In the Facebook discussion of various GDC issues, several themes have been repeated:

GDC, it is complex, you have the minds to deal with the complexity. It will take time, you have time if you start right away. Connectional Church, are there other conditions/expectations we should raise? This is not about Demands in an adversarial atmosphere. This is about treating others as we expect to be treated in a family circle.

Proportional Judgment or, more accurately, proportional liability, clouds the litigation. It is the principle that when multiple entities bear some responsibility for a loss, the court (jury) may assign a proportional responsibility to each party with corresponding financial obligation. If one party is responsible for 20% of the loss, another 30% and another 50%, each party pays “their percentage” of the dollar amount awarded.

It sounds fair, depending on your perspective. It gets more complicated, though. What if a defendant is deemed to be 90% responsible, but has No Money (or not enough)? The Plaintiffs would collect 10% from the other entities, and they would receive little or nothing from the entity judged most the blame. Herein lies the risk of going to trial…it is a gamble. Major blame could be given to a party with the least ability to pay. The Plaintiffs lose big time. Are you reading between the lines?

The Institution, The Plaintiffs, and The Others are walking a tightrope trying to balance who is to blame for how much of the judgement and do they have the resources to pay? Settling before going to trial substitutes reasonable negotiation for risk. When there is no agreement, those with confidence welcome the jury, as those who are unsure seek compromise and pray for a better result.

Who do you think is responsible… and at what percentage? Is the Harris Estate sufficient? Is there recoverable money hidden somewhere by those who managed the loss? Will the corporate entities rise to the point of blame, and payments, for us to achieve 100% wholeness through the Settlement?

Morally, there is no mystery. The Institution owes the People. The Others owe the Institution! What is the moral commitment of The Institution?

If ANY of the Others choose to go to trial, proportional responsibility will be assigned regardless to The Settlement. The Plaintiffs’ ability to collect from the Institution is capped. Does limited Institution liability matter if insufficient liability falls on The Others? Will The Institution and The Plaintiffs drop its case against some, if others settle? (A bad mistake for morale. Will there be a cover-up in our future?)

Is this a good deal? Yes, if you think you think significant, additional, collectible funds may not be awarded at trial. No, if The Institution does not respond with post-judgment payments to bring Participants to 100% whole. No, if The Institution walks away, and Participants do not have a court enforceable moral commitment (a legally binding promise without acknowledging legal responsible for the cause). No, if The Others are not ordered to pay significant, collectible funds that will bring Participants to 100% Whole more quickly. No, if The Institution continues to spend money on legal fees to pursue The Others with little or no hope of recovering any of those fees in even a “good” outcome. No, if the only ones walking away smiling and at peace are attorneys.

From the beginning, The Institution and The Plaintiffs should have been working together to hold OTHERS responsible for their part, and together, they should have been seeking financial restitution for the wrongdoing of others. Just as important, The Institution should have committed to a trustworthy path toward 100% Wholeness from the start.

Sophistry, evasion, and opaqueness corroded a fragile confidence. Still, are they listening? Will they respond as Emperors or Shepherds? Will the Church commit to a moral response with equitable, viable plans as The Institution pursues legal justice and remedies? Why make us Object or Opt Out to get a just acknowledgment of our cries? Compromise usually entails loss. The Participants should not be the losers here!

Two frightening phrases in the earlier days of the litigation were: “this will destroy the church as we know it” and “this will send us into bankruptcy.” That the church could be changed in a fair settlement is probable. We are already different with our levels of trust. Bankruptcy, though, seems more rooted in fearmongering and institutional selfishness, not institutional survival.

Bankruptcy is a legal instrument to protect assets and enable continued, modified operation. The connectional church has very few directly titled properties. Reaching for school property and local church properties would be a long, arduous, and complex endeavor which will yield little or nothing. Local, incorporated property, even with trust clauses, is more secure than most imagine. Moreover, the connectional church does not have authority to step in and claim local church property to satisfy a debt. We are not organized like the Roman Catholic Church where a diocese has a direct title to church properties.

