Dear Friends in Christ,
Just before Christmas, the chairpersons of the Board of Trustees, Board of Pensions, Council on Finance and Administration (CFA) and the Dean of the Cabinet wrote to you that GNJ for years had been underbilling congregations for clergy and lay employee benefits and property insurance. For instance, the gap between what churches were billed for health insurance and the actual cost to GNJ for health insurance was more than $6,000. Designated program reserves and property sales were used to make up the difference in the underbilling. As a result, GNJ has $10 million less in program-designated reserves, and discovered property sales were not being invested as directed by the annual conference. As a result, GNJ has a $6 million budget shortfall.
Over the last three weeks, a team of GNJ leadership has been reviewing GNJ’s finances to understand GNJ’s financial position. Based on what they found this past week, GNJ will not hire six open positions and laid off seven staff members, not for performance reasons but to balance the budget.
The leadership has developed a plan to balance the budget, rebuild the reserves and assist churches over five years to meet the full costs of clergy and lay employee benefits.
You may find the report on GNJ finances, a plan to balance the budget and rebuild the reserves, a staffing plan and legislation for the January 22, 2021 Special Annual Conference Session here. The plan was developed by a team of leaders and has been reviewed by CFA, Board of Pensions, Board of Trustees and the Cabinet.
An independent team that includes a lawyer and forensic auditor will review the use of reserves and other financial matters to identify what occurred and how it occurred and report directly to the May 2021 Annual Conference Session with recommended actions to be taken.
I want to thank everyone who has worked together to assess the problem and work toward a solution. I especially want to thank our new CFO/Treasurer, Rob Zuckerman who identified the problem and was instrumental in developing the path forward.
With God’s help and by working together, we will overcome this challenge. I ask that you pray for the staff who have been laid off and for the leadership as they lead us through the challenge.
Keep the faith!
John Schol, Bishop
United Methodists of Greater New Jersey