Top SBC Good News Stories of 2014

Bah humbug! Bad news all around...but...here's my list of the top good news stories for SBCers in 2014:

1. Lottie Moon hits record total, $154.1 million.

Southern Baptists may be giving less to the Cooperative Program and less of their disposable income to churches and mission causes, SBC entities may be mired in retrenchment mode because of flat or declining giving, but the Lottie Moon Christmas Offering for International Missions is at its highest level ever (but I am not allowing anyone to recalculate this in real dollars, adjusted for inflation, so as not to rain on good news).

2. Messengers elect a president who has greatly increased his church's Cooperative Program giving.

OK, so Ronnie Floyd's church is still below the average percentage and Baptist Press didn't report what that percentage was but he did lead his church to give substantially more to the CP than in earlier years. The CP has no chance of any increases if messengers elect leaders who show no interest in supporting it and most megachurches are not heavy CP supporters. This year, the election of a megachurch pastor was a positive move relative to the Cooperative Program.

3. Our housing allowance is safe from federal constitutional challenges.

At least it is safe for now, the previous federal district court's ruling that it was unconstitutional having been overturned on appeal.

4. IMB trustees show a willingness to embrace the 21st century.

With the election of thirty-six year old David Platt as the new IMB leader, replacing his seventy-year-old predecessor, trustees demonstrate that they recognize that some new thinking is in order for our flagship institution. Younger Southern Baptists are encouraged thereby.

5. Southern Baptist leaders and entities recognize mental illness as a grave problem.

The SBC, it's leaders and entities, have been AWOL on the serious business of mental illness among us. While leadership cannot force change at the local church level, at least there has been a steady stream of sensible initiatives from our folks. Regretfully, this has come as a result of the suicides of two children of high profile SBC leaders.

6. At various levels, the SBC is showing engagement on racial issues.

The response to racial turmoil of Ferguson, Missouri and of the death of Michael Brown in New York has generated sensible commentary from our leaders and mostly civil and profitable discussion among us. This is a change and is good news.

7. NAMB's church planting initiative, Send North America, is continuing to thrive.

While some critics snipe about it, SNA is engaging large numbers of younger Southern Baptists who are interested in church planting and large numbers of SBC churches who wish to partner in planting churches in North America. One is hard-pressed to name any other national SBC initiative that shows success.

8. Great Commission Giving is up.

Southern Baptist churches gave $777 million in Great Commission Giving for 2012-2013, an increase of $23 millions from the previous reporting period. GCG is the aggregate of giving to all SBC causes. Although these figures are somewhat soft in that churches self-report as they choose, any increase is good news. Critics of GCG will have to explain why it is not good to give to SBC causes and why such should not be celebrated.

9. The key Cooperative Program percentage increased.

That would be the percentage of undesignated church offering plate dollars given to the CP. We moved up ever so slightly from 5.414% to 5.5%. This makes two years straight there was a tiny, tiny increase. Frank Page concludes that the CP has reached its "nadir". An increase of 0.086% isn't much...but it's something.

10. Average SBC clergy salaries are up.

The 2014 LifeWay Compensation Study revealed that total "package" compensation for senior pastors was up 1.8% from 2012. Not much but up is up and not down...has to be good news. Senior pastors are advised to thank God for this and not to complain that the average pay for non-senior pastor staff positions were up by a good bit more than for senior pastors.

Sorry, but that MDiv is not a paying investment

LifeWay and Baptist Press do a good job this time of the year in researching and writing about clergy salaries. BP's story about pastor salaries not keeping pace with inflation is a good example. As churches prepare budgets for the coming year, information about clergy pay is helpful.

According to LifeWay's 2014 Clergy Compensation Survey, pay and pay package increases for full-time senior pastors are going up at a rate less than the rate of inflation. This means that as a group, senior pastors are slightly losing ground relative to the cost of goods of services. Any senior pastor who finds a way to direct his church deacons, personnel, or finance committee to the LifeWay study and/or to this Baptist Press article is doing a good thing. Church people should be informed about such things. It may or may not help, but if the pastor doesn't take some initiative to inform key people in his church they will likely never have the relevant facts to make good decisions.

