The Board of Trustees of the Annual Conference works to fulfill responsibilities outlined in paragraphs 2512-2516 of the 2016 Book of Discipline, as well as the new paragraph 2553 approved at the special session of General Conference 2019. The following report provides details of primary responsibilities and activities of the Trustees since the 2019 Annual Conference.
The United Methodist Building
The United Methodist Building was completed in 2010 and has had only relatively minor maintenance issues since that time. Anticipated capital improvements over the next few years include carpet replacement, painting, and potential overhaul or replacement of HVAC units due to normal wear and tear. Funding for capital improvements will be paid from capital reserves held in investment funds in the United Methodist Foundation.
- Bethel (Burlington) – Corridor District – closing June 2020 with property sale pending June 2020
- Hollister (Halifax County) – Heritage District – property sale pending June 2020
- Perkins – Beacon District – merged with Moyock UMC July 2019 (reported as closed at 2019 Annual Conference)
- Union (Ahoskie) – Beacon District – property sold April 2020
- Weldon (Weldon) – Heritage District – property sold July 2019
The Board of Trustees continues to receive local church properties as they are closed in compliance with the Book of Discipline. The Trustees are working in partnership with Church Transformation Ministries on the evaluation and recommendation for redevelopment or disposal of closed church properties. Church Transformation Ministries expects to increase the number of churches with which the ministry works in the coming years. Redevelopment work happens in partnership with other ministries in active local churches. The United Methodist Real Estate Foundation or other property management and realty companies assist the Trustees in the marketing and sale of closed church properties as needed. Proceeds of closed church sales will be held by the Trustees in an investment account using earnings to help sustain the ongoing efforts of Church Transformation Ministries, New Faith Communities, and the Trustees’ work with closed church properties such as cemeteries. Conference Trustees may receive recommendations from district superintendents and/or District Boards of Trustees regarding the use of the proceeds from the sale of closed church properties and other assets. The Conference Trustees will evaluate recommendations and make disbursements as approved by the Board in accordance with provisions of the Book of Discipline.
Conference Parsonages And Property
The Board of Trustees provides funding for Conference executive clergy staff positions with housing allowances in lieu of parsonages. Funding to pay the clergy staff housing allowances is provided through the Conference budget. In 2013, investments from prior conference parsonage sales were added to the funding generated through district parsonage sales to furnish housing allowances to district superintendents. Funding needed for district superintendent housing allowances is to be generated from earnings on the investment of the sale proceeds from conference and district parsonages. Assets remaining to be used to fund staff housing allowances total $48,315.85 as of December 31, 2019.
A proposal was approved at the 2019 Annual Conference to sell the Episcopal Residence and begin paying a housing allowance to provide housing for the Raleigh Area bishop. The Episcopal Residence was placed on the market and a housing allowance became effective July 1, 2019. The residence sold on April 17, 2020. Net proceeds of the sale were added to capital funds being held for capital repairs to the property and were invested with the United Methodist Foundation. Earnings on the investment will be used to provide the Episcopal housing allowance in the future. The investment in the Episcopal Housing Fund was $926,820.01 as of May 2020.
Frederick And Closs Peace Wardlaw Bequest
The Conference Trustees oversee the remaining assets of the Wardlaw bequest, given with the stated preference of providing a retreat or renewal location for clergy of the Conference. The Wardlaw Retreat Center at Camp Don Lee was completed in 2012 and has been in use for that purpose since that time. A second Wardlaw Retreat Center, located at Camp Chestnut Ridge, was dedicated in November 2019 and welcomed its first guest in February 2020. Funds remaining from the Wardlaw bequest are being held for potential maintenance needs for the retreat centers at Camp Don Lee and Camp Chestnut Ridge and have a value of $75,542.22 as of April 30, 2020.
The Book of Discipline provides that one of the responsibilities of local church Trustees is to review insurance annually in order to ensure that the church, its properties and its personnel are properly protected against risks. In evaluating these levels of protection, the Conference Trustees recommend the levels of coverage approved by the General Council on Finance and Administration*. In general, the recommendation includes the following types and levels of coverage as guidelines for property and casualty insurance coverage:
- Building and business personal property insurance at full replacement cost,
- General liability coverage at $1,000,000,
- Physical abuse and sexual misconduct liability coverage at $1,000,000,
- Pastoral professional liability coverage at $1,000,000,
- Employee dishonesty and crime coverage at levels adequate to cover assets held by the church – each church needs to evaluate this coverage independently,
- Directors and Officers liability coverage at $1,000,000,
- Umbrella policy coverage at $1,000,000, and
- Workers’ Compensation coverage at $1,000,000 for all employees whether or not the church meets the minimum requirements under North Carolina law.
*Details of the GCFA recommendation can be found at:
Property insurance for the NC Annual Conference property is insured through the denominational insurance provider, United Methodist Insurance (UMI). In addition to conference insurance coverage, UMI provides coverage options at competitive costs for local churches that meet all of the recommended coverage levels provided above.
The 2016 Book of Discipline gives the responsibility to receive and administer restricted donations for the annual conference in paragraph 2512.3.a. to the Annual Conference Board of Trustees. The North Carolina Annual Conference has established a permanently restricted asset fund named the Mission Endowment with the goal of endowing in perpetuity funding for new mission endeavors within the North Carolina Conference. The Board of Trustees has enacted the endowment agreement proposed to the 2016 annual conference and has received donations throughout the year for the Mission Endowment. The balance of the Mission Endowment as of December 31, 2019, was $1,479,217.74. The 2019 annual distribution was contributed to the Youth Storm Response Fund ($50,000) and new ministry at The Church at Spring Forest New Faith Community ($15,385.25). The 2020 annual distribution ($73,866.59) was contributed to the COVID-19 Response Fund.
Local Church Disaffiliation Agreement Update
As required by the legislation approved by the 2019 Special Session of the General Conference of The United Methodist Church, the Board of Trustees has developed a draft of the process of disaffiliation for any churches in the NC Conference that express an interest in doing so. The legislation approved by General Conference required the Board of Trustees to confer with the Cabinet and a variety of other officers of the conference. Many elements must be included in the process, such as preparation of a standard disaffiliation agreement, calculation of Conference and local church pension liabilities based on market factors, and additional terms to be included in any such agreement. The consultation has been completed and the Board of Trustees will meet to finalize the standard agreement within the next few months. Any disaffiliation agreement
s between the Board of Trustees and a local church must be approved by a majority vote at a duly called session of the Annual Conference before any disaffiliation can take place. The Board of Trustees will make this process available when it has been completed. Because of these factors, the delay of General Conference and the inability of the Annual Conference to meet in person in 2020, an Annual Conference vote on any agreements cannot take place until June 2021, at the earliest, in lieu of a specially called annual conference session.
The Conference Board of Trustees seeks to be faithful stewards of the assets of the North Carolina Conference. All financial activities and assets held by the Conference Board of Trustees are included in the audit of financial records of the Conference. Full reports of this activity are available from the Conference Treasurer’s Office. We will continue to manage property of the Conference to the best of our ability in compliance with the Book of Discipline.
David Peele, President