Originally published on Forbes.com Nov 27th, 2013
The Southern Baptist Convention (SBC) was quick to denounce Judge Barbara Crabb’s ruling that excluding cash housing allowances to clergy from taxable income is a violation of the First Amendment establishment clause. SBC, as the second largest denomination in the country, is probably the one with the most skin in the game, since they have more clergy serving congregations, than the first largest denomination – Roman Catholicism. Russell Moore , the president of the Ethics and Religious Liberty Commission of the Southern Baptist Convention, is reported to have said:
The clergy housing allowance isn’t a government establishment of religion, but just the reverse. The allowance is neutral to all religions. Without it, clergy in small congregations of all sorts would be penalized and harmed.”
He also, perhaps unfairly, laid into Judge Crabb
The judge in this case has a history of issuing similar decisions. We will continue to fight to protect the housing allowance, because we believe clergy are essential for flourishing, vibrant communities
When I spoke with Reverend Moore, I asked him what the other decisions were. I knew about her 2010 decision declaring the National Day of Prayer unconstitutional, but one decision does not constitute “a history of issuing similar decisions”. Reverend Moore did not know of any others.
My initial research into Judge Crabb seemed to indicate that her most controversial decision before the prayer case involved Chippewa Indians spearing fish. That decision helped spark something called the Wisconsin Walleye War. There was also this really fascinating case about comic books. Apparently, Dark Ages Spawn is a mere derivative of Medieval Spawn. Who knew?
Anyway, more research was required. I found three cases. Judge Crabb ruled against taxpayer money going directly to a faith based program called Faith Works. Then there were two Ten Commandments monument cases. In one she ruled against the Freedom From Religion Foundation and the other she ruled in their favor along with other plaintiffs.
I think it was the same monument in both cases. I don’t know if that constitutes a “history”. Judge Crabb is either blessed or cursed with having the Freedom From Religion Foundation in her bailiwick, so you would expect that she would get more than her share of this type of case. I could only find the three and she ruled against FFRF in one of them.
What was really interesting in my conversation with Reverend Moore is that, regardless of the constitutionality issue, he was unwilling to concede that there might be anything at all wrong with any aspect of the clergy housing allowance. I asked him if maybe there should be some limit on the six-figure mega housing allowances drawn by the mega pastors of the mega-churches.
The one most currently in the news is Steve Furtick of Elevation Church in Charlotte, NC where reporter Stuart Watson is investigating Futrick’s 16,000 square foot home. Reverend Moore did not know that Furtick was affiliated with SBC. I know better than to rely on wikipedia, but if you google Furtick and SBC you sure get the impression he is affiliated.
Rev. Moore indicated that it would not even be appropriate for the SBC to suggest to the mega pastors, that as Herb Cohan used to say, “Don’t be such chazzers.” Each congregation is accountable to God for how it compensates its ministers. Of course, Furtick’s congregation does not get any say in his compensation, but that is another story. Reverend Moore pretty much insisted that the mega-churches with their mega housing allowances are such a tiny minority of SBC congregations that they are not even worth discussing in this context.
The Evangelical Council for Financial Accountability quoted from a report by the Commission on Accountability for Religious Organizations that at least implicitly indicates that there might be something for the churches to be looking at:
Religious organizations and their leaders most certainly should not attempt to skirt the law for financial gain. Operating on the high road of integrity includes making reasonable and appropriate determinations as to who is a minister consistent with the polity of each religious organization and making appropriate decisions regarding clergy housing or related allowances. For a religious organization or its leaders to intentionally abuse the law is shameful and damaging to its mission and to the religious community as a whole. On the other hand, when individual organizations and leaders set their bar high—and even raise the bar—it inspires others to do the same. We encourage all religious organizations and their leaders to help raise the bar of reasonable and ethical conduct in this area.
My blogging buddy, Reverend William Thornton (In the spirit of full disclosure I should mention that Reverend Thornton coached me a bit for the Moore interview) had some interesting commentary on the denomination’s reaction.
