Uncle Sam pays some church salaries

For three decades, Ray Holmes worshiped with the Pitman Road Church of Christ in Sewell, N.J. 

An accountant for nonprofit organizations his entire career, Holmes also served as the Philadelphia-area church’s treasurer.

In March, he began gathering data the congregation would need when payroll funding became available via the federal government’s Coronavirus Aid, Relief and Economic Security Act.

But even before the coronavirus relief bill was passed, Holmes became ill and handed church finances off to an elder. He was admitted to the hospital the last week of March. The bill was signed March 27. Holmes died March 31 of COVID-19. He was 63.

The rescue package initially included $349 billion for the Payroll Protection Program. Subsequent legislation added $310 billion. Generally, organizations including churches that employ fewer than 500 people are eligible. Recipients may apply for loan forgiveness if they spend at least 75 percent on payroll costs and the balance on mortgage interest, rent and utilities.

Dan Cooper was Holmes’ friend and lead minister at Pitman Road for 35 before becoming part-time connections minister in July 2019. Cooper and Dave Perine, an elder who works with giving, recommended the church of about 200 should apply for funding. The other elders agreed. After Holmes became ill, the pair worked to complete the application. 

A week before they were to file, they encountered a question that would become a matter of conscience: “Current economic uncertainty makes this loan request necessary to support ongoing operations of the applicant.”

Cooper said they couldn’t check that box. 

“It was not necessary,” he said. “It would have been nice, but our contributions have been all right so the consensus of the elders was that there are others that need money worse than we do. So we decided not to apply.”

Survey findings

A recent survey of Protestant pastors by Lifeway Research found that 40 percent of congregations had applied for the federal assistance, which is administered by the Small Business Administration. Fifty-nine percent of applicants had received funds. The exact number of recipients among Churches of Christ is unknown. 

The 800-plus member Memorial Church of Christ in Houston also believed that people most in need should get the money, said David Duncan, the church’s preaching minister. While some expressed concern about unstated conditions, Duncan said such doubts were secondary. 

Josh Means, Equity Bank’s Missouri president and a board member for the not-for-profit Christian Financial Resources, said churches’ concerns about government overreach prompted an FAQ document for faith-based organizations. 

“That’s why the SBA put out the document, to kind of put some of those concerns to ease for churches,” Means said. 

The SBA specified that receiving a loan does not “limit the authority of religious organizations to define the standards, responsibilities, and duties of membership; limit the freedom of religious organizations to select individuals to perform work connected to that organization’s religious exercise nor constitute waiver of any rights under federal law, including rights protecting religious autonomy and exercise under the Religious Freedom Restoration Act of 1993, the Civil Rights Act of 1964, or the First Amendment.”

Not everyone accepted that assurance, including several Christian Chronicle readers who responded to an earlier story about the federal funding. Some cited a Scriptural obligation to lay by in store rather than accept outside funds. Others expressed distrust of the government.

But for the 80-member Alum Creek Church of Christ in Columbus, Ohio, the coronavirus aid bill could make it possible to keep paying seven teachers in the congregation’s small preschool. 

“In my opinion, we’re supposed to be good stewards of finances. It’s a gift, and for us not to accept it in my mind would have been a mistake.”

Minister Adam Metz, the only full-time staff member, was concerned about the teachers. “They’re a great staff, and we’ve worked hard to treat them as well as we could. There was not much hesitancy (about applying). Our primary concern was there were no strings attached.”

However, when the Ohio congregation applied, funds had been exhausted. The church’s $21,000 request was approved in the second round. 

Four times the size of the Alum Creek congregation, the Westhill Church of Christ in Cleburne, Texas, faced a similar dilemma. 

Contributions dropped about 25 percent after services went online. With four full-time employees and seven part-time teachers in a Tuesday-Thursday preschool, elder Jeff Giles was relieved when he and another elder learned about the Payroll Protection Program possibility from a finance committee member.

“There’s no strings attached,” Giles said. “In my opinion, we’re supposed to be good stewards of finances. It’s a gift, and for us not to accept it, in my mind, would have been a mistake.”

Church-state questions 

While some have expressed concern about strings, invisible or otherwise, the constitutionality of a program like this one will hang on a more complex question: Does such a statute result in “excessive government entanglement” with religion?

Kenneth Pybus, chair of the Journalism and Mass Communication Department at Abilene Christian University, is an attorney and First Amendment scholar. 

“The Constitution doesn’t just protect free exercise of religion, wherein it protects us as Christians from government involvement,” Pybus said. “It also protects government from the church. That’s what the establishment clause is. It prevents the government from forcing a specific religious view on people.”

