Grassley-led ministry review ends with same decades-old questions
Image has not been found. URL: http://images.americanindependent.com/2010/07/MahurinReligion_Thumb.jpgThere wasn’t a great deal of fanfare last week when U.S. Sen. Chuck Grassley released a three-year-long committee staff review of the financial activities of several media-based ministries and churches, but that is likely because the paper offers no concrete steps forward.
Grassley, former ranking member of the Senate Finance Committee, raised eyebrows in conservative Republican circles during 2007 when he announced that he had sent letters to six Christian ministries requesting detailed data on expenses, executive compensation and amenities given to executives. At the time, Grassley said he was “following up on complaints from the public and news coverage regarding certain practices at six ministries” that “involve governing boards that aren’t independent and allow generous salaries and housing allowances and amenities such as private jets and Rolls Royces.”
The ministries initially targeted by Grassley — led by Kenneth Copeland, Creflo Dollar, Benny Hinn, Eddie Long, Joyce Meyer and Randy and Paula White — are not required to file financial disclosures with the Internal Revenue Service because they are designated as tax-exempt churches.
In delivering the review to members of the Senate Finance Committee, Grassley noted that “the tax-exempt sector is so big that from time to time, certain practices draw public concern.”
“My goal is to help improve accountability and good governance so tax-exempt groups maintain public confidence in their operations,” he said.
The 61-page staff memo, which is available in full below, indicates that only two of the four targets — specifically Benny Hinn of Texas and Joyce Meyer of Missouri — complied in full with the request made by Grassley on behalf of the Senate Finance Committee. None of those who refused to cooperate with the government’s investigation have been penalized, and none of the organizations, cooperating or not, have been charged with any specific findings.
The other four either did not provide a response or provided incomplete responses. As a result, Committee staff obtained information about these churches from public sources and third party informants. Informants were either current or former officers, directors, and key employees, current or former members, or watch dog groups. … All most all of those who spoke with us insisted on complete anonymity while others were too frightened to speak to us even anonymously. Some had received warnings from the churches that they would be sued if they violated confidentiality agreements they had signed.
Authors of the review note that multiple “assumed” or “doing business as” names were used by the ministries, none of which filed disclosures with the IRS.
The number of types of entities, including private airports and aircraft leasing companies, raises concerns about the use of the church’s tax-exempt status to avoid taxation. However, given the four churches’ refusal to provide tax information, we are unable to determine whether and the extent to which they are reporting and paying taxes on income earned in those entities.
The authors also note that, after details of the initial investigation were released, “constituents from across the country” requested additional investigations of other churches and religious organizations that were perceived to be providing leaders with excessive perks or compensation, or targeting specific vulnerable members of the general population for fundraising. The organizations named by constituents “included several media ministries, several other non-denominational churches, some Catholic and Baptist churches, the Church of Scientology, Kabballah Centres, the New York City mosque being built near the World Trade Center site, a church that sends prayer solicitations via mail with requests for donations, and a voodoo church that solicits donations through its website.” Although staff did not make direct contact with these organizations, some information related to them was included in the overwall review.
Committee staff conducting the review found that, despite the 1979 creation of the Evangelical Council for Financial Accountability intended to provide oversight and guidance, many of the questions posed decades ago in connection to accountability within media-based ministries are still applicable today. Despite that, however, there are no direct conclusions within the review regarding oversight or violations of tax rules. There is also no direct discussion on if the lavish salaries drawn by some, or if the often family- or friend-generated oversight of “church” accounts is appropriate or excessive. (It is worth noting that the six initially targeted ministries prescribe to a religious theory that God blesses the faithful with worldly riches, and often utilize their own wealth as a testament to that belief.)
In the wake of the review’s release, however, the ECFA did announce the formation of “an independent, national commission” to lead a review and provide input on “major accountability and policy issues affecting churches and other religious organizations.”
“The challenge is to encourage good governance and best practices and so preserve confidence in the tax-exempt sector without imposing regulations that inhibit religious freedom or are functionally ineffective,” Grassley said. “I look forward to working with the ECFA and other organizations in a productive way.”
In that vein, the review offers several avenues for continued discussion centered around tax-exemptions allowed for parishes and peripheral groups as well as the current lack of legal requirements for a church to provide transparency to its congregation and donors. But, as the review itself states, these are the same questions that have been raised for years.
For the past 10 years, Grassley has served as either the majority or minority leader on the Senate Finance Committee, which has exclusive branch jurisdiction over tax policy. Due to GOP term limits, Grassley will continue as a senior member of the committee, but has transferred his leadership role to the Senate Judiciary Committee. The release of the review was Grassley’s final official act in a leadership position on the Finance Committee.