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Episcopal Dioceses & Parishes Face Worst Financial Crisis since Depression - IV

Episcopal Dioceses and Parishes Face Worst Financial Crisis since Depression - Part 4
Residential Seminary Model is Passing Away Before our Eyes, says Lexington Bishop

News Analysis

By David W. Virtue
April 9, 2009

Empty Churches Across the NationAcross the country Episcopal dioceses are facing decline as parishes shrink, accelerated by lost income, graying congregations and a church that is incapable of attracting a younger generation to replace thousands of priests who will retire in the next 10 years.

The overall situation in The Episcopal Church is aptly summarized by the crisis in the Diocese of Washington as described by Bishop John Chane. "At the present time, it is clear that many of our parishes have had to make significant cuts in their operational and ministerial budgets. Likewise, the diocese, dependant on parish giving is looking at an "all options are on the table" scenario for addressing significant financial shortfalls. Along with reducing some staff positions and budget cuts in funding for parish support, growth and clergy wellness the diocese is faced with a "how can we continue to provide basic services to our parishes given the budgetary constraints that the diocese and our parishes are now facing?"

Chane, one of the most outspoken revisionist bishops in TEC and a pathological hater of Evangelical Nigerian Primate Peter Akinola, got a reality check noting that "hard issues" face his diocese this year including the need to have some difficult conversations with congregations handling issues of survival.

Diocesan leaders identified a number of congregations whose viability as standalone congregations is in doubt. Several "special cases," require increased diocesan attention. The diocesan staff is in close touch with three.

In some cases, Chane said, parishes "have been close to red-lining for a long, long time. It's not pastorally fair to these people who have been beating themselves up for so long not to give them the tools to make some decisions. It's very expensive, yes. It takes a lot of time. But it's the fair thing to do. It's the pastoral thing to do."

Linda Freeman of St, Luke's, Bethesda, said one should not hold out false hopes. In recent years, council members have discussed the closures of Holy Spirit, Germantown, and Nativity, Camp Springs. "Sometimes we're skittish when it comes to end of life," said The Rev. Sheila McJilton, of St. Philip's, Laurel. "We don't know what to do, so we kind of keep the patient alive and on life support. Some of this care - it's hospice care. We just need to be able to look somebody in the face and say, 'We're looking at the end here. Let's walk through this together.'"

In a devastating convention address on the state of affairs in the Diocese of Lexington, Bishop Stacy Sauls said the diocese would probably have to sell Cathedral Domain the diocesan camp and conference center and then dropped that a number of dioceses face similar crises. "In the last few years, the Diocese of North Carolina has sold its camp and conference center. The Diocese of Pennsylvania has voted to sell its camp and conference center. The Diocese of Milwaukee has closed its camp. The Diocese of West Virginia is exploring the possibility of closing its camp. The Diocese of Western North Carolina and the Diocese of East Tennessee are struggling to keep their camps open. I need not point out to you that every one of those dioceses is larger than ours, some much larger and much wealthier.

"I tell you quite honestly, we cannot afford the way we are doing our camping ministry now. As I have reported to you, during the previous five years preceding our last Convention, we have spent $248,000 of income primarily from congregational 14 assessments and $254,000 of unrestricted endowment assets to cover the Cathedral Domain's operating losses. In 2008, we used another $72,000.

"Since our last convention, we have not made the progress we needed to make to preserve this important asset of our Diocese. Last year in my convention address, I told you that unless we did something differently we had less than ten years before we would no longer be able to afford to keep the Cathedral Domain open. We did not do things differently. It turns out that I was overly optimistic, economic collapse has decreased the value of our reserves, and that we have wasted a year. I want you to hear me say in total candor, that at the current rate of loss, we have less than five years left."

Sauls then moaned about the high cost of hiring new clergy arguing that the old residential seminary model is finished. (This is not good news for The Episcopal Church's already failing liberal seminaries.)

"The median clergy compensation in The Episcopal Church nationally is $64,500. With pension and standard insurance benefits, the total cost to a congregation for a median-level priest is between $82,000 and $94,000. That means that a median-level priest is beyond the reach of 22 of our 35 congregations, those with annual incomes less than $150,000 per year. That means that the existing free-market system of clergy placement, unless we think differently and do something differently, will likely, in time, choke the life out of 63% of our congregations, which serve 27% of our people.

