The Conference Board of Pension and Health Benefits is providing financial relief to congregations through a six-month Benefits Ministry Shares Holiday starting April 1, 2020. Your questions answered here.
STEVEN BUCK & DONALD EMMERT
Board of Pension & Health Benefits, Michigan Conference
March 27, 2020 | LANSING, Mich — We are writing to inform you of the action approved today by our Conference Board of Pension & Health Benefits (CBOPHB). This is a difficult time adversely affecting our daily lives and ministries in many ways. In response, the CBOPHB convened to consider how it might provide a measure of financial relief to our churches over the next several months.
As a result, the CBOPHB voted unanimously to institute a Benefits Ministry Shares (BMS) Holiday beginning April 1, 2020 through September 30, 2020. This means that all conference BMS related expenses incurred for April-September will be funded through an available CBOPHB reserve account, and the Benefits Ministry Shares monthly statements will cease for the next six months.
To honor God and each other, the CBOPHB has heard its call and determined it is able to provide this financial relief to our congregations while continuing to observe its fiscal responsibility of administering the benefits programs of our shared ministry together. The financial holiday through Benefits Ministry Shares was identified as the most equitable means in which to provide financial assistance to every local church. While the exact dollar amount (which will not be billed) to each local church will be different, the level of Benefits Ministry Shares relief will be 100% for every local church.
To be clear, this action is not intended to address every financial issue facing our conference benefit programs. On the other hand, neither is this an insignificant level of financial assistance. The expected total savings to our local churches and expenses to be assumed by the CBOPHB over the six-month financial holiday is estimated at $1,900,000. Necessarily considered in this decision was the reality that since January the CBOPHB reserve account has decreased over 25% due to the volatility of the global market. Even so, because of the many years of faithful stewardship from our local church congregations, the CBOPHB is able to institute this financial holiday today.
The following is important. Barring a complete collapse of the economy, the Michigan Conference will be able to draw upon the additional $1.9 million without jeopardizing the sustainability of the denominational benefit plans or incurring the risk of recapturing those funds through future increases to the local church. The Michigan Conference 2020 Comprehensive Benefit Funding Plan as previously reviewed and approved by the Wespath actuarial department confirms these projections. In other words, the CBOPHB has sought to identify the extent to which we may safely utilize our reserve money now without incurring the risk of returning to the local church to recover those same funds later.
Two additional items: There will be no delay or reduction regarding benefits payments during the financial holiday period. All benefit liabilities will continue to be remitted in full and as scheduled. Secondly, the Benefits Ministry Shares Financial Holiday does not signify that the level of Michigan Conference benefit liabilities will decrease either currently or in the future. Thus, all BMS outstanding balances from January-March 2020 will continue to be carried forward with the expectation of payment. It will also be imperative that every local church prepare to resume their regular Benefits Ministry Shares monthly payments following the end of the holiday period.
As we continue our journey together, the members of the CBOPHB join everyone in collective prayer that God’s Holy Spirit bring healing and wholeness to our families, our churches, our nation, our world.
The Benefits Ministry Shares Holiday statement above was released to local churches in Michigan on March 26. Since then, additional questions have been arriving at the benefits office. The following are responses for clarification and sharing:
- What do Benefits Ministry Shares pay for? Regarding benefits, Benefits Ministry Shares provide the conference (employer) funding for clergy/conference staff pension contributions as well as disability/death welfare plan premiums. These expenses will continue to paid in full during the holiday period (April 1 through September 30). The only change is that they will be paid for through the Conference Board of Pension & Health Benefits reserve fund and the local church will not be billed for these expenses.
The conference benefits office will cease to bill/send the monthly Benefits Ministry Shares statement to each local church for the months of April-September 2020. For reference, see the annual BMS amount as indicated on Line 27 of the 2020 Clergy or DSA compensation recommendation form.
- Does the BMS Holiday include health insurance premiums? No. Churches that are currently receiving a monthly health insurance statement will continue to receive a statement and will be responsible for remitting applicable health insurance premiums and/or waiver contributions.
- Does the BMS Holiday include common budget ministry shares? No. Churches will continue to receive a monthly statement from the conference treasurer’s office for ministry shares related to the conference common budget which are separate from the Benefits Ministry Shares.
- Does the BMS Holiday affect UMPIP clergy contributions? No. Wespath Benefits & Investments will continue to send monthly statements for personal UMPIP contributions withheld from clergy/employee payroll and remitted directly to Wespath.
- Will clergy receive no/decreased contributions in their retirement plan over the next six months due to the BMS Holiday? No. As previously stated, all conference contributions will continue to be remitted in full and uninterrupted.
- Will the BMS Holiday deplete reserves and jeopardize future benefits or increase future local church liabilities as a result of the holiday? As addressed in the initial notice, the CBOPHB took great care to assess the level of financial assistance available through the reserve fund that could safely be utilized while limiting the potential risk of future adverse consequences. Per actuarial valuation, the amount designated for the six-month holiday was deemed appropriate. If the entire financial sky were to completely fall between now and September, the BMS Holiday along with every financial element of the annual conference would need to be reconsidered and reassessed. On the other side, the hope is that the BMS Holiday will provide temporary relief to the local church during this period of financial disruption in anticipation of a coming recovery.