, providing affordable health care is becoming more difficult, Wilson said, because the cost of health care increases with the age of those insured.

Despite that challenge, he said, the Conference Board of Pension and Health Benefits has worked to develop plans that keep costs down for both active and retired clergy, while providing adequate coverage. Currently, the board is focused on “providing catastrophic protection, rather than fine-tuning deductibles and co-pays,” Wilson said.

The Rev. David Harris, senior pastor at Estero United Methodist Church, gets his blood pressure checked at the health fair offered on two days of the annual gathering. It’s part of a conference emphasis to encourage clergy to adopt healthier lifestyles so they can be more effective in ministry. Photo by Angie Bechanan. Photo #10-1481. Click on picture for larger photo or view in photo gallery with longer description.

The self-funded program for active clergy will continue, he said, despite a loss of $700,000 that required a subsidy of an equal amount, along with a $1.3 million subsidy for retiree plans. In August, the board will determine how much is available to subsidize the programs going forward and whether an increase in premiums is needed. 

Investments used to fund future pension and health benefits, on the other hand, reached an all-time high of $35.8 million, Wilson said.

Given the recent passage of health care reform, the board will reevaluate existing plans for any changes that need to be made in compliance with new laws. 

In the meantime, Wilson asked that all clergy and lay employees of the conference complete a confidential health assessment at The data from it and results from the health fair held at the annual business session will help the board “design a health program and services that meet the needs of clergy and staff with population profiles and more precise data,” said Russ Barlow, chair of the health insurance subcommittee.

Both Wilson and Wendy McCoy, director of the conference’s human resources and benefits program, stressed the need for proactive health choices about diet, exercise and rest. “If ministers are not physically healthy and spiritually fit, their ministry will suffer,” McCoy said. “We want to help by providing the resources they need through an informed study and not just random guidelines.”

George Potter, a member-at-large from the North West District, asked if any provisions could be made for part-time clergy and staff to receive health insurance. Wilson said a minimum salary level for clergy and 30-hour work week for staff determine eligibility, but it’s something the conference will consider.

Other business

• Despite having sufficient funds for all pension obligations for at least 20 years, the United Methodist General Board of Pension and Health Benefits, based in Evanston, Ill., has requested additional funding from annual conferences. For many, that means an increase in church contributions from 12 percent of clergy compensation to about 18 percent. Because the conference has sufficient assets, the conference board voted not to raise the 12 percent for the next three years, Wilson said.

Lay and clergy members take a vote during the financial report. Photo by Dave Summerill. Photo #10-1482. Click on picture for larger photo or view in photo gallery with longer description.

• Given the concern over bank failures, conference leaders took steps to minimize the conference’s exposure to financial risk by: encouraging Regions Bank, the conference’s primary bank, to participate in the FDIC’s Transaction Account Guarantee Program, which guarantees the entire amount on all non-interest bearing accounts through June 30 when the program expires; holding quarterly meetings with Regions Bank executives to review financial results and conditions; and moving approximately $10 million to a new account with Morgan/Keegan and Smith Barney. “There is minimal exposure (to risk) with the deposits that we have now,” Wilson said.

• Members approved a total conference budget of slightly more than $17.5 million — $873,378 or 4.74 percent less than the 2010 budget. The conference finance committee cut $525,000 from the 2011 budget request in an effort to reduce the financial burden on churches during the economy’s slow recovery. Likewise, the General Council on Finance and Administration reduced the conference’s general church apportionments by $348,000.

News media contact: Tita Parham, 800-282-8011,, Orlando

*Parham is managing editor of e-Review Florida United Methodist News Service.
**Carpenter is a freelance writer based in Palm Harbor, Fla.