Decision Number 1172

Review of a Bishop's Decision of Law in the Indiana Annual Conference Regarding Whether the 2011 Budget Meets Requirements of ¶¶ 615 and 811.4 and Complies with Judicial Council Decisions 1054 and 1146

Digest

The matter of notification of the general apportioned funds of the Annual Conference to the charges is left to the Annual Conference to determine in compliance with the 2008 Discipline. All charges must have equal access and ability to obtain the apportionment information. The Bishop is affirmed in his ruling on the matter of notification of the annual conference apportionments.

Paragraph 614.1 of the Discipline requires that upon receiving a statement of the amount to be apportioned to the Annual Conference for the several general funds authorized by the General Conference, the annual conference Council on Finance and Administration shall recommend an apportionment formula or method to the Annual Conference for its action and determination. The Annual Conference shall apportion the same to the several districts, charges, or churches by whatever method the conference may direct, but without reduction. The full amount must be budgeted and apportioned. The bishop's ruling is modified to state expressly that the full obligation of the general church funds must be apportioned without reduction.

Statement of Facts

On June 12, 2010, the report of the Conference Council on Finance and Administration of the Indiana Annual Conference was adopted. The minutes of the Annual Conference indicate: "A tithing report was issued. Discussion ensued regarding two large churches not paying tithe. It was noted that 50% of the churches paid 90% or more; 34% gave less than a tithe; 16% tithed zero." At the time of the report of the Council on Finance and Administration a lay member of the Annual Conference asked the following:

I respectfully request a rule of law concerning whether the action just taken by the annual conference has passed a budget that is in compliance with paragraphs 615 and 811.4 of the 2008 Book of Discipline and with Judicial Council decisions 1054 and 1146.

Following the adoption of the budget of the Annual Conference the following motion was made:

That the Indiana Conference approve CF&A proposal to inform every United Methodist congregation in Indiana of their 2010 and 2011 general church apportionment via website.

The motion was adopted.
The Bishop ruled stating:

I rule that the budget as presented by the CFA and passed by the Indiana Conference is in compliance with paragraphs 615 and 811.4 of the 2008 BOD and with Judicial decisions 1054 and 1146. Following the receipt of Judicial Council decision 1146, the CFA of the Indiana Conference announced in the Hoosier United Methodist Together newspaper (Posted on May 19th) its plan to list the General Church apportionments for all individual congregations on the Indiana Conference website. Then in the initial CFA presentation on Thursday of Annual Conference (June 10th) their report and power point explained this Judicial Council decision and noted that the General Church apportionments for all individual congregations for 2010 and 2011 were listed on the website. On Saturday, June 12th the CFA moved to amend their pre-conference report and gain Annual Conference approval for using the web site to inform all local congregations of their General Church apportionments for 2010 and 2011 (and the Annual Conference approved that amendment), and thus the final report of the CFA, including the 2011 budget and the web site posting of all General Church apportionments, was approved in proper order.

The Bishop further ruled:

I believe it is clear from all of this information and the approval by the Indiana Conference of the CFA report that the Tithe is not a substitute for the General Church apportionments but a strategy to accomplish the full payment of these General Church apportionments, as noted in the CFA report itself which states, "If all churches pay their tithe in full, cased upon their 2009 tithe income, the Indiana Conference will be able to pay these General Church apportionments in full" (page 22 of the pre-conference reports.) Further I find in examining the actual Indiana Conference web site listing of the General Church apportionments assigned to each local congregation that the total of these individual amounts for 2011 equals the $5,767,921 assigned by the GCFA to the Indiana Conference, which means that 100% of the General Church apportionment has been distributed to all of the local congregations of the Indiana Conference.

Jurisdiction

The Judicial Council has jurisdiction pursuant to ¶ 2609 of the 2008 Discipline.

Analysis and Rationale

Paragraph 615 of the 2008 Discipline states in part:

Apportionments—When a change to the apportionment formula or method is proposed, the council should provide for a study of the proposed change's effects. After its study, which may include resources supplied by the General Council on Finance and Administration, the council shall recommend such formula or method to the annual conference for its action and determination which shall include the approved budgeted amounts for clergy support, administration, World Service, Conference Benevolences, and other apportioned causes (¶ 614.1-.4), the sum of which shall be apportioned to the districts, churches, or charges of the conference.

1. The council, on receiving from the General Council on Finance and Administration a statement of the amount apportioned to the annual conference for the several general funds authorized by the General Conference, shall apportion the same to the several districts, charges, or churches by whatever method the conference may direct, but without reduction.
2. The council shall recommend to the annual conference for its action and determination whether the apportionments referred to in this paragraph shall be made by the council to the districts only or to the churches or charges of the conference. If the apportionments are made to the districts only, then the distribution to the churches or charges of each district shall be made as provided in ¶ 614.3. The conference may order that the district superintendents make the entire distribution to all the churches or charges of the conference.
3. Should the annual conference make the apportionments to the districts only, the distribution to the churches or charges of each district shall be made by its district board of stewards, composed of the district superintendent as chairperson and the district stewards elected by the several charge conferences (¶ 247.14). In that case, the board, meeting on call of the district superintendent as soon as practicable after the adjournment of the annual conference, shall make the distribution to the churches or charges of the district using such methods as it may determine, unless the annual conference shall have determined the method of distribution to the churches or charges.

