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Why is the Episcopal Church Working as a Debt Collector?

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debt-collection-final-noticeFor decades The Episcopal Church (ECUSA) has faced declining membership (in 1966, the ECUSA had 3,647,297 members; by 2013, the membership was 1,866,758, a decline of 49 percent.) But even when people are leaving the pews someone still has to pay for those pews, as well as the other overhead costs that come with running a large organization. Not surprising, the denomination has sought ways to bring in additional revenue.

Currently, the ECUSA has two primary sources of income. According to its latest audited financial statements for the calendar year 2013, it received a little over $27 million from its member dioceses, and it received half as much again, or $13.8 million, from the federal government.

As A.S. Haley notes, the money ECUSA received from the federal government was in connection with the services provided by Episcopal Migration Ministries, which assists the State Department in relocating refugees throughout the United States. That is certainly noble and necessary work, and the denomination should be commended for providing a valuable service to a vulnerable community.

But as Haley points out, the records show the ECUSA also makes a lot of money as a debt collector:

As of the end of calendar 2013, ECUSA had undertaken to collect for the U.S. Government a total of $11,339,000 in loans made by the Government to refugees for their expenses in being brought to the United States for relocation.

From the Presiding Bishop’s annotated budget proposal for the 2013-2015 triennium, we learn (p. 2, line 13) that the Church earned a total of $2,163,008 from its debt collection efforts during the 2010-2012 triennium, and incurred collection costs for that same period (p. 5, line 87) of just $983,442. As a debt collector from 2010 through 2012, therefore, the Church added a total of $1,179,566 to its bottom line, or approximately $393,189 of pure profit per year.

And from the latest year-end statement of operations for calendar 2014, we learn (line 13, column 4) that in just its most recent year, ECUSA took in a total of $933,218 from the refugees it assisted — some $223,218 over budget, and attributed in the note at the far right to “Exceptional performance by the Refugee Loan Collections staff.” At the same time, its loan collection expenses for 2014 (first page, fourth line from the bottom) were just $548,343, for a net surplus from debt collecting of $384,875 — so the profitability of refugee loans continues at almost the same pace, thanks to the staff’s extraordinary efforts.

Does that claim of a “$2.4 million surplus” in 2014 still look the same to you? Was it achieved, in part, on the backs of the refugees whom the Government paid ECUSA to assist?

While I find the idea of a Christian denomination serving a debt collector rather off-putting, there isn’t anything inherently wrong with recovering money that was loaned. But it bothers me that the ECUSA is making a hefty profit off the collection services. Either they are collecting more than they should (and thus acting unjustly toward the refugees) or the government is allowing the denomination to keep a portion of the funds loaned (and thus acting unjustly toward taxpayers).

Perhaps there is a reasonable explanation, and if so I hope someone with knowledge about the practice can clarify what is going on. But it certainly looks bad. As Haley asks, “What in the world is a church doing in the debt collection business, and pocketing more than twice its actual costs of collection while doing so? Would that not be considered excessive, even for a loan shark?”

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Joe Carter Joe Carter is a Senior Editor at the Acton Institute. Joe also serves as an editor at the The Gospel Coalition, a communications specialist for the Ethics and Religious Liberty Commission of the Southern Baptist Convention, and as an adjunct professor of journalism at Patrick Henry College. He is the editor of the NIV Lifehacks Bible and co-author of How to Argue like Jesus: Learning Persuasion from History's Greatest Communicator (Crossway).

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