Vol. XVIII, Issue 23
Adoption Agreements for 2020
Wespath recognizes that many of you are holding Annual Conference Meetings now and in the coming weeks. We apologize for any challenges caused by the approaching deadlines for Adoption Agreement submissions.
Please complete and submit the following documents:
- By June 20—Grant Continuation and Approval Report, which was e-mailed to conferences between May 17 and 20, 2019
- By June 26—Adoption Agreement Supplement One—CRSP (Pre-82 Plan), indicating the Past Service Rate (PSR) and Contingent Annuitant Percentage for 2020 that were approved at annual conference, even if they have not changed from the 2019 rates
It is important to submit these agreements on time to ensure fall actuarial reports reflect the final 2020 past service rates (PSR).
If you are making changes for 2020, please also complete and submit:
- Your plan sponsor manager with questions about the conference adoption agreements.
- Kevin Menczynski at 1-847-866-4555 or firstname.lastname@example.org with questions about the grant report.
* Annual conferences adopting UMPIP Automatic Features effective January 1, 2020—Wespath will send signature-ready UMPIP adoption agreements effective January 1, 2020 to annual conferences that are adopting Automatic Features according to the timetable discussed with those annual conferences.
DAC and CACs Now Available for 2021
The Denominational Average Compensation1 (DAC) and Conference Average Compensations (CACs) for jurisdictional (U.S.) conferences are now available for 2021. This document provides a complete listing, by conference name, of both the 2020 and 2021 figures.
In addition, this graph may be of interest. It shows that while the total amount of compensation in the United States for full-time clergy has been decreasing the past few years, the total number of U.S. full-time clergy has been decreasing faster. Therefore, the average full-time compensation level has continued to increase. The DAC increased 2.1% this year which is in line with increases over the last few years.
In order to use the DAC and CAC figures properly, please remember the following:
- Wespath calculates the DAC and CACs solely for use by the denomination’s U.S. pension and welfare plans for clergy. Any other use is strongly discouraged.
- In general, the DAC and CAC are averages of the compensation (as defined by the benefit plans) of full-time U.S. clergy who participate in the Clergy Retirement Security Program (CRSP) and/or the Comprehensive Protection Plan (CPP).
- The DAC includes the compensation of clergy serving local churches in the United States, jurisdictional bishops and district superintendents, and clergy serving general agencies and other appointments in the United States extending the ministry of The United Methodist Church. Clergy in those extension ministries are included only if they participate in the Clergy Retirement Security Program (CRSP) and/or the Comprehensive Protection Plan (CPP).
- The CACs include the compensation of district superintendents, but exclude the compensation of bishops and clergy serving general agencies.
- Plan compensation includes housing allowances, housing exclusions and certain tax deferrals, such as UMPIP before-tax contributions and Code section 125 medical spending account deferrals. For clergy living in a parsonage, plan compensation also includes an amount equal to 25% of compensation.
- Plan compensation excludes amounts paid in lieu of a conference providing a group health plan.
- Plan compensation now includes moving expense payments due to changes in tax laws effective for the 2021 DAC. Wespath has adopted a “lookback year” approach by including in the current year’s DAC calculation the moving expense payments provided in the prior calendar year.
To accommodate the Church’s advance budget planning needs, Wespath sustains a long tradition of calculating the DAC with a two-year lag. In other words, the 2021 DAC is calculated based on 2019 compensation data. There are no adjustments or projections to account for the two-year difference.
1 Denominational Average Compensation is a specifically defined term associated with the Clergy Retirement Security Program, including its Supplements, and the Comprehensive Protection Plan. As such, its name can be changed only by General Conference.