PARISH ADMINISTRATION & FINANCE ENEWS
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In Memoriam - John W. Spaeth, III
by Louis Fuertes
Jack Spaeth passed away peacefully on April 15, 2019. For 32 years -- from 1980 until his retirement as Canon for Stewardship and Administration in 2012 – Jack provided guidance, counsel and support for the Episcopal Church in Connecticut, its clergy and parish leaders. His legacy includes many of the financial and administrative processes that are part of our life at The Commons and across ECCT. His patience, good humor, practicality and professionalism set a high standard for us all. His faith, positive outlook and grace were apparent through his final days. A memorial service at Christ Church Cathedral in June is being planned for Jack, details of which will be announced shortly.
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Rounding up the Parochial Report stray
By Louis Fuertes
Two weeks ago, we sent a “Tick tock, Tick tock” email nudge to two dozen parishes that (at that point) were three weeks late in submitting their 2018 Parochial Report. This prompted several apologetic email responses (some explaining enviable travel habits of parish treasurers, others documenting the fact that health emergencies and life events don’t pay attention to canonical reporting deadlines). We have also received Parochial Reports submissions from a number of parishes, bringing the number of Missing in Action Parochial Reports to fewer than 15. Further email and phone call nudges are on tap to get to the 100% compliance standard we have achieved in prior years.
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Parish Survey "How-to"
by Matt Handi
Your bishops and staff at the Commons have been working on ways to bolster collaboration between parishes and the people of the Episcopal Church in Connecticut working towards God’s mission and have rolled out a parish survey that supports this effort. We ask that all parishes complete their surveys in a timely manner and then refresh their data annually.
Contact
Matt Handi
at 203-639-3501, ext. 107 if you require assistance or further information.
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"Parochial Reports are fun, but audits are totally a blast!"
by Louis Fuertes
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The quote above is from nobody, ever. I will not attempt to sell anyone on the idea that audits/financial reviews are the dessert after the Parochial Report main meal, the play-offs after the regular season or graduation parties following final exams. I will say that, in addition to being canonically required, audits and financial reviews have many benefits:
- They engender confidence with vestries and congregations that parish financial affairs are being managed responsibly
- They identify areas for improvement in financial operations and risk management
- They can identify and help correct posting and reporting errors that could otherwise get perpetuated into the future
- More subtly, the discipline of consistent annual audits or financial reviews can encourage better financial practices 12 months a year (e.g., performing monthly reconciliations, consistently creating sufficient documentation of journal entries, getting multiple check signatures when required, developing written and vestry-approved policies and procedures, etc.)
On a more worldly plane, failure to have audits/financial reviews performed is the most common reason why parishes are not in Good Standing. Parishes that are not in Good Standing are ineligible to receive ECCT grants or loans. In 2018, no less than 20 different parishes qualified to receive grants or unsolicited financial support but did not receive funds because they were not in Good Standing.]
While the benefits of having regular audits performed are a positive motivation, it is also true that it is much easier for really bad things to happen when audits /financial reviews aren’t performed annually. Embezzlement, inappropriate use of parish funds, nepotism and self-dealing practices aren’t certain to happen if parishes don’t have audits/financial reviews performed, but when these rare problems turn up in ECCT parishes, it is generally the case that the parish has not had audits/financial reviews performed regularly.
2018 Audits (required for parishes with over $750,000 in total revenues) and financial reviews are due on September 1, 2019. We suggest that parishes engage accountants to perform their audit/financial review as tax filing season winds down. Karolyn Nicolaides (
KNicolaiders@episcopalct.org
, 203 639 3501, ext. 134) can provide you with a list of accountants who have performed audits and financial reviews for other parishes.
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Industrial Appraisals
by Matt Handi
Our effort to reappraise all properties is close to completing and is about to wrap up. If you would like a copy of your parish’s appraisal, please contact
Matt Handi
at 203-639-3501, ext.107.
Appraisals for the following parishes have been completed since the last Admin and Finance eNews was distributed:
- St. Thomas Episcopal Church, New Haven
- St. John’s Episcopal Church, Stamford
- Christ Church, Pomfret
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Property insurance claim reporting process
has changed!
By Louis Fuertes and Matt Handi
After years of a positive partnership with our previous insurance broker, Willis Towers Watson, we parted ways in September 2018 and engaged a new insurance broker, Beecher Carlson. Due to this change we want to provide all of you with the proper contacts at Beecher Carlson so that you know who to touch-base with if you need a certificate of insurance, have to report a claim or have a general question about insurance and/or safety.
Please see below for the applicable contact information. For property claims, please continue to call
John Webster
at York Risk Services. John’s number is 201-388-4509
Account management:
All general questions should be addressed to: Michael McGowan, Managing Director, 646-358-8521, Cell 646.285.2462, mmcgowan@beechercarlson.com
Certificates of Insurance/Evidence of Coverage:
- For evidence of insurance or an auto ID card: Linda Volpe, Client Services Administrator, 646-658-8543 or cell 646-740-6217, lvolpe@beechercarlson.org
Claims Reporting Information
Type of Loss: General Liability or Automobile Liability.
