July 31, 2012
New technologies bring new liabilities. Is your church exposed?
Church websites, Facebook pages, electronic fund transfers, online databases with sensitive information—churches using digital tools face new methods for operating, as well as new risks. And like all risks, the potential liabilities associated with technology use require a good risk management plan.
According to Paula Burns, a risk management expert with Insurance One Agency, cyber liability relates to the display, transmission, dissemination, or other use of “matter” in a cyberspace environment.
Computer viruses are one significant vulnerability for churches. For example, if a computer virus infects your church’s network and system, you could face significant loss or corruption of data—a first party loss. If someone on your church staff inadvertently spreads this virus to others outside your ministry, your church could be liable for a third-party loss. In either case, churches’ insurance policies frequently do not provide coverage for cyber liability like this.
“Few insurance companies have responded fully with policy language and coverage that addresses exposures to cyber liability,” Burns says. “Churches need to ask their insurance provider whether or not they offer coverage against first- and third-party loss for computer viruses and other technology-related incidents.”
Continue reading Cyber Risks at Church...
July 26, 2012
David Middlebrook explains the benefits of a properly conducted report.
Q: At the end of every year, our board discusses the salary for our ministers for the upcoming year. We would like to compensate our ministers for all they do for our church, and some have suggested we get a compensation study done on our senior pastor and others at the executive level. What is a compensation study?
A: A compensation study, when properly undertaken, is an independent report on an organization’s total compensation of certain individuals, usually those at the executive level. It is performed by a compensation committee or a group of the board of directors, neither of which would include the subject of the study or members of the subject's family. This group or committee also should consist of only non-disqualified persons.
Total compensation includes both cash compensation (which is salary, bonus, and housing allowance) and non-cash compensation (which is everything else). Properly done, the compensation study should serve the organization for at least a few years, barring significant changes in the size or finances of the organization or its compensation structure. The process for determining the reasonableness of compensation is much like that of valuing an item of property.
Continue reading Q&A: Should Churches Perform a Compensation Study? ...
July 24, 2012
Deciding details early coordinates efforts and avoids last-minute problems.
Editor's Note: The following is an excerpt from Engage by Nelson Searcy and Jason Hatley, with Jennifer Dykes Henson (Baker Books, a division of Baker Publishing Group, 2011):
The first church I pastored was a small Baptist church in Charlotte, North Carolina. I was a 21-year-old kid. The night they voted to call me as pastor, a whopping fifteen people were in attendance. Later I learned the plan that night had been either to vote me in or to vote to merge with the church down the street. They went with me, but I’m still not sure they made the right decision. Fortunately, God began to bless that little church and it started to grow. After a few long, hard seasons, we were averaging almost 100 people per week. Since attendance was so “high” every Sunday, I went to the deacon board with a proposal: we needed to hire a part- time minister of music. They reluctantly agreed.
After a few interesting interviews, I found a woman who fit the bill perfectly. Her name was Laura. Laura was an incredible singer, and her husband played the piano to boot—I got a two-for-one deal! Now, with the three of us on the platform, God began blessing our church even more. But things were far from perfect.
Continue reading Why Thursday Deadlines Make for Better Sundays at Church ...
July 19, 2012
Important information to address this common tax question.
Q: Can a church give a cash benevolence gift to an employee? And is it taxable income?
A: Yes and yes.
For better or worse, churches seem to attract needy employees. They may need their car repaired or have serious uninsured medical expenses. The Internal Revenue Code requires all benevolence payments provided to employees be taxed. The church must add the amount of the benevolent payments to the employee's Form W-2, and if nonclergy, withhold all payroll taxes like the payment was wages. It makes no difference if the payment is direct or indirect, like to the employee's doctor.
Continue reading Q&A: Is Benevolence for a Church Employee Taxable?...
July 17, 2012
The Acts 15 model provides leaders with guidance.
Over the years we have seen the best and worst responses to conflict from our brothers and sisters in Christ. But the story of one conflicted church, a church we will call Lakeview Community Church (LCC), stands out from the rest because of its shocking ending.
God-fearing immigrants founded LCC almost 100 years ago on lakefront property near Cleveland, Ohio. These hardy people shared not only a common faith but common values. They did business with each other, and the children of many of the families married and continued to grow the church and the family businesses.
Over the years, the neighborhood around the church's property changed significantly. The new ethnic demographic of the community contributed to the church's growing sense of being disconnected from their immediate neighborhood. In addition, many of the children and grandchildren of the founders lived in more upscale suburbs, but continued to remain members, traveling to the church each Sunday to attend service and visit grandparents. As the grandchildren grew into teens, intergenerational conflicts began to erode the former unity of the church.
Continue reading Redeeming Even the Messiest Church Conflicts...
July 12, 2012
Investigation also says leaders disregarded safety—here’s what churches should note.