Bankruptcy is moot, though, for two important factors. 1. The Institution’s properties and negotiable assets are not essential for our operation. 2. We operate on an annual budget. As long as we are collecting assessments, there are resources to structure debts and pay judgements. The threat is not bankruptcy; it is the diminished assets and the ego/business perks which accompany them.

Those who think the current “Settlement” protects the Institution from bankruptcy are falling for a rhetorical, strategic scam. The “Settlement” does not protect from bankruptcy as much as it preserves our current excessive mode of operation. This is especially true if The Institution does not have to deliver additional funds to make participants 100% whole. Limiting a payment to Plaintiffs (actually all of us) is no consolation when exigent circumstances are used to justify the nonpayment of additional funds.

Sure, it is great to operate with a cushion. We don’t do enough in vital areas such as Christian Education, Evangelism and Global Development. Nevertheless, the Institution has made it on a shoe string before, and it can do it again. The Church must address a 100% Whole guarantee with absolute, moral resolve. If the Institution recovers funds from responsible parties, we will rejoice and give thanks. If not, we must tighten our belts. Reorganize. Pay those who served within the last 60 years that which is fair based on contributions and actual interest paid.

It may not be much. It may not be all that it could have been. It is a debt that should not be evaded through bankruptcy, asset manipulation, or disingenuous efforts at preserving the current, lavish Institution at the expense of the dignity of The Church’s salaried servants. Rather than expending so much time and energy on financial assets, we need to focus on our other, most valuable asset: The People who sacrifice to pay assessments and walk as faithful disciples.

The Proposed Settlement as known is undesirable for many reasons. The “details” are probably more troubling. Foremost, there is NO commitment to Wholeness guaranteed by The Church. Alarming is inattention to the disposition of denominational assets which will make it difficult to see a path to full restoration. Sadly, we need a court recognized and ordered commitment to push our Institution to act like The Church we love and of which we can be proud. The following is a summary of an alternative. A more detailed document may be forthcoming. We need legal assistance to polish an alternative and present it to the Court!

AN ALTERNATIVE SETTLEMENT PROPOSAL

Whole

“Wholeness” shall be defined as actual contributions; less approved fees; less loans, hardship and other early withdrawals; plus interest at the rate actually paid by Symetra compounded quarterly (which often exceeded 1.5%); plus interest at the Symetra paid rate of 1.5% for the period of July 2021up to final, full payment.

The AME Church shall ensure that all participants will be made whole within 16 years or by the time of their separation.

The AME Church will provide any additional funds necessary to make participants whole once all reasonable efforts have been made to collect court awarded funds.

The AME Church will advance payments of “wholeness” to those who have retired/separated with the understanding that if supplemental funds have been applied, the Church will be reimbursed up to the amount advanced in settlement.

Current Retirees (estates) Will be Made Whole Immediately

As indicated above, funds won through negotiation/judgement will reimburse the Church for funds up to the amount paid in advance. Additional amounts received above the advance payments will be paid to Retirees (estates) as compensation “above wholeness.”

Statement on Status of “Wholeness” to Be Issued

            The Church will maintain a separate record of the status of “wholeness.” Such statements will indicate the original sum, plus interest earned (1.5%/yr from July 2021), less appropriate fees, less payments to individuals (separated) or to accounts in approved, qualified plans. The record shall continue until the balance owed for all participants is zero.

            In no case shall the Church, or a Trust, fail to pay to each participant (or their accounts) a proportional share of ALL annual earned interest less reasonable fees.

Funding the Alternate Settlement

The Church shall liquidate 75% of investments, including the AME Future Fund. This should provide more than $10m. These initial funds shall be used to pay those who are already retired/separated.

The Church shall sell, or develop, the Washington, DC property. Up to $5m shall be used to make whole those already retired. The remainder shall pass through a Trust to accounts held in a qualified plan such as that currently managed by Wespath. The remaining participants shall be credited with their proportional share.

The Church shall establish a lien against the Sunday School Union Property (Nashville) which will have the effect of limiting excessive leveraging and secure the residual value to the Annuity Participants until all are made whole.