Example of General Liability Loss: A third party slips or falls at the Church. Example of Auto Liability Loss – You get into a car accident
- Aaron Eutermoser, Senior Claims Advocate, 404-460-1342, cell 404-210-0332, aeutermoser@beechercarlson.com
Type of Loss: Workers Compensation.
Example: An employee is injured at work.
- Please also cc Aaron Eutermoser at aeutermoser@beechercarlson.com
- Carrier Contact: The Hartford New Loss Reporting, 800-327-3636, fax: 800-347-8197, email: lossconnect@thehartford.com
- Include current policy number of 08WBAA9HK3 for new loss submission
In addition to the above please feel free to contact
Matt Handi
at 203-639-3501, ext. 107 to further discuss if you have any questions.
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Excess liability premium now added to parish invoices
by Matt Handi
You will notice a new line item on your March invoices and going forward throughout 2019 detailing the cost of Excess Liability premiums. This line item was just added to the parish invoices as we did not have the final premium cost settled until recently. The total annual premium will be divided into 10 separate payments reflecting the number of months left in the year. Please contact
Matt Handi
at 203-639-3501, ext. 107 if you have any questions or concerns.
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Speaking of Good Standing requirements:
investment asset management
By Louis Fuertes
ECCT Canons set forth a number of obligations for financial management of parishes. ECCT Canon IV.2.A is a lesser known Canon that establishes a requirement that parishes manage their investment assets in a specific manner:
- Trust and permanent funds and all securities whatsoever kind shall be deposited in a Federal or State Bank or a Diocesan entity. Any parish desiring to deposit permanent funds and securities of any kind whatsoever with any other organization must receive the approval of the Bishops and Finance Committee by filing an application that meets the requirements of the Diocesan Investment Policy. If approved, substantive changes to the information in the approved application as defined in the Diocesan investment policy must also receive the approval of the Bishops and Finance Committee.
Canon 1.7.1 (b) of The Episcopal Church establishes a similar requirement, referencing a “Diocesan Corporation” as an acceptable investment alternative to a state or Federally chartered bank. The “Diocesan entity” or “Diocesan Corporation” for ECCT is Donations & Bequests for Church Purposes, Inc. (“D&B”).
Beginning in 2016, we have been working to bring the parishes with the most significant investment balances outside of D&B into compliance with ECCT Canon IV.2.A, and we have made great progress. As of this writing, over 90% of the investment balances of ECCT parishes are in compliance with ECCT Canon IV.2.A
- Over 20 parishes with sizable investment balances outside of D&B have submitted a request to oversee investment management, have demonstrated in this request sufficient capacity to perform this function and have received permission from ECCT’s Finance Committee to continue current practices
- Several parishes we have approached have concluded that they do not have a Finance Committee with the capacity to oversee management of parish investment assets and transferred investments into D&B.
If your parish holds assets invested in market securities outside of D&B and have not received written permission from ECCT’s Finance Committee to do so in the last two years, you are invited (and urged!) to come into compliance with Canon IV.2.A in one of two ways:
- By transferring parish investment assets into Donations and Bequests. This approach is strongly suggested for parishes that do not currently have a Finance Committee made up of at least three unrelated adults with sufficient investment management expertise (as demonstrated through educational, professional or personal experience) that allows them to be capable fiduciaries for parish investment assets.
- Alternatively, by completing a request for approval from ECCT’s Finance Committee to continue current investment management oversight practices. The submission should address the questions in the document accessible here (https://www.episcopalct.org/investment-management/) concerning parish Finance Committee experience, investment policies, governance relationship to the parish’s vestry, willingness of parish Finance Committee members to hold the interests of the parish above the interests of themselves, their family members, or any of their friends or associates. Once this request has been completed, it should be submitted to Louis Fuertes, Canon for Mission Finance and Operations (lfuertes@episcopalct).
Note that parishes that, before the end of September, either transfer investment assets to D&B or gain ECCT Finance Committee approval to continue current independent oversight for their investment assets will be in compliance with Canon IV.2.A. Parishes that that are not in compliance with Canon IV.2.A (and with other Canons concerning financial management and reporting) cannot be considered to be in Good Standing at the time of our Annual Convention (on October 26 and 27).
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You say LIFO, I say FIFO!
By Louis Fuertes
Beginning in July, ECCT will change its process for posting payments, crediting the earliest open invoice first (the
F
irst one
I
n will be the
F
irst one
O
ut or “
FIFO
”). Since 2015, we have been crediting the most recent open invoice upon receiving payments from parishes (the
L
ast one
I
n was the
F
irst one
O
ut or “
LIFO
”). We are making this change at the suggestion of our auditors, who point out that FIFO posting results in a useful measure of the aging of our receivables.
If this “inside baseball” discussion of our posting process has not caused you to skip ahead to the next topic, perhaps a discussion of why this bit of financial operations minutia should matter to anyone. {Hint: it will matter to some parishes!]. Consider these clues:
- Prior to 2015, parishes pledged financial support for ECCT. Unfulfilled pledges from years before 2015 remain as accounts receivable balances.
