Present: Bishop Spong, President; Bishop McKelvey, Vice President; Mr. John Zinn, Treasurer; Mr. Michael Francaviglia, Secretary; Mr. Michael F. Rehill, Chancellor

Bishop's Appointments: Mr. Steven Boston; The Rev. Margaret Gunness; Mr. Michael James; Mr. Russell Murphy; The Rev. Scott Hoogerhyde

Elected by Convention: The Rev. Emory Byrum; Ms. Peg Dengel; Ms. Kathy Ganim; Mr. William Heick; The Rev. Canon Angela Ifill; The Rev. Scott Kallstrom; The Rev. Harry Smith

Elected by Districts: The Rev. Caroline Bruschi; Mrs. Patricia Cumberbatch; The Rev. Lawrence Falkowski; The Rev. John Hartnett; The Rev. Rose Hassan; Mr. Scott Helsel; Ms. Diane Kaczmarek; The Rev. Mark Lewis; Ms. Pamela Lindquist; Ms. Dagi Murphy; The Rev. Ashley Neal; Ms. Cheryl Notari; The Rev. Isaac Persaud; Mr. Junius Powell; Mr. Robert Simmons; Ms. Jean Wadnik; Mrs. Virginia Whitehouse; The Rev. Dr. Franklin Vilas

Absent: Mr. E. Kim Byham; Ms. Mary Sunden; The Rev. William Parnell; The Rev. William Potter; The Rev. Steven Steele; The Rev. Gordon Tremaine; Ms. Nancy Weidbrauk

Others present: Ms. Clara Horsley; Ms. Dale Gruner; Mrs. Louise Heick; members from St. Paul's, North Arlington; members of the DOM executive committee: Laurence Taber, The Rev. Carolyn Lumbard; The Rev. Tracey Lind, Acts/Vim Chair

Prior to the start of the meeting, the Council expressed its congratulations to William and Louise Heick on the occasion of their 50th wedding anniversary.

The meeting was called to order at 7:10 p.m. by Bishop Spong. The Rev. John Negrotto, rector, welcomed members of Council. He described the church as fast growing in membership, with a doubling of the Sunday school. A new outdoor sign was erected recently, another sign of vitality. The Council expressed its thanks for the hospitality.

AGENDA

It was moved and seconded to adopt the agenda with an addition of the Companion Diocese Relationship report by Canon Ifill. The motion was adopted.

MINUTES

It was moved and seconded to accept the minutes for the October 8, 1997, meeting with corrections to the name Robert Simmons on page three, adding Isaac Persaud as present and change the title of The Rev. Tom Logan to interim. The motion was adopted.

EPISCOPAL COMMUNICATIONS: BISHOP SPONG

• Welcomed members of the DOM executive committee.
• Thanked the Diocesan Council, Standing Committee and the diocese for the study sabbatical time given to him this past year and for those given to clergy. The opportunity to study was an important renewal time for clergy persons; this time enhanced clergy skills to better their service as ministers. Reported on the time spent in New Zealand and Australia.
• Welcomed members of St. Paul's, North Arlington. He announced that he would not participate in the debate regarding reclassification. Current signs of life were encouraging; however, he felt that the integrity of the canons must be maintained and followed to the letter of the law. It was not an insult to be reclassified as an aided parish and be given three years to get your life back to where it should be. It would be his recommendation that the canons be followed; if not, there could be problems with others who have been so reclassified in the past.

TREASURER'S REPORT

Mr. Zinn presented the Treasurer's Report. It was moved and seconded to accept the report, subject to audit. The motion was adopted.

Mr. William Heick asked about the distribution of the diocesan audit report. Mr. Zinn replied that the audit was presented to an audit committee, but could be presented to the Council. The 1996 audit will be included in the December packet of council materials.

DISCRETIONARY FUND GUIDELINES

Mr. Zinn introduced the guidelines for discretionary funds. When money was combined with a lack of guidelines and human nature, there was risk and danger. The purpose of the guidelines was to introduce accountability and to educate. The source of the proposed guidelines was the national church's guidelines. Discussions were held with clergy on the Ethics Committee and in the Newark Clergy Association. Copies had been distributed to all active clergy for comments. The report will also be presented at the Treasurer's Workshop.

Mr. Zinn moved that the guidelines be referred to the December meeting for action. They were as follows:

RESOLVED that effective January 1, 1998 the following guidelines are approved for the handling of discretionary funds in the Diocese of Newark

Discretionary Funds have been in use within the Episcopal Church for decades if not centuries. Yet the Canons of the Church do not mention Discretionary Funds by name. The basis for discretionary funds apparently comes from Title III, Canon 14(f) first approved in 1814 which provides for a special offering for the poor to be administered by a member of the clergy as Almoner, the person charged with giving alms to the poor. The Canon further provides for the appointment of "a responsible person" if the parish is without a Rector.

