Power Breakfast: Recession hits churches, Home Depot, health care

From time to time, this recession sparks interesting developments.

AJC reporter Gertha Coffee takes a look at churches and concludes that the ones looking to expand into bigger facilities are in a buyer’s market. They are getting good deals right now because of the downturn in commercial real estate.

But because of declining donations, some other churches are having trouble meeting their mortgage payments and are selling their buildings to downsize. Churches are the main buyers of other churches.

“One of the things that is a little bit different than a few years ago is more properties are on the market because of bank pressure and foreclosures,” Matt Messier, of CNL Specialty Real Estate, told Coffee. “Churches are not immune to that issue.”

To make some deals works, sellers have been using creative financing to help buyers purchase churches, said Dan Simpson, managing broker at America’s Network Realty Group in Dunwoody. That’s because traditional mortgages have been more difficult to come by.

Also in the AJC:

In other media:

20 comments Add your comment

Unimpressed

August 19th, 2009
7:14 am

Churchs are feeling the economic crunch? Too bad. They are mostly cashcows for people who run the church. It’s about time they are taxed like other businesses.

Buzz

August 19th, 2009
7:16 am

You are truly an uninformed numbskull

Batboy

August 19th, 2009
8:08 am

Make that angry uninformed numskull.

Drago

August 19th, 2009
8:25 am

There are always fools in a crowd and unimpressed appears to be one. Probably have not been in a church in years…….

Kitty Boo

August 19th, 2009
8:42 am

This downturn hit hard. I don’t know anyone that been immune to it’s lethal grip. Hopefully, with a little divine intervention it will end soon and life may be better for all.

M

August 19th, 2009
9:06 am

And why shouldn’t they be taxed?

sammy

August 19th, 2009
9:18 am

Let the churches pray for free but if they own property it have to pay property taxes and if they take in cash it should pay income taxes. Why should I have to pay additional fees to cover a money making venture because they get a free ride?

Mike K

August 19th, 2009
2:44 pm

I don’t necessarily have a problem with churches not paying taxes on their properties where they worship. I think that if you tax them only the richest would survive. I do think that if you have other property that is not a sanctuary or actual place of worship (e.g. baseball and soccer fields) then that should be taxed.

Ron

August 19th, 2009
2:47 pm

The only churches that “make money” with the few Ministers you see on national TV and they are supposed to pay taxes on what they receive. The typical church pays a minister a salary and he is to pay taxes on his earnings like anyone else. The other monies that is not used to pay the church mortgage ,pianist,youth minister and other paid staff. Any money left over is usually used for soup kitchens, programs for poor and homeless and other missions. Those of you who have attended a church know this to be true. I am sure there may be a 1% exception or abuse.

Ellie

August 19th, 2009
3:21 pm

I don’t know what planet some of you are living on but I have found that the majority of the “big” churches have no soup kitchens, nor do they care about the average guy. One church that is a “big” church that does do charitable acts is Hopewell Baptist Church in Norcross. It is your little churches, barely scraping by, that honestly and truly are trying to help and usually find a way to help, people. So before judging others, take a good look at your church and what they are actually doing; not what they pay lip service to.

DeeDee

August 19th, 2009
3:27 pm

Where I go to church the pastor and asst. pastor make a decent salary, $80,000 and $65,000, respectively, which is taxed. BUT, they also each get a $28,000 housing allowance…….that is tax free! Our church is looking at ways to cut back since donations and attendance have declined. I’m sure they’ll be looking at the janitor or office staff but not at the top salaries earners. Church has become a business.

Big Jon

August 19th, 2009
3:32 pm

Well I used to be in Church almost everytime the doors were opened. I agree with unimpressed. Alot of area Pastor’s and there wives and children live pretty good lives. Come on Church people get your heads out of the sand, your pastor just has you fooled. Jesus said ” In my Kingdom the last shall be first and the first shall be last”. In your Pastors Kingdom your last. Wake up Jesus People!!! Your Pastors are human they need to be held accountable, and if your Pastors makes alot of money and you let him ” Shame on you”. If he goes somewhere else, let him go. Again, Wake Up Church!!!

