Churches Say Audits Would Be Too Costly
Opposition Grows on Reports to State

By Kathleen A. Shaw
Telegram & Gazette [Massachusetts]
January 25, 2006

Opposition among Central Massachusetts churches continues to mount against proposed legislation that would require them to report their finances to the state.

Carole L. Kowal, of Spencer First Congregational Church, United Church of Christ, said small congregations such as hers are struggling to pay skyrocketing fuel bills and maintain their buildings, and cannot afford the extra expense involved.

She called the proposed bill "well-intentioned" but said it would have unintended consequences for independent and small congregations.

"Imagine the New England landscape dotted with all those white steeples rising over town commons. Now imagine them boarded up and empty because that is where we are headed," Ms. Kowal said.

The bill, sponsored by Sen. Marian D. Walsh, D-Boston, arose because of problems Catholics in the Boston archdiocese had when seeking information about the finances of the archdiocese after large payouts were made in the sexual abuse scandal and after the closing of numerous parishes and sell-offs of church property. A hearing on the legislation is scheduled for 1 p.m. today at the Statehouse.

Meanwhile, Gov. Mitt Romney signaled this week that he may veto the bill if it passes, according to The Associated Press.

In remarks on Monday to reporters, Mr. Romney said that while he believes government and society have a responsibility to regulate churches and charities, the measure before the Legislature goes too far.

"I will not be able to support a bill which goes beyond a very routine regulatory interaction level but instead imposes the kind of onerous reporting requirements, oversight and intrusion in religious practice which is reportedly being considered by some associated with this bill," the governor was quoted as saying

Timothy Lyons, spokesman for Ms. Walsh, said the financial disclosure law would not affect individual Catholic parishes because they are not legal entities in Massachusetts, but would require financial reporting by the state's four dioceses.

"We feel that the proponent of this bill is anxious for accountability with the Catholic Church but since the law must be applied equally, small churches such as ours will suffer," Ms. Kowal said. A better reporting system needs to be devised by legislators before requiring the small churches to comply, she added.

Clergy in non-Catholic congregations, many of which are independent and exist as legal entities, say they oppose the law because it would adversely affect their churches.

The Rev. Leah Elrod, pastor of First Presbyterian Church, Worcester, said the proposed legislation would not only impose financial hardship on smaller congregations but it raises serious constitutional issues.

She is among several area clergy who have been meeting with legislators to express opposition to Senate Bill 1074, also called the Public Charities Act, which would require financial reporting similar to what is required of nonprofit charities.

Rev. Elrod said many congregations consider the financial support of the congregations as based in the Bible and theology, and they do not want interference from the state. "We are transparent in our reporting," she said.

Under the legislation, her congregation would be required to make a financial report to the state before the church could collect money from members, or hold a church supper or other fund-raisers, she said.

Ms. Kowal, who is chairman of the administration committee of the Spencer church, said her committee maintains the building and presents the operating budget to the congregation for approval each year. After just completing the budget process, the church is facing a $12,000 deficit and it could go higher if repairs to the church become necessary. "Since our church is a very large old building, we never know what problems we may be facing in each coming year," she said.

The deficit is because of a 55 percent increase in heating oil and 25 percent rise in utility bills, she said. The insurance rose 35 percent because of the loss of 38 churches in the Gulf area during Hurricane Katrina, she said. She said a number of churches in the United Church of Christ are projecting budget deficits this year for similar reasons.

The Rev. Richard Jones, Spencer pastor, said the church considered closing off the main sanctuary during the winter and holding worship services in a smaller room downstairs, but the congregation decided to try to offset the heating costs and keep the services in the sanctuary, where they have the organ.

Ms. Kowal said the United Church of Christ has told her congregation it would cost about $6,000 to hire an outside accountant to audit the church books if this law passes. "The audit would not only look at weekly offerings but every dollar from every supper and fundraiser we put on. We already have a secretary, treasurer and collector who keeps track of all these financial records and provide reports monthly, quarterly and annually," she said.

"We have nothing to hide and our books are open to every member and, if required, could be made available to the state," she said. "We are finding that the majority of our free time is spent fundraising, leaving less and less time available for spiritual pursuits."


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