In recent years there has been a great deal of review of the appropriate use of discretionary funds. The following which are based upon National Church guidelines are the guidelines for discretionary funds in the Diocese of Newark.

1.The discretionary fund is a fund of the parish or mission. It is the Discretionary Fund of the Rector of St. Swithin's church. The funds belong to the church and remain with the church once the priest ceases to be the rector/vicar.

2. All donations for the discretionary fund should be made to the church, deposited in a church account and then transferred to the discretionary fund. The only deposits made to the discretionary fund should be checks drawn on a church account. There may be rare occasions when someone wishes to make an anonymous donation for the benefit of someone in need. On these occasions a deposit can be made directly to the discretionary fund, but a warden or the treasurer should be informed of the transaction especially to confirm that the disbursement is used for the stated purpose. Such transactions should be extremely rare.

3.The discretionary fund should be audited annually along with the rest of the church's finances. Such an audit should be conducted in accordance with the audit requirements of the Diocese of Newark.

4. National Church guidelines permit the use of the discretionary fund for expenses "related to the exercise of ministry not otherwise provided in the church's budget" so long as the vestry/executive committee gives prior general approval for such a use of the fund. This could include the purchase of books, journals and related expenses, but should not be used for the general operating expenses of the church. While such a use of the discretionary fund is permitted, it is recommended that such items be provided through a budget line entitled "rector or vicar's expenses" rather than being paid out of the discretionary fund.

5.If the discretionary fund is maintained as a separate account, the priest should keep detailed records of the funds transactions. When checks are written to cash, the priest should keep a private record of what is done with the proceeds. Monthly the bank statement for the account is to be submitted to the treasurer for verification that all deposits made into the account came from disbursements from a church account. The treasurer should make a notation on the bank statement and file it with the church's financial records.

6. The primary use of discretionary funds is to assist the poor of the congregation and the larger community. Wherever possible it is preferable that payments for rent, utilities, medical care and the like be made directly to the provider rather than to the individual or family.

7. The Canons provide for funding for discretionary funds to come from the undesignated "alms and contributions" at one service per month throughout the calendar year. In practice this has traditionally meant the loose offering at one service. Some congregations also provide funding through the church budget. Churches also may have a policy that all fees for weddings, funerals and baptisms be deposited in the discretionary fund.

Supporting information: Recently there have been problems throughout the Episcopal Church with the use of discretionary funds primarily due to a lack of control and accountability. Such problems have occurred in the Diocese of Newark. Many clergy and vestries/executive committees have taken steps to prevent such problems in the future. It would be helpful and supportive of these efforts to establish diocesan guidelines for the use of discretionary funds.

These guidelines have been developed based upon the National Church's Manual for Business Affairs plus material developed by the Diocese of Rochester. The guidelines have been discussed with the executive committee of the Newark Clergy Association and the Clergy Ethics Committee. They have been sent to every rector/vicar, warden and treasurer for comment and will be discussed at the November 15th Treasurer's Workshop. The proposed resolution is presented for action at the December meeting of the Diocesan Council.

INSURANCE COMMITTEE

Mr. Zinn presented on behalf of the Insurance Committee the following resolution regarding worker's compensation coverage. It was seconded and adopted.

RESOLVED that effective January 1, 1998 the Diocese of Newark transfer its worker's compensation insurance to the Hartford Insurance Company subject to the review of the contract and all related documentation.

Supporting Information: For insurance coverage such as property, liability, and worker's compensation, the Diocese of Newark maintains an association with the Church Insurance Company rather than a group. Under this arrangement missions are required to use the same carrier as the Diocese, but parishes have the option of using the same carrier or another of their own choosing. Historically close to 90% of the churches in the Diocese of Newark participated, but in the past few years a number of parishes have made separate arrangements.

One part of that association is the worker's compensation insurance which provides coverage for job related accidents or illnesses. This kind of insurance is very heavily regulated by the state which sets maximum rates for coverage based upon payroll and different classifications of workers. Over the past year the Diocese has been approached by a broker who felt that he could provide similar coverage in a number of these liability areas at a lower cost. In order to pursue this the Diocese requested proposals for this coverage and received two, one from the Hartford and one from Liberty Mutual through Church Insurance. Church Insurance does not provide this coverage directly, but through another carrier.

With the same levels of coverage the Liberty proposal would cost $78,000 compared to $51,000 for the Hartford quote. The difference is based upon the belief that some employees were placed in an inappropriate category and special programs available through the Hartford. In addition the Hartford plan offers a dividend arrangement whereby some portion of the premium will be refunded depending on the level of claims. The committee feels that we need to explore what possibilities there are with these kinds of coverage and believes that this is a relatively low risk way to test the situation.