Bluestreak

August 19th, 2009
3:34 pm

Once the government has fixed all those who REALLY should be paying taxes that aren’t (illegals/CEO’s with their golden parachutes) then the government could look at this (not that I think churches should). However, as long as we have folks unofficially living here but not contributing in any way, shape or form…and on top of that syphoning off what the government will give them…or the CEOs that take companies into the toilet or cheat the tax system, then this shouldn’t even be an issue.

Church worker

August 19th, 2009
4:05 pm

I work for a church. We have seen contributions struggle because people are struggling. So, instead of making people feel guilty, we are offering Dave Ramsey’s FPU class. Our hope is that if people can get their finances straight, they will have the ability to give and the desire as well.

DeeDee

August 19th, 2009
4:33 pm

Church worker – Dave Ramsy’s class is really good and that’s a great thing for the church to do. My question is really, why will the church committees cut everywhere, EXCEPT the pastor’s salary and housing allowances? Our church would fire the janitor before it asked the pastors to take a salary cut, no matter how small! A couple of office workers make $3000 more than their housing allowances.

Keepingitreal

August 19th, 2009
4:51 pm

Lest we continue to respond out of ignorance, Churches are not the only organizations that do not pay property or income taxes. This is a specific allowance granted by the IRS to non-profit organizations who are classified as a 501(c)(3). This also includes schools, hospitals and other like organizations. These organizations must also meet the criteria to then be designated as “tax-exempt” based upon their purpose (e.g., charitable, religious, scientific, literary, and/or educational). So it is important to note that this is not a special privilege given only to churches. Unfortunately, most people’s information of what churches are doing from a charitable standpoint comes from the news media when they want to run a sensational story about someone in small minority who abuse a privilege. The vast majority of the good works that churches do (as well as schools, hospitals and other charities) never make their way into media publications because they are not sensational to the general public and are not “newsworthy”.

Church Worker

August 19th, 2009
5:02 pm

DeeDee, you are right that leadership can set a tone. I would rather take a 10% cut or whatever, and keep staff. It builds morale and shows your people that they matter to you. I also agree that most churches waste a ton of money on non-essentials that could be cleaned up instead of just getting rid of staff. I have seen what happens when a church goes the quicker route of getting rid of administrative staff instead of digging in and getting rid of pork. When the staff was let go, those responsibilities were passed to other people who were now working 10+ extra hours a week with no more compensation, while grieving the loss of a co-worker. It is very bad for morale. Now, if we the pastors had set a tone with pay cuts, we could have kept the staff. Or if we had looked at all the wasted money, we could have kept the staff.

Keepingitreal

August 19th, 2009
5:56 pm

Housing allowances are only tax exempt for income tax purposes. Ministers are considered self-employed for some IRS regulations and the housing allowance falls into this category. Ministers must pay a self-employment tax on the portion of their compensation package that is designated as a housing allowance. As for pay cuts, most churches have an employment contract with the minister and therefore can not cut their pay since it is contractual. I know of many ministers, including myself, who will usually give up usage of other things in their compensation packages to help out in financially tough times. These things include book allowances, travel, tuition for continuing education classes, conventions expenses, expenses for representation at denominational meetings for which there is travel and several other types of compensation benefits. Depending on the church and the minister, these may be done quietly without the fanfare and might not be known to everyone.

Brent Hoffman

August 20th, 2009
12:25 pm

I have a beautiful church on in Duluth near I-85 for sale and we have reduced it significantly to attract attention. It is in great condition on 10.3 acres at the lighted intersection of Duluth Hwy and Boggs Road. This Church is really priced to sell.

Brent

RGB

August 20th, 2009
9:10 pm

Nice, informative posts KIR. I’m never amazed but always disappointed by people who come out of the woodwork to take a shot at churches, Christians, and religious people in general. Give them an anonymous blog and they are instantly acclaimed theologians, economists, historians, tax accountants, and experts in human behavior.

You people should devote your attention to self examination first (and that should keep you occupied a while). Next, look at your government and the people who are supposed to serve your needs and be good stewards of your tax dollars.

Church attendance, tithing, and even entry into heaven are all voluntary activities.