The Church and The Plaintiffs shall continue to pursue claims against other responsible parties. The total expenses/fees requested by The Plaintiff attorneys shall not exceed $20m, and it shall be the first paid claim against funds won/collected from the other parties.

Should more than $75m be won/collected from the other responsible parties, both The Plaintiffs and The Church may apply for additional compensation.

The Church shall provide no less that $4m each year to satisfy the cash requirements to make whole those who are retiring/separating. There shall be an actuarial analysis to determine the annual cash requirements and the amount to reach full settlement within 16-20 years. In no event shall funds not be available at the time of separation.

The Church shall ensure funds availability through its annual budget by exercising its discretion relative to decreases to expenses and increases to income.

Allocution

            The Church (and other responsible parties) shall submit an allocution to the court expressing regret for whatever role they played (or failed to fulfill) in the creation of the Annuity Crisis with an apology to the Participants and their families and to the AME Church.

This Summary does not address the Real Estate Deal or other suspect funding plans. The Participants have little concern on “how” the Institution finances settlement, but Participants cannot allow further financial abuse or underfunding of 100% Wholeness. The unfair binding of assets and “business as usual” at the expense of Participants is UNACCEPTABLE.

The Connectional Budget may not be easy, but most rightly lament the size of the District Budget (plus). From presiding elder sheets, they land with pastors and church finance committees who pour over the items and grand total required at the designated reporting time. Like government taxes, most do not like Connectional or Episcopal District/AC/PE District assessments. Also like taxes though, some of these contributions are really necessary.

THE NEGATIVE SIDE
Many districts and annual conferences have not done a good job of apportionment. Demographic realities are often overlooked, and the ever changing condition of congregations can result in gross, destructive inequities. The burden is not equal.

In some places, the District/Annual Conference budgets equal or exceed the Connectional Budget. The unrealistic expectations of some churches cannot only discourage pastors/congregations, but also result in morale crushing delayed maintenance, cancelled ministries and ultimately, a total nonpayment of any denominational support.

The intentional fog around that which is mandatory or voluntary denies opportunity for self-adjustment. While some may cut an important voluntary item, like assistance for struggling congregations or disaster relief, others use the opportunity to say to the folks at the top, “we love you and want to, but we have already sacrificed and it just isn’t here.”

Our negative, uninformed views about assessments does not help. We sometimes act as though “our institution” can exist without funding. Just as governments need taxes to function, the church lives on the financial commitment of the faithful. Rather than blanket cries about what we cannot afford, we need to study what is truly happening with the District Budget with an eye to efficiency.

THE REALITY
It costs a lot to run a District. The categories suggest how fast the totals add up. Executive maintenance (housing, car, health and other insurances), Office Space (own or rent, not free), Clerical and logistical Personnel (yard/building maintenance & repair); these alone could be more that $200,000k depending on the size of the district. Those audits we demand: $10k+. Here is my favorite: $1,000-$1,500 for the District lawyer to tell the auditor there are no pending cases against the District! You would be shocked by the cost of those pretty, full color bulletins and booklets we leave on the chair: $1,000s not $100s. A large District may easily spend more than $50k on graphics and printing so we can “present.” Professional Fees (accounting other than auditing, legal, development); AND those Projects (colleges, seminaries, camps, etc.). In the blink of an eye, even a small district can generate a tab of $500k. This is all yet WITHOUT ANY “GIFT” TO THE BISHOP!”

Many have never seen their District’s Budget, let alone participated in the formation and approval of a budget. Greater transparency could lead to more acceptance of District/AC budgetary needs, and control excessive spending. Sometimes we need more than the cute summary on a PowerPoint. We need to see THE BUDGET to gain confidence that the folk in charge know what they are doing.

We need to demand a realistic budget with reasonable income and expense expectations. The day is coming when districts, like churches, will have to ask “can we meet the minimum financial requirements to exist, or must we close/merge?”

