Endowment Policy

 

 

I.                    The Church Mission

 

We, the congregation of Bel Air UMC, are called to make disciples of Jesus Christ, as we SHOW all people the way to the Father, teach them to KNOW the Son, Jesus Christ, and prepare them to GROW in faith and ministry, empowered by the Holy Spirit.

 

Statement of Welcome:

 

We endeavor to be a church that is open, loving, welcoming, and accepting of all persons. We are enriched by the gifts of persons of different ages, ethnicity, gender, handicapping conditions, education, and economic class. As followers of Jesus, we seek to help each one through our ministries of worship, education, and care giving find his/her way to God and God’s will.

 

II.                 Purpose of Endowment Committee

 

We seek accumulated, inherited and appreciated resources. It is understood that special gifts and bequests should not take the place of faithful stewardship of current income, but should be made to enable The Church to accomplish areas of work it might otherwise be unable to undertake.

The purpose is to establish a regular policy and procedure for the effective management and disposition of funds or other properties, which are contributed to The Church and received by the Endowment Committee as endowment through:

 

A.     Bequest by will/living trust

B.     Charitable gift annuity

C.     Charitable remainder trust

D.     Transfer of property (e.g., cash, stocks, bonds, real estate)

E.      Gift of retirement plan proceeds

F.      Assignment of life insurance

 

All provisions of the church’s endowment program pertaining to the investment of funds, administration of funds, and limitations of use of distributions shall be applicable to both designated and undesignated contributions, and all gifts made to the Fund shall be accepted subject to the terms and limitations set forth in the BAUMC “Donation of Tangible Personal Property Policy”.

 

III.               The Endowment Fund Mission Statement and Structure

 

The Endowment Fund is a fund maintained to provide income in perpetuity, or for a designated term, for general or restricted use by The Church. The fund objectives are to conserve the principal and utilize the investment income in accordance with the Endowment Spending Policy. The income, from undesignated gifts to The Endowment Fund, shall be used for the purpose consistent with the mission of The Church. This would include, but not limited to:

A.     Missions

B.     Programs

C.     Buildings and property maintenance

 

The Endowment Fund shall be subjected to the laws of the State of Maryland, the articles of Incorporation of The Church, the Discipline of the United Methodist Church, and actions of The Church Conference of The Church.

 

IV.              The Endowment Committee

 

The Endowment Committee shall exist under the authority of The Charge Conference and shall report via the Finance Committee to the Board of Trustees and Administrative Council.

The Endowment Committee shall be composed of up to 9 members, including 5 members­ at-large. The members at-large shall be elected for a three (3) year term by The Church’s Nominating Committee process. Other voting members are Chairperson of Trustees, Church Treasurer, Finance Chairperson and Administrative Council Chairperson. These members shall serve as long as they are elected or appointed to those positions. Non-voting ex-officio members may include the Pastor and Lay Leader. The initial length of terms of the members-at-Large shall be determined by draw after the new members are elected. The Church Treasurer shall act as the Fund’s Treasurer; one at-large member shall be elected to serve as the Fund’s Financial Secretary.

 

The Endowment Committee shall be responsible for:

 

A. Emphasizing the value for adults of all ages to have a will and/or estate plan and provide information on the preparation of these to members of the congregation.

 

B. Encouraging church members and constituents to support God’s work in the world, by giving through United Methodist Churches, institutions, agencies and causes by means of their wills, annuities, life insurance, memorials, special gifts, and various types of property as methods they can use to extend their Christian stewardship.

 

C. Maintaining a record of all gifts to The Endowment Fund: the value, the donor, the date and the type of each gift, as well as any formal expression by the donor(s) of the use to which the gift might be put.

 

D. Investing and managing appropriately all assets of The Endowment Fund.

 

E. Reporting to the Charge Conference, via the Finance Committee to the Board of Trustees and Administrative Council, annually, the status of The Endowment Fund, acceptance and rejection of gifts, the income available for distributions, and the distributions made to date

 

F. Promoting and publicizing The Endowment Fund frequently and consistently throughout The Church and its membership. Expenses for this activity may be charged to The Endowment Fund.

 

G. The Board of Trustees is given the authority by the Book of Discipline to be the legal recipient of gifts and bequests on behalf of The Church.

 

 V.

 

Gifts of Property

 

Normally, gifts received in forms of property other than cash will be converted to cash at their market value as soon as practicable. However, there may be occasions when the Endowment Committee will decide that it is consistent with the purpose of The Endowment Fund to retain a gift of property in the form in which it is received and treat the income from the investment as part of The Endowment Fund’s income.

 

VI.       Designated or Restricted Gifts

 

 

The Endowment Committee shall review all gifts. The Board of Trustees, with the recommendation of the Endowment Committee is charged with the responsibility to accept or decline a gift for investment in The Endowment Fund. No gift shall be accepted that comes with restrictions inconsistent with the mission of The Church.

