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Public Accommodations Laws: Potential Effects on Churches

To answer this question, churches must be well-versed in federal, state, and local laws.

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Overview: The Hitching Post Case

The case of Hitching Post Weddings v. City of Coeur d’Alene explores how public accommodations laws may affect churches and religious wedding services.

Background

A Christian couple, both ordained ministers, purchased the Hitching Post chapel in 1989 and operated it as a for-profit wedding service.
In 2014, they formed Hitching Post Weddings, LLC, and declared it a religious corporation in their operating agreement.

The agreement stated that:

They operated the business as an extension of their religious beliefs.
Its purpose was to promote one-man-one-woman, biblical marriage.
They did not offer services inconsistent with this purpose.

They implemented policies reinforcing the chapel’s identity as a religious corporation.

Legal Conflict

The plaintiffs had consistently refused to perform same-sex wedding ceremonies, citing religious convictions.
In 2013, the City of Coeur d’Alene passed Ordinance § 9.56, prohibiting discrimination in public accommodations based on sexual orientation and gender identity.

Coeur d’Alene Ordinance Explained

Ordinance § 9.56 defines “public accommodation” broadly, covering:

Venues open to the public for services, events, or rentals
Places selling food, offering lodging, or providing personal services
Educational and recreational facilities

It exempts:

Religious corporations, associations, educational institutions, or societies
Facilities used strictly for religious purposes

However, it does not clearly define “religious corporation.”

Legal Timeline and Responses

May 2014: A federal judge declared Idaho’s same-sex marriage ban unconstitutional. The Ninth Circuit Court of Appeals affirmed the decision.
June 2015: The Supreme Court ruled in Obergefell v. Hodges that states must recognize same-sex marriages.

Plaintiff Concerns

Plaintiffs temporarily closed the Hitching Post in October 2014, fearing prosecution under the ordinance.
They later reopened but continued declining same-sex ceremonies.
They filed a lawsuit against the City, alleging violations of their constitutional rights.

City’s Response

The city attorney clarified:

If Hitching Post was operating as a legitimate nonprofit religious corporation, it was exempt from the ordinance.
The city would not prosecute any religious organization lawfully exercising First Amendment rights.
The city argued the lawsuit was premature because no enforcement action had been taken.

Court’s Ruling on Standing

To sue in federal court, plaintiffs must show:

A concrete, actual, or imminent injury
A direct connection between the injury and the ordinance
A likely remedy from court intervention

The court ruled the plaintiffs lacked standing because:

They had no concrete plan to violate the ordinance.
The city made no threats or enforcement actions.
There was no history of ordinance enforcement against similar organizations.

The court granted the Motion to Dismiss.

Implications for Church Leaders

Key Legal Questions for Churches

Churches often ask whether public accommodations laws apply to them, especially regarding:

Sermons or teachings rejecting same-sex marriage or gender identity
Denying use of church property for same-sex ceremonies
Limiting access to programs based on gender identity or sexual orientation

To assess risk, consider:

Is the church a place of public accommodation?
What forms of discrimination are banned in your jurisdiction?
Can the church assert a constitutional defense under the First Amendment?

How Public Accommodations Laws Define Churches

There are typically three approaches:

Full exclusion – Some laws clearly exempt churches.
Conditional exclusion – Churches are exempt only if they avoid commercial use of their facilities.
Full inclusion – Some jurisdictions include churches regardless of how facilities are used.

Case Example: Massachusetts

In 2016, Massachusetts added gender identity to its nondiscrimination laws.
The state initially classified churches as public accommodations.
After legal pushback, officials clarified that churches may qualify—but only when hosting public, secular events.

Legal Precedents Supporting Religious Exemptions

Several courts have recognized First Amendment protections for churches:

Fort Des Moines Church v. Jackson (Iowa, 2016): The court ruled that sermons are protected religious activities.
Presbytery of New Jersey v. Florio (3rd Cir. 1994): Affirmed that religious practices are exempt from public accommodation laws.

Conclusion

General Guidelines for Churches

Private Use = Less Risk: Churches not open to the public for secular, revenue-generating events are less likely to be deemed public accommodations.
Public Invitations = More Risk: Churches offering public access—especially for non-religious events—could fall under public accommodation laws.
Revenue Matters: Churches charging for use of facilities are at higher risk of classification as a public accommodation.

⚠️ Important:

Laws vary by jurisdiction. Legal counsel should always be consulted to evaluate risk and ensure compliance.

Church leaders must remain informed about local and state laws, especially as they evolve. Legal guidance is essential for navigating these complex issues.

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

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Some Churches Keep Their Budgets Rolling

Navigating unexpected ups and downs with an alternative budget.

Michael E. Batts, CPA

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Last Reviewed: May 8, 2025

Many American churches approach budgeting as a formal, annual process, aligned with a fiscal year. But in reality, there’s no legal requirement for budgeting to follow this rigid format.

⚠️ Important: Always check your church’s governing documents—such as articles of incorporation, bylaws, or denominational polity. These may require formal annual budgeting, even if state law does not.

Moving Toward Dynamic Budgeting

Thanks to advances in technology and access to real-time financial data, churches now have the ability to monitor and forecast finances more dynamically than ever before.

Some churches are choosing to supplement or even replace the traditional annual budgeting model with more flexible alternatives.

