congregational finances during the pandemic 11...congregational finances during the pandemic...

Congregational Finances

During the Pandemic – 11

The United Church of Canada

L’Église Unie du Canada

June 24, 2020

Erik Mathiesen

Clyde Harris

Kendra Fry

Katja Brittain

A New Creed

We are not alone,

we live in God’s world.

We believe in God

who has created and is creating

who has come in Jesus

the word made flesh

to reconcile and make

new

who works in us and others

by the spirit.

We trust in God.

We are called to be the Church:

to celebrate God’s presence

to live with respect in Creation,

to love and serve others,

to seek justice and resist evil,

to proclaim Jesus, crucified and risen,

our judge and our hope.

In life, in death, in life beyond death,

God is with us.

We are not alone.

Thanks be to God.

EHM ~ The United Church of Canada

What We’ll Cover Tonight June 24

Latest news

– Mission and Service reminder

– CEBA loan eligibility for some

– CEWS extended to August 29 some new details

– Quick recap of various programs

– Church helpdesk [email protected]

– Insurance update and re-entry considerations?

Your questions

Information is accurate as at 3:00 p.m. EDT.

Information may be affected by subsequent

announcements.EHM ~ The United Church of Canada

mailto:[email protected]

Reminders June 24

Things evolved so churches are now:

– eligible for CECRA rent program

– eligible for CEBA loans

UCC Protect (and likely other) Insurance premiums

up 30% or more with June renewal

-T3010 filing deadline extended to Dec 31, 2020 but

consider filing now if CECRA eligible

-please submit church statistics (blue forms) online

asap.


Food

Health Care

Education

Human

Rights + more

saves livesduring COVID-19

Credit: Cordillera Disaster Response Network

Those who are most

vulnerable in Canada and

around the world count on

Mission & Service gifts and

will even more now.

Transferring Mission & Service gifts as

regularly as

possible lets those we serve know how

much they can count on our support.

If your congregation hasn’t already

transferred Mission & Service donations

received so far, could you please do so as

soon as you are able.

Credit: Our Place

gives hope

thank you for your

dedicated leadership

The financial viability of our

beloved churches is of

utmost concern; We are also

concerned about those who

are suffering even more

now. Our shared Mission &

Service can help.

Thank you again for

faithfully supporting your

congregation’s ministry -

and our ministry together

through

Mission & Service. Credit: Massey Centre

CEBA Clarification - recap

$40,000 Canada Emergency Business

Account

Churches and other ministries are ELIGIBLE

IF

Must have payroll >$20,000

Must have rental revenue on line 4610 or

sales revenue on line 4640 of T3010

Repaying the balance of the loan on or before December 31,

2022 will result in loan forgiveness of 25 percent (up to

$10,000).EHM ~ The United Church of Canada

CEBA Clarification - recap You have to be able to certify applicant :

is not a union, charitable, religious or fraternal organization or

entity owned by such an organization or if it is, it is a registered

T2 or T3010 corporation that generates a portion of its revenue

from the sales of goods or services;

It is not a non-profit organization, registered charity,

union, or a fraternal benefit society or order, or an

entity owned by such an organization, unless the

entity is actively carrying on a business in Canada

(including a related business in the case of a

registered charity) that earns revenue from the

regular supply of property/goods or services;


Restrictions on use of CEBA Funds

The funds from this loan shall only be used by the

Borrower to pay non-deferrable operating expenses

of the Borrower including, without limitation, payroll,

rent, utilities, insurance, property tax and regularly

scheduled debt service, and may not be used to fund

any payments or expenses such as

prepayment/refinancing of existing indebtedness,

payments of dividends, distributions and increases in

management compensation.


Applying for CEBA Funds-

Payroll stream

If you have a business account, can apply online at

major financial institutions

– Attestation is online too

Talk to your financial institution if online not available.