Joe Paterno and other key Penn State officials knew about sex abuse allegations as early as 1998, but actively hushed concerns in fear of repercussions, according to a special investigative team’s report released today. The sweeping independent report notes that the investigation’s “. . . most saddening finding . . . is the total and consistent disregard by the most senior leaders at Penn State for the safety and wellbeing of Sandusky’s child victims.”
The report agrees with a recent grand jury’s findings that Penn State officials made no attempt to investigate abuse allegations, identify victims, or protect other children from the continuing crimes.
According to head investigator (former FBI Director Louis Freeh), "The most powerful men at Penn State failed to take any steps for 14 years to protect the children who Sandusky victimized." Freeh noted a trickle-down effect of organizational fear that arguably resulted in even a school janitor failing to report an incident of abuse he witnessed in 2000 because of concern for his job. In an ironic twist, the lack of action by staff and officials, all to protect jobs and reputations, most likely will carry severe consequences for the university and its staff in the months and years to come.
Church leaders and staff must remember that reported abuse must be investigated seriously and quickly. Liability can be traced not only according to what is (or isn’t) done, but how quickly an organization responds.
Continue reading Report: Penn State Sex Abuse Allegations Arose in 1998...
July 12, 2012
An Oregon church says its insurer's restrictions go too far.
Set Free Christian Fellowship in Medford, Oregon, recently received a letter from its insurance provider that outlines requirements for allowing known sex offenders to attend the church. Stipulations include fully disclosing the identity of sex offenders to the 100-member congregation, allowing offenders to attend only one predetermined service, and requiring offenders to be escorted while on site.
The Medford church, which specifically reaches out to people struggling with addictive behaviors, fears that these proposed requirements may lead to its closure.
Continue reading Setting Boundaries for Sex Offenders to Attend Church...
July 10, 2012
A conversation with Bill Wilson, president of the Center for Congregational Health.
Bill Wilson, president of the Center for Congregational Health and keynote speaker at this year’s annual National Association of Church Business Administration (NACBA) conference in Houston, Texas, July 10-14, talks about what it means to be a healthy church and what to do when the church is sick.
What are some of the biggest challenges you see churches struggling with right now?
Well, the metrics are discouraging for most established churches, and anybody who’s paying attention knows that the trajectory for the church in general is not real great. Everybody is talking about downsizing their staff. United Methodist, Southern Baptist, Evangelical Free—doesn’t matter. Everyone is downsizing. So, what that means is, local congregations who have been, in effect, farm teams of the denominations and have relied on the denomination to do their identity and mission work, now need to decide everything on their own, from curriculum to strategic initiatives. It used to come from the top down, but it no longer does.
Continue reading When the Church Needs a Doctor...
July 5, 2012
To help congregants with work-related matters, church leaders will need to manage church business wisely.
Most ministers have managerial responsibilities, such as budgeting, hiring, supervising, and purchasing, though it seems many church members either do not understand this or harbor doubts about pastors’ competence in these roles. When our interviewees were asked why they had not sought pastoral counsel about work-related matters, quite a few shared misgivings about the church’s own management:
“How well does the church conduct its business affairs? Would any of their practices be relevant for the world?”
“The church is not a good example itself. Consequently, church officers burn out or become too attached to their responsibilities.”
“The church’s support comes from businesspeople, but we are not always confident the church manages that money responsibly.”
“I see all the same problems in the church working environment.”
Of course, the church is a business, and a sizable one at that. Taken as a whole, churches and other places of worship continue to receive the largest share of Americans’ charitable giving, more than education, human services, health, and other categories. Two-thirds of all adults, and 76 percent of Protestants, make such contributions. Annual per-capita giving by Protestants averaged $1,304 in 2004. Total annual giving to religious congregations in the U.S. exceeds $80 billion, a figure that translates to a like amount of spending and investment.
Continue reading Church Business Matters...
July 2, 2012
One survey shows many say no; what the law says about political activity.
On Father’s Day, numerous churches in Maine used their offering time to take up collections for a political action committee (PAC) campaigning against a same-sex marriage referendum on that state’s ballot.
An article on ChristianityToday.com points out such an activity is permissible, and won’t jeopardize a church’s tax-exempt status if conducted within reason. But many church leaders are often confused about what’s allowed when it comes to politics. The Internal Revenue Service explicitly prohibits church support or opposition for political candidates in races; however, churches may lobby for or against legislation, including referendums on ballots, although the IRS is vague about how much or little it will permit.
Our nation celebrates its independence this week, and November seems far away, yet we already find ourselves in a heated political season. A contested race for the White House is underway, as are competitive races for congressional seats. Many states will have referendums covering a variety of social and moral issues, including abortion, religious liberty, and marriage. In some form or fashion, churches will see spirited, and perhaps contentious, political debate in their communities.
What role, if any, should they play in that dialogue?
Continue reading Should Churches Be Involved in Politics?...