Benefits of a dynamic budgeting approach:

Adjusts to changing revenue expectations;
Responds more quickly to unexpected challenges;
Supports churches experiencing rapid growth or crisis.

This approach allows church leaders to make ongoing financial decisions rather than waiting for a new fiscal year.

Whether to retain or abandon the formal annual budget is a governance decision, possibly involving the church board or membership, depending on your church’s structure.

The Importance of Budgeting Policy

A popular alternative to annual budgeting is the rolling forecast or rolling budget.

How it works:

The church forecasts finances for the next 12 months;
Forecasts are updated quarterly (or at another regular interval).

While flexible, this method presents challenges if the church uses its budget for expense control.

To stay on track, consider adopting policies such as:

Requiring a minimum cash flow surplus each quarter or year;
Setting quarterly or annual benchmarks toward long-term financial goals;
Formalizing spending constraints to promote responsible stewardship.

Such policies provide a framework for financial discipline, even within a more fluid forecasting model.

Budgeting as a Tool for Stewardship and Oversight

Even without a formal annual budget, churches can and should use forecasting tools to support internal control and oversight.

Best practices:

Compare actual results with forecasted amounts regularly;
Use discrepancies to evaluate financial health and adjust spending;
Treat the budget or forecast as a living document—not a static report.

This ongoing review process strengthens internal control and reinforces a culture of financial accountability.

📘 This article was originally adapted from Church Finance by Michael E. Batts. We’ve used a combination of AI and human review to make this content easier to read and understand.

Michael (Mike) E. Batts is a CPA and the managing partner of Batts Morrison Wales & Lee, P.A., an accounting firm dedicated exclusively to serving nonprofit organizations across the United States.

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How Churches Can Balance Staffing Costs and Ministry Growth

Managing church staffing costs while growing a ministry is a challenge for many church leaders.

Bob Smietana

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Last Reviewed: January 31, 2025

Darrell Mims, executive pastor of World Victory Church in Duluth, Georgia, has a simple rule for making decisions about money and staffing: if the money isn’t in the budget, then just say no.

Overspending is obviously the last thing any financial manger wants to do. But how do financial managers help balance the need to build a ministry and keep the costs down? How do financial managers help leadership teams make staffing decisions that follow sound policies and keep the budget out of the red?

Church Finance Today asked financial managers at small and large churches and experts in church finance. They shared a number of helpful insights.

Calculate and evaluate staff costs

Most churches should evaluate staff costs at least once a year at budget time, said Dan Busby, president of the Evangelical Council for Financial Accountability. Churches generally spend between 35 and 60 percent of their budgets on staffing. Church size, local cost of living, and ministry philosophy all play a role in determining the right percentage.

Most churches calculate personnel costs as a percentage of expenses, said CPA Vonna Laue, a Church Finance Today advisor. This helps determine how much of a church’s resources are spent on compensation and benefits. If churches want to calculate the costs as a percentage of income, they should exclude designated giving since it often fluctuates based on other campaigns and projects, Laue said.

Whichever calculation is used, a church should know the percentage first so that it can decide whether to spend more to hire additional staff.

World Victory’s Mims says that the process for hiring starts with a ministry evaluation: can this job be done with a volunteer? If it needs to be a staff role, how many hours of work are needed, and how much should the person be paid? If the leadership decides a new position should be added, Mims looks at what the position will cost and whether that cost fits in the budget. Hiring new staff, said Mims, might mean cutting back on other program expenses.

Make certain compensation is fair

Treasurer Laura Youderian mostly worries about getting the pastor’s salary right—the main staffing cost at River of Life Church in Cincinnati, a small church where many ministry roles are filled by volunteers or part-time staff.

Youderian is also an assistant professor of economics at Xavier University, which shapes how she sees the question of staff compensation. For example, prior to becoming a minister, the church’s pastor had made more money in his previous vocation. That’s something to keep in mind when setting the pastor’s salary, she said. If you set it too low, it could cause a pastor to look for other options.

“I think about his value outside the church,” she said. “Our pay has to be enough for him to not think about doing something different.”

Budget for changes in staff

Libertyville Covenant Church, north of Chicago, recently needed to hire a new organist when the former organist passed away unexpectedly. She’d been a church member, and charged less than the going rate. As a result, the church only budgeted $3,000 per year for an organist. However, the true going rate was $10,000 a year. That left the church without many options, said John Bethancourt, Libertyville Covenant’s treasurer.

The church places a high value on its music program and wanted to get a talented organist, but they couldn’t find a part-time organist. So it was going to cost them.

“Sometimes you’re going to have to pay more to get the right person,” he said.

Complicating matters was the timing—the church was halfway through the budget year. Funds were already allocated. So Bethancourt went back to the church leadership and told them they couldn’t afford to hire an organist every week, unless giving increased. And unless giving grew the next year, there might not be enough to fund an organist in the future.

In the end, several members of the congregation chose to make up the difference in the budget to hire a full-time organist. But the lesson learned is helpful: churches need to research the going rates of a position before hiring someone, let alone budgeting to pay them.

Consider outsourcing

Outsourcing can make sense for churches, especially when it comes to support operations like bookkeeping or building maintenance, said Stan Reiff, a partner with the accounting firm CapinCrouse.

