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Statement of Proceedings
of the
Trustees of the Episcopal Fund and Diocesan Properties-2007
Authority and Responsibilities of
the Trustees of the Episcopal Fund and Diocesan Properties
The positions and functions of the Trustees are as set forth in the Statutes of the State of New Jersey, which
provide that the Trustees are the legal custodians of various types of real and personal property. As defined by
statute, the Trustees are a separate not for profit corporation having all of the custodial powers and responsibilities
as defined by the Statutes. Significantly, the Trustees cannot have day-to-day operational responsibility for the
diocese or the diocesan budget.
Members of the Trustees of the Episcopal Fund and Diocesan Properties are chosen by the diocesan convention for
life, or as the statute reads, “permanently,” subject to the Trustees themselves having the power to remove a member
for cause.
Funds Managed by Trustees
The Trustees manage funds which fall into three major categories:
1. The endowment of the diocese (unrestricted funds given or left to the diocese), the income from which by statute
is used “to support the episcopate of the diocese”;
2. Undesignated capital funds, the income from which can be used at the discretion of the Trustees; and
3. Restricted funds held for the benefit of the diocese, congregations, or other ecclesiastical institutions, for
which the Trustees serve merely as custodians.
Property for Which Trustees Hold Title
The Trustees hold title to the following property:
1. Real property of the diocese (e.g., the Bishop’s house in South Orange, and Episcopal House at 31 Mulberry Street,
Newark);
2. Mission and Aided Parishes while they remain in that status, formerly under the auspices of the now disbanded
Department of Missions; and
3. The property of extinct parishes as declared by the Convention. (N.J.S.A. 16:12-16).
Overview of Trustee Operations-2007
The Trustees met collectively four times in 2007 (March, June, September, and December) to manage the endowment
of the diocese and to oversee the properties and various funds under their supervision. Between quarterly meetings,
the officers of the Trustees met on a weekly (frequently daily), basis, by phone, in person, or by e-mail, as did
subcommittees of the Trustees, and they communicated with all Trustees on matters before them. At the March 2008
meeting of the Trustees, they plan to expand the number of their scheduled meetings, as the workload of the Trustees
has increased enormously.
During 2007, the Trustees also worked closely with Jim Caputo, the diocesan property manager, to address concerns
on properties under the auspices of the Trustees. Many of these properties formerly were under the now disbanded
Department of Missions, and many of them confront needed costly repairs or environmental-related remediation. The
Trustees presently are addressing a priority list of property matters, ranging from the removal of in-ground oil
tanks and the replacement of dysfunctional heating units, to the repair of leaking roofs, floors, and walls, the
removal of physical hazards, and the resolution of violations of legal codes in kitchens and restrooms. The Trustees
have discussed with Bishop Mark Beckwith the urgent need for a diocesan strategy within the Bishop’s Office regarding
ongoing diocesan property management.
Assets that Can, and Cannot, Be Used
at the Discretion of Trustees
The Trustees of the Episcopal Fund and Diocesan Properties wish to correct misconceptions about the sum of assets
that can be used at the discretion of the Trustees. By providing the following financial summary and shedding light
on financial realities regarding the assets under the supervision of the Trustees, the Trustees hope to assist
members of the diocese to better understand actual facts concerning what the Trustees are—and are not—able to do
at their own discretion.
The Trustees provide funding for diocesan projects, commitments, and responsibilities from the income of an endowment,
whose value as of September 30, 2007, was $1,685,000. The income from the endowment that the Trustees spend annually
presently equates to approximately $75,000. In 2007, almost all of that income was applied, at the request of diocesan
leadership, to a salary line item in the diocesan budget. It is the policy of the Trustees not to spend the principal
of the endowment, with the view that, if this were done, the endowment would be depleted rapidly and the funding
of future requests and building maintenance necessarily would have to cease.
The funding of projects in 2007, such as the repairs of churches, has come solely from the remainder of funds in
the Congregational Growth and Development Fund. As of September 30, 2007, there were $562,925 remaining in the
Congregational Growth and Development Fund, with $55,108 in outstanding commitments, leaving $507,817 in net funds
available.
Only one property was sold by the Trustees in 2007: the Bishop’s house in Montclair. The historical precedent in
the Diocese of Newark is that the Trustees have purchased a house, absent any debt, for the Diocesan Bishop. In
2007, the Trustees applied the full proceeds of the sale of the former Bishop’s residence in Montclair to the purchase
of a South Orange residence for Bishop Mark Beckwith and his family. The Bishop’s house in Montclair was purchased
on September 30, 1998, for $465,000. The net proceeds from the sale were $763,000. The purchase price of the new
Bishop’s residence in South Orange was $838,545.