The lack of serious scrutiny of the budget at both the General Conference and the General Board is not an omen of hope.  The masses see themselves as helpless, and the will to do better has been deflated by sharp, political points. Episcopal gifting is a protected category while vital areas of ministry and administration are cut. A key is transparency in the process.

Some Conclusions

1. If the people want a Bentley, show them the cost and let them pay without a fuss.  If an electric bicycle is closer to their budgetary appetite, let them claim it and ride with pride! Transparency!
2. Accept that it costs to be a church.  Stop looking for someone else to pay a bill you made out of pride and excess. Embrace the costs!
3. Stop lamenting Episcopal Compensation/Gifting if you are not going to do something about it.  You are wearing out yourself and people of goodwill inside and outside the church. No need in blaming the Connectional Budget when you are truly upset about an executive gift and/or unfair planning/distribution of a local budget.
4. You want missions? Pay up.  You want evangelism/expansion? Give. You want social action/involvement? Contribute. You want to dance? Pay the drummer.  You don’t trust the process? Fix it or shut it down. Whining is so undignified for a child of God!
5. District Budgets should be on every AC Agenda along with the District Audit. Take care of business with the laws on the books. One element of integrity is a realistic plan of church support and a mind to enforce the fair plan. As we “ooo and ahhh” Episcopal Gifting/Compensation/Support, let us look at the reality of institutional support.  If we are going to be a Church, we must pay whether or not we repair the breaches.  Otherwise, turn off the lights, lock the door, go in peace, and stop complaining.

One of the biggest mysteries, and exaggerations, in our Zion is: how much bishops receive! No one knows for sure except each recipient, and some of them do not know exactly how much they get because of the way the compensation and gratuities arrive. Be sure, it is less than you think and more than you can imagine. The following will give you an idea.

The Official Compensation from the Budget: Salary ($63,067), Travel ($21,022/2021-2024), Social Security Match, Annuity, & 403-B.

Bishops in Districts 1-13 may also receive (most, not necessarily all): Housing/Residence, car, & medical insurance. These benefits vary in Districts 14-20.

The “Extra” Compensation: Then there is the “Extra” Compensation which usually comes in the form of “gifts” from annual conferences, District Meetings (Midyear, Christian Ed, Planning, etc.), preaching honoraria, holidays, and unspecified. For reflection, these are organized into categories.

Minimum (no District among 1-13 pays less) – $ 75k Low – $150k – $200k Mid – $200k – $350k Mid/High – $350k – $500k High – $500k+

Districts 14-20: Two Districts “may” provide from $5k – $20k of extra compensation over and above what bishops may receive as honoraria preaching in the USA. Little to no additional compensation is available in five of the Districts 14-20.

Folk are more fairly angered by those who receive more than $500k at a great sacrifice to the people they serve. The masses are frustrated when the District “extras” far exceed the Connectional Budget with properties deteriorating, disciples decreasing in number, and the laboring ox can barely find feed to be energized in the treading of the corn.

Until we are ready to hold bishops to the law (which means filing charges) and demand transparency with fiscal restraint at the annual conference level, standardizing compensation is just not going to happen. Even a few tweaks have no chance of adoption as we really lack will and courage to effect change. Some possibilities? 1. Shift 100% of Episcopal Compensation to the Districts (1-13). This would focus on true cost/benefit. Bishops should negotiate compensation with districts under the oversight of a connectional eye for fairness. 2. Mandate that all “in District” gifts and honoraria pass through a single portal. This will establish the truth in the total and provide for tax compliance. 3. Pay bishops in Districts 14-20 substantially more than the current common salary. $150-$200k would make it less burdensome for bishops to be assigned to Districts 14-20 AND it may be an added incentive for an indigenously elected person to want to remain in their indigenous region. 4. No bishop should be earning more than $500k or less than $150k. There should be both voluntary and mandatory standards to curb the excesses.

Desire for greater service; personality differences; influence/power mongering; conflicting perspectives on ethics, theology, ecclesiology; and, ego may drive some of the strife among the bishops. At the end of the day, don’t forget to look at the money!

In the next post I invite you to look more realistically at District Budgets.

