SECTION 1 – Resolutions

RESOLUTION I:
RESOLVED, that the 128th Convention of the Diocese of Newark adopts the following minimum salary rates, effective January 1, 2003:

Minimum Salaries

Deacon             $24,650
Assisting Priest    26,300
Priest-in-charge   32,850

Supporting Information:
The Diocese of Newark has adopted a system of salary administration for clergy that includes minimum salary levels for all full-time clergy serving parishes or missions in the Diocese. Each year, the Commission reviews these salary levels and makes recommendations to Convention for changes, if any, that seem appropriate. A history of the last ten years follows:

The Commission has reviewed economic and inflation projections for the next few years. In addition, the Commission compared compensation ranges in the Diocese of Newark with those of our neighboring dioceses of Connecticut, Pennsylvania, Long Island, New Jersey and New York. While inflation is expected to be quite low (in fact, some economists predict modest deflation) in the next couple of years, median compensation in our diocese lags the median in nearby dioceses: Connecticut ($61,654), New Jersey ($59,054), Pennsylvania ($57,976), Long Island ($56,958), New York ($57,872), Newark ($55,770). These analyses have led to the recommendation of a proposed 4.0% increase.

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RESOLUTION II:
RESOLVED, that the 128th Convention of the Diocese of Newark recommends the following scale, effective January 1, 2003, for annual merit increases in salaries paid to clergy in the Diocese:

Merit Increase Scale

Outstanding    6.0%
Very Good    5.0%
Satisfactory    4.0%

Supporting Information:
For clergy continuing to serve the same congregation, this Diocese recommends an annual review of goals and performance for clergy, congregations, vestries, and executive committees. Clergy salary should be increased on merit based on this review in accordance with the merit increase scale. The Commission recommends that a true merit increase would exceed the rate of inflation, reflecting the notion that the meritorious performer should be recognized and not merely "kept even" with the economy. Furthermore, the Commission recommends that the diocese consider the impact of the continuing differential in compensation medians on the clergy of the Diocese of Newark, and the need to address compensation as one means to keeping our best clergy here.

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RESOLUTION III:
RESOLVED, that the 128th Convention of the Diocese of Newark establishes a minimum standard for remuneration to supply clergy at a fixed rate per worship service plus the IRS-approved mileage rate for travel to and from the church. For 2002, the IRS-approved rate is 36.5 cents per mile. Remuneration standards shall be as follows:

Sunday services: $125 for one service plus $50 for each
additional service

Weekday service: $50 per service, without sermon

And be it FURTHER RESOLVED that, for those supply clergy who so desire, this remuneration be declared eligible for the clergy housing allowance exclusion upon the passage by the vestry of a resolution so designating.

Supporting Information:
    The recommended remuneration for supply clergy was increased two years ago after remaining unchanged for the previous five years. No increase is recommended for 2002. Importantly, the remuneration can be eligible for the clergy housing allowance exclusion. The diocese can supply sample language for such a resolution, which must be passed by the vestry (or Executive Committee) prior to the payment for services.

    In any year in which the total payments to any one individual exceed $600, a 1099 tax form must be provided at the end of the year, a copy of which is filed with the IRS. Pension assessments are due for any non-retired cleric who is paid $200 a month or more for three consecutive months.

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RESOLUTION IV:
RESOLVED, that the 128th Convention of the Diocese of Newark recommends each congregation provide a minimum annual allowance for continuing education of $500 for each full-time cleric and a proportionate amount for those employed on a part-time basis.

Supporting Information:
     The diocese has long recommended that congregations assist their clergy in finding and affording continuing education opportunities. The recommended minimum allowance was raised two years ago to $500 and remains unchanged for 2002.

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RESOLUTION V:
RESOLVED, that the 128th Convention of the Diocese of Newark recommends $4,000 as the minimum for reimbursable business expenses for full-time clergy serving parishes or missions in the Diocese. All expenses should be items deductible under Internal Revenue Code Section 162 and should be administered under an accountable plan. Examples of expenses include automobile, entertainment, books and periodicals, religious supplies and materials, and dues and conferences for professional organizations.

Supporting Information:
     The amount suggested by Convention for business expenses was raised last year from $3,500, where it had been since 1983, to $4,000. The Commission does not recommend an additional increase this year.
     Beginning in 1989 the Internal Revenue Service put restrictions on the deductibility of business expenses. All business expenses should be paid to the clergyperson through an accountable plan. This plan must be in writing. It must require the clergyperson to substantiate his or her business expenses. It must require that any amount in excess of the substantiated expenses covered by this arrangement be returned. If the plan conforms to all of the above, the reimbursed funds do not have to be included on the clergyperson's W-2 and, and, therefore, never have to appear on his or her tax return.
    This recommendation is for a minimum expense allowance. Depending on the geography of the parish/mission which is served and the travel and other expense requirements of the individual, a higher allowance may be warranted.

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RESOLUTION VI:
RESOLVED, that the 128th Convention of the Diocese of Newark recommends that each parish and mission plan annually for the financial implications of the clergy coverage necessary to that full-time clergy can take a minimum 3-month sabbatical every five-to-seven years.

Supporting Information:
     The diocese has long suggested that clergy be eligible for a sabbatical every five-to-seven years. Many clergy find, however, that when actual plans for his/her sabbatical are being made, a principal stumbling block is that the church does not have funds available to pay the cleric's salary and pay for the clerical assistance expected during the sabbatical time. This resolution would encourage every congregation to set aside money in each year's budget for this eventual purpose.
     Some congregations are able to financially support clergy with additional funds for sabbatical travel or study or both. That is certainly encouraged as well. But the Commission recommends that, at a minimum, every congregation prepare for the funds necessary for clergy supply.
     One additional note: sabbatical time is in addition to vacation time and time set aside for continuing education. Often, clergy planning a sabbatical will plan for vacation, continuing education, and sabbatical time to be taken contiguously.

