Church Finances: Preacher, You’re Crooked!

Posted on February 12, 2008. Filed under: Bi-vocational Ministry, Worship Wars |

“Preacher, you’re crooked!” shouted the church’s Treasurer and paid Janitor. It was a business meeting in my first year as pastor, in my first 6 months even. Cal was red faced and pointing his finger at me, accusing me of being crooked in front of the whole church. The issue at hand was my pay package. I was following the advice of my CPA, a godly man with whom I had taught Sunday School at Birchman Baptist when I was a fresh graduate out of seminary in 1990-92. He told me, and other resources I checked confirmed that he was right, that a minister could take a substantial percentage of his pay as a housing allowance and that portion would not be taxed as salary. How you figure up the housing allowance was to combine the house payment, insurance, utilities and upkeep. The reason ministers could arrange their pay like this was that we are considered self-employed, similar to farmers. I was asking the church to adjust my pay so that half of it was housing allowance. The former interim pastor had taken the whole pay package as housing. With taking half of it, I was actually cheating myself because I deliberately underestimated my housing costs in order to be above reproach. Yet I caught an earful of reproach from Cal.

How should one respond when one is called a crook in a public meeting of the church? I was quite taken aback. I did what came naturally I guess, I thanked him for his comments very calmly and moved on to the next part of the motion, which carried.

But, as how Paul Harvey would say, here is the rest of the story. Back in March of 1992, in my 2nd month as pastor, the church received a bill from the IRS for back payroll taxes unpaid to the tune of $8,000. For our small church this was a devastating amount. It would almost drain our savings. Who was the Church Treasurer during the years in question? Cal. The church wanted him to fix it so he went to an accounting firm in Fort Worth that dealt with churches a lot. They negotiated with the IRS and got the total down to about $4000. the church raised some money through offerings and used some of the reserve and paid it all off. In a couple of years we elected a new Treasurer.

But the story gets better. A couple of years later, one of the young ladies of the church came to me with something that she was concerned about in the church’s financial dealings. She presented to me the evidence that the church nursery worker was not the one to whom the checks were being made out. The church checks were actually being made out to her daughter, who did in fact work in the nursery with the mom. But all the church documents said the mom was the nursery worker, stated what the salary was, and anyone who visited the church would assume that she was in fact the nursery worker. But the checks told a different story.

I did some checking with the treasurer, Cal, and his wife and a couple of deacons. When the church needed a stable nursery worker, Cal’s wife came upon Nancy and recommended her to the church; the church voted her in as the nursery worker. But between Cal’s wife, Cal, and a deacon or two, the nursery worker had an arrangement to get the checks made out to her daughter, who stayed with her in the nursery. The daughter was quite young, probably around 11-12. The church did not know about this little arrangement. When I was informed of this I consulted my godly CPA and he made it clear to me in no uncertain terms that this was not a wise thing to do, was illegal, and gave the appearance of sin. I got with the deacons and the treasurer and confronted them with the facts and told them that my accountant said we were operating illegally and that we had to make the checks payable to the official nursery worker. Of course there was much whining and I was accused of being mean and trying to hurt the nursery worker. The church was just doing this to assist somebody with their finances. The whole reason this pay arrangement was made was so that Nancy would not pay as much in taxes. When you have a second job you are taxed more heavily. Eventually reason prevailed and the checks were made out properly from then on and the tax evasion scheme between the treasurer and nursery worker and deacons was ended.

Now fast forward to 2005. The church treasurer (not Cal!) came to me with one of the men who, though not a deacon, was a deacon at heart and really did a lot of work around the church. These two men showed me a series of receipts from Cal for yard tools like leaf blowers, edgers, etc. In one year’s time he had gone through an amazing amount of lawn tools. We all recalled that several lawnmowers had been replaced over the years as well. How was this equipment disappearing and being used up so quickly?

Cal, the janitor and former treasurer, had years before, volunteered to do the lawn work for the church at no charge. And he did a good job. But it was never a part of his official duties as janitor. But along the way, Cal also had a lawn business on the side, and he was using the church’s equipment along with his own. They were interchangeable and to him, indistinguishable.

We began to ask Cal about the whereabouts of some of the lawn equipment and it seems that it kept on getting stolen from the back of his truck. One church member though, saw one of the church’s mowers at Cal’s house repeatedly. Finally, Cal’s health was beginning to fail and, combined with the equipment problems, things came to a head. The men of the church wanted me to force the issue and tell Cal to retire.