There is a pending contract for the sale of Trinity Church, Montclair (church, only, not the rectory), with the
Petra Baptist Church, which presently rents the property. The Trustees expect that this contract will be finalized
by March.
All other assets that are under the oversight of the Trustees of the Episcopal Fund and Diocesan Properties are
held in trust for other entities of the diocese. These assets equated to $25.6 million as of September 30, 2007.
These assets are legally restricted in their use. Trustees legally cannot use these assets, or income from them,
at their own discretion. Regarding these assets, the Trustees simply act in a custodial capacity. Such assets include
endowments, pension plan funds, and other vital assets of individual entities within the diocese.
In fact, the Trustees have very limited resources that they are able to use at their discretion for projects within
the diocese and to support pressing diocesan needs. Funding of needs and projects largely can come only from the
sale of churches and other diocesan properties.
Summary of Trustee Projects in 2007
In 2006-2007, the Trustees, with the assistance of Jim Caputo, diocesan property manager, identified some $3 million
in urgent and other necessary repairs on properties under their supervision. The repairs are necessary to preserve
the property asset, to meet legal codes, and to remove potential safety and health hazards. Most of the properties
formerly were under the Department of Missions until it was abolished by Bishop Croneberger. Attention to these
repairs was prioritized by consultation among the Trustees, the diocesan property manager, the diocesan financial
office, and Bishop Beckwith. A schedule of projects was established, with urgent matters given top priority.
The diocesan property manager reported to the Trustees in early December 2007 that, as of that time, he had spent
approximately $300,000 on needed repairs. The Trustees are aware of the diocesan property manager’s estimated expenses
for all projects; the diocesan staff, to date, has not presented to the Trustees a formal accounting of actual
expenses. The Trustees await this report.
Projects accomplished and underway in 2007 (alphabetically by town)
• Christ Church, Belleville: The long rear interior staircase of the vicarage has been rebuilt, as its condition
was hazardous and used by persons with physical impairments. The heating system in the church parish hall is being
replaced as it has extensive leaks throughout. The main sewer line which collapsed was replaced.
• St. Mary’s, Belvidere: Three in-ground oil tanks have been removed and replaced. The contaminated soil has been
remediated. The problematic parish hall roof is being replaced with an insulated EPDM roofing system; damaged fascia
boards also are being replaced.
• All Saints, Bergenfield: Extensive work has been accomplished, including the replacement of the vicarage and
vicarage garage roofs, refurbishment of the substandard vicarage kitchen, and removal of an oil tank from under
the driveway. The vicarage driveway will be resurfaced in the spring. The congregation is attempting to secure
a $28,000 loan to repay a portion of the cost of the work.
• St. Cyprian’s, Hackensack: The leaking water heater has been replaced. Quotes are being obtained to install a
small heating system in the parish hall to provide comfort to church members, and for a fire suppression system
in the kitchen to bring the church into compliance with fire code.
• Cator Avenue, Jersey City: The property, once again, has been cleared of debris, an ongoing problem. The some
forty feet of fencing securing the property that had been stolen, has been replaced and the property reposted and
resecured. The diocesan property staff checks the property weekly.
• St. John’s, Jersey City: The leaking in-ground oil tank at the church site has been removed, as well as the contaminated
soil. The in-ground oil tank at the vicarage also has been removed. All trees on the St. John’s property have been
trimmed away from surrounding buildings, as requested by neighbors and the city inspector. The church building
has been secured; diocesan building staff checks the property weekly.
• St. Gabriel’s, Milton/Oak Ridge: The in-ground oil tank at the church has been removed and replaced with an epoxy-coated
above-ground exterior tank. The diocesan property manager is awaiting quotations to begin other necessary work.
• Trinity, Montclair: The in-ground oil tank at the church has been removed. By March 2008, the Trustees expect
to close a $775, 000 sale contract with the Petra Baptist Church that presently rents the church building. At the
Trinity vicarage, the dysfunctional garage doors have been replaced and the garage cleaned of extensive debris.
Two oil tanks have been removed, and the indoor tank replaced by a double-wall interior tank. The contaminated
soil around the leaking exterior in-ground tank at the vicarage has been remediated.
• Episcopal House, Newark: The chronic roof leak has been repaired. At the request of Bishop Beckwith, the Trustees
have approved the expenditure of $20,000 from Trustee-overseen assets for the remodeling of the entry level and
other areas of Episcopal House. A video/audio remote door attendant and panic alarm system has been installed.