- Beginning in 2015, Common Mission Support payments became canonically specified obligations
- A parish with unfulfilled pledge receivables from before 2015 has the right to contact staff at the Commons and (with evidence of approval if its vestry) request that its pre 2015 pledges be reduced to the amount already contributed
- ECCT’s finance staff shifted to LIFO (Last In, First Out) posting in 2015 to preserve the right of parishes to revise pre-2015 pledges downward, and posted payment receipts to the most recently posted Common Mission Support obligations instead.
- The right of parish vestries to request downward adjustments of pre-2015 pledges is not well understood, although a number of parishes have availed themselves of this option in the past.
Why should parishes care about the change from LIFO to FIFO? Because vestries of parishes with unfulfilled pledges dating back before 2015 will be well-advised to request that pre-2015 pledges be reduced to the amounts actually contributed between now and mid-June. Beginning in July, payments will be posted first to the oldest unpaid pledge balances, which could have been reduced to $0 upon formal request of the parish.
Sometimes it helps to understand how financial posting works. This would be one of those times. If your parish would like to reduce its pre-2015 pledges to the amount already contributed, please send documentation of a vestry vote to request that change to
Karolyn Nicolaides
.
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Mission for Mission Finance & Operations Position
By Louis Fuertes
ECCT is seeking to hire its next Canon for Mission Finance & Operations, as Canon Fuertes has announced his decision to retire this fall. The full position description is available on ECCT’s website
here.
Prior leadership experience in Episcopal parish settings is very beneficial in performing this role, so please encourage individuals with relevant experience and gifts to consider applying for this position.
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The Episcopal Network for Stewardship (“TENS”) Convention online streaming registration extended
participation fee is $99
By Louis Fuertes
The Episcopal Network for Stewardship (“TENS”) is holding its Annual Convention from April 28
th
through May 2nd The agenda (see
https://www.tens.org/conference2019-generosity-transformed/
) is designed to provide parish leaders with ideas and tools for managing and transforming annual appeals, planned giving and legacy programs at their parishes. The registration for attending the Convention in Indianapolis was closed on April 12, but we understand that registration for participation via live streaming will be extended to April 26. Those interested can register for live streaming at
www.stewardshipresources.org/generosity-next-registration-2/
. The participation fee is $99.
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Will you still need me, will you still feed me, when I’m 70 ½?
By Louis Fuertes
Baby Boomers whose early childhood memories might include Howdy Doody, Captain Kangaroo, Rocky the Flying Squirrel and Bullwinkle the Moose (not to mention Clarabelle, Mr. Green Jeans, Boris Badanov and Natasha Fatale) have by now reached (or are approaching) the magic age of 70 ½ years when distributions from IRAs, 403 (b)s and 401 (k)s become mandatory events in order to avoid significant IRS excise tax penalties. All defined contribution plans managed by the church Pension Group and invested with Fidelity have experienced a plan change as of 1/1/2018 in which Minimum Required Distributions will be made whether plan holders are retired or still working (note that this is a CPG initiative, not an IRS ruling. The IRS allows individuals who are still actively working at age 70 ½ to defer distributions).
In its communication regarding this plan change, CPG advises employees with questions about Minimum Required Distributions to contact CPG’s Tax Hotline and speak with Nancy Fritschner at 877-305-1414 or The Rev. Canon William Geisler at 877-305-1415.
Employees affected by this plan change should consider its impact on their personal financial planning and payroll withholding decisions.
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A
nnual Spring Training & Gathering (for laity and clergy) April 27 in Berlin CT
By Louis Fuertes
Meriden’s Daffodil Festival coincides with the April 27 date we had chosen for ECCT’s Spring Training. As a result, we have been bumped from our normal venue (Lincoln Middle School in Meriden) and have found a new home at Berlin’s High School (139 Patterson Way, Berlin, CT). Spring Training is a great event annually, attended by hundreds of parish leaders from across the state who take part in training sessions covering a wide array of practical topics. More information is at
https://www.episcopalct.org/spring-training/
.
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2018 - 2019 ECCT Cycle of Prayer Available
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Parish admins invited to join a listserve
Want to chat with colleagues about ACS vs PowerChurch? Offer tips on more successful mail merges? Get suggestions on names for a new campaign?
Alison Hollo
, Senior Administrator for the Office of the Episcopate, invites parish administrators to forward her their names and email addresses to be added to an ECCT listserve for parish admins.
As a member of Bishops' Executive Secretaries Together (B+E+S+T), Alison has participated in their listserve and wants to make the same opportunity available for parish admins in ECCT.
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2019 Treasurers' Newsletter can be found
here
.
Included: Clergy Compensation, Insurance, Lay Pension, Church Records, Supply Clergy, Tax and other IRS information, and other management operations.
2018 Treasurers' Newsletter can be found
here
.
2019 Spring Safe Church Training Schedule
here.
(Choose "Option 1" or "Option 2" links for Basic Safe Church Training info and dates)
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The next issue of the Parish Admin & Finance eNewsletter will be published mid-April.
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