DRAFT
AFFILIATION MEMORANDUM OF UNDERSTANDING (MOU)
AFFILIATING CHURCH (AF)
and
The River Conference (TRC)
and
The Free Methodist Church (FMC), USA
DATE 2022
This agreement is rooted in our shared commitment to the authority of God’s Word. Both parties affirm that this process will be grace filled and exemplify what it means for leaders to move forward in unity.
The affiliation process provides AF, TRC, and FMC with the opportunity to insure they are mutually compatible before making a full commitment to one another.
The Free Methodist Church Affiliation Process
The FMC Book of Discipline outlines the affiliation process as a means for independent congregations or congregations from existing denominations to become part of the FMC.
Following completion of the process, AF will have the same rights and privileges as any other full society as outlined in the FMC Book of Discipline.
Affiliating Church Transition Process
AF votes to leave the United Methodist Church at the Church Conference on DATE.
Disaffiliation Annual Conference (UMC) is DATE.
Both parties agree that the affiliation process began on DATE (official release day from UMC).
The affiliation process for AF to become a FM Society will last until the TRC Annual Conference / Leadership Summit in June 2023.
AF will become a Full Society at the June 2023 at the Annual Conference after mutually agreed upon conclusion of the affiliation process. The River Conference and Free Methodist Church (EPP) tithe / apportionments will begin on upon signing the MOU according to the agreed upon schedule.
Affiliating Church Property
The Free Methodist Trust Clause: We would like to clarify that according to ¶6830.E.3 of our Book of Discipline, affiliating churches are not required to sign our trust clause for property already owned. Whether or not the trust clause is required once an affiliate becomes a Free Methodist society (a full member of the denomination) is left to the discretion of the Board of Bishops.
In light of your current circumstances, the Board of Bishops, have determined that should you decide to join our denomination in June 2023 after the affiliation process, current property will not be held in Trust by the Free Methodist Church. Any future expansions, additions, or facilities for new Free Methodist church plants would require a trust clause, except those future expansions, additions or facilities on the property currently help by the Affiliating Church. Any new property purchased would require the current Free Methodist Book of Discipline Trust Clause.
We would add that we believe our trust clause has value not only for the denomination, but also for the local church. As mutual trust is established, it is our hope that the day will come when you willingly choose to sign our trust clause as a healthy means of protecting kingdom assets.
Financial Expectations of AF:
TRC uses as very simple formula for determining apportionments. We collect from all Societies / Churches a simple 10% Tithe. The 10% is fair-shared – 6.8% TRC and 3.2% FMCUSA.
The 10% Tithe is calculated on all income, less pass throughs (Free Methodist World Missions, Capital Campaigns, and others on a case by case basis).
Depending on what is required by your United Methodist Church affiliation, we propose the following:
| AFFILIATION PERIOD | DATE to DATE | DATE to DATE | DATE to DATE |
| 0% participation in apportionments. |
25% participation in apportionments 2.5% of all income less pass throughs |
50% of participation in apportionments 5% of all income less pass throughs |
100% participation in apportionments 10% of all income less pass throughs (based on chart below) |
TITHE (SHARED EPP) FORMULA:
| Tithe (Shared EPP) | Income Levels | EXAMPLES | $900,000 | $2,000,000 | $3,000,000 | $4,000,000 |
| 10 % EPP | Up to $1,000,000 |
$90,000 TOTAL $90,000 |
$100,000 | $100,000 | $100,000 | |
|
10% on first $1,000,000 5% on $1,000,001 to $2,000,000 |
$1,000,001 to $2,000,000 |
$100,000 $50,000 TOTAL $150,000 |
$100,000 $50,000
|
$100,000 $50,000
|
||
|
10% on first $1,000,000 5% on $1,000,001 to $2,000,000 2.5% on $2,000,001 to $3,000,000 |
$2,000,001 to $3,000,000 |
$100,000 $50,000 $25,000 TOTAL $175,000 |
$100,000 $50,000 $25,000
|
|||
|
10% on first $1,000,000 5% on $1,000,001 to $2,000,000 2.5% on $2,000,001 to $3,000,000 .5% on $3,000,001 to $4,000,000 |
$3,000,001 to $4,000,000 |
$100,000 $50,000 $25,000
$5,000 TOTAL $180,000 |
||||
| No Additional Tithe | Above $4,000,001 |
***Subject to change upon action of the FMC and TRC
Ordination Transfer Process:
United Methodist Elders and LMC from AF will transfer their credentials to the TRC. This process will be directed by the TRC Ministerial Education & Guidance Board.
At a minimum, Elder transfers will need to complete three courses:
- History & Polity of the FMC
- Free Methodist Way
- Wesleyan Theology (unless previously completed)
The church staff who will be pursuing transfer of Elders’ orders from the UMC (or other credentialed organizations) to the FMC. AF will ensure that all pastors on AF staff, and any hired in the future, are in full theological harmony with the Free Methodist Church.
