With the economy still going through rough patches, Congress repeatedly evaluating whether to limit the deductibility of charitable donations, and the rate of charitable contributions flat or slowly increasing, some churches find it hard to cover their operating expenses and keep their doors open. Many churches of various sizes and types are becoming increasingly interested in whether their church can—or should—merge with another church, acquire another church, or dissolve their church and donate the assets to another church (collectively referred to herein as "transactions").
These transactions have long been common in the business world, but interest in them has grown rapidly recently within the nonprofit sector. A few years ago, The Chronicle of Philanthropy reported "charity leaders are looking at mergers and acquisitions as a potential strategy to ride out the turbulent economy … [t]he troubled economy has put merging with or acquiring another organization front and center on the radar for the senior managers of many struggling nonprofits." The article indicated the rate of transactions among nonprofits was nearly identical to that of for-profit businesses.
The very phrase "mergers and acquisitions" or the concept of these types of transactions can evoke many different images. Some may envision a hostile corporate takeover. Others may picture a fluid joining of two distinct bodies of believers and, as a result, becoming one church community. Still others may think of a resource-rich church with declining membership partnering with a vibrant church with few financial resources. No matter what image this phrase evokes, there is little question that the idea of two church communities merging is a relevant and pressing issue in the church world today.