Follow the Money Trail

In the epic tale All The President's Men, the secretive informant known as "Deep Throat" badgers Washington Post reporter Bob Woodward to "follow the money trail." Deep Throat, who we now know to have been Mark Felt (the #2 man at the FBI), was convinced that if people knew how money was spent by the Committee to Re-Elect the President (CREEP) they could figure out exactly what happened, who did what and when. The same is true in the church. I believe many churches are not forthright about how they spend money, for a number of reasons.

Two sad snapshots

I served for three years as the executive pastor of a mid-sized congregation with a $3.4 million budget. The business administrator of the church was strident about reminding the congregation that 10 percent—a whopping $340,000—went to missions each year. We wore this truth as a badge of honor.

However, as I followed the money trail, I learned that included in the $340,000 was the $64,000 salary of the missions pastor and the $30,000 salary of the mission assistant, along with a variety of office expenses. So in reality the church "gave" about $230,000 to missions, and perhaps less.

The second money trail relates to the ever-sensitive matter of senior pastor compensation. I consulted with a church some time ago where the senior pastor's base salary was $111,000 with another $21,000 in benefits for a total package of $132,000. The next highest paid staff person—an associate pastor who had served at the church for 15 years—earned $70,000.

On one occasion I asked the administrative pastor of the church about this gap in compensation. He explained that he estimated that the senior pastor brings in excess of $1 million in tithes and offerings each year due to the fact that he was an incredible preacher. "When Patrick preaches the offering is 25 percent higher than when someone else preaches." I asked if the congregation was made aware of the salary scale of the staff. Aghast, the business administrator told me the congregation could not handle that information well.

Where your treasure is …

Jesus said, "where your treasure is, there will be your heart." I think this applies to churches too. Consider these real-life examples of churches and where their treasures reside:

The church that spends $3.6 million per year ($57,000 per week) to professionally produce their worship services (think, "lights, camera, action").
The church in which the budget is $500,000 per year and the senior pastor's compensation package is $100,000 (about 20% of budget).
The church in which the budget is $1 million per year and the congregation gives away an increasing percentage each year.

A while ago I was helping a church that was in a major crisis, one that would cause it to close its doors six months later. "How must we change?" asked the interim senior pastor. "The first thing you need to do," I said, "is to do one ministry very well. And that ministry should be toward people who are outside the congregation, preferably people who are in great need, such as the homeless."

In that instant I could tell the pastor wrote me off. He tried to be polite and thanked me for my input. Realizing that I no longer had very much credibility with him, I pressed further. "In order to do that one ministry well you will need to make much deeper cuts in staff. And I think your compensation should be first. You make $75,000 per year. You will need to take a cut to $50,000 at most." From that moment on the interim pastor was always cordial with me, but not once did he ask for my opinion again. Three months later the elder board forced the interim pastor to resign due to mismanagement of finances.

The original question remains, "How must we change?" More churches in North America should be asking this.

Three innovative changes

What might have helped that church escape the "crash and burn" that it experienced in the years leading up to its demise? These three things might have helped:

Each year publish the salary and overall compensation of the pastors of the church. The transparency of this act will automatically cause the budget committee or whoever oversees the finances to take a hard look at each person's salary. In the words or Ricky Ricardo in the I Love Lucy show, "you have some 'splaining to do!"
Diversify the leadership team, especially in two ways. First, have men and women give input, perspective, and make decisions together on the use of money. Second, include a diverse socio-economic group: blue collar and white collar, educated and uneducated, etc. People with less money have a very different perspective on it than people with large amounts of disposable income.
Track the actual money that is given to people and causes outside the church. This is not just about giving 10 percent to missions, although that might be one step in the process. More important is the focus and attention given to causes outside the congregation. This posture invites people in the community to become more and more sensitive to those less fortunate and in great need.

The "business" of church

What is the "business" of church, if we can be so crude? It is as the primary agent of God's kingdom coming on earth as it is in heaven. If this is the core business, should not our budgets reflect this? If so, our vision must be on those who are far away from the kingdom, who need to be introduced to the King of the kingdom.

I was senior pastor of a church in Amsterdam (The Netherlands) for five years. We wrestled each year with how to spend the $750,000 faithfully given by the church community. At first I felt proud that we dutifully gave 10 percent to missions, and that my salary of $60,000 was not "extravagant." The executive pastor and worship pastor were each paid $50,000 and I was quick to tell people these financial facts.

Then one winter we spent three months preaching and learning from the Sermon on the Mount. We heard Jesus saying things to us such as, "Blessed are the poor in spirit," and "Where your treasure is there is your heart," and "Do not worry."

Jesus turned my paradigm about finances upside down. Instead of thinking about how to give away 10 percent to missions, we began to dream about mission and not as a mere percentage or number. Instead, we began to talk about how we could operate on the smallest administrative budget so that the most could be given away.

I began to feel free as a pastor … free to bless others and free to be honest with my congregation about what we did with every euro given. Over time I invited everyone and anyone to "follow the money trail" at my church. People could look at every line item and how we spent money and we could explain it without embarrassment.

The blessing of blessing others

I am not currently a pastor of a church. I am a parishioner of a church of 1,200 people—most of them are half my age. The church is led by a group of elders and pastors who try to model a "Blessed to be a blessing" lifestyle. Our church seeks to give away an additional 1 percent each year from its budget. In 2014 the hope is to give away 16 percent of all money that comes in. The church is growing, and income is increasing as well. In real dollar terms my church will have much more money this year to bless people! What a great "problem!"

I had to smile when the senior pastor, Michael, was asked a pointed question at a recent leaders' lunch of key people in the church. "When will we stop adding a percentage each year to bless others?" the person asked. Michael paused for a moment, smiled and said, "Never. Hopefully we will be giving away 80 percent of the income each year!"

Many of us smiled in agreement. The business manager of the church looked a bit perplexed at the moment, but then he also gave a big grin! Most of all, I think Jesus was smiling too.

Brian Newman served as senior pastor of Crossroads International Church of Amsterdam for five years. He also served as an assistant pastor at a church in Geneva and as executive pastor of a church in Denver. He has consulted with a number of churches going through major transition.