Churches don’t always have in-house expertise to take care of those tasks. And even if they do, those tasks are often time-intensive. Why let a volunteer who is a CPA do the books, when an outside bookkeeper could handle those tasks, he said, leaving the CPA free to do more big-picture thinking.

Case Study: Blending Volunteer Work with Paid Staff and Outsourcing

Matt Self had his hands full when he first became treasurer for Church of the Redeemer in Nashville.

The 15-year-old church of 400 still functioned as a church plant when it came to finances. Self’s predecessor helped count money, complete payroll, and prepare financial reports, with the help of an outside bookkeeper. Along with stretching the limits of what one financial person could do, the arrangement raised internal control concerns because one person handled all of these financial areas.

That left little time for long-term planning. When Self took the volunteer job in 2015, the church’s finances were not organized in a sustainable manner. Also, the church changed a policy that year so that the volunteer serving as treasurer turns over every few years, which could make the transition between volunteers difficult, Self explained.

Self sensed it was time to beef up the church’s policies and procedures and operate more like an established congregation rather than a start-up.

Working with the church’s elders, Self helped transition some of the tasks that the volunteer treasurer had been handling—like writing checks—to the parish administrator.

Then in 2015, the church also decided to add more outsourced bookkeeping from an accounting firm. That firm now prepares the monthly financial reports, which Self then reviews and presents to the board. Without bookkeeping responsibilities, he’s freed to do more planning and budgeting.

“I told [the elders] we were going to spend more money in order to get better service,” Self said. The relatively small amount of money involved—a few thousand extra dollars a year—made it an easy decision.

Increased time for long-range planning has come in handy for Self. The church recently wanted to make one of their staff members—who’d worked on a one-year project—a permanent part of the staff. To pay for that change, the church’s elders wanted to tap into their reserves.

Self had a better idea. He reviewed the church cash flow over the previous three years and saw that the church could add a staff person without dipping into reserves, as long as giving remained consistent. Self had always budgeted conservatively, and had only planned on spending about 90 percent of the money that came in.

For the current budget, the church raised both its planned expenses and projected giving, and asked church members to increase their giving to meet the new budget. If the new giving didn’t meet the goal, the church would still be okay—because the church could afford to pay for the new staff person with the amount of money it usually received on a yearly basis. In a pinch, it could cut back on nonstaff expenses, or tap the reserves as a last resort.

—Bob Smietana

Often you can hire an expert, such as an executive pastor or CFO, on a part-time basis, said Reiff. Hire them for just the time you need, then have a less-expensive staff person or outsourced firm do the rest of the work.

“You should outsource until it is cheaper to bring it in-house,” advised Reiff.

Outsourcing can also provide additional funds for ministry, said Terrence Chavis, a financial consultant and former executive pastor at Concord Church in Dallas. Finding an outside firm that can handle support duties is relatively easy, he said. Finding good ministry staff is harder.

“If we have to choose between hiring a children’s pastor and an accountant, I am going to lean toward hiring the children’s pastor,” he said. “There are plenty of organizations where I can outsource the accounting.”

Find solutions when the budget is tight

Part of a financial manager’s job is saying no to bad decisions, said Chavis. But another part is to find ways to expand the church’s ministry.

Let’s say, for example, a church really does need to create a new position, yet there’s no money to do so. Chavis says a financial manager needs to help the church explore other options.

There are always options, he stressed. Hiring a new full-time staff member may mean cutbacks in other areas, such as programming. He’d also look for other alternatives: could the church hire an intern from a local seminary or college to do a project?

Pastors, he said, are wired to see people’s needs and try to meet them. A financial manager can help a pastor meet those needs in a sustainable way.

“You have to appeal to the sense of meeting the need,” he said. “We can still meet the need, [but] it may not look like what you pictured.”

For more on issues related to personnel costs, check out more resources available on ChurchLawAndTax.com or ChurchLawAndTaxStore.com:

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Vacation Bible School: 9 Safety Tips

How to prepare for this significant summer event.

Caitlin Edwards

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Last Reviewed: February 14, 2025

Is your church ready for Vacation Bible School? Has your children’s ministry team started preparing? If you haven’t thought about it yet this year, consider this your warning: it’s time to start planning.

Here are a few things to consider throughout this month:

Set a date. If you don’t have Vacation Bible School on your church calendar yet, it’s absolutely key that you put it on there now.
Develop a plan for screening volunteers. Children’s safety is the most important factor when it comes to VBS. In order to make sure the children attending it are safe, you need to be certain the adults working with them can be trusted in their roles.
Start gathering volunteers. While it may be too early to meet with everyone you hope will help with VBS, it is important that you get a small team of lead volunteers together who can help you plan and make this year’s VBS a success.
Decide on a theme and order a curriculum. Curriculum is pivotal when it comes to how successful your event will be. Be sure to order a curriculum that fits with your church’s setting and the age groups you’re trying to reach. Also, when deciding a theme, consider your volunteers and the space you have available.
Distribute information. Once you’ve decided on a date and theme, it’s time to get the word out. Start by putting information in your church bulletin, on the church website, and on any other calendars around the church building. After your church community is aware of the event, brainstorm some ways to let the wider community know: putting flyers up at a local coffee shop, sending invitations to friends, or even something creative and artistic, like chalk signs on sidewalks.
Create a VBS calendar. Create a calendar for the week of VBS. As you plan what will happen each day, create to-do lists and ask the rest of your volunteers to help based on your needs.
Review waivers and release forms. Your church likely uses waivers or release forms for VBS participants. Make certain you understand these documents. They can be helpful, but there are legal limitations. Perhaps most importantly, leaders shouldn’t develop a false sense of security about the needs for good supervision, good decisions about the safety of activities, and good precautions to take to help ensure the well-being of participants.
Ensure you have a medical emergency plan. To be prepared for a medical emergency, you’ll need to have a basic First Aid kit at the VBS location; you’ll also need an emergency contact form for each child in case of a serious emergency.
Plan for the possibility of overflow. Hopefully, you’ll have the problem of having too many people at your church for VBS. If that’s the case, you’ll want to consider issues like the best use of the parking lot and how to direct drop-off and pick-up traffic.

