c. 2000 Religion News Service
ST. LOUIS _ Leaders of the Lutheran Church-Missouri Synod, the nation’s second-largest Lutheran body, are slashing program budgets and reaching into collection plate offering to pay off a multimillion-dollar debt that has been growing over the past quarter-century.
“The Board (of Directors) knew there would be some difficult decisions,” Synod President A.L. Barry said. “The board did what had to be done.”
The $47.4 million debt has accumulated over the last 20 to 25 years on the books of the national office of the denomination’s Concordia University System.
“It isn’t any one big thing,” LCMS Chief Administrative Officer Brad Hewitt said. “It’s years and years of little things.”
While the debt comes from a variety of sources, it is all related to the church’s higher education expenses. For example, a chunk of the money owed was incurred when the LCMS moved Concordia Theological Seminary from Springfield, Ill., to Fort Wayne, Ind., in the mid-1970s. In 1986 the LCMS closed St. John’s College in Winfield, Kan., and much of that debt remains on the books.
“The issue isn’t that it’s necessarily been bad; we’ve done a lot of things and it’s helped,” Hewitt said. “The issue is up until the past two or three years we’ve paid that debt using undesignated bequests.” The funds came from those who willed money or property to the LCMS and did not designate how the money should be used.
However, the trend in recent years is for people to designate their willed funds to specific ministries.
“They’ve continued to get money, but it hasn’t been going to paying the debt,” Hewitt said. “This year we had virtually no money to pay the debt so we had to find a new way to fund the payment.”
That meant cutting budgets and dipping into “unrestricted funds” to come up with the $5 million payment each year for the next 20 years.
Unrestricted funds largely come from Sunday morning offerings and are routed through the synod’s districts to various programs. The cuts come on top of budget requests that departments had already trimmed themselves by $4 million, knowing there was less money to go around this year.
The board adopted a balanced operating budget totaling $81,981,000, of which $28,413,000 is in unrestricted funds.
“Our total budget is doing well and is allowing certain work to expand, but the effects of these cuts will be felt in programs that have depended on Sunday morning offerings,” said the Rev. David Mahsman, director of news and information for the 2.6 million-member denomination.
The Board for Congregational Services took one of the biggest hits. CS helps support the national aspects of running the second-largest parochial school system in the nation, behind only the Roman Catholic school system. CS also supports national LCMS events, education and resource development related to youth, stewardship, leadership and family. Those areas will have to operate with $600,000 less than requested, or about one-third less than the amount for which it asked. It is unclear what CS programs will be cut, officials said.
The Board for Higher Education will have $2 million less than originally budgeted for grants or subsidies to synodical schools. That will affect budgets at two LCMS seminaries and 10 LCMS colleges and universities.
“This board has been working for the last couple of years toward a change in direction regarding its stewardship of the synod’s money,” said Donald Muchow, the education board’s director. He said the board is determined to pay off the existing debt while incurring no new debt without evidence it can be paid.
“We weren’t even paying off the interest, so the synod’s fiscal viability was in jeopardy,” he said.
Under a new policy the Board of Directors will make sure principal and interest payments are made wherever it has debt or has guaranteed debt, like that incurred from higher education. “That’s just demonstrating being good stewards and managing the resources we’ve been given. And we’ve determined you’re not being a good steward if you can’t make the payments,” Hewitt said.
(BEGIN OPTIONAL TRIM _ STORY MAY END HERE)
The directors looked at each department and set budgets with the intention of eliminating some programs entirely rather than cutting every program across the board. For example, the Forum on Mission and Ministry, which has met twice a year at an expense of $50,000, was eliminated.
The Board for Communication Services’ budget was cut by $200,000, meaning the Reporter, the official monthly newspaper of the LCMS, will no longer be sent at synod expense to most lay leaders of the church. As many as 30,000 free subscriptions will be canceled by August. “We’re estimating that’s going to save us about $100,000 per year in postage and printing,” Mahsman said. However, it cuts the circulation of the paper nearly in half.
The directors also decided to no longer make capital investments in Concordia International School Shanghai in China. The preschool through high school opened in 1998 with approval of the Chinese government. So far the synod has given some $4 million to the school. “That’s really painful,” Muchow said. “There’s not a soul on the board who feels good about that.”
DEA END WICAI