The River Conference Credentialing Webpage: https://leadership.fmcusa.org
Pension Participation:
Post-affiliation process, elders are required to participate in the Deferred Benefits (pension) Program of the Free Methodist Church USA. The pension is calculated at 13.5% of Cash and Housing paid by the church.
Those close to retirement will need to discuss vesting and impact of retirement related to the Deferred Benefits Program with the Deferred Benefits Manager at FMCUSA. A conversation will the TRC Superintendents and regional Bishop will occur for those who may retire prior the 5 year vesting period for FMCUSA Deferred Benefits.
Free Methodist Church Deferred Benefits Webpage: https://hr.fmcusa.org/pensionretirement
Major Medical Insurance:
Neither TRC nor FMCUSA provided major medical insurance. Two options are typically available to the society / church – individuals obtain insurance on the EXCHANGE or contact a insurance provider who may be able establish a group for the church pastors and staff.
Property Insurance:
All churches shall have property and liability insurance and The River Conference and the FMCUSA must be added as additional insured.
The typical policy includes:
- Liability Insurance
- Property Insurance
- Director and Officers Insurance
- Pastoral Care / Counseling Coverage
- Sexual Misconduct Liability Insurance
- Bonding
- Worker’s Compensation
- And other coverages
The FMCUSA strongly encourages every church to obtain sexual misconduct liability insurance. For many years, this has been the number 1 or number 2 reason why churches and pastors are sued.
Because our churches are different sizes and offer distinct ministries, we do not have a certain coverage amount that we require of our churches. Talk with your insurance provider to determine what is best for your church. A good rule of thumb is to buy as much as you can afford.
We do not endorse any particular insurance provider. We offer two insurance companies that specialize in church coverage are:
Brotherhood Mutual
6400 Brotherhood Way
Fort Wayne, IN 46825
800-333-3735
https://www.brotherhoodmutual.com
Church Mutual Insurance Company, S.I.
P.O. Box 357
3000 Schuster Lane
Merrill, WI 54452-0357
(800) 554-2642
https://www.churchmutual.com
IMPORTANT: Once you have obtained your coverage, request a Certificate of Insurance (COI) (Be sure to download and save as a PDF) and email them to [email protected] and upload to Free Methodist Church USA at https://fmcusa.fromsmash.com.
Representation in The River Conference:
During the affiliation process Affiliating Church will participate in the Annual Conference as honorary guests with no vote.
Historically, Free Methodist have had a balanced representation. Simply put, for every Elder representing the church the church will have a lay delegate to represent the church. The number of Elder and delegate representation will be determined based upon the 2019 Book of Discipline.
Membership:
In the FMC membership is broken into three categories – Active, Inactive, and Youth. We base all representation on active membership and not total membership. For our purpose here we want to clarify Active and Inactive. Active is defined as participating in the life of the church through attendance, tithes & offering, and commit to the Free Methodist Way. Inactive are those who do not meet afore mentioned measurement. EXAMPLE: Someone who is part of a small group, attends worship, gives of tithes and offerings, and is committed to living into the Free Methodist Way would be considered active. Someone who attends worship occasionally, is not committed to the Free Methodist Way, but may give tithes and offerings would be considered inactive.
Commitments:
AF agrees to participation in:
- TRC Annual Conference / Leadership Summit
- TRC Conference events
- TRC District Gatherings
- Life Giving Leadership Gatherings
- Other optional events as suggested by TRC Superintendents and the Area Bishop
Documents:
AF will provide in a digital form (PDF) the following documents:
- EIN (Employer Identification Number) documentation
- Certificate of Standing from the State of Texas Secretary of State
- Articles of Incorporation (most likely will need to revise to recognize the new TRC / FMC relationship)
- By Laws (most likely will need to revise to recognize the new TRC / FMC relationship)
- Certificate of Insurance with TRC and FMCUSA listed as additionally insured.
We hope Affiliating Church views this affiliation (and potential membership) as a synergistic two-way relationship and expresses its desire to share the things that God has taught us with the annual conference and the larger denomination. Lighthouse Fellowship humbly and sincerely desires to be a resource for church planting, church growth and church health.
Authority:
The Book of Discipline (BOD) is authoritative in the FMC. The BOD is “a contemporary expression of how this part of the Body of Christ both inspires and organizes itself for effective ministry under the direction of the Holy Spirit, as together with other Christian traditions we live and serve our Lord in the neighborhoods of our world” (2015 Book of Discipline Forward)
The Free Methodist Way (https://fmcusa.org/thefmway)
Life-Giving Holiness
Love-Driven Justice
Christ-Compelled Multiplication
Cross-Cultural Collaboration
God-Given Revelation