Chapter Sixteen - 2012 Stats - Direct Billing or Apportioned Benefits

Over the past decade many annual conferences have grappled with whether to apportion or direct bill the cost of pension and health benefits to local churches. When these benefits are apportioned then their cost is incorporated into the apportionment formula, which means that some churches actually pay less than what these benefits cost for their appointed staff and other churches pay more. When these items are direct billed, then each church pays the actual cost for their appointed staff. I thought it would be interesting to see if anything popped out when we looked at those that reported direct billing and those that did not.

Of congregations with at least five members:

• 14,624 congregations (45%) reported direct-billing of both pension benefits and health benefits 

• 9,591 congregations (30%) reported neither direct-billed pension benefits nor health benefits (We can assume both were apportioned)

• 6,686 congregations (20%) reported direct-billed pension benefits but not health benefits  (We can assume health benefits were apportioned)

• 1,539 congregations (5%) reported direct-billed health benefits but not pension benefits  (Not sure what assumptions to make about these congregations, as they represent a variety of annual conferences.)

Those congregations that reported both direct-billed health and pension benefits paid 88.01% of their apportionments and reported 8.75% of their expenditures went to apportionments.

Those congregations that reported neither direct-billed health and pension benefits paid 84.71% of their apportionments and reported 10.75% of their expenditures went to apportionments.

Those congregations that reported direct-billed pension benefits but not health benefits paid 86.05% of their apportionments and reported 10.71% of their expenditures went to apportionments.

Those congregations that reported direct-billed health benefits but not pension benefits paid 86.59% of their apportionments and reported 11.16% of their expenditures went to apportionments.

(Note: The reported percentage of apportionments paid to  expenses includes both district and annual conference apportionments)

Here are a couple of questions these numbers raise for me.

• Do congregations that are direct-billed feel better about the connectional church since their apportionments are a lower percentage of total expenditures?

• Do congregations that pay health and pension benefits as part of apportionments have a clear understanding of the actual cost of staff?

• What would happen if health and pension benefits were all direct-billed, and each church was asked to tithe 10% of their income to the connectional ministries? (Currently the total for all churches over 5 members is 9.19% of congregational expenditures go towards apportionments.)

The statistical data included herein were provided at no charge by the General Council on Finance and Administration of The United Methodist Church (GCFA) and may be obtained directly from GCFA, PO Box 340020, Nashville, TN 37203-0029. This data is proprietary and is owned by GCFA and may not be used in any commercial or exploitative way, to make a financial profit, or in a manner that defames the United Methodist denomination or its agencies or organizations. GCFA does not endorse any particular use of the data or accept responsibility for its interpretation or analysis by another.