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RESOLUTION VII:
RESOLVED, that the 128th Convention of the Diocese of Newark mandates the granting of parental leave in conformance with the resolution passed by General Convention in 2000, to wit:

     a. A member of the clergy who has been employed by the church for at least one full year and is the designated "primary child-care parent" is entitled to leave for the birth or adotion of a child for a minimum of eight weeks with pay. Up to eight additional weeks may be taken without pay. The member of the clergy may elect to use vacation leave or sick leave during this latter period.

     b. A member of the clergy who has been employed by the church for at least one full year and is the "non-primary care parent" is entitled to leave for the birth or adoption of a child for a minimum of two weeks with pay and up to ten additional weeks without pay.

     c. A member of the clergy employed by the church for less than one full year is entitled to the same numbers of weeks leave. Pay during this period is negotiated between the church and the cleric.

Supporting Information:
     In 1998, the diocese established the principal that parental leave was a right for new parents, mandating six or eight weeks leave with pay (depending on birth circumstances) and six additional weeks negotiated with the vestry. The resolution would update our policy to conform with what has passed General Convention.

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SECTION 2 –SUMMARY OF CLERGY COMPENSATION POLICIES

Full Time Clergy – Including Full Time Interim Clergy

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Part-Time Clergy – Including Part-Time Interim Clergy

     As varying models for ministry evolve in this diocese, a number of congregations are employing clergy on a part-time basis. The Commission has recommended guidelines to the diocesan deployment officer. A full-time clergyperson is estimated to work approximately 50 hours in an average week. Compensation calculations for part-time clergy should be based on this workweek average; for example, a half-time position would require 25 hours of work per week. Note that clergy, whether part-time or full-time, are acknowledged to be "on-call" all of the time. Part-time Interim Clergy who are not residing in church-supplied housing should receive an additional payment to cover travel to and from their residence. This amount is taxable income and should be calculated using the IRS automobile rate for the year (36.5 cents per mile).

     Notes: Tax-exempt housing allowance: a portion of each cleric's cash stipend may be designated by a Vestry or Executive Committee as a "housing allowance" in accordance with the Internal Revenue Code. The designation must be voted upon prior to payment and explicitly noted in the minutes of the meeting. The clergyperson is solely responsible for tracking qualified housing expenditures and declaring any excess "housing allowance" as income. The maximum amount of "housing allowance" that is excludable from taxable income is the lowest of the following three amounts: the rental value of the house (fully furnished), the actual amount spent to provide housing (including furnishings and utilities), or the amount designated in the vestry designation.

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SECTION 3 – HEALTH AND DENTAL INSURANCE RATES FOR 2001

Health Insurance

All clergy have a choice of 4 plans. 2001 annual premium rates, payable to the Diocese in quarterly installments:

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Dental Insurance

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SECTION 4 - EXAMPLES

Pension Assessment

          I. Clergy receiving cash housing allowance:

                Salary                                            $31,600
                Housing & Utility Allowance            15,000
                Social Security Offset                        3,542
                Total Compensation                      $50,142

                Pension Assessment      = 18% of Total Compensation
                       (.18 x $50,142)     = $9,026

         II. Clergy in rectory or vicarage:

                Salary (a)                             $31,600
                Utility expense (b)                    3,400
                Social Security Offset (c)         3,539
                Housing "value"                      11,562 [.30 x (a+b+c)]
                Total Compensation             $50,101

                Pension Assessment          = 18% of Total Compensation
                       (.18 x $50,101)         = $9,018

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     Social Security Offset

          Clergy are considered employees for income tax purposes (compensation reported on W-2) but are taxed as self-employed persons for Social Security purposes, called SECA tax. The Diocese of Newark recommends that clergy compensation be enhanced by an amount equal to 50% of the clergy's estimated self-employment tax to correct this tax differential. This compensation enhancement is considered taxable income, so the calculation is circular:

                     Step 1:       Salary                                                               $32,850
                                       Utilities                                                                 3,600
                                       Housing                                                              12,400
                                       Social Security Estimate                                        3,713 *
                                       Total Self-Employment Income                         $52,563

                     Step 2:        Income Adjustment (subtract 7.65% of Total)
                                                     .0765 * $52,563 =                               $4,021

                     Step 3:        Taxable self-employment income:                     $48,542

                     Step 4:        $48,542 X 15.3% (full SECA tax) =                 $7,427

                     Step 5:        $7,427 X 50% (Diocesan recommendation)=    $3,713
                                        If not close to original estimate, plug in a figure
                                        between the two and start over at Step 1.

* A good estimate results from adding current salary, utilities and housing together and then multiplying by .076.

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Summary of Examples

Overall cost of full-time clergy compensation and benefits package

*Pension assessment = .18*1.3*(a+b+j+k)
**Pension assessment = .18*(a+b+c)
***Housing Equity Allowance = .05*1.3*(a+b+k)

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Submitted by the Standing Commission on Clergy Compensation:

                                                                     Phone                      email
Linda Curtiss, chair                                        800-223-6602         lcurtiss@cpg.org
The Rev. Lauren Ackland                              973-377-0106         lackland@gracemadison.org
Carlotta Budd                                                973-822-3778        CMB@buddlaw
The Rev. Canon Gervais Clarke                     973-676-8886        calabar52@hotmail.com
The Rev. Canon Paul Hunt                             973-430-9916        canonhunt@dioceseofnewark.org
John Snyder                                                   201-560-0626        johnsnyder1951@msn.com
The Rev. Stephanie Wethered                        973-334-3655        revmothers@aol.com

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