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What Should My Church Do with Old, Uncleared Checks?

Sometimes, a check is written but never cashed. Tips on how to handle these old, uncleared checks.

Frank Sommerville, Attorney, CPA

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Last Reviewed: January 17, 2025

Q: Two checks written by my church more than a year ago have not been cashed and are assumed lost. Since I can’t track down the payees, I want to remove these checks from our records so they no longer show up as uncleared. Any suggestions for how best to do this?

If the payees do not cash them, you must turn the check amounts over to the state as “unclaimed property” after the passage of a certain amount of time. If you don’t, you will be guilty of breaking “escheatment” rules.

These rules vary from state to state. Here is a website that provides guidelines for most states.

Frank Sommerville is both a CPA and attorney, and a longtime Editorial Advisor for Church Law & Tax.

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Cell Tower Leasing for Churches: Benefits, Challenges, and Key Considerations

The benefits and challenges of cell tower leasing for churches, plus expert tips for making informed decisions.

Heidi Hall

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Last Reviewed: January 21, 2025

Competing for greater market share with the promise of better-than-ever coverage, cellular companies are constantly seeking new places to construct cell towers. This means pastors and church financial directors may frequently be approached by companies hoping to build antennas into steeples, disguise them as crosses or bell towers, or attach them to spires. For many, this raises the question: is cell tower leasing for churches a wise decision?

These arrangements often promise substantial lease fees—potentially hundreds or thousands of dollars per month—for cash-strapped churches. However, they also come with possible pitfalls, such as hidden tax burdens, community opposition, and restrictive leases that limit future property use. Below, we explore these key considerations in depth.

Pluses and Minuses of Cell Tower Leasing

While leasing church property for cell towers can provide significant income, it is not without its challenges. A quick internet search reveals examples of churches involved in disputes with neighbors over whether cell towers alter the neighborhood’s character. Others resist the towers due to concerns about electromagnetic radiation, though the federal government and numerous studies have largely dismissed these fears.

Despite initial opposition, many neighborhoods grow accustomed to cell towers over time. For example, Sarah Graham, financial administrator at The Church at Green Hills in La Habra, California, noted no controversy over the T-Mobile-operated tower on her church property, disguised as a cross, which generates $24,000 annually.

Maintaining Control of Church Property

Churches satisfied with their leasing arrangements often credit strong contracts that preserve their control over property. Casey Hale, an attorney specializing in church-related legal matters at Brown & Streza, warns that poorly negotiated agreements can create long-term issues. Churches might find themselves locked into unfavorable terms, limiting property use or resulting in below-market rental rates.

“In dealing with carriers, you want to be as shrewd as snakes,” said Steve Kazella, founder of Tower Genius, a cell tower lease consulting firm. Kazella recommends consulting experts with knowledge of zoning, tax codes, and the wireless industry to ensure favorable agreements.

Understanding IRS Rules and Tax Implications

On the tax side, issues often stem from property tax regulations, which vary by state, and the complexities of Internal Revenue Service (IRS) rules. Under IRS guidelines, income from activities unrelated to a church’s ministry may be subject to unrelated business income tax (UBIT). Dave Moja, a CPA and tax consultant, offers these key tips:

Check with local government to determine whether property taxes apply to the area where the tower will be constructed.
If the church owns the building outright and the IRS deems it “real property,” rental income may be exempt from UBIT.
If the church rents land for a tower, it may owe UBIT if the property is debt-financed.
Work with tax advisers to navigate local, state, and federal regulations effectively.

Dealing with Zoning Boards and Neighbors

Zoning and community acceptance are other important considerations. Kevin Donohue, partner at Tower Genius, notes that churches are often viewed favorably by zoning boards for cell tower projects, particularly when antennas are concealed. Addressing community concerns early can also smooth the process.

Seeking Expert Guidance

Churches should never enter cell tower agreements without consulting experts. Real estate agent Dominic Dutra, who advises nonprofits on cell tower leasing, cautions that poorly structured contracts can result in loss of property control, unexpected taxes, and insufficient income. Churches should thoroughly evaluate whether leasing aligns with their ministry goals and long-term plans.

“Does it do anything for us beyond the income?” Dutra advises asking. “Or does it constrain what we want to do with our property on a long-term basis?”

FAQs: Cell Tower Leasing for Churches

1. Are cell tower leases taxable for churches?

It depends. Churches may owe unrelated business income tax (UBIT) if the income is unrelated to their ministry, especially if the property is debt-financed.

2. Do cell towers lower property value?

Opinions vary, but well-disguised towers or antennas often have minimal impact on property values over time.