If a donor’s will, trust or other planned gift, or the instructions accompanying other special gifts, directs that the principal be preserved and income be used for a designated and acceptable purpose, the gift shall be added to the Endowment Fund and its related income used in accordance with the donor’s designation.

 

VII.      Investment of Assets

 

In determining the investment of assets of The Endowment Fund, the Committee may assign this responsibility to the Baltimore Washington Conference Foundation, a bank trust department or a professional investment management service. The Endowment Committee’s investment objectives shall be as follows: 1) conservation of principal for the effective maintenance of purchasing power; 2) regular income at a reasonable rate; 3) growth of income and principal over and above that necessary to offset cost of living increases (inflation); and 4) investment of assets in institutions, companies, corporations, or funds that make a positive contribution toward the realization of goals outlined in the Social Principles of the Church. The Endowment Committee is charged with the responsibility to develop specific investment and spending policy guidelines for the investment and management of The Endowment Fund’s assets, which will be reviewed annually by The Charge Conference.

 

VIII.           Use of Earnings

 

All The Endowment Fund income or earnings shall be deposited in an interest-bearing account as received, pending distribution. Distributions from The Endowment Fund shall be made on the basis of the following procedures.

·         Designated Funds: The Endowment Committee shall instruct the Investment Service to distribute the Endowment Fund designated earnings at least annually, in accordance with the Endowment Spending Policy. Designated “Property” grant recommendations will be administered by the Board of Trustees.

 

·         Undesignated Funds: A grant application must be filled out by the requesting organization or committee and presented to the Endowment Committee for review and validation. The Endowment Committee will present their recommendations to the Finance Committee for approval. Once the Finance Committee approves the requests and presents them to the Administrative Council the Endowment Committee will instruct the Investment Service to distribute the requested Endowment Fund earnings in accordance with the Endowment Spending Policy.

 

·         A moderate sum may be kept in non-interest bearing demand account to satisfy administrative and cash flow needs unless interest earnings checks are reasonably available.

·         The amount of earnings distributed should only be the amount in excess of the Endowment Fund principal plus the amount that keeps pace with the rate of inflation.

 

IX.                Limitations on Use of Principal

 

 

 

The fund objectives are to preserve the purchasing power of the principal and utilize the investment income as defined in the Endowment Spending Policy. Any part of the principal (subject to the operation of the Spending Policy) may be withdrawn only in extreme and overwhelming circumstances bordering on the survival of The Church, providing that use of the principal has not been restricted by a donor(s). Any withdrawal of principal must be approved by a three-fourths (3/4) vote of those present at an official Charge Conference (with a declaration to pay back the funds in accordance with a pre­ arranged payment schedule).

 

X.        Accountability and Audit

 

 

 

The Endowment Committee shall make a completed financial report annually to The Charge Conference, including all funds received by The Endowment Fund during the year, the total amount in each type of fund at the end of the year, how the investment of the funds is being handled, all disbursements, and the income or earnings received during the year.

An Auditor or an Audit Committee elected by The Charge Conference, outside the Endowment Committee, shall conduct an audit annually to ensure that standard accounting procedures are being followed and to protect the interests of the donors, the Endowment Committee and The Church.

 

XI.       Liability of Trustees and members of Endowment Committee

 

 

 

 

In the absence of gross negligence or fraud, no member of the Board of Trustees of Bel Air United Methodist Church or of the Endowment Committee, shall be personally liable for any action made or omission with respect to the Church’s Endowment Fund.

 

XII.    Merger, Consolidation or Dissolution of  Bel Air United Methodist Church:

 

 

If at any time the Bel Air United Methodist Church is lawfully merged or consolidated with any other church, all the provisions hereof in respect to the Fund shall be deemed to have been made in behalf of the merged or consolidated church, which shall be obligated to administer the same in all respects and in accordance with the terms thereto. If Bel Air United Methodist Church should ever be dissolved without any lawful successor thereof,

the Fund, including both the principals and interest to date, shall:

 

Empower the Baltimore Washington Conference Foundation to continue the distribution of earnings while maintaining the preservation of endowment principal and to authorize a successor United Methodist Church or institution to assume the powers afforded to Bel Air United Methodist Church.

 

XIII.     Effective Date and Modification

 

This policy will become effective when adopted by The Charge Conference of The Church.

Changing times, unusual circumstances and new ideas or practices may lead to desirable changes in this policy statement at some future date. Any change or amendment must be approved by a three-fourths (3/4) vote of those present at The Charge Conference.

 

 

SIGNED THIS  ____ Day of _______________, 2008

 

________________________________                _________________________________

 

Chairperson, Finance Committee                             Chairperson, Administrative Council

 

________________________________                 ______________________________

Chairperson, Board of Trustees                               Presiding Officer, Charge Conference