I get the feeling that both GuideStone and the ERLC were caught flatfooted by this decision. The two CEOs of the entities issued a joint statement and GS head, O. S. Hawkins even stated that the decision was “not unanticipated.” I suppose that such anticipation was expressed around the water cooler in GuideStone’s executive suite because nothing was said about it before the decision was handed down. I expect both entities to sharpen their focus now. It is incidental but both entity leaders are among the higher paid SBC clergy and likely exclude nice sums from their income tax through the housing allowance.
He also got in a kindly chuckle at the Freedom From Religion Foundation:
Naturally, the Freedom From Religion Foundation, Inc., plaintiff in the lawsuit is elated with the decision.
“May we say hallelujah!”sayeth the FFRF.”Hallelujah” translates to “praise the Lord” so I am gratified that our fellow citizens at the FFRF aren’t completely free from religion. Although, we hate to have our sacred tax break ox gored by the FFRF, those associated whom I have exchanged comments with have always been perspicacious, cordial and not unkind. Some Baptists commenters might take a lesson.
Reverend Thornton clearly thinks that his denomination does have a problem that is bigger than Judge Crabb.
No reasonable, thinking Southern Baptist minister can avoid one conclusion in all this: the manner in which our housing allowance has been used borders on clergy malpractice. A growing subset of ministers who are very highly paid and who live in multi-million dollar mansions are able to exclude hundreds of thousands of dollars from income taxation. While this is perfectly legal, I would expect that most of us would think it to be bad policy for both government tax law and for maintaining clergy goodwill in the community. Do we really think it fair to shift taxes from wealthy clergy living in mansions to the less highly compensated? Surely not. Add to that the practice of churches ordaining ministry associates in administrative or peripheral church jobs solely so that they can be qualified for the housing allowance.
Not surprisingly, I have not been able to get any response on this decision from the few liberal religious ministers that I asked about it. Unitarian Universalists will tend to be more sympathetic with the likes of the Freedom From Religion Foundation. When I spoke with Reverend William Schulz a former President of the Unitarian Universalist Association he indicated that if he had the vote, he would vote to rescind the housing allowance. That does not stop him from taking advantage of it when he is entitled to it.
I think there are really three issues with the housing allowance. One is constitutionality. There are arguments on both sides. The next is tax policy. The clergy housing allowance as it is now is bad tax policy because it creates a gaping loophole for the most highly compensated members of a particular profession. Simply eliminating it would also be bad tax policy, because many small organizations that are very important to people have come to rely on it in the last half-century or so.
Jonathan Medows is both a CPA and an ordained rabbi in the Conservative Jewish tradition. He told me that he is worried that the loss of the allowance could lead to a “recession in the clergy industry” since small congregations will not have the resources to make their clergy whole in the event of a removal of the allowance. He expects that this crisis might get the Conservative, Reform, and Orthodox all on the same page, which apparently is not all that common. We’ll see. Jonathan does not currently have any skin in the game as he has enough on his hands with his tax practice and family.
The third issue is whether, regardless of constitutionality and legality, a special tax benefit that is just for them is a good thing for the clergy. I would argue that in the United States, it is not. How does a senior pastor who might make $80,000 per year explain to the teachers in his congregation that even though their entire salary is subject to income tax, his is not? On top of that, denominations are going to have to spend a lot of their limited moral capital in defending the exclusion. If it is not uncomfortable for them that denomination leadership may be among the bigger, although not the biggest, beneficiaries, their credibility as spiritual leaders is called into question.
Currently, I am among the 80% or so of Unitarian Universalists on inactive status, but I have no doubt as to what I would be doing if I was still involved in congregational governance. I would try to get a commitment from the congregation that, in the event that the allowance goes away, which would be 2015 at the earliest, we would make our minister whole.
Some ministers are low paid because they serve the desperately poor, but mostly it’s because people are clueless and cheap. When they went to church with their grandmother in the fifties she put a dime in a collection plate so they figure the buck that they throw in must be going a long way. Remember that the package in the church budget that is going to minister’s compensation is the entire cost and that the minister has to pay both sides of the FICA equation, so far moderately paid ministers, their special tax status can be close to a wash.
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