• St. Andrew’s, Newark: The large boiler in the church that ceased to function and was beyond repair has been replaced
and converted to gas. Another small boiler will be replaced by a high-efficiency gas unit to enable the abandonment
of oil usage altogether. The oil tank will then be removed.
• St. Barnabas, Newark: All of the dangerous dead and other trees have been removed or trimmed. The surrounding
city sidewalk has been replaced where necessary.
• St. Paul’s, North Arlington: The front stairs of the vicarage are being rebuilt and the small concrete driveway
replaced. Other repairs will follow at both the church and the vicarage.
• St. Peter’s, North Bergen: The collapsing walkway wall on the north side of the church has been rebuilt. The
deteriorated front and rear porches and steps have been replaced. A scan for oil tanks revealed none. The inoperative
heating system presently is being replaced.
• St. Matthew’s, Paramus: The boiler room door has been replaced to comply with safety standards.
• St. Gregory’s, Parsippany: Quotations are being obtained for a fire suppression system in the church kitchen
to comply with fire code and for replacement of cabinets and counters in the vicarage kitchen.
• Good Shepherd, Ringwood: The electrical system has been brought up to code. Both badly deteriorated, substandard
restrooms have been refurbished. The front door of the church was reversed and crash bars were installed to comply
with fire code.
• Church of Our Savior, Secaucus: The dangerous collapsing, badly slanting front steps and facade of the church
have been rebuilt. The old oil-fired boiler has been replaced with a gas-fired boiler. The in-ground oil tank will
be removed in February 2008.
• Bishop’s Residence, South Orange: All the family room and second-floor hardwood floors were refinished prior
to the Bishop and his wife’s relocation to the house. The torn sheet vinyl flooring on the third floor was replaced
with carpeting. Malfunctioning doors were trimmed where required, and some window cords were replaced. The cedar
deck in the rear of the house was refinished. The brick front steps and front walkway are being replaced owed to
concerns of safety caused by heaving.
• Christ Church, Teaneck: Two in-ground oil tanks were removed in December 2007.
A new tank was installed in the vicarage.
• St. Thomas, Vernon: A very large tree was removed from the property for safety reasons. The vicarage was completely
renovated in preparation to call a new vicar. The congregation donated the majority of the materials, appliances,
and labor for this work.
• Holy Trinity, West Orange: A new boiler was installed in December. The in-ground oil tank is scheduled for removal
in January 2008. The broken walkway and disability ramp-way will be replaced following the oil tank removal. A
fire suppression system will be installed to comply with fire code and the substandard stove replaced when quotations
are received.
• St. Mark’s, West Orange: The main boiler of the church, which was in very bad condition, was replaced, and the
entire system was upgraded. Toxic bird waste was removed from the bell tower, and the tower and windows have been
pigeon-proofed. The rear door of the vicarage has been rebuilt for safety reasons and the locks have been replaced.
• St. Mark’s Cemetery, West Orange: Once again, St. Mark’s Cemetery has been cleaned of debris, dumped by local
contractors and others in the community. The brush has been cleared from the property. The fall 2007 round of maintenance
at the cemetery cost approximately $30,000.
The above list of projects represents only the beginning of a long list of necessary repairs at mission churches
and vicarages. The Trustees will continue to work with the Bishop and members of the diocesan staff in 2008 to
attend to other identified concerns as financial resources become available.
The Trustees have been in consultation with the Bishop regarding the development of a strategy concerning more
effective diocesan management of properties in the future, and have sought outside professional advisement in this
regard.
Conclusion
Although much has been accomplished in 2007, including visits by representatives of the Trustees to all churches,
vicarages (except one), and other properties under their auspices, as well as much legal work by Trustees to clear
properties of encumbrances, sell and purchase properties, and protect diocesan assets and interests, the Trustees
acknowledge that there is yet much work to be accomplished in 2008. In 2007, the Trustees were indeed fortunate
to have Bernie Milano, a partner of KPMG, agree to serve as an advisor to the body, which is deeply appreciated
as we move into the work of the current year.
Respectfully submitted,
Deborah A. Brown, President
rustees of the Episcopal Fund and Diocesan Properties
Trustees:
Deborah A. Brown, President, Michael F. Rehill, Esq., Carlotta Budd, Esq., John Garde, Esq., Vice President, William
Carpenter, Esq., John E. Lynch, Marge Christie, Secretary, Peter Van Brunt
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