3. How much income can a church earn from a cell tower lease?

Lease income varies widely but can range from several hundred to several thousand dollars per month, depending on the location and carrier.

4. Should churches consult legal or tax experts before signing?

Yes, always. Experts can help navigate zoning, tax laws, and contract negotiations to protect the church’s interests.

By seeking expert advice and carefully weighing the pros and cons, churches can make informed decisions about cell tower leasing and ensure their property remains an asset to their ministry.

Image: AdobeStock/Jonathan Stutz

Caring For Refugees is More Than Just a Calling For Churches

Resources to engage your church in responding to a refugee crisis.

Jamie Aten

The local church has a critical role to play in caring for refugees. Loving the stranger is core to our calling as Christians—and it’s part of the church’s DNA. The Bible commands us to “love those who are foreigners” (Deuteronomy 10:19) and care for the vulnerable (Matthew 25:40).

Many Christians have long been committed to serving refugee populations both here and abroad. It is part of God’s call to pursue justice for the oppressed and to welcome the stranger in our midst.

As a ministry leader with limited time and resources, you fortunately don’t have to start this process from scratch. Christian organizations, researchers, and ministries have been doing this work for decades. They’re eager to share what they’ve learned with local churches and equip them.

The Humanitarian Disaster Institute researches refugee camps and develops partnerships with various aid and relief organizations. Here are some resources I use in this work that I hope will help you, too.

Books

If you’re looking for a deeper dive into the subject, start with these books.

Statistics

Reliable, relevant information is a key starting point for any ministry. With the recent surge in “fake news,” finding facts from trusted sources is more important than ever.

Videos

Refugees aren’t just statistics—they’re real, individual people with unique stories of loss, trauma, resilience, and hope. Videos are a great way of understanding the depth of their stories and how our work can enter into those stories.

Advocacy Websites

When you’re looking to take action and aren’t sure how to proceed, these websites offer practical steps you can take.

Ministry Resources

These ready-to-go resources will offer helpful guidance as you start refugee ministries in your church.

Christian Organizations

Many organizations that work with refugees have been partnering with local churches for decades, and their official websites are filled with valuable information and resources.

Resettlement

World Relief: This organization helps resettle refugees once they arrive in the United States, and they have many opportunities (with varying levels of commitment) for churches to partner with their work.
International Association for Refugees (IAFR): IAFR has established relationships with churches and pastors in refugee camps and is doing influential work with refugees— both before and after resettlement.

Advocacy

World Evangelical Alliance Refugee Task Force: This task force is focused on “facilitating a coordinated response from the global to the grassroots level,” which includes mobilizing churches and advocating on behalf of refugees.
World Vision: World Vision’s strong fundraising ability and their presence in developing countries allows them to offer assistance to huge numbers of refugees internationally. The organization also has a robust church engagement arm.

Medical supplies and services

Medical Teams International: This organization sends medical supplies and care to vulnerable people around the world, including refugees and displaced people.
MedAir: This organization provides international emergency services to meet physical needs in crisis areas and to assist in recovery efforts.

Trauma and theological training

Humanitarian Disaster Institute: At the HDI, we have partnered with IAFR on conducting trauma and theological training in the Kakuma Refugee Camp in Kenya, and we have worked with World Relief on a number of projects over the years—both here in the Chicago area and globally. Last year, we cohosted the GC2 Summit, an event to help the church show the love of Jesus Christ to refugees and refugee communities. Refugee care was a focus of our 2016 annual conference and will be again at our 2018 Disaster Ministry Conference. In addition, we’ve published research and trainings around multiple refugee care and humanitarian aid topics.

May you be blessed in your efforts to demonstrate God’s love for the most vulnerable “strangers” among us.

Dr. Jamie D. Aten is a disaster psychologist and the founder and executive director of the Humanitarian Disaster Institute and Disaster Ministry Conference at Wheaton College (Wheaton, IL).

Taking the Next Steps

Action steps your church can take to implement or strengthen your child-protection program.

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Spokesperson David Staal wraps up the training and offers action steps your church can take to implement or strengthen your child-protection program.

Responding to an Allegation

The story of how one church handled an allegation of child sexual abuse.

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What would your church do if it were faced with an allegation of child sexual abuse? This video depicts the story of how one church handled this situation. Experts add insights to this first-person story.

Supervising Scenarios: What Would You Do?

Interactive segment teaches principles of good supervision.

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This fast-paced, interactive segment teaches principles of good supervision. It helps children and youth volunteers think through common scenarios of supervision.

Legal Requirements: The Church’s Responsibility to Protect Kids (with Richard Hammar)

Richard Hammar explains legal requirements for protecting children in your ministry.

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Viewers receive more training by the most trusted name in church law—Richard Hammar. In this segment, he explains legal requirements for protecting children in your ministry, plus practical tips on how your ministry can meet the “reasonable standard of care.”

Screening & Selection: The Candidate (a short film)

Teaches leaders how to interview a candidate, conduct a background check, and check references.

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This segment creatively teaches leaders how to interview a candidate, conduct a background check, and check references. Participants will see and hear what the screening and selection process should look like.

Screening & Selection: Your First Line of Defense

Richard Hammar’s teaching session on the importance of proper screening and selection of staff and volunteers.