Paragraph 811.4 states:

4. The apportionments for all apportioned general Church funds, as approved by the General Conference, shall not be subject to reduction either by the annual conference or by the charge or local church (¶ 615.1).

Judicial Council Decision 1054 states:

The council [on finance and administration, on receiving] the several general funds authorized by the General Conference, shall apportion the same to the several districts, charges, or churches by whatever method the conference may direct, but without reduction. (¶ 614 of the Discipline). It shall be the duty of the council [on finance and administration], unless otherwise provided, to estimate the total amount necessary to furnish a sufficient and equitable support for the district superintendents of the conference, . . .for the Episcopal Fund apportionment to the annual conference, . . . the annual conference share of the cost of the bishop's housing, . . . the needs for pensions and benefit programs of the conference, . . .an amount . . . to be used for compliance with the approved schedule of equitable base compensation for pastors, . . . [and] the amounts needed for any other programs of clergy support the conference may adopt, such as a Sustentation Fund . . . or provision for the moving expenses of pastors." (¶ 613.1 of the Discipline). The council [on finance and administration] shall include in its budget recommendations specific amounts recommended for all other funds properly apportioned to the annual conference for the support of duly authorized general or other connectional funds. The budget recommendations shall likewise include any other amounts to be apportioned to the districts, charges, or churches by the annual conference for conference or district causes of any kind. (¶ 613.4 of the Discipline).

Further, Judicial Council Decision 1146 states:

The General Conference has set forth very specific and detailed processes by which annual conferences are to determine and set their budgets, including the portion of their budgets that involves general Church apportionments. Upon receiving a statement of the amount that is apportioned to the Annual Conference for the several general funds authorized by the General Conference, the annual conference Council on Finance and Administration shall apportion the full amount to the districts, charges, or churches by whatever method the annual conference may direct, but without reduction.

Ninety percent (90%) of the apportioned amount for General Church funds is proposed in the 2011 budget and spending plan of the Indiana Annual Conference. The Annual Conference must budget and apportion the full amount. Paragraph 614 sets forth the requirements for annual conference budgets:

1.The council shall recommend to the annual conference for its action and determination budgets of anticipated income and proposed expenditures for all funds to be apportioned to the churches, charges, or districts.
b) The council shall report to the annual conference at each session the percentage approved by the General Conference as the basis for the Episcopal Fund apportionment to the annual conference and shall include in its recommended clergy support budget the amount determined by the treasurer of the General Council on Finance and Administration as necessary to meet this apportionment.
1.d) After consultation with the conference board of pensions, the council shall report to the annual conference the amounts computed by that agency as necessary to meet the needs for pensions and benefit programs of the conference. Such amounts need not be derived solely from apportionments.
2.(3).d) The council, on receiving from the treasurer of the General Council on Finance and Administration a statement of the amount apportioned that annual conference for World Service, may recommend that the conference combine the total World Service apportionment, without reduction for the quadrennium, and the approved conference benevolences budget (¶ 614.3a). If combined the sum of these two amounts shall be known as World Service and Conference Benevolences, and the combined budget thus established shall include a statement of the percentage for World Service and the percentage for conference benevolences. (See also ¶ 619.1a(2).)
4. Other Apportioned Causes—The council shall include in its budget recommendations specific amounts recommended for all other funds properly apportioned to the annual conference for the support of duly authorized general or other connectional funds. The budget recommendations shall likewise include any other amounts to be apportioned to the districts, charges, or churches by the annual conference for conference or district causes of any kind.
6. The council shall make its budget recommendations to the annual conference in a format based on guidelines suggested by the General Council on Finance and Administration.

Upon receiving a statement of the amount that is apportioned to the Annual Conference for the several general funds authorized by the General Conference, the annual conference Council on Finance and Administration shall budget and apportion the full amount without reduction. The Annual Conference determines the method of notification of the churches and charges of their apportionments. The method of notification must be fair, and equally accessible and obtainable by all charges.

Decision

The matter of notification of the general apportioned funds of the Annual Conference to the charges is left to the Annual Conference to determine in compliance with the 2008 Discipline. All charges must have equal access and ability to obtain the apportionment,

Paragraph 614.1 of the Discipline requires that upon receiving a statement of the amount to be apportioned to the Annual Conference for the several general funds authorized by the General Conference, the annual conference Council on Finance and Administration shall recommend an apportionment formula or method to the Annual Conference for its action and determination. The Annual Conference shall apportion the same to the several districts, charges, or churches by whatever method the conference may direct, but without reduction. The full amount must be budgeted and apportioned. The bishop's ruling is modified to state expressly that the full obligation of the general church funds must be apportioned without reduction.