Are The Crystal Cathedral Salaries a Valid Expense?

 Perhaps a church works under different rules when under chapter 11 than the rest of us. It seems to me that they should be paring down the expenses to the bone. Of course it does allow them to continue to operate their church so some of those expenses will undoubtedly be justified. We'll have to leave it to the trustees.
    . . . June


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Creditors and Feds Object to Crystal Cathedral Salaries
The Freedomist:

The U.S. Trustee Program and creditors are objecting to salaries given out by the Crystal Cathedral to several of its employees as the Garden Grove, Calif., megachurch undergoes bankruptcy proceedings.

Crystal Cathedral

The latest filing by creditors on Thursday questioned the church’s request to continue employing William Gaultiere, part-time pastor of Spiritual Formation Ministries and son-in-law of Chief Financial Officer Fred Southard, as the bankruptcy case is under review. Gaultiere receives a salary of $61,955 plus benefits, with over 95 percent of the total amount coming in the form of a housing allowance, the Los Angeles Times reported.

Earlier this week, a federal authority overseeing Crystal Cathedral’s bankruptcy case and creditors filed objections to the salaries of three of the church’s employees for what appeared to be redundant duties. Two of the names listed are related to the church’s founding pastor, Robert H. Schuller.

Names of several other family members who work at the church were also listed in the filings.

The trustee questioned the $132,019 housing allowance for Southard, who takes only a $12,000 salary, the $70,000 compensation for Schuller’s youngest daughter, Gretchen Penner, who produces the church’s “Hour of Power” telecast, and the $55,000 salary of her daughter, Neva Klaassen, who books musical guests for the TV show, according to the Orange County Register.

“There is no justification whatsoever for a housing allowance of this amount,” court documents state. “Mr. Southard has failed to explain why such a housing allowance is necessary or appropriate, given this Debtor is in Chapter 11 and suffering financial difficulties.”

Jim Penner, Schuller’s son-in-law and wife of Gretchen, defended their compensations this week, noting that Southard’s tax-exempt housing allowance was a “benefit of working in a church,” reported the Orange County Register.

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I think the trustees are right in objecting to some of these expenses. If we were in bankruptcy, we wouldn't be drawing those salaries, would we? Please leave your comments

June

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The CRYSTAL CATHEDRAL Works Through Chapter 11 Bankruptcy

The Crystal Cathedral and broadcaster of the “Hour of Power” program has filed for Chapter 11 bankruptcy. The bankruptcy was filed to protect the church from creditors as it struggles with debt of over $43 million, according to the following article. Prior to the filing, the church had attempted to negotiate a repayment plan with a long list of vendors, but a handful broke away from the group to file their own lawsuits and forced the church to seek protection under Chapter 11. I hope they work things out.
   . . . June

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The key to a successful Chapter 11 bankruptcy for The Crystal Cathedral:
October 31st, 2010 |  Author: pro4534

The Crystal Cathedral, the Southern California mega-church, landmark, and broadcaster of the “Hour of Power” program has filed for Chapter 11 bankruptcy. The bankruptcy was filed to protect the church from creditors as it struggles with debt of over $43 million. The bankruptcy filing provides more evidence of the challenges facing churches across the country as the slow economy continues to hurt even the most well-established and famous of the lot.

In addition to its national Hour of Power broadcast led by the Rev. Robert H. Schuller, the church is renowned for its signature glass-covered place of worship and its “Glory of Christmas” and “Glory of Easter” programs. Schuller, in fact, is credited by many as the man who brought televangelism into the mainstream.

Completed in 1980, The Crystal Cathedral’s grounds saw additional buildings added over the years including a Richard Meier-designed Welcoming Center in 2003. In January, reacting to $55 million budget deficit, the laid off 50 employees to cut $4.9 million from its $20 million annual operating budget, and parted with its Rancho Capistrano property, a 170-acre retreat and wedding center. Its two signature programs, “The Glory of Easter” and “The Glory of Christmas” were canceled to slash the budget further.