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Richard Hammar, noted church attorney and CPA, and one of the creators of Reducing the Risk, presents a powerful teaching session on the importance of proper screening and selection of staff and volunteers. This segment provides a five-step plan for reducing liability.

Sexual Abuse in Faith Communities—an Expert Roundtable

Five experts who deal with different aspects of sexual abuse in the church.

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This presentation features five experts who deal with different aspects of sexual abuse in the church, ranging from a psychologist who helped create his church’s child protection program to an insurance claims manager who understands the legal impact of sexual abuse allegations. By sitting in on this group’s discussion, viewers gain insight into the issues surrounding child sexual abuse in ministries today.

A Victim’s Story

The true story of a victim of clergy abuse.

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This segment presents the true story of a victim of clergy abuse. It should help sensitize leaders to the human cost of sexual abuse in ministry settings.

Child Protection as the Foundation of Your Ministry

Children’s ministry director David Staal introduces churches to the problem of child sexual abuse in the church.

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Children’s ministry director David Staal introduces churches to the problem of child sexual abuse in the church. This segment gets people invested in solving this safety issue by engaging them, heart and mind. It should be the first presentation that you view and show.

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Pastoral Succession Plans: Why Your Church Needs One

Pastoral succession plans help minimize disruptions, provide uninterrupted leadership, protect the church’s resources, and much, much more.

Erika E. Cole

A prominent church with more than 25,000 members rapidly eroded into a congregation of less than 250 with dwindling finances—and its rapid demise traces back to a problem many churches unfortunately face today: the lack of a pastoral succession plan.

The absence of succession planning can cause severe problems for congregations and raise numerous legal issues. In the case of this megachurch, when the church’s founding pastor died suddenly, the congregation viewed his son, who was on staff at the church, as his heir. However, the church’s board did not feel he was prepared to be the senior pastor. A rift ensued, and the son of the deceased pastor was fired. The subsequent years of infighting and costly litigation over the church’s significant assets wasted invaluable resources and virtually destroyed the church.

This is just one among far too many examples of the devastating consequences churches suffer when they do not plan ahead for a transition in pastoral leadership.

According to the Evangelical Council for Financial Accountability’s most recent Nonprofit Governance Survey, 65 percent of all nonprofit boards self-report that they do not have a succession plan. As staggering as that figure is, this number would likely be higher if the survey exclusively asked church boards.

Why succession planning is essential

Dave Travis, CEO of Leadership Network, fittingly defines succession as “the intentional transfer of authority and leadership from one primary leader to another.” The need for new leadership can come very unexpectedly, such as in the case of a death, resignation, sudden illness, or termination of a leader. Whatever the reason for a change in senior leadership, churches need a succession plan for at least five reasons:

Minimize disruptions

Every church needs a carefully documented plan to ensure that pastoral leadership will be handed over to the next top leader in an orderly way that has minimal impact on operations.

Provide uninterrupted pastoral leadership

Congregants continue to need spiritual guidance and pastoral leadership when a senior pastor leaves, and before the new pastor arrives.

Properly handle the church’s resources

Every church needs sound stewardship, especially during transitions. As an organization financially dependent on contributions from its members, a church must make every effort to properly steward the assets of its congregation. A church that wastes resources on expensive litigation—which can be avoided by a succession plan—is not carefully managing the congregation’s resources. In the case of the megachurch whose founder died, the years of litigation jeopardized 110 acres of valuable real estate, and a 10,000-seat sanctuary, plus several valuable ventures. It brought a lot of bad press—both through traditional media and blogs—and bad feelings, but worst of all, many people were turned off to church altogether.

Progression of ministry

Succession planning should not be thought of as just switching out one leader for a new one; rather, it is an opportunity for growth. While churches rightfully grieve the loss of old leadership, the arrival of new leadership, when handled strategically and wisely, can breathe new life into a congregation, ignite a fresh vision, and create innovative ministry opportunities.

The best alternative to litigation

In my experience, the alternative to chaos and court intervention is a well-orchestrated succession plan. As an attorney, I have great appreciation for the court system.

As a Christian, I recognize the admonishment of 1 Corinthians 6:1 that suggests we make every effort to avoid bringing cases in civil court against other Christians.

However, when there is no thoughtful, documented plan established to fill a pastoral vacancy, chaos often results. T

That chaos often prompts conflict, and the opposing parties tend to look to the court system for help. Dissatisfaction usually results.

Depending on the nature of the dispute, courts may not weigh in because of First Amendment concerns, and when courts do intervene, it’s common for neither party to like the outcome. Case in point: the megachurch dispute affecting tens of thousands of people and numerous important assets ultimately was resolved by the decision of one judge. Neither side walked away feeling fully satisfied.

Denominational churches still need a succession plan

While denominations generally have a clear process to guide local churches when a vacancy occurs, there is a difference between what’s on paper and what often happens. What I have seen in practice is that the “replacement” leader provided by the denomination often brings out the worst in fellow Christians. I have even seen local congregations of a denomination change the locks to the church building to keep out the new pastor sent by the national office. Like independent congregations, churches that belong to a denomination need a succession plan, and they would be wise to coordinate that plan with denominational leadership.

Key questions to answer

In their book The Elephant in the Boardroom, Carolyn Weese and J. Russell Crabtree outline several questions to help start the process of creating a succession plan:

Do you have a strategic plan that defines where your church is going and how you are going to get there?