DEPARTMENT OF MISSIONS

The Rev. Carolyn Lumbard, executive committee member, presented a report on covenant development training conducted by the DOM for mission congregations. The training provided a method to measure progress in different areas. Twenty congregations were connected to the DOM. Six were incorporated missions; two were aided parishes. Aided parishes received modest funding, but no mission investments for program or clergy subsidy and no debt service support. Different models of ministry within the DOM were BEAM, the educational effort at Hasbrouck Heights and Ridgefield Park; and Newark Area Ministry.

Mr. Laurence Taber, executive committee member, reported that the financing program established by convention that set up a second fund within the Episcopal Capital Loan Fund lowered substantially the debt service for 1998.

CONGREGATIONAL VITALITY COMMITTEE

Bishop McKelvey described the process established by the Screening Committee this past year based on the previous year's experience. Two new people will be added to the screening committee. The screening committee met this summer and reviewed the information provided in parochial reports. A policy was established this year that if parochial reports were not submitted by March 1, a letter would be mailed to the churches asking for the report by April 15 else the church would be referred to the Standing Committee. Mission congregations would not receive the monthly mission investment check if the report was late. Four years of report data were in a computer data base. Able now to review and analyze church growth and activity. Nine congregations, two of which were missions, were presented by the screening committee to Bishop McKelvey. He met with clergy and wardens of the churches, along with screening committee members. The number was reduced to three for committee involvement.

He announced the churches that were referred to the Congregational Vitality Committee: St. Luke's, Montclair; Trinity, Montclair; and, St. Mary's, Haledon.

ACTS/VIM RECOMMENDATIONS

The Rev. Tracey Lind, chair, presented the recommendations. It was moved and seconded to refer the recommendations to the December meeting.

Total Recommendation to the Diocesan Council: $84,000

WARD J. HERBERT FUND RECOMMENDATIONS

Mr. Michael James presented the recommendations. It was moved and seconded to refer the recommendations to the December meeting.

Total Recommendations to Diocesan Council: $92,015

EPISCOPAL CHURCH WOMEN

Mrs. Clara Horsley reminded members about the annual UTO ingathering for the winter. She urged support for North Porch and the November 23rd toy drive.

PLANNING COMMITTEE

The Rev. John Hartnett presented the report from the Planning Committee. The principles that guided the committee were that under the canons the Council had responsibility for long range planning; the council works as a referee of process rather than managing content. The natural channels of responsibility were either the budget committee or the program committee. The Council should model behavior rather than mandating behavior. The Council should take responsibility for those areas over which it had authority. Objectives should be specific and measurable.

He presented a comparison of the goals in the document distributed in April prepared originally by the bishops and staff to ones prepared by the Planning Committee.

Mr. Michael Rehill expressed concern that the committee document was a refocus to an action plan for the Council rather than providing goals for the diocese. It was the role of planning committee is to recommend goals for the diocese and not for the council. Ultimately, the bishop sets the goals.

Bishop Spong articulated his concern that too much structure can mute a bishop. In some dioceses, bishops cannot make basic decisions, such as committee appointments. The bishop does set the goals. He requested that the planning process not be changed until he leaves office. Council involvement was crucial and necessary, but should not hinder or interfere. Need to keep separate the lines of authority.

The Rev. John Hartnett moved that the document prepared by the Planning Committee be withdrawn and for Council to adopt the original set of goals. Bishop Spong suggested an amendment to the resolution that the staff review the Planning Committee document for possible inclusion and implementation. The motion as amended was seconded and adopted.

JERSEY CITY MINISTRY

The Rev. Isaac Persaud presented a status report on the Jersey City Ministry. The merger of the three churches had been a success, with one hundred per cent of St. Matthew's and twenty-five per cent of the St. Stephen's memberships joining with Incarnation as the new congregation of St. Augustine's. Membership had increased as did Sunday school enrollment and pledging units.

Architectural drawings had been received for the new building. Engineering reports on the structural soundness of the existing building were also received. He outlined the costs for the property purchase, renovation of existing structures and construction of the new church.

The Rev. Scott Kallstrom reported the development of the area ministry council will next be undertaken by the Jersey City Strategy and the churches.

STEERING COMMITTEE- ST. PAUL'S CHURCH, NORTH ARLINGTON

The Rev. Lawrence Falkowski reported that Steering Committee members had met with representatives from St. Paul's starting in the summer after the Council received the recommendation from the Standing Committee for reclassification to aided parish. At the September meeting, it was decided to delay the vote on reclassification until the November meeting.