Much like the situation for many California homeowners, The Crystal Cathedral took on mortgages during the boom times and then ran deficits as revenues decreased expanding too quickly. Despite the cutbacks, revenues dried up to a point where the church was forced to file Chapter 11. Prior to the filing, the church had attempted to negotiate a repayment plan with a long list of vendors, but a handful broke away from the group to file their own lawsuits in an attempt to force the church to pay them first. This effectively broke the negotiations and forced the church to seek protection under Chapter 11.

The Chapter 11 bankruptcy will allow the church to continue operations while it works out a payment plan through the bankruptcy court. Jim Penner, the executive producer of the “Hour of Power” said “We want to pay our vendors back”, while others at the church confirmed that operations would continue as normal. The Chapter 11 reorganization process will result in a payment plan which will ultimately have to be approved by creditors and the bankruptcy court.

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Rev. Robert Schuller PLEADS For Help For his Church

Rev. Robert Schuller made a plea from the pulpit as he spoke publicly for the first time since the church filed for bankruptcy protection Oct. 18, according to the Associated Press article below. It must be so very hard for Dr.Schuller to be in this position with the church he so proudly founded and prached in for so many years.
     . . . June

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Schuller pleads for dollars for Crystal Cathedral
The Associated Press Sunday, October 24, 2010; 11:21 PM

Crystal Cathedral founder the Rev. Robert H. Schuller on Sunday tearfully asked his parishioners for help in overcoming the megachurch's bankruptcy and tens of millions in debt.

Schuller, 84, made the plea from the pulpit as he spoke publicly for the first time since the church filed for Chapter 11 bankruptcy protection Oct. 18.

'I need more help from you,' Schuller said, according to the Orange County Register. 'If you are a tither, become a double-tither. If you are not a tither, become a tither. This ministry has earned your trust. This ministry has earned your help.'

Schuller's voice cracked with emotion as he told congregants about his family home and cornfield in Iowa getting flattened by a tornado when he was a teenager.

"I learned from my father that tough times never last," Schuller said. "Tough people do."

Citing debts of more than $43 million, the Orange County-based church that also produces the long-running "Hour of Power" television show declared bankruptcy last week.

The church, founded in the mid-1950s by Schuller, has already ordered major layoffs, sold property and canceled its annual "Glory of Easter" extravaganza. 

Church officials have said that for the time being, "Hour of Power" will remain on the air though the number of stations airing it has been cut.

Chapter 11 bankruptcy allows a business to keep operating while it tries to put its finances in order under court supervision.

The church has said its money troubles are almost entirely the result of the recession, but others have blamed an inability to keep up with the times and leadership and succession problems that included a disastrous attempt to hand the church over to Schuller's son

Schuller's daughter, Sheila Schuller Coleman, ended up assuming senior pastor duties.

She assured church members Sunday that using "Biblical" money management the church would get out of bankruptcy.

The congregation gave Robert Schuller a standing ovation near the end of his daughter's remarks.


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The Home of The HOUR OF POWER in Bankruptcy

 The home of the Hour Of Power, the Crystal Cathedral is now under bankruptcy protection. This is a very sad time for Dr Robert Schuller and his family. They are good people. Unfortunately, hard times come to God's house as well as ours. According to the article below, the church had been negotiating a repayment strategy with vendors, but a number of filed lawsuits seeking faster payment prompted a coalition formed by creditors to fall aside, leaving bankruptcy the only option. It's very sad.
    . . . June

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Crystal Cathedral Bankruptcy
 scarlett journey:

Crystal Cathedral, the megachurch birthplace of your televangelist exhibit “Hour of Power,” filed for bankruptcy Monday in Southern California following struggling to emerge from debt that exceeds $43 million.

In addition to a $36 million mortgage, the Orange County-based church owes $7.5 million to a number of hundred distributors for companies ranging from marketing to using live animals in Easter and Christmas providers.

The church had been negotiating a repayment strategy with vendors, but a number of filed lawsuits seeking faster payment, which prompted a coalition formed by creditors to fall aside, church officials stated.

“Tough times never last, every storm comes to an end. Right now, people need to hear that message more than ever,” Sheila Schuller Coleman, the Cathedral’s senior pastor and daughter of the founder, advised reporters exterior the worship corridor.

“Everybody is hurting today. We are no exception,” she mentioned.


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