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| Don't ask about the money for the Schwan Cathedral at Martin Luther College. |
The Lutheran Church - Missouri Synod - The Lutheran Witness:
"When I stepped into this office in September 2010, LCMS Inc. had borrowed over $15 million from moneys designated for other purposes. This internal borrowing is legal (so long as the donor designations are ultimately honored, and they are) and had been standing operating procedure as far back as anyone remembers."
'via Blog this'
ALPB Forum:
Undiscovered internal borrowing. The amount of the internal borrowing has been set by auditors at $6.9M. There was no mismanagement or misappropriation of funds. All the money was spend on ministry. Technically the internal borrowing was not an error in accounting. It was due to the outdated financial reporting protocol that was used by our fiscal department. The internal borrowing (spending money for operations from our special or restricted funds) went undetected by our Synodical Council's (SC) finance committee for a year and a half, even though some of those committeemen are CPAs and business managers. The problem was uncovered by our then Executive Director of Support Services. The money is being repaid over ten years and to date has not had a significant effect on our operational budget.
WELS - 2003
WELS President Mark Schroeder led his first full Synodical Council meeting in November
... One of the bigger decisions the council made was to approve a proposal to consolidate the synod’s four debts, totaling $22.4 million, into one single debt.
This consolidation helps reduce confusion over the variety of interest rates and a feeling among some that the Board for Ministerial Education was carrying a disproportionate share, $15.1 million, of the debt. Now the entire debt will be one line item in the synod’s general operating budget and will be repaid over 10 years at four percent interest. ...
The four debts included $7.3 million for costs associated with the amalgamation of Dr. Martin Luther College and Northwestern College, and Martin Luther Prep School and Northwestern Prep in 1995; $7.3 million for operational borrowing for 2001-03; $6.9 million for the boiler house at Martin Luther College in New Ulm, Minn., and the science wing at Michigan Lutheran Seminary in Saginaw, Mich.; and $900,000 for a dormitory at Luther Preparatory School in Watertown, Wis. ...
WELS -- 2007
Pastor Birkholz, I find your thread interesting. History has a tendency of repeating itself and time will tell whether the extent of the LCMS financial situation proves to match the history of WELS. The Lutheran Witness article states the $15 million is just the "Corporate entity" which raises the question whether any District or LCMS ministerial institution faces a similar circumstance. Watch for any other reports of operational borrowing -- spending more than available funding -- which is unsustainable. Interest rates paid on various external borrowings may lead the LCMS to look at consolidating some debt.
The ELCA with its current membership turmoil may be in a similar situation to the LCMS.
LCMS President Harrison may find spending more time discussing things, such as finances, with WELS President Schroeder beneficial.