One of the adages I heard from the late Bishop E.L. Hickman was: “a dead man’s bones make a poor foundation.”  He cautioned the listeners to avoid the temptation to seek the demise of another to secure personal position and gain.  That word should be heard on the chit-chat lines of our Zion today.

Not only do we speculate about who will be elected (and in which order), but also there is much conjecture about how many bishops we will elect in a few weeks.  The number which a reasonable person should conclude is five, although there could be more, or fewer, places. 

Six bishops retire, and one bishop now is located “for a quadrennium.”  The election of five, with the return of one, would yield the number needed for the current configuration.  Sadly, there are those who speculate that one or two current bishops will not be in active service in the coming four years.  They argue this will justify the election of six or seven new bishops. 

Woe to the candidate or supporter of a candidate who wishes ill on a bishop to increase the odds of the election of another.  A dead man’s bones make a poor foundation!

While I see the strength in the election of the “anticipated five,” there are some reasons to choose fewer bishops.  First, the position of Ecumenical Officer and Chaplain Endorser can be divided and separately assigned to a bishop who also presides over a district. That reduces the number by one OR holds the number at five, should ill fate visit one on the Council of Bishops.  Second, there are four districts which can share the leadership of two bishops (1 bishop – 2 districts). This reduces the number to be elected by up to two (2).

In summary, there are options which limit the number of bishops elected to as few as two! Let us pray no one in our Zion is wishing for trouble for our bishops to create opportunity for a newly elected “holy leader in God.”  We ask God to keep the meditation of our heart and the politics in our mouth reflective of God’s will for the strength of our Zion.  If God wills the election of a person, we only must elect one (1). Electing twenty (20) does not guarantee a particular candidate’s election, and it may result in unforeseen problems.

Let’s be fair and kind in our dealings. Let’s be spiritual in our campaigning and voting. Let’s build on righteousness, not a dead man’s bones!

Corruption is Pandemic! It makes governments less efficient. It robs the needy of humanitarian assistance, and blocks life supporting aid from populations in distress. It is found in both developed and undeveloped countries. Yes, it can be found in the Church! It is not one of the pandemics which will be discussed at the General Conference.

Much could be said of the waste, suffering, and injustice of Corruption. The normalcy of corruption is disturbing as it has made unethical practices accepted and expected in everyday life.

Corruption is a vile expression of privilege. For some, it is as though God “created them to be the beneficiaries” of unfair dealings. We classify the “givers” and “receivers.” Compassion and dignity get strained when the “receivers” have expectations of the “givers” which become demands. The corrupt have a distorted view of humanity.

Corruption indicates both selfishness and faithlessness. It is about “me,” and my inability to trust God for the necessary provisions of life. This is a crisis!

God, give us insight to the things we do, and accept, which demean others. Help us to see the needs of others alongside our own. Teach us to trust you. Increase our faith in your promised goodness and mercy. Let there be an end to corruption. Let it begin with me. Amen

In 2004, the AME Church made a major commitment to Indigenous Leadership with an unprecedented election of three bishops who were born in overseas districts (Districts 14-20). The intent was sealed with a document: The Covenant. Persons born outside of the USA would serve areas of their birth. Yet, the understanding of those elected was not clear in terms of their having made an active, career long obligation.

While most delegates in 2004 thought the obligation would be until retirement, the very wording of The Covenant suggested a lesser arrangement. The document called for the continued election of District 14-20 candidates until there “may” be a natural rotation off into Districts 1-13. The very notion of “rotation” showed the matter had not been thoroughly reasoned.

Rather than effectively responding to years of discussion in the African Jurisdictional Council (AJC) to empower local leadership of the church, the denomination created a smooth path for the election of global candidates with no clear vision for how they would be best deployed. The dilemma faced us after eight years and the challenge of assignments. Unlike our sister churches, we had no provisions for more than an eight year tenure for a bishop beyond North American shores. Suddenly, bishops were not indigenous, and they were not in the nation of their preference.