The last straw, however, was when Cal brought up the issue of vacation pay. Cal never took a vacation. He was incredibly faithful and reliable. But back in the late 1980’s before I came to the church, Cal had approached the church for back pay for unused vacation time. This amounted to about $5000. The church was without a pastor and the deacons gave in without much of a fight. The church paid Cal $5000. The deacons did tell him not to do this again.

Cal approached one of the deacons in the fall of 2005 about the issue again, this time asking for about $8,000 claiming 3 weeks vacation pay for about 17 years or so. The deacon brought the matter to me. I immediately said “No way!” or words perhaps a little less tactful but to the same effect. We brought this matter up in deacons’ meeting and church council, combined with the missing tool issue, and reached a conclusion that Cal had to go.

On the night of one of our monthly Men’s Suppers (a harbinger of things to come for me) we met with Cal after supper and told him that we would not honor his request for back vacation pay and that we were retiring him, immediately. He left without a word. That night one of our men went to the storage room and accounted for some equipment that was in there, thinking that there might be a problem.

Sure enough, the next day I got a call; the equipment had been removed overnight after the one man had checked it. Cal still had his keys and was to return them on Sunday, so the thinking was that he had come to the church later on Friday night or very early Saturday and removed the equipment and supplies.

We had another meeting Sunday evening and I told the group that we should call the police. I had done some thinking about this and the long ago missing Social Security payments and realized that the money owed the government had been reported as paid in all the business meeting minutes during the years in question. Cal’s explanation back in 1992 was simply that the tax forms had not been filled out correctly, but that the money had been sent in. At that time, nobody other than Cal spoke with the accountants who helped him settle with the IRS, nobody did an audit of the years in question. I had now reached the conclusion, perhaps wrongly (was I being judgmental?) that Cal had in all likelihood taken the money from the church in those years. Was the one who publicly accused me of being crooked, perhaps a crook himself?

At that last meeting the consensus was to not call in the police as it “might tarnish the name of the church in the community”. I was the only dissenting vote. Then the committee discussed whether to give Cal severance pay. I couldn’t believe it. Everybody in the room thought Cal had stolen hundreds if not thousands of dollars from the church, he had demanded the church pay him thousands of dollars in vacation pay to which he was not entitled, and he had apparently gone back to the church after the first meeting to take some more equipment, and now this committee was considering giving him severance pay? The motion carried to pay him about $1,000 but to call it a love offering for his years of faithful service.

Now move forward in time to February of 2007 and the Men’s Supper on the first Friday. I was the main cook and had fixed two big pots of my world class spaghetti sauce (this recipe will show up sometime in my recipe column on this blog page). The men all loved my spaghetti sauce, we ate this meal about 3 times a year. At the end of the meal, the same group of men, minus George, requested to meet with me. I pretty much knew what was about to happen as the church had continued to shrink to the point where we were averaging about 20-25 on Sunday mornings. The men asked me to resign and on the following morning I preached my last sermon and made a graceful, upbeat retreat from that church.

Oh, by the way, I did not ask for any back vacation pay, nor did I ask for any kind of a severance pay. No offering was expected, none was given. In my mind, the church quite simply could not afford it. The only thing I went back to the church for was to retrieve my library and clean out my office.

In my 15 years at the church, I never once asked for a raise and I truly believe I was overpaid. The church paid well for a small bi-vocational church, I received about $20,000 a year. As small churches go, it really was paying quite well. I offered to the church council on numerous occasions to cut my pay, but they refused to consider it. The church was actually a very giving church and never had serious money problems until my final two years. Thankfully, due to the Barnett Shale bonanza, the church got several thousand dollars last year for their share of the gas lease.

There is more to tell about the money matters of this church, but that will have to wait until next time.

Monday, February 11, 2008– Due to a drastic increase in my work load at work, my blogging efforts are taking a back seat. Plus, my studies for Genesis: Answers to Life’s Crucial Questions are needing a lot more attention. But, these blogs are the stories about my efforts at pastoring a small, elderly, traditional, bi-vocational Southern Baptist Church. I pastored from 1992-2007 in Fort Worth but I am leaving the name of the church out and will only use first names of the people I am talking about when I am speaking favorably; other names are fictional though the stories are all true.

Why write these stories when they are essentially negative? To try to see where I went wrong, to explore what is dreadfully wrong with the churches like this one, and to help prepare any young minister who may face similar challenges.


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