"Over the course of the last year, one Episcopal seminary has closed. Another has sold a large part of its campus. Another has closed one of its two campuses and moved into a facility in partnership with another denomination. At least one other is in very real financial distress and may have to close. This is not only a phenomenon of The Episcopal Church. We are finding as the Church that the denominational residential seminary model, by which the vast majority of our current clergy were trained, is something we can no longer afford. It is passing away before our eyes."

"The other 11 congregations of the 22 I mentioned most at risk in need of something new have annual incomes between $50,000 and $150,000. Generally speaking, these churches have the resources to support some sort of stipendiary clergy but nowhere near what is necessary to compete for clergy in the free-market system. Here is another startling reality. Of those 11, six are currently seeking priests-six." You can read his full statement here: http://tinyurl.com/d4kjv2

In the Diocese of Western Massachusetts, Bishop Gordon Scruton tried to put the best face on the situation when he told the diocese recently, "There are many things I am not thankful for, such as: the closing of St. John's, Worcester; the suspension of ministry of Camp Bement; the financial struggles experienced by many of our congregations; the $200,000 we are in the process of cutting from our Diocesan budget." On the closure of St. John's, their outgoing rector, The Rev. Lise Hildebrandt said this, "And then - wilderness. Former staff members are struggling with their own demons-unemployment or having to work and attach to a new parish or staying to mop up the remains of St. John's. Vestry members and parishioners are visiting other churches or joining other churches, or not going to church at all for a time. All of us are disoriented, grieving, wondering where God will lead us next?"

The Bement Camp and Conference Center on Jones Pond in Charlton recently celebrated its 60th Anniversary, but now faces closure. "Diocesan Council met on Jan. 29 to discuss the proposals. After a very sobering and prayerful conversation, with strong supporters of Bement saying how reluctant they were to make the decision, the council was unanimous that as a Diocese, they cannot provide the money Bement needs, especially at this time when so many congregations are struggling financially." The diocese learned it would need $1.2 million to keep the camp open after 2009. They don't have it. The diocese will sell it off. The same thing has happened in the Diocese of Pennsylvania where the diocese has put Camp Wapiti on the market for $15 million.

The parish of St. Barnabas, Lynchburg in the Episcopal Diocese of Southwest Virginia, voted to close because in recent years church membership has experienced a continuing decline in numbers. They will hold their final service on June 11. Ironically, the church was founded in 1959 to serve the then-rapidly expanding population of Peakland-Bedford Hills in northwestern Lynchburg. While the parish has been known for strong community involvement, social action could not keep the church alive. They will close just as they commemorate the church's 50th anniversary.

In the heart of New York City, St. James on Madison Avenue is feeling the pinch with The Rev. Brenda G. Husson detailing in a newsletter the parish's current financial situation, including the cuts already made and the very real possibility for far more devastating cuts in staff and programs in the future. She writes, "My emotions have been all over the place. But nowhere near where I'd like them to be for Easter. She said she feels anger, for starters. "I'm angry that the downturn in the markets could have this severe an effect on our ministries. I'm angry that this occurred just as the Vestry was poised to have a deficit-free operating budget after years of hard work and diligent cost-cutting and consistent increases in stewardship. I'm angry that I clearly never made a compelling enough case for why dependence on our endowment for operations was a bad idea and that a 120% increase in stewardship over the last 12 years hasn't gotten us even close to free of it." This is only the tip of the iceberg. Other parishes in the Diocese of New York may be forced, in time, to close, a source told VOL.

In the Diocese of Michigan, Bishop Wendell Gibbs recently eliminated one-third of diocesan staff positions because of falling income. The diocese will hold a special convention April 18 to assess the financial buffeting in the region and its effect on diocesan mission and ministries. It has one topic: Sustainable mission for the Episcopal Church in Michigan.

By all accounts, it is not going to be good. A $2.9 million annual budget, approved last October, depended on a then -nine million dollar Extended Ministries Fund that the diocese does not normally tap in order to balance an annual budget. Now it will have to, but nobody is happy. The value of the corpus has declined from nine million to six million dollars. Additionally, congregations at the epicenter of the financial crisis in southeast Michigan show a 12 percent state unemployment rate. In Detroit, the unemployment rate exceeds 20 percent. Another imperiled Episcopal church that sustained its neighborhood outreach ministry on a thread has snapped. St. Philip's and St. Stephen's both voted in February to close.

