NECESSARY CHURCH POLICIES
Last week, I talked about pastor
discretionary funds and accountable reimbursement plans (ARPs), and stated that
written policies for both are an important way to make sure everyone has the
same understanding. I also always recommend, strongly, that written accounting policies
are important to have in place as well.
Recently, I read an article that took
this idea of written policies a little further. The title of the article was “7
Policies Every Church Needs for Trust and Transparency.”[1]
The author’s list includes:
1. Building Use Policy
2. Endowment Policy
3. Finance Policy
4. Gift Acceptance Policy
5. Memorial Fund Policy
6. Pastor’s Discretionary Fund Policy
7. Safe Sanctuary and Limited Access Policies.
To this list, I would also add a Sexual
Harassment Prevent Policy. This is a policy required by the State of New York. A
model policy, training, and other information is available on the New York State
government website.
In addition, a policy governing Accountable Reimbursement Plans is also a good idea. It makes it clear for all parties if
everyone understands what the ARP can be used for.
The building use policy lists
expectations about access to property and the use of the building, furniture,
etc., so both the church and the persons using the property have the same understanding.
This policy should include information about passwords, keys, fees, emergency
contacts and insurance coverage. One issue that a church should be aware of
when considering the use of their building is that any use that isn’t missional
in nature should trigger taxes for unrelated business income. The use of the
building could also affect exclusions from real estate taxes.
The endowment policy
(or planned giving policy) should discuss the use of the monies, whether
the principal can be used or just income, what the use for the monies is. It should
also discuss how the funds are invested, etc. It might be a good idea to
consult with an attorney about this policy to make sure it complies with state
laws.
The finance policy
(or accounting policy) specifies who is responsible for what financial
tasks, i.e. treasurer, bookkeeper, financial secretary, counters, finance chair,
finance committee, etc. It also lays out how money is handled, from collection,
through counting, deposit, paying of bills, bank accounts, and reporting.
The gift acceptance
policy is an important one. This one is often ignored because the idea of
having rules to accept a gift seems silly to many. But a written policy can
spell out what types of gifts are acceptance and which ones are one. It will
talk about major gifts and specify the persons/positions that make decisions
about each gift, particularly gifts that bear restrictions on use.
The memorial fund
policy describes the purpose and use of gifts given honoring a persons’
life. This policy should really state that while “input from family members may
be invited, the church retains the right to adopt or reject suggestions”[2].
Memorial gifts are given to honor a person’s life, so having a plan and
avoiding accumulating memorial funds will help do that.
The
pastor’s discretionary fund policy lays out what the proper use for the
funds would be, which, as we talked about last week, is to help people or
situations in need. The author stated that it is the church’s responsibilities to
protect both its assets and leadership. Also, the fund management system needs
to be revised periodically to make sure everyone understanding the procedures
and the pastor is protected from tax or other risk.
The
safe sanctuary policy is a policy that is available from the Conference
Safe Sanctuaries committee. It lays out guidelines for supervision,
transportation and other procedures to protect children, youth and vulnerable
adults. These policies have to be in place, reviewed periodically and
training provided so that all employees and any volunteers that may come
into contact with children, youth, and vulnerable adults have received the
training.
So, with the author’s list of seven and the two
additional ones I added, every church should have at least nine written
policies in place. These are the basic policies. A church may have need of
others.
If you wish more information on this,
or need templates for any of these policies, please feel free to contact me at
(315) 427-3668 or sranousacctg@twcny.rr.com. I’d be happy to help.
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