But I was drawn to another figure given in the BP piece:

Seminary graduates receive, on average, $1,981 more in total compensation than non-seminary graduates and receive more vacation days.

Less than $2,000 more for an MDiv? (I realize that the survey did not distinguish among the various seminary degrees but MDiv is the standard pastoral degree offered by all the seminaries.)

Let's see. You leave a paying job to attend one of the seminaries where you invest somewhere around $25,000 in tuition alone during the three years needed to acquire an Masters of Divinity degree. During that period most students continue to work but suffer the loss of significantly more income than they would have received if they continued in their secular job not to mention expenses related to moving and traveling, etc.

At the successful completion of a seminary education the minister has a shiny new masters degree which enables him to land a larger church with higher income prospects for his pastoral career.

You bet. On average, an extra $1,981 year after year-after-year.

Impressive?

Not exactly.

Do the math. Financially, it doesn't pay brethren. Most will never recover from where he would have been had they not sought to acquire that MDiv. But then, at least theoretically as a better educated pastor, he is a better pastor which is a worthy goal, finances aside, not to mention that following God's will is always a sound investment.

But considering the future of the Christian ministry in America - declining church membership numbers, reduced personal giving rates, and increasing economic marginality of average-sized and smaller SBC churches - maybe it's time to consider that a three year MDiv and the expenses thereof might be excessive.

Is a two-year MDiv program worth considering? I think so.

Pastor, put down the multi-level sales scheme and step away from it!

You're a Southern Baptist pastor, that's as high up as you are ever going to get, and you are paid less than the average $60k salary for SBC senior pastors. You look at your future with a clear eye and understand that upward pastoral mobility is limited and substantial salary inreases will probably not be coming. You recognize that the salary difference between a senior SBC pastor with ten years experience and 30+ years is not much, on average.

So, understanding that you need to provide for your own retirement, educate your own kids, and have a house of your own at some point down the road, you start looking around to see if you can supplement your income with something that you can fit in your job responsibilities as a pastor.

Good move, taking personal responsibility for your future.

Eureka! A friend of a friend has a route where it is asserted that you can make a substantial second income, possibly exceeding your income as a pastor.

This involves some sales but the bigger money is made recruiting others into the "business opportunity," "under you," as it is explained, where you get a cut of their sales.

Welcome to multi-level marketing, or worse.

Take my advice, pastor, stay away from this stuff.

You probably will not make much or any money and you will probably get dirty in the process. There are other routes to extra income that are more straightforward and honest and in which you will not get your hands soiled.

I attended an evangelism meeting held at our local associational office some years ago, an event led by a staff member from the state convention. I received a phone call from the staffer inviting me to stay after the meeting for what he called a good business opportunity for pastors to earn extra income. I stayed. The opportunity was a multi-level deal with borderline legality. It was held out that some pastors were making tens of thousands of dollars working this.

This was a shameless scheme to suck pastors into a deal where a few might make some money but where most would lose their few hundred dollars spent to buy in. It angered me that a denominational employee piggybacked this onto a ministry event.

Dangle a few hundred dollar bills in front of a pastor and what do you get? From some, you get an ocean of drool, I'm afraid. We could all use the extra money.

I didn't "buy in" although I did waste quite a bit of time fending off phone calls from my colleagues who had and who wanted me in the deal.

The most recent example I was hit with was one that recruited subscribers to a deregulated utility supply service and, more importantly, involved persuading your friends to be 'dealers' at a price of several hundred dollars. Not many people selling the product. Lots of people putting money in a pool as "dealers," hopeful that enough others could be persuaded to do the same and you'd end up with a tidy sum. Same nonsense. Pyramid scheme with a patina of respectability.

My reflexive response to these things is this: "No. Not just 'no' but 'Gehenna no.' Goodbye."

