Parker T. Williamson
Editor emeritus and senior
correspondent of The Layman
Journalists who monitor the work of denominational agencies
often must choose among several committees that meet simultaneously.
Which committee will provide the most comprehensive information to a
reporter who can cover only one? Early in my career, I received good
counsel: “Follow the money.”
Sooner or later, most issues of moment, no matter how pious the
language that enshrouds them, will find their way into a financial
statement. Thus this editor who by disposition and training is inclined
more toward theology than arithmetic, has often turned his focus to
budgets and balance sheets.
'Hearts and Hands'
Sometimes rhetoric and rubles don’t match. Denominational leaders,
for example, applaud the progress they say they have made in their $40
million “Hearts and Hands” fund raising campaign. They report
that the campaign has raised just over $26 million in pledges and gifts,
mostly from the presbyteries.
But a review of the figures shows that most of this is not new money
raised by “Hearts and Hands.” It is money that the
presbyteries are pursuing in campaigns of their own, money that will
stay within the boundaries of the presbyteries to meet their own
church-development goals. “Hearts and Hands” has given itself
a free ride, taking credit for raising funds that would probably have
been raised even if there had been no “Hearts and Hands”
campaign. This truth comes to light when one follows the money.
Benevolence or business?
Again, following the money, we note the announcements that several
congregations that have chosen to disassociate from the Presbyterian
Church (USA) are making “mission gifts” to their former
presbyteries. The language invites examination. Are these allocations
real mission gifts as they are often described, or are they exit fees?
Do the transactions that they represent reflect benevolence or business
decisions?
Take the case of
Central Presbyterian Church of Huntsville, Ala. v.
the Presbytery of North Alabama. Central’s congregation
declared itself no longer a member of the Presbyterian Church (USA).
North Alabama claimed Central’s property, and the congregation
defended its deed in court.
North Alabama Presbytery found itself facing an escalating financial
crisis. Having spent $65,000 on legal fees, it discovered “certain
aspects of Alabama law which appear unfavorable to the presbytery.”
Presbytery officials had to weigh the cost of losing their case at the
state level and then risking a lot more money on an appeal that might go
as far, in their view, as the U.S. Supreme Court.
Like most presbyteries, North Alabama is not wealthy. Facing the
prospect of protracted litigation, it started borrowing money from
neighboring presbyteries, presumably in the hope that a North Alabama
win might provide legal precedent for the others. But how much
indebtedness was this presbytery willing to incur on a case whose
outcome had become doubtful? It was time to do a deal.
In order to settle the matter, Central agreed to give the presbytery
$250,000, $110,000 of which is to be designated for a church camp whose
ministry the people of Central have loved and supported. With the
remaining $140,000, the presbytery can bail itself out of legal expenses
that it has already incurred and, for the moment, assuage the pain of
losing Central’s annual contributions to the presbytery’s
budget.
Following the money, one learns that Central did, in fact, make a “mission
gift,” but one also discovers that this benevolence had significant
business implications.
The buck stops here
As the flow of departing congregations increases, we can anticipate
numerous variations on the above-described business arrangement. For the
local congregation, it makes sense to pay an exit fee if the amount is
less than anticipated legal expenses and, if prorated over a few years,
the amount is less than the church would have contributed to the
presbytery if it had remained a part of the denomination.
Many presbyteries will have no choice but to deal, considering their
declining income, dwindling reserve funds and the expected cost of
litigation. A cluster of departing congregations that pools its
resources in common defense of their property rights can break the bank
of most presbyteries, while denominational headquarters, whose income is
falling fast, has shown itself in no condition to bail them out.
Louisville has already suffered several financial crises requiring
denominational leaders to make major budget cuts, but the big one is yet
to come. Within five years, when presbyteries have expended the exit
fees that they negotiate with departing congregations, they will face
significant budget reductions. At that point, will they cut their own
programs in order to fund current-level contributions to denominational
headquarters? It is reasonable to assume that they will pass much of
that hurt on to Louisville.
Following the money, one observes a national organization that is
feeding upon itself in a desperate attempt to survive. Ministries and
staffs are being downsized. Reserve funds are being consumed. Assets are
being sold. Empty church offices are being leased to non-church
entities. The institution is doing what all dying institutions are
inclined to do – cannibalizing itself.
Follow the money
Presbyterians will want to keep close watch over one remaining
denominational entity that administers significant assets, the
Presbyterian Foundation. Among its accounts are millions of dollars
whose use was restricted to specified purposes by the donors. As
Louisville’s appetite for foundation disbursements increases, it is
prudent to inquire into the mechanisms employed by the foundation to
ensure that donor designations are honored.
We have seen no evidence that suggests any misfeasance or malfeasance in
this regard, but it is reasonable to assume that the degree of financial
hunger now being experienced by denominational agencies could – in
the absence of transparency and accountability safeguards – lead to
excessive creativity in the interpretation of donor restrictions. Thus,
we would encourage Presbyterian Foundation officials to scrupulously
avoid making block grants to denominational agencies from
donor-restricted accounts, recognizing that the foundation’s
fiduciary responsibility ceases, not when it transfers funds to an
intermediary agency, but when those funds have actually been spent for
purposes identified by the donor.
In short, we believe that the advice this editor received long ago
applies to foundation officials today: Follow the money.
The Rev. Parker T. Williamson is editor emeritus of The Layman.