Creating a new strategic plan or carefully examining the current one helps leaders explore the strengths and weaknesses of their church’s vision and mission. As far as succession planning goes, the leadership team should reflect on how a transition in pastoral leadership would affect the church’s vision and mission.

Do you have a clear understanding of your particular church culture and the specific advantages and risks a pastoral transition poses?

Every church has a unique culture, and the current senior leader is often responsible for that culture. For instance, he or she might draw a certain crowd to the church. Does succession planning provide an opportunity to broaden that crowd or change it in a way the church leadership finds desirable?

Have you had an honest, structured discussion with your governing board about what is going to happen to the church when the pastor leaves?

Having “the talk” between the senior leader and the church board can be tough, no matter who initiates it, but it must be done. In fact, it should be done with regularity, as opposed to it being a haphazard, uncomfortable discussion. Make it a part of a regular agenda that starts early in the new leader’s tenure.

Do you have a pastoral transition plan in place that describes in detail how your church will maintain excellence at the point when the current pastor leaves and a new pastor is called?

As discussed earlier, a succession plan must strive to minimize disruptions in ministry and operations before the new leader arrives.

Work with a qualified church attorney

Ideally, the senior pastor initiates the succession plan discussion. However, sometimes the church board makes the first move. Regardless of who initiates, the church should engage a competent attorney with experience representing churches. Along with a strong legal understanding of succession, the attorney should also know how to apply biblical principles to church leadership, governance, and pastoral transition. Prior to hiring, ask the attorney to explain the Bible-based principles that guide his or her understanding of succession planning. Moreover, an attorney with experience in this area should be familiar with the legal parameters that such a plan can (and cannot) include.

Positioned for success

It has often been said that the only certainties in life are death and taxes. In large part, the church has managed to avoid the latter, but the former has had its hand in the demise of too many ministries. Consider what actions you need to take to ensure that your church is best positioned for continued success by having a properly prepared succession plan.

Erika E. Cole is an attorney who works exclusively with churches and is a founding partner of The Law Offices of Erika E. Cole LLC.

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Handling Employee Resignations in Churches: Key Considerations and Best Practices

Understand how to manage church employee resignations with this guide covering resignation timing, retraction rules, employment policies, and board member liability. Ensure clarity and compliance in your church operations.

Richard R. Hammar, Attorney, CPA

Bio

Q: A church employee provided a letter of resignation to our church board. A few days later she changed her mind and asked the board to disregard her letter of resignation. What should we do? When is a resignation effective, and can it later be revoked?

Note the following ten points regarding resignations:

1. Most employees hired for an indefinite term are “at-will” employees who can resign at any time, subject to the conditions summarized below.

2. Employees hired for a specified term may be unable to resign prior to the end of their employment term, and, if they try, they may be subject to damages in a lawsuit brought by their employer. Clearly, this is something to be discussed in advance to avoid wasteful litigation.

3. An at-will employee’s unilateral right to resign may be limited or restricted by an employment contract that provides otherwise.

4. An at-will employee’s unilateral right to resign may be limited or restricted by an employer’s policy manual that provides otherwise. For example, some manuals require a specified number of days of advance notice before a resignation will be effective.

5. If an employee has an unconditional, unrestricted right to resign, his or her resignation is effective whether it is “accepted” or not.

6. It is a good policy for employees to present a resignation in a written, dated, and signed letter that is confirmed in an email.

7. Even if an employee has an unrestricted right to resign, be aware that suddenly walking off the job may impose a burden on an employer that in some cases leads to a negative reference.

8. Some courts have ruled that an employee cannot rescind or retract a letter of resignation. It is entirely up to the employer to decide whether to accept a rescission or retraction. So, employees should assume that a letter of resignation cannot later be rescinded or retracted.

9. Employees who are being investigated for misconduct sometimes resign as a way of preempting the disciplinary process. Like any resignation, such resignations generally are effective immediately and preempt the disciplinary process unless the right to resign is restricted by an employment contract or employee manual. This principle is illustrated by one of the leading cases addressing the discipline of church members. In 1989, the Oklahoma Supreme Court issued a ruling that remains the definitive analysis of church discipline. Guinn v. Church of Christ, 775 P.2d 766 (Okla. 1989).

The court reached the following three conclusions:

The discipline of church members (i.e., persons who have not withdrawn from membership) is a constitutionally protected right of churches.

Discipline of persons who have effectively withdrawn their church membership is not a constitutionally protected activity, and churches that engage in such conduct can be sued under existing theories of tort law.

The constitutional right of a church member to withdraw from church membership is protected by the First Amendment guaranty of religious freedom unless a member has waived that right. One way to do this is by a provision in a church’s bylaws, or other governing document, prohibiting members from resigning their membership when under discipline. This strategy may prevent members from preempting the disciplinary process by resigning their membership.Similarly, an employer may seek to restrict the ability of employees to resign their employment if under investigation or discipline for wrongdoing. While in many cases employers would be pleased to accept the resignation of employees under investigation for wrongdoing, that is not always the case, and so employees should understand that their right to resign may be restricted by an employer policy or contractual term.