The Rev. Tom Logan, interim, introduced Barbara Coughlin, Sunday school superintendent, Leslie Cappel, evangelism chair, Vernon Byron, Jr., a new member, Roberta Cozeen, a returning member, and Walter Schaufle, treasurer, who were in attendance with many other members from St. Paul's. Mr. Logan commented that the canons read the Council "may reclassify", which means there should be discretion in the decision. It was request that the congregation not be reclassified for at least three years. The delay would be a powerful healing symbol. In comparison to their neighboring churches, the parish was different than the others in the Ridge area.

Ms. Coughlin described the increased youth involvement in the parish, on Sunday services and in the church school. Mr. Cappel reported on the growth in church attendance and involvement; there were attempts to bring back lapsed members. Mr. Byron shared his reasons as a new member for being part of St. Paul's a community of faith with strong spiritual leadership and vision. Ms. Cozeen shared her reasons for returning to St. Paul's. Mr. Schaufle commented on the status of the church's finances as increasing with the growth of membership.

Mr. Michael Rehill described the process of Canon 9 designed to give a congregation the means to get where they want to go over a three year period, but if it doesn't work, the assets are preserved, with the next step being an incorporated mission. The reclassification starts a time period for reasonable goals to be reached and a final report to the convention. There is no interference in the operation of the church. The transfer of title of assets is for legal mechanism to handle real property. Intention of the canon is to challenge parishes to set and reach goals.

Mr. Logan comented that they were dealing with perception and symbols. The use of canon nine was viewed as negative and punitive. Reclassification would be an additional hurdle for them to deal with internally.

Mr. Rehill responded that reclassification was not, and was never intended to be, punitive. It was a mechanism in the event of failure. In essence, six years was being asked for; three years as proposed and then another three years hence when classified as an aided parish. Today's vestry cannot bind the future vestry to agree to accept voluntarily incorporated mission status. Aided parish status does not make you any less of a parish. Can be restored to parish status within a period of less than three years. There is no transfer of funds, except for endowment, which St. Paul's doesn't have. Control remains with the vestry.

Bishop McKelvey described resources available stewardship, evangelism, business planning, Isaiah Team for consultation, youth ministries assistance and some financial assistance for emergencies.

The Rev. Caroline Bruschi moved that St. Paul's, North Arlington be reclassified an aided parish. The motion was seconded.

The Rev. Harry Smith moved a friendly amendment that Council acknowledges and commends the work begun by St. Paul's North Arlington to regain the financial strength necessary for classification as a parish in this diocese; and that in accordance with the canons of this diocese that St. Paul's be reclassified as an aided parish; and that Council commends to the Department of Missions the plan set forth by St. Paul's in its proposal to Council as a starting point for developing a covenant relationship with the Department of Missions, and that the Council looks forward to the success of St. Paul's efforts and its reclassification as a parish by the year 2000. The motion was seconded and adopted.

The motion to reclassify St. Paul's, North Arlington, as an aided parish was adopted after a motion was adopted to call the question.

STEERING COMMITTEE - EPISCOPAL CAPITAL LOAN FUND MINUTES

Mr. William Heick reported that the Steering Committee ratified the minutes of the ECLF minutes of October 15 that approved by a mail vote an 18 year, $40,000 loan at 8% to St. John's, Union City for roof and gutter repairs. Since the church needed the money at the time of the ECLF action, the Steering Committee took the step on behalf of Council to expedite the loan execution. Mr. Heick moved their action for Council ratification. The motion was seconded and adopted.

STEERING COMMITTEE- VESTRY/EXECUTIVE COMMITTEE VISITS

The Rev. John Hartnett reported that he will send feed back forms to members and reminded them to setup their visits.

EPISCOPAL COMMUNICATIONS - BISHOP MCKELVEY

• Announced the institutions of The Rev. David Morris as vicar at Good Shepherd, Ringwood; The Rev. Carolyn Lumbard at St. Alban's, Oakland; and, The Rev. Jo-Ann Murphy at St. Paul's, Morris Plains.
• Discussions continued with the Lutheran Synod of New Jersey on the joint camping venture. Four subgroups were formed: camping, conferencing, family camping and special education programs. The above ground property will be assessed with the intent to buy half of the property. Additional details will be reported to Council before the next Convention.
• Some clergy news: Steven Steele was recovering after a fall down an elevator shaft at the new church; Maggie Reinfeld was married recently in October; Richard Pease died, a long time rector at Rutherford; Dorothy Austin will be ordained on November 18 to the diaconate.

COMPANION DIOCESE RELATIONSHIP

The Rev. Canon Angela Ifill reported briefly on the inauguration of the companion diocese relationship with the diocese of Lebombo, Mozambique.

The benediction was pronounced by The Rev. Scott Hoogerhyde.

The meeting was adjourned at 10:10 p.m.

Respectfully submitted,

Michael Francaviglia
Secretary