If payroll less than $20,000 and/or personal bank

account used – you probably aren’t eligible anyway

but you need to explore the “non deferrable expenses

stream”.

https://ceba-cuec.ca/


https://ceba-cuec.ca/

CEWS – news June 24

The Government announced on May 15, 2020 that the CEWS

would be extended by an additional 12 weeks, to August 29,

2020. The eligibility criteria will apply for the current period

(period 4). Any potential changes would commence as of

periods 5 (July 5 to August 1) and/or 6 (August 2 to August 29).

Period 4 applies to wages from June 7 – July 4

Revenue test threshold is June 2020 revenue drop of 30%

Qualify for period 4 (June test) if you qualified for period 3

We are told the July August process will be very different and

likely announced next week.


Federal Wage Subsidies @June 24

https://www.canada.ca/en/revenue-

agency/campaigns/covid-19-update/frequently-asked-

questions-wage-subsidy-small-businesses.html

75% - you apply for it – if eligible

https://www.canada.ca/en/revenue-

agency/services/subsidy/emergency-wage-subsidy.html

Excellent resource now. Be sure to read FAQ.


10% - you take it (and defer to ADP)

https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update/frequently-asked-questions-wage-subsidy-small-businesses.html

https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy.html

CERB – Benefit recap

Canada Emergency Response Benefit,

(“CERB”) available to laid-off staff irrespective

of eligibility for EI.

$500/week for 24 16 weeks

must have earned $5,000 in 2019.

expanded to allow $1,000 income.

many part-time and contract workers will be

better off in the short term (will need ROE)


Layoff Considerations - recap

check with your region – province-specific

employment standards to be adhered to.

hopefully less pressure if CEWS (75%) eligible

core group benefits to continue (excl LTD and RCP)

funded by the church

Arrangements can be made to keep up pension

payments

preparation of Record of Employment (ROE)

– fastest to do online at Service Canada

webinar at United-in Learning re ROE Web

–EHM ~ The United Church of Canada

United Church Emergency Loan-recap

intended to supplement federal funding programs and

respond to transition from them as federal programs

expire.

Special case intervention now

Online now. Application goes automatically to region

for review

eligibility to be confirmed in consultation with the

region

needs based and viability based

THANK YOU United Church Foundation!


United Church Emergency Loan-recap

This $10,000 loan

– will be interest free if paid in full by September 30,

2021.

– if paid by September 30, 2021, $500 is forgiven for

a total repayment of $9,500.

– Interest at 2% starts to accrue on October 1, 2021

– Principal and interest will be paid within three

years from September 30, 2021.

– A payment plan will be developed with you.

dates may change to align with everything changing


Internal governance - recap

Wage or rental subsidy applications do not

require region approval

CECRA is a forgivable loan so for for

approval purposes - a grant!

Any loan applications REQUIRE

– congregation board approval

– region approval (perhaps expedited)

– Online application by someone authorized

to “bind the applicant”


CECRA – The Benefit

Canada Emergency Commercial Rent Assistance (CECRA) for

small businesses provides relief for small businesses experiencing

financial hardship due to COVID-19. It offers forgivable loans to

eligible commercial property owners to:

reduce the rent owed by their impacted small business tenants

meet operating expenses on commercial properties

Property owners must offer a minimum of a 75% rent reduction for

the months of April, May and June 2020.

- As per CMHC web at

- https://www.cmhc-schl.gc.ca/en/finance-and-

investing/covid19-cecra-small-business


https://www.cmhc-schl.gc.ca/en/finance-and-investing/covid19-cecra-small-business

CECRA - Eligibility

LANDLORD ELIGIBILITY

While the program is titled “Commercial” working with the Ontario

Non Profit Network we have confirmed that Not For Profits and

Charities who have properties that collect rent from eligible small

business owners will be eligible.

Must have a legal rental or lease agreement

Must have declared rental income on their 2018 and 2019 tax

returns (T3010) or make special case

No longer a requirement to have a mortgage, although it is

administered via CMHC


CECRA - Eligibility

TENANT ELIGIBILITY

Tenants must prove a 70% reduction in income-

compared to last year or to Jan/Feb 2020 incomes OR

have ceased operations

Tenants regular rent must be less than 50k per month

Tenants must earn less than $20 million per annum

Tenant must provide their business number for

application. If sole proprietor SIN.


