Stewardship & Budget 2023

STEWARDSHIP MINISTRIES 

Recommendations from the Council on Finance and Administration 

1. The proposed budget of $18,107,147 shall be adopted for 2024, including a mission share income budget of $12,564,729. This represents an increase of $80,346 or 0.6% in the mission share asking compared to the 2023 budget. 
2. The Benevolence Factor (BF) for 2024 will be reduced from 17.55% down to 17.45%. The collection rate assumption for 2024 is set at 87.0%, which is 3% less than the 2023 assumption. 
3. As required by The Book of Discipline, the ratio for World Service and Conference Benevolences shall be set as follows: 33% for World Services and 67% for Conference Benevolences. 
4. The firm of Ellin & Tucker is approved as independent auditors to audit the Conference Treasurer’s financial records for 2023. 
5. The date for closing the 2023 Conference financial books shall be set at January 9, 2024, with all payments to be received by the Treasurer’s Office no later than that date. 
6. The Baltimore-Washington Conference grants authority to the Council on Finance and Administration, in consultation with the Bishop, the Cabinet, and the Discipleship Council to act on financial matters between sessions of the Annual Conference. 

Submitted by: 
Phil Potter, President 
Paul J. Eichelberger, Chief Financial Officer and Treasurer 

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 RECOMMENDATIONS 

The Conference Board of Pensions and Health Benefits requests that the Annual Conference adopt the following recommendations: 

1. That BWC continue to provide retiree medical to all eligible participants. 
2. That in accordance with paragraph (e) of Supplement One (Pre-1982), the surviving spouse pension benefit shall continue to be 85% of the participant’s formula. 
3. Pre-1982 Service – Past Service Rate (PSR): That the Annual Conference shall approve the following pre-1982 prior service funding plan in compliance with the Disciplinary requirement listed in ¶1506.8: The Past Service Rate (PSR) for 2023 is confirmed at $807. The PSR for 2024 will be set at $840. 
4. That the Annual Conference shall approve the following funding plans based on the receipt of a favorable opinion from Wespath Benefits and Investments in compliance with the Disciplinary requirement listed in ¶1506.6. 

Funded status and contributions are based on actuarial valuations as of January 1, 2022, 

Pre-82 Plan: Baltimore-Washington Conference is fully funded, with its Pre-82 Plan assets equal to 121% of its liabilities. 

Corridor Funding: Clergy Retirement Security Program (CRSP-DB) and Ministerial Pension Plan (MPP) annuities. The funded Ratio for this funding is the same for all Conferences 

Post-Retirement Medical: Based on the biennial actuarial report received in April 2022, the Post-Retirement Medical plan is reported to have a current view funding ratio of 106.7%. The ongoing view funding ratio is 174.8%. These funding ratios are lower than the 146.6% and 214.4 values that were respectively reported in the previous report. An increased liability in the valuation caused the change as the assumed annual increase in the HRA was increased from 2%/yr to a new value of 4%/yr. The 4%/yr assumption is more consistent with the actual increases in recent years and the new funding ratio of 106.7% is a good indication that the fund is properly funded to support that new assumption. The next actuarial report will be based on December 31, 2023 funding levels. 

The funding plan as of December 31, 2021 is summarized below. 

5. That the following resolution, as required for IRS compliance, shall be approved:

Resolutions Relating to Rental/Housing Allowances for Retired or Disabled Clergypersons of the Baltimore-Washington Conference 

The Baltimore-Washington Conference (the “Conference”) adopts the following resolutions relating to rental/housing allowances for active, retired, or disabled clergypersons of the Conference: 

WHEREAS, the religious denomination known as The United Methodist Church (the “Church”), of which this Conference is a part, has in the past functioned and continues to function through ministers of the gospel (within the meaning of Internal Revenue Code section 107) who were or are duly ordained, commissioned, or licensed ministers of the Church (“Clergypersons”); 

WHEREAS, the practice of the Church and of this Conference was and is to provide active Clergypersons with a parsonage or a rental/housing allowance as part of their gross compensation; 

WHEREAS, pensions or other amounts paid to active, retired and disabled Clergypersons are considered to be deferred compensation and are paid to active, retired and disabled Clergypersons in consideration of previous active service; and 

WHEREAS, the Internal Revenue Service has recognized the Conference (or its predecessors) as the appropriate organization to designate a rental/housing allowance for Clergypersons who are or were members of this Conference and are eligible to receive such deferred compensation; 

NOW, THEREFORE, BE IT RESOLVED: 

THAT an amount equal to 100% of the pension or disability payments received from plans authorized under The Book of Discipline of The United Methodist Church (the Discipline), which includes all such payments from the General Board of Pension and Health Benefits ("GBOPHB"), during the years 2023-2024 by each active, retired, or disabled Clergyperson who is or was a member of the Conference, or its predecessors, be and hereby is designated as a rental/housing allowance for each such Clergyperson; and 

THAT the pension or disability payments to which this rental/housing allowance applies will be any pension or disability payments from plans, annuities or funds authorized under the Discipline, including such payments from the GBOPHB and from a commercial annuity company that provides an annuity arising from benefits accrued under a GBOPHB plan, annuity or fund authorized under the Discipline, that result from any service a Clergyperson rendered to this Conference or that an active, retired or disabled Clergyperson of this Conference rendered to any local church, annual conference of the Church, general agency of the Church, other institution of the Church, former denomination that is now a part of the Church, or any other employer that employed the Clergyperson to perform services related to the ministry of the Church or its predecessors, and that elected to make contributions to, or accrue a benefit under, such a plan, annuity or fund for such active, retired, or disabled Clergyperson's pension or disability as part of his or her gross compensation. 

NOTE: The rental/housing allowance that may be excluded from a Clergyperson's gross income in any year for federal income tax purposes is limited under Internal Revenue Code section 107(2) and regulations there under to the least of: (1) the amount of the rental/housing allowance designated by the Clergyperson's employer or other appropriate body of the Church (such as this Conference in the foregoing resolutions) for such year; (2) the amount actually expended by the Clergyperson to rent or provide a home in such year; or (3) the fair rental value of the home, including furnishings and appurtenances (such as a garage), plus the cost of utilities in such year. 

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STEWARDSHIP MINISTRIES

Recommendations from the Commission on Equitable Compensation The Commission on Equitable Compensation is recommending that the base salary for the 2024 Clergy Salary Table be increased 4.0%, or $1,920, which will make the base salary $49,910. The Commission is also proposing an increase in the recommended housing allowance of 3.0% or $642, which will make the recommended housing allowance $22,036.

Submitted by:
Kim Ayres, Chair, Commission on Equitable Compensation

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