10. It is common for church board members to resign their position when they relocate or become incapacitated. However, church bylaws usually do not address when and how such resignations occur. This is an important and frequently overlooked issue, since board members generally remain liable for the actions of the board until their resignation is effective. If the timing of a resignation is ambiguous, then this can expose a former board member to continuing liability. To avoid this, a church’s bylaws should clarify precisely when a board member’s resignation will be effective.

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

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What if Our Minister Requests a Housing Allowance that Exceeds His Total Salary?

What should churches do if a minister’s housing allowance request exceeds their salary? Find IRS-compliant solutions here.

Vonna Laue, CPA

Bio

Last Reviewed: January 18, 2025

Q: We just hired a pastor, and he is purchasing a new home with a very large down payment. This will make the cost of his housing higher than his salary. How do we handle that?

How Should a Church Allocate a Housing Allowance?

A church should only designate a housing allowance up to the minister’s yearly salary. This assumes the minister qualifies for a housing allowance based on IRS requirements. The allowance must also:

Represent compensation for ministerial services.
Be used exclusively for housing expenses.
Reflect the fair rental value of the home (furnished, plus utilities).

If the minister’s housing expenses exceed their salary, it is their responsibility to cover the difference through other means. However, the church cannot designate a higher allowance in anticipation of additional income earned outside the ministerial role.

Example: Housing Allowance vs. Total Salary

Let’s consider an example:

Your minister earns $15,000 annually from your church.
He anticipates housing expenses of $17,500 for the year.

The church can only designate up to $15,000 as a housing allowance. Even if the minister earns the additional $2,500 by working a part-time job, the church cannot include this external income in the designated housing allowance. Any additional income will be taxed like other payroll earnings, as it is not tied to the minister’s work at the church.

Key Takeaways

The housing allowance must not exceed the minister’s salary from the church.
Only income earned through ministerial services qualifies for a housing allowance designation.
Additional earnings from non-ministerial jobs cannot be included in the housing allowance.

Additional Resources

For a comprehensive guide to church compensation, consider Church Compensation: From Strategic Plan to Compliance.

FAQs About Clergy Housing Allowance

What is a clergy housing allowance?

A clergy housing allowance is a portion of a minister’s compensation designated for housing expenses, including rent, mortgage, and utilities, that is excluded from taxable income.

Can the housing allowance exceed a minister’s salary?

No, the housing allowance cannot exceed the total salary paid by the church, even if the minister incurs higher housing costs.

What expenses can the housing allowance cover?

Eligible expenses include rent or mortgage payments, utilities, furnishings, and the fair rental value of the home. Non-housing-related expenses do not qualify.

Can additional income from non-church jobs be included in the allowance?

No, only income earned through ministerial services provided to the church can be designated as a housing allowance.

Conclusion

Churches must carefully allocate housing allowances based on the minister’s salary and ensure compliance with IRS guidelines. Additional income earned outside the ministerial role cannot be included in the housing allowance. For further guidance, refer to Church Law & Tax’s resources.

Vonna Laue has worked with ministries and churches for more than 20 years. Vonna was a partner with a national CPA firm serving not-for-profit entities through audit, review, tax, and advisory services. Most recently, she held the role of executive vice president for a Christian ministry that works to enhance trust in the church and ministry community.

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Can Churches Mandate Employee Tithing? Legal Considerations and Guidelines

Learn the legalities of mandatory tithing policies for church employees, supported by Supreme Court rulings. Understand requirements for payroll deductions, verification, and labor law compliance.

Frank Sommerville, Attorney, CPA

Bio

Last Reviewed: January 28, 2025

Q: Is it legal for a church to have a policy that demands or mandatorily requires employees give a portion of their income as a requisite for employment?

Yes, with some caveats.

In Corporation of the Presiding Bishop v. Amos, 483 U.S. 387 (1987), the United States Supreme Court approved the firing of a church employee who failed to maintain a temple recommendation for his local congregation of the Church of Jesus Christ of Latter-day Saints. The local temple could not recommend him for employment unless he was a member in good standing.

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To be in good standing, the local temple requires its members to prove that they have paid their tithes. Since the church employee failed to provide the temple recommendation, he was terminated.

Churches can impose religious requiremens on non-religious employees

The church may impose religious requirements on its employees, even those employees not involved in active practice of the faith.

In the Supreme Court case, the church employee was a janitor in a gymnasium owned and operated by a nonprofit organization associated with the church.

While we’re on the topic of tithing, as more churches go increasingly online with both their tithing and communications efforts, now’s the time to consider cyberliability insurance. Take a look at this helpful article to gain more insight and share with others.

The church may not withhold the tithes from the employee’s pay without written permission from the employee.

Churches can withhold tithes from employee pay

If the employee refuses to consent to the withholding of the tithe, then the employee may be subject to discipline, including termination. Also, if the church withholds the tithes from the employee’s pay, it can only withhold the tithes after the withholding of payroll taxes.

If the church mandates that employees pay tithes, the church must pay the nonexempt employees for the time required to pay the tithes.

The US Department of Labor rules require employers to pay at least one-tenth of an hour for duty time and many state laws require payment of a minimum of two or more hours each time the employer requests the nonexempt employee to perform any task.

Churches can request verification of employee tithes to another church

If the employee is not a member of the employer church, then the church may require the employee to request that the employee’s church provide a certificate to prove that the employee paid tithes to his or her home church.

Frank Sommerville is both a CPA and attorney, and a longtime Editorial Advisor for Church Law & Tax.