2018 Year in Review

I am very proud and honored to work with The United Methodist Foundation of Arkansas (‘UMFA’), which has five decades of experience helping to expand Methodism around our state. Being in partnership with the Annual Conference has been a cornerstone of UMFA, allowing us to provide leadership opportunities to people of all ages, both clergy and laity. I am beginning to hear the exciting ministries happening in the local church provided by estate gifts managed by the Foundation. These funds are helping the local church make disciples for Jesus Christ. I am excited about the future of UMFA and Arkansas Methodism as we continue to transform lives.

The following is a snap-shot of some important information I wanted to share with you. Although UMFA had many changes in 2018, the Foundation’s Board and staff continued to work hard with local churches and institutions ensuring that the United Methodist ministry in Arkansas is thriving.

 

 

 

 

 

 

 

Rev. J. Wayne Clark, President & CEO

 

Assets Under Management

After a nine-year trend of consistent growth, UMFA assets under management decreased somewhat in 2018 due to the fourth quarter market downturn.

We ended 2018 in excess of $153 million, a 7% decrease. Although the Arkansas Conference is a comparatively small one, and our state is near the bottom in terms of wealth, our Foundation is the 6th largest in the country thanks to the generous spirit of Arkansas United Methodists.

 

2018 Investment Performance Review

We completed our seventh year of partnership with Wespath Investment Management, a United Methodist agency that is also responsible for managing the United Methodist Church’s $21 billion in pension assets. This has been a great relationship. Their performance and service are top notch, and their efforts in the area of socially-responsible investments can’t be matched. All three of our investment pools compare favorably with their 5-year benchmark comparisons.

The performance numbers below reflect the general market decline experienced in the fourth quarter, 2018.  Long-term returns are comparable or ahead of their benchmarks.

 

Investment Pool

$

(millions)

1 Year Return

Average 3
Year Return

Average 5

Year Return

5 Year
Benchmark
Return

 Blended Investment Pool

117.9

-6.60%

5.71%

3.49%

3.23%

 Growth Investment Pool

9.4

-8.73%

6.97%

4.70%

3.76%

 Income Investment Pool

9.8

-1.07%

3.22%

2.22%

2.40%

 

 

Types of Accounts

Our asset composition is divided into four areas:

  • Trustee Accounts –49%: Permanent endowments owned by UMFA. The annual income is used as directed by the donor.

  • Life Income Accounts –7%: Funds that provide lifetime income to the donor, and later the funds are used to support UM ministries as directed by the donor.

  • Revocable Trusts –2%: Owned by individuals who have named UMFA as their trustee. A substantial portion of these trusts will someday be gifted to UMFA.

  • Agency Accounts –42%: Funds owned by United Methodist institutions and local churches and placed at UMFA for investment management. 

        

Grant Activity

UMFA continued to make a dramatic impact on the United Methodist Church in Arkansas. Over $1.1 million in grants were made at the discretion of the Foundation’s board to high priority areas including leadership development, human welfare, and Conference institutions.  Some of the year’s highlights are:

  • We have now provided 36 scholarships to Arkansas students attending a United Methodist seminary. There are four more students currently attending seminaries, and we hope to approve four more scholarship recipients this spring.

  • We made the final installment on our $200,000 grant in support of the new student center at Philander Smith College.

  • We made the final installment on our $150,000 grant to Hendrix College to underwrite their new Welcome Center.

  • A major contribution, $21,000, has been made to provide certification and training for Youth Pastors and Directors of Youth in partnership with Perkins School of Theology at Southern Methodist University.

  • UMFA’s grant of $83,000 enabled 100 clergy and lay leaders from the ARUMC to attend the Leadership Institute at the United Methodist Church of the Resurrection in Leawood, Kansas.

  • Through the UMC’s Dollars for Scholars program, the Foundation provided fifty, $1,000 scholarships to United Methodist students attending United Methodist colleges and universities.

  • The Center for Calling and Christian Leadership continues to develop as it challenges and prepares young people for future leadership in the church. A significant grant of $137,500 will bring talented and gifted lay and clergy leaders to our congregations.

 

Endowments Created by Local Churches and Individuals

An endowment is an investment fund where the principal amount invested remains intact, and the earned income is used according to the instructions created by the local church or donor. The income can be designated for a specific purpose or undesignated. A few examples of how local churches use their endowment funds are: 

  • A church in east Arkansas had a donor leave a gift to the church. The church has created an endowment fund at the Foundation; the income from this endowment will generate funds in perpetuity to the church providing yearly support for their children’s ministry programs.

  • Every year, an Arkansas church receives a yearly income check generated by the church’s Foundation-managed endowment fund.  This income is used to support their food pantry ensuring the church will always be able to help those in need in their community.  

  • Another church awards yearly scholarships from the interest generated from their Foundation-managed endowment.

  • A church member created an endowment with the Foundation upon the death of their spouse. The endowment will support their local church’s mission ministry. The church member plans to make additional contributions to the fund and upon their death a portion of the estate will be given the endowment.

 

Foundation Staff Changes

Kristin Hartman was promoted to Director of Accounting for the Foundation.  Kristin brings a great deal of experience to her role having been hired initially as UMFA’s Account Manager in May 2011. Kristin, a Little Rock native, graduated from the University of Arkansas at Little Rock with a Bachelor of Arts in Liberal Studies. She and her husband Shaun are proud parents of two sons, Coen and Arlo.

Emily Madden was hired as UMFA’s new Account Manager in February 2019.  Emily was born and raised in Little Rock where she currently lives with her husband, Jeff, and their two children, Mya and Sam.  She graduated with a Bachelor of Science in Architectural Studies from the University of Arkansas at Fayetteville.  

 

UMFA Events & Activities of 2018

  • February 15: UMFA hosted our Investment Forum which featured presentations from our investment experts from Wespath Investment Management, the Foundation’s investment manager and the UMC agency responsible for $22 billion+ in UMC pension assets.

  • February 21-23: UMFA hosted a visit to Lydia Patterson Institute in El Paso, Texas to explore ways we can support their capital campaign. LPI is an educational institution of the South-Central Jurisdiction of the UMC.

  • May 18: UMFA Board Meeting

  • September 19: UMFA hosted the United Methodist Lawyers Conference, the annual presentation of legal education topics relevant to United Methodist attorneys.

  • November 16: UMFA Board Meeting and 33rd Annual Bishops’ Club Luncheon; Pleasant Valley Country Club, Little Rock.

 

UMFA Events & Activities of 2019

  • February 12-13: Pre-Retirement Seminar for Clergy with presentations on retirement benefits explicitly tailored for clergy and their spouses' ages 62 and older; UMFA Lusk Training Center

  • April 30: UMFA Endowment Seminar features material specific to current and potential endowment clients; UMFA Lusk Training Center

  • May 17: UMFA Board of Directors meeting; UMFA Lusk Training Center

  • September 19: United Methodist Lawyers Conference; Pulaski Heights UMC, Little Rock

  • November 15: UMFA Board of Directors meeting & 34th Annual Bishops’ Club Luncheon; Pleasant Valley Country Club, Little Rock