CECRA Process

Landlords to gather the Following Proofs:

Tenant reduction in revenue

Leases or rental agreements

Reduction or removal of rent letter with guarantee of

no evictions, signed by both parties

Application now available online.

Need to register first!

https://www.cmhc-schl.gc.ca/en/finance-and-

investing/covid19-cecra-small-business

SEE MAY 27 WEBINAR FOR “HOW TO” DETAILS


https://www.cmhc-schl.gc.ca/en/finance-and-investing/covid19-cecra-small-business

CECRA: The Calculation

Who Pays What:

The tenants pays 25%

The provincial government pays 50%, retroactively for April,

May, June

The landlord accepts the 25% loss

Example: Tenant one pays $1,000 a month usually

With the CECRA they now pay $250, the government pays

$500 and the landlord forgives $250. This applies for three

months

If the month has passed the reduction can be applied to

future months or refunded


Questions so far


10% Subsidy processing

All church payroll entities eligible for 10% wage

subsidy (March 18- June 19). Same for other

ministries

1,300 pastoral charges will have the rebate

processing done for them by ADP and the national

office

Tools available online for those who choose to do it

themselves

– Temporary Wage Subsidy worksheet

– TWSE-TA Form Managed Services


10% Subsidy processing Example

THREE EMPLOYEES

$60,000 salary, plus two part-time at $12,000/yr

– $7,000 per month or $1,615.38 per week

– Income tax withheld still only $1,200

– Eligible subsidy is $2,100 4,125 for the 3 month

period

Will take 3 monthly transactions to realize the full

subsidy entitlement because max for any pay period is

10% of monthly wages ($700)


10% Subsidy processing

ADP and General Council calculate, verify and process

payments in a big batch at the end of each month.

ADP is currently working on the June refund. (payrolls through

end date of June 19). Expect those payments in early July.

“The March and April carry forwards will be processed after the

last refund for June is completed to avoid any confusion and this

will also help us in making any adjustments if any refund is

overpaid or under paid.”

Multiple variables including: timing of processing, catch-up

amounts, timing and frequency ADP tax remittance, size of tax

bucket.

Need to trust the systemEHM ~ The United Church of Canada

Federal 75% (CEWS)

Eligibility

Calculating Revenues

Eligible Employees

Eligible Remuneration

Calculating the wage subsidy

Claiming the wage subsidy

Ensuring Compliance

But any of this requires being able to apply online.


https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy/cews-frequently-asked-questions.html







Federal 75% (CEWS)

The CEWS will be processed at the payroll program

(RP) account level, so you will have to file a separate

application for each RP account.

Do a separate version of the CRA online calculator

and on line application for each RP#

For cases where some employees on ADP and some

not, you will need to have separate workpapers and

consolidate them for your application (depending on

whether different RP numbers)


75% CEWS processing – calculator

Calculate the values using the spreadsheet

– Download the calculation spreadsheet

– Enter the claim period (dropdown menu)

– Suggest not to use the batch entry

– Go to Weekly tab to enter each individual

• Monthly salaries x 12 / 52 = weekly salaries

• Employee at Arm’s Length must be answered

• All pay figures on a weekly basis

• All weeks must have an entry even if 0.00

• Totals transferred to Instructions and ResultsEHM ~ The United Church of Canada

Federal 75% (CEWS)

There are three ways to apply all online:

– My Business Account

– Business representatives may apply using

Represent a Client. (need Level 2 or 3)

– If neither are an option for you, use the Web

Forms application with your web access code

Sign into the Web Forms application

Get a web access code (WAC) 1-800-959-5525

“help desk” support at [email protected]


https://apps.cra-arc.gc.ca/ebci/ghnf/netf/prot/ntrWgSbsdyStndAln.action?request_locale=en_CA

https://apps.cra-arc.gc.ca/ebci/leb0/wacretrieve/pub/disclaimer.action?request_locale=en

Cybersecurity - more scams

COVID-19 related transition tools has

created opportunity for scammers

Most recently reports of purported

messages from national office asking for

e-payment (followed up with phone call)

Phishing attempts often use name of

someone you know.