Some candidates (2004) foreknew the issue, and they refused to enter the Covenant. They were connected to their new base in America. They did not foresee themselves serving in their birthplace for more than one or two quadrenniums (like their American born colleagues who also sought the episcopal office). So, now we have it. Worthy candidates did not take advantage of a favorable condition to be elected. Others took advantage of the opportunity with the notion that the church was trying to make the ranks of leader internationally diverse, not that indigenous leadership had become a new value for our Zion.

Most of the delegates (2004) were clear on the terms of commitment. Whether or not those elected had the same understanding is not for current reflection. That many candidates thought they lost the opportunity for episcopal service because of the global “set aside” is no longer relevant. These are my pressing concerns:

1. The personal toll on “indigenous” leaders is unfair given our undeveloped structure for Indigenous Leadership. Moving bishops across the continent to diverse cultures for an entire career is not fair to them, or their families. We need to address the impact of our policy with a pastoral response. We do not have to perpetuate an administrative error by continued insensitivity to the human predicament. Let’s move forward from our mistakes.
2. The church has reneged on its obligation under The Covenant. The document/sentiment should be considered null and void. This is not an automatic claim check to a District 1-13 assignment. It is the call for the removal of the stigma and prohibition. Evaluate gifts and graces. Match them to vacancies.
3. We need legislation which will accommodate truly indigenous leadership. Indigenous Bishops are a good idea we have not properly developed. A Southern African Jurisdiction may accomplish much of this, but there are other considerations such as tenure limits on service in one area.
4. Our comrades in Districts 14-20 are going to have to be clear about THEIR acceptance of indigenous leadership. Let us not be fooled, there are some districts which have No Desire for indigenous leaders. Candidates from those districts need to be forthright in their campaign. You are not a bishop for “your” area as “your” area does not want “your” leadership. You are a candidate from the global theater seeking to serve wherever the has for a person of your gifts and graces. Rank and file AMEs need to be cautious about how we encourage aspirations. Do not mislead your sisters and brothers.
5. AMEs, Be Careful About What You Ask For! You may get it, and have to live with it. Advice for Districts 1-20!
6. We have wasted 20 years of preparation time for a new generation of leadership from the continent. When I think of the late Bishop Senatle, not only do I remember a man of depth and gifts which were unknown to most, but I also consider the mentoring/preparation of the late Bishop Ming. The Bishops, Clergy, and Laity should be praying for, and preparing, leaders from the trenches of Districts 14-20.
7. Indigenous only works if the people who will be led do the selecting. Americans must not elect leaders who will be forced on the people. My comrades across the water, I will not support any candidate from among your numbers until you come together in support of the candidate(s)!

Other Streams of Income! We have shouted about this for decades. The fact is there are many AME’s who have tapped “other streams” for a while. Rental properties, investments/endowments, and community-wide fundraisers which do not rely on the offering plate or the congregation for the bulk of the income. The General Church has a stream of income hidden in plain sight: The Reserve/Endowment funds.

The retiring CFO boasted $10m of reserve/endowment assets. It seems a sizeable sum is there, and in the AME Future Fund. Has anyone asked the question: how much are we earning on our invested reserve/endowment funds?

This brings us to a more important question: why is not Investment Income an income line item for our General Budget?

We have passed the reasonable point of delayed distribution from investment gains. Now is the time to receive an annual distribution of $200k from Investment Gains.

Look at the positives: 1. $200k is less that 5% of investments which should be realizing a greater gain (no dipping into principal), 2. The distribution is enough to offset the budgetary expense (contribution) of $132k/year TO endowment. 3. The few additional funds realized would also be enough to bring the Wilberforce Community College (19th District) allocation in line with the other main educational institutions. 4. It will set a positive example of the benefit of endowment funds. 5. It could establish incentive for the cultivation of endowment as an alternate income stream.

Endowments are critical factors in the present and future AME Church at both the general and congregational level. Endowment distributions are, in fact, a stream of income beyond the offering plate. The folk need to see this advantage. The budget, for the sake of transparency, needs a line item for investment income to the Budget of the Church.

Will the General Board and the General Conference insist on Investment Income as a budget line item?