Boards Push Forward Despite Budget Cuts

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March 19, 2024 | ATLANTA (UM News)

Key points:

  • The first joint board meetings of the United Methodist Board of Global Ministries and United Methodist Board of Higher Education and Ministry took place March 4-8 in Atlanta.
  • As of July 1, both boards will be under the purview of Roland Fernandes after the retirement of the Rev. Greg Bergquist, top executive of Higher Education and Ministry.
  • Plans call for more equitable collaboration with constituents who need aid, to get past colonialist attitudes.

Working under the pall of large, looming budget cuts, the United Methodist boards that support leadership development and mission work used their first joint meeting to offer an egalitarian vision of the relationships with each other and their constituents.

“We have to deal with the realities that we are facing and do the best we can,” said Roland Fernandes, top executive of the United Methodist Board of Global Ministries and United Methodist Committee on Relief. “I'm optimistic, even though it’s difficult.”

Come July 1, Fernandes will add overseeing the United Methodist Board of Higher Education and Ministry to his responsibilities. That’s when Higher Education’s top executive, the Rev. Greg Bergquist, is due to retire.

The boards are not merging, everyone involved was quick to say.

“At events like this, it seems like we’re very close to (merging),” Fernandes said in an interview at the conclusion of the March 4-8 meetings. “When you really get into the details and looking at it, it’s not so much, because there’s a lot of differences in our agencies. … It is definitely not something that we could just easily say we can go ahead and merge.

“It’s really important to keep them both separate at this point.”

A memorandum of understanding on the new relationship was signed March 6 by officials from Global Ministries and Higher Education and Ministry, Bergquist said.

“In conversations with the executive committees, the board of directors is supportive of all of our staff to claim this alignment process as your number one goal for this year,” Bergquist said.

“This is not only going to help us to continue to push ahead our normal ministries,” he added. “This is going to help us to focus on this coming together in new and powerful ways that we believe … will generate the kind of mission and vision … and strategy that will push us into the next quadrennial that will really make a difference.”

The meeting at the Emory Conference Center Hotel included 32 Global Ministries directors, 10 from the Board of Higher Education and Ministry and one from each joining remotely through Zoom. Throughout, there was an emphasis on leaving top-down management styles behind.

“Our general agencies have often presumed to be the center of whatever activity we were tasked to support, whether that was mission, education or something else,” Fernandes said. “We have portrayed ourselves as a global church, but in reality, we function as a U.S.-centric church with some global outreach.”

Going forward, Fernandes said the direction will be less centralization and “more mutuality and more cooperation.”

“We need a different mindset starting at the level of the individual to change to a truly post-colonial, mutual way of working, especially when we have the privileged access to resources that most often aligns with power,” he said. “The many conversations we have had in recent months with partners around the world are all geared to this very purpose of increasing mutuality in mission.”

Budget

Planning for the next quadrennium for now will be limited to two years, 2025 and 2026, instead of four.

“Because of the many uncertainties in the church right now, especially around budgets and regionalization, it does not make sense to spend time trying to project our work four years into the future when there are too many factors that we cannot foresee and do not control,” Fernandes said. “Instead, I believe it is better to focus on the next two years and how we can respond strategically to changes in the agency, in the church and in the world.”

Like much of the church feeling the impact of the disaffiliation of about 25% of local churches and the remaining hangover from the COVID-19 pandemic, both the boards of Higher Education and Ministry and Global Ministries are facing deep budget cuts.

Operating revenue of Global Ministries, UMCOR and the Board of Higher Education and Ministry fell $23.1 million from 2021 to 2022 (from $102.2 million to $79.1 million).

“Almost half of our income for Global Ministries comes through the World Service (Fund) apportionments,” said Michael Gurick, chief financial officer of Global Ministries and UMCOR. “And you’ll see a general trend over the last four years of steady decline.”

From 2020 to 2023, World Service Fund apportionments to Global Ministries dropped from $22.3 million to $20.8 million.

And things are going to get worse before they get better.

“The potential impact of the proposed budget that (the General Council on Finance and Administration) is presenting to General Conference is so significant that it bears repeating,” Fernandes said. “GCFA is recommending a dramatic reduction to apportionments collected and hence a dramatic reduction to the World Service Fund, which is one of the major sources of funding for both our agencies.”

The General Council on Finance and Administration is proposing cutting the World Service Fund’s contribution to Global Ministries by 52%, he said. That would reduce its apportionment share by more than $60 million, “a huge challenge for the agency to sustain,” he said.

“We will be helped in the short-term by strategic decisions we have made over the past five years that have put the agency in a good financial position at the present with strong reserves,” Fernandes said. “These reserves mean that we have a cushion that will allow us some transition time as we adapt to the new budget reality.”

The reserve fund contains $71 million, Gurick said. The goal is for it to be able to cover between six and 12 months of operation.

“We’re actually ahead of that, primarily due to the cuts and changes that took place between 2018 and 2020,” Gurick said. “We took those cuts anticipating a General Conference that never took place. For that reason, we were able to see our reserve position grow to where we are today. UMCOR finished at $109 million in net assets.”

Still, with the anticipated cuts that are coming, “the transition time will be short,” Fernandes said.

“The pressure is on to take decisive actions in the next 18 months to adjust to these new realities,” he said.

“We have just concluded an extensive fundraising study and will soon begin to work on some of the recommendations from the study, which our executive committee has been looking into and supported,” Fernandes said.

Gurick brought up what he thinks is a prime fundraising opportunity.

“We received $9.5 million collectively … in 2023 from legacies and bequests,” he said. “In 2020, in the year of the pandemic, we received almost $18 million. Most of this was undesignated.” Undesignated means there are no conditions on how the money is used.

That indicates the need to talk about Global Ministries' mission with those who are retiring, Gurick said. “They’re thinking about estate planning. I just think you can see the impact in one year, what that can mean for us.”

The family of the Rev. Edgar Avitia Legarda performs a poem he wrote and set to music during his service of remembrance at the first joint board meetings of the United Methodist Board of Global Ministries and United Methodist Board of Higher Education and Ministry on March 7 at Emory University in Atlanta. Avitia, a longtime staff member of the United Methodist Board of Global Ministries, died last year at age 62. Photo by Adam Bowers, Global Ministries.

East Africa

To continue the return of the East Africa Episcopal Area to the Global Ministries fold, after a decade when financial irregularities caused it to be denied support, Fernandes will name a special assistant and a treasurer who will focus exclusively on the area.

“It was unfortunate that it took over 10 years to resolve this matter, and we heard sobering testimonies about the negative impacts of the embargo for the church in East Africa,” Fernandes said. “There are a lot of learnings from this, and there was also a lot of hope and expectation for what is possible for the church there now that the embargo is over.

“We are going to be very intentional about our work in East Africa to strongly support the church there and reestablish partnership across the various program areas of Global Ministries.”

Hope for the future

Bishop Hee-Soo Jung, president of the Global Ministries board since 2016, said he was hopeful for the future despite the budget cuts.

“When you (pave) a parking lot, even though you paved it very well, still a crack happens,” he said. “There’s a yellow flower dandelion coming out, right?

“That’s exactly my belief and theology. In between a crack, there’s always new life coming.”

Jim Patterson is a UM News reporter in Nashville, Tennessee.