Don’t click on links or send info without

checking.


Insurance matters

Insurance rate increases of 30% or more

– 30% for UCC Protect program

– Reports of 40% + from others

UCC Protect relatively flexible on Covid-19

closing (visits 2x week vs. daily for some)

Insurance companies have not identified any

incremental requirements for re-opening


Building Re-opening

• For whom?

• Congregations not as immediate?

• Other groups

• tenants with leases

• various: 12 step, book clubs, yoga

It’s for the community of faith to decide who,

when, how they want to allow back in the

building (change the schedule/rooms to allow

for cleaning). Your region will have resources.


Building Re-opening - protocols

Cleaning: who, what, who pays for the extra resources

Record keeping: building user needs to be able to produce a

record of who (names/phone or email) was in the building;

Physical distancing in the rooms used ; in the hall ways,

outside on church premises

Contracts: addenda to agreements and T&Cs; what to

charge going forward in order to pay for church operations while

users might be more financially constrained

One strike and you are out: Terms and conditions

should be posted in all rooms/hall ways to ensure the rules are

communicated to everyone in the building. Not abiding by the

rules cannot be tolerated for the safety of everyone involved.

•EHM ~ The United Church of Canada

Questions so far


Logging into CRA Accounts or Service Canada

Can’t avoid having online accounts for a charity anymore

Reasonably straightforward unless

– Your numbers don’t make sense (RP should equal RR)

– You have previously been registered but don’t now know the

contact name

– You have inadvertently de-listed your trustees/directors

– You maintain payroll “off” ADP

To help you get there:

[email protected]

Rose, Carla and Clyde will try to help you navigate

any complexity.



Reconciling all this later this year

– So much happening at once

– Inevitable that there will be some duplication or

errors in claims

– Reconciliation in the fall for

• Maximization of 10% wage subsidy (max

$1,375 per employee or 10% of total wages)

• Reconciling 10% adjustment on 75%

– Keep books and records substantiating

• Eligibility calculations/determinations

• Your calculations


Summary of what you need to do for wage

subsidies– Solve the online application challenge

– PROCESS the 10% transactions (have ADP/GCO

do or do it yourself)

– Determine your 75% subsidy eligibility and for

which periods.

– If eligible for the 75%

• Use CRA spreadsheet for overall calculations

• Use ADP/church spreadsheet for 10%

adjustment

• File online by whichever method will work

• Keep complete records for each filingEHM ~ The United Church of Canada

Contacts for action

Getting set-up or fixed with CRA

[email protected]

ADP TEWS queries (authorization etc) [email protected]

Deferring monthly withdrawals of assessments

– [email protected]

Suspending church loan payments [email protected]

Stewardship queries [email protected]

United Church emergency loan

https://www.united-church.ca/community-faith/being-community/united-

church-emergency-support

new par donor requests tripled! https://www.united-

church.ca/sites/default/files/resources/generosity_in_unprecedented_ti

mes.pdfEHM ~ The United Church of Canada






https://www.united-church.ca/community-faith/being-community/united-church-emergency-support

https://www.united-church.ca/sites/default/files/resources/generosity_in_unprecedented_times.pdf

Closing


We say "we'll get through this" and yet grieve that so many will not.

We say "we're in this together" and yet know the huge chasms in our

experience.

We say "we'll build back better" and yet feel the tug into familiar grooves of

inequity and excess.

Creator. be with us.

Console us in our losses.

Shelter us in our hopes and intentions.

Embolden us in our dreams and gestures.

Come alongside us as we yearn, confirm and act towards your holy and

beautiful intention of right relations for peoples and our aching wounded earth.

Amen

Jennifer Henry, KAIROS

congregational finances during the pandemic 11...congregational finances during the pandemic...

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