"We are in a different financial place than where we were even six short months ago," Gibbs wrote to the diocese on March 25, signaling the necessity to sacrifice mission and ministry opportunities. In April, two weeks before the special convention, the bishop made the first sacrifice. He dissolved five positions on the 2009 diocesan staff. One in the finance office had gone unfilled since Convention approved the 2009 budget. The four others- Canon for Ministry Development and Transition Ministries, Canon for Lifelong Learning, Director of Stewardship and Planned Giving, and Director of Payroll and Benefits-were full-time positions eliminated from that staff, effective the end of May.

In the Diocese of Newark, home to the Episcopal Church's lay Homosexual Emeritus Dr. Louie Crew, financial hardship has hit the investments of the diocese's pension funds which have come up short. The ability to pay all the benefits earned - and that will be earned by continuing employees - is currently at risk. A funding source - or sources - must be found, said a report. A year ago, the shortfall was near $600,000. With the degradation of the value of the portfolio, it is greater today.

The Bishop's Advisory Committee on Human Resources takes seriously the need to fund the pension deficit, said a report. One step toward that end is to limit the growth of that deficit by closing the plan to new entrants. All new employees will be offered the opportunity to participate in the national Defined Benefit plan (with a mandatory premium paid by the diocese of 9% of pay) or the national Defined Contribution plan (with a mandatory contribution paid by the diocese of 5% of pay and a match of up to 4% if the employee contributes). In the meantime, no employees will be newly enrolled in the Diocesan Lay Pension Plan. The Diocese of Northern Michigan, which faces a possible veto of its bishop-elect Thew Forrester, also faces a financial shortfall. Its income is not viable to support a diocese. An office manager told VOL that none of its 27 parishes has a full time rector dedicated to one parish. A handful of retired priests serve multiple congregations. The diocese can no longer afford even that model.

The outcome of a March Diocese-wide finance meeting heard Manuel Padilla, a member of the new Episcopal Ministry Support Team and Ministry Developer in the Western Region, lay out the situation facing the diocese: an economy in recession, large losses in their endowment funds from the stock market plunge, and a declining population in most of the Upper Peninsula. He offered figures and graphs illustrating the decline, over the past 10 years, in average Sunday attendance in churches and static income. "The leadership of the diocese believes that the staffing level we have now is rock bottom. We have not been cutting fat in the last few years," Padilla said. "There is no fat in our budget. We are talking about cutting off our limbs." Given the serious situation, a proposal is being developed by the Core Team to discuss how it might remove the regional boundaries as far as budgeting, so that all Ministry Developers are paid out of the diocesan budget, which would remove some of the convoluted financing that currently happens. It was stated clearly throughout the meeting that the current trends cannot be ignored. Much is out of our control: the stock market and economy, the declining overall population of the Upper Peninsula."

"Our biggest challenge is to grow our congregations," said Thew Forrester. "We are here in the midst of our very busy lives, because our way of following Christ gives us hope. If we embrace fully who we are, there will be enough people attracted to our congregations." The irony of this is that bishop-elect Forrester, is a lay ordained Buddhist who has the equally bad habit of substituting readings from the Bible with readings from the Quran, hardly a recipe for Christian evangelism.

It is equally clear that the election of Forrester was driven in part by finances. "It is a reality in every area of our lives within the Church, the business world and our personal lives that financial concerns impact how we live, how we set our budgets and how we make our vision happen in the context in which we live," he wrote in a letter to the diocese.

Without a discernible gospel, there is no way this or any Episcopal diocese will grow. With aging Episcopal congregations, a national financial meltdown and thousands of orthodox Episcopalians fleeing the "gay church", the Episcopal Church faces a bleak future.


Episcopal Dioceses & Parishes Face Worst Financial Crisis since Depression :: An On-going Series from VirtueOnline.org

Part 4 - http://www.virtueonline.org/portal/modules/news/article.php?storyid=10242

Part 3 - http://www.virtueonline.org/portal/modules/news/article.php?storyid=9983

Part 2 - http://www.virtueonline.org/portal/modules/news/article.php?storyid=9804

Part 1 - http://www.virtueonline.org/portal/modules/news/article.php?storyid=9638

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