The landmark case that has guided church-state decisions for more than 50 years is Lemon v. Kurtzman, 403 U.S. 602 (1971), wherein statutes in Pennsylvania and Rhode Island provided salary supplements to teachers at church-related schools. The court ruled them a violation of the establishment clause, crafting what came to be known as the Lemon Test. To pass constitutional muster, a statute must (1) have a secular legislative purpose, (2) its principal or primary effect must neither advance nor inhibit religion, and (3) it must not result in “excessive government entanglement” with religion.

Keeping people employed was the secular legislative purpose of the Payroll Protection Program, regardless of the employer. However, Pybus said, “When you have money going from government to a church or school, you have some reporting requirement.” Historically, that kind of provision has been problematic.

“The Supreme Court agreed a neutral and secular aid program can’t be denied to churches because doing so is a violation of free exercise.”

However, in cases subsequent to Lemon, including one in 2017, the court turned to the free exercise clause and upheld a Missouri program that allowed playground owners to apply for a grant for scrap tire surface material. 

Pybus explained, “When a church in Columbia, Mo., applied for the grant, the government denied it and said, ‘We can’t provide it because you’re a church, and it violates the establishment clause.’ The church said, ‘No. Denying it violates the free exercise clause — you’re harming us.’ The Supreme Court agreed a neutral and secular aid program can’t be denied to churches because doing so is a violation of free exercise.”

Surprised by funding

Gareth Flanary, minister for the West Springfield Church of Christ in Massachusetts, assumed the Payroll Protection Program loan would not be available for churches. 

He learned otherwise after watching a church consultant’s webinar. Flanary believed the federal money could provide funding for two part-time positions and a summer intern. 

“For me, theologically, if God will use government to support what we’re doing, we should embrace that, and in turn we should serve in our cities.”

“Missiologically, we’re a small church but very involved with community and missions in the area,” Flanary said. “We spend a lot of our resources in those areas and did not want to lose a beat when it came to those.”

He was surprised when the congregation’s $16,300 request was approved. 

“I’m very thankful for it,” he said.

Although Lifeway Research found fewer small churches pursued or received coronavirus relief funds, two church plant organizations with small congregations have done so.

Ron Clark, founding minister of the Agape Church of Christ in Portland, Ore., recently became executive director of Kairos Church Planting, which is associated with Churches of Christ.

Kairos has 30 church plants in 15 states and applied for $58,000 to support 12 employees comprising six full-time equivalents. However, before its application was approved, the bank expended all of the funds it alloted to the program. Kairos still hopes to be approved in the second.

“Having done ministry with domestic violence and homelessness for 13 years in Portland, we’ve never turned away any kind of funding,” Clark said. “For me, theologically, if God will use government to support what we’re doing, we should embrace that, and in turn we should serve in our cities.”

COVID-19 changed everything

Jessica Hemenway Knapp is associate minister of The Seed Gathering, a Church of Christ church plant and campus ministry at University of Arizona.

Knapp said COVID-19 has changed everything about the ministry. 

“Students were sent home. It affected where we can meet and if we can meet,” she said. “We don’t know how it will be in the fall. If we could just get two months of salary as a buffer, that would be fantastic.” 

Knapp has a Ph.D. in mathematics and left a faculty role for campus ministry. She recognizes the complexities of such programs.

“I understand the theological concerns, and some have asked, ‘Why would you even consider that?’ But in my mind, that money was going to go to someone, and I wanted it to go to students we have to meet their needs. I don’t believe accepting funds means the government controls how I minister to people and tell people about God.”

But the group’s application was not successful. “There was a lot of back and forth with the bank, a lot of clarifying, and by the time that was settled, the funds were gone,” Knapp said. The Seed Gathering reapplied and received $6,500 in the second round.

Dealing with banks can be challenging.

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Related: Uncle Sam helped congregations, Christian universities meet payroll

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“I’ve been harping on this for over a decade now,” Means said. “It’s really important for churches to bank at the right bank. 

“If you’re at too big of a bank, those churches are just a number, so when something like this pops up you won’t have a relationship with a commercial lender or regional president,” he added. “If you’re at too small a bank, they don’t have the liquidity in place to fund the PPP loans for churches and their business customers.”

For churches that received funds, Means advises them first to consult their attorney. But he also emphasizes the importance of “keeping very detailed records in coming months as they apply to have those loans forgiven.” They will need documentation that the funds were used in compliance with the bill’s requirements.

“Some churches have more sophisticated processes than others,” he said. “If you come in with a Big Chief tablet or Word doc just listing where the money went, it won’t go well.”

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