Somewhat different, and more sinister, are affinity scams like the one that swindled millions from folks in an Atlanta church (this is illegal and I don't need to be told the difference between legal multi-level marketing schemes and Ponzi schemes). The pastor of the church promoted the program in his church and recommended it to his people. Now he and the church are being sued on the basis that the church gave a "tacit endorsement" of the illegal scheme. Hmmm, the stakes are raised if you and your church might get sued over your plan to put money in your pocket.

Forgive me, my scheming ministerial brethren, but don't you feel a little funny selling stuff and promoting these things to your congregation? (I know several pastor's wives who sell make-up, jewelry and the like. I see no issue with these where you make a little money actually selling the product.)

An enterprising pastor can sell books on Amazon or products on Ebay and make some extra money perfectly honorably and legitimately. He can probably do this and it not even be known to his congregation, not that it needs to be kept secret. Just do it from your basement, not the church, and do it in some of the 100 hours a week you aren't working.

Far too much suspicion already falls on those of us who pastor churches and preach the Gospel. Don't add to that with this nonsense.

If you want to be remembered by your congregation for your preaching, your ministry, your selfless service, stay away from this stuff.

But if you want for your former church's members to remember you as, "Oh yeah, Brother Get-Rich-Quick, he was the one who was spending most of his time pushing the latest and greatest moneymaking scheme" then have at it, brethren.  

Freedom of conscience and confidential clergy salaries:

I have learned over the last 15 years or so that one topic that always gets some attention is the business of pastor pay being private or public.

Just this year, all 17 1/2 days of it, I have run across two such discussions:

• SBC Voices' distinguished SBC VP Dave Miller: How confidential is your salary?
• Here I blog has a regular ethics feature with this question.

 The comments on both, many in the former and a few in the latter, cover the usual objections and support for disclosing such information.

The questions might be summarized below:

1. Should clergy pay be regularly disclosed to members of his congregation or should a pastor and church take steps to conceal his salary from his congregation and restrict such knowledge to only a few key people?

2. Is the pastor harmed if his pay is made public to his congregation or is he harmed if members are denied such knowledge?

3. Are church members too unspiritual to handle the information?

4. Are ordinary members too unsophisticated to be trusted with such knowledge.

My answers are:

1. The church should be open and transparent and disclose compensation matters to the congregation. Such may be done through regular distributed financial reports or through an annual budget vote with the figures available upon request by members in other times throughout the year.

2. No, but many pastors think they are. Pity the poor pastor. If he is underpaid he doesn't want anyone to know. If he is overpaid he doggone sure doesn't want that known. If he is paid just right, he still doesn't want anyone to know.

3. Some may be but then some staff may be too unspiritual to handle managing the information as well. Judging all members to be spiritually unworthy of such knowledge is elitist, condescending, and often ill-motivated.

4. Most are unlearned on the intricacies of clergy pay but this should be an incentive to inform not to keep secret.

I have never served a church where members did not know exactly what they were paying me and I suspect that the vast majority of my colleagues are like me. That is generally the Baptist way: Trust the Lord and tell the people.


But there is another reason in favor of disclosure that is seldom mentioned. I put it like this: There is a freedom that comes from the understanding that you are hiding nothing from the people you serve and that any one of them who has a question can get an answer.The pastor can, and should, say, "I am your servant. I am grateful for your contributions and appreciate your financial support. All of the church's expenditures are on the financial report. Ask any deacon or finance committee member your questions. If they cannot or will not answer. Get back to me."

They may not like the answer but they cannot complain that the pastor and a few key leaders are witholding information from the people who make up the church or that there are two classes of members - the hoi polloi and the illuminati.

But, alas, I am in a shrinking number in my views here. Americans are odd people. A pastor might tweet his little brain out day-by-day. He might display a public media hemorrhage on Facebook for his membership to gawk at. Just don't ask him how much the church pays him, lest his sensitive schnoz get all out of joint.

I am still looking for a compelling reason as to why a minister should keep his or her pay secret from the members whose contributions fund it.

I'm all ears here brethren/sistren.

2012 Average SBC Sr. Pastor Pay: $60,774

 Pastor pay is up! Happy days are here again!

Look at it this way. On the first of every month, you go to your church office and are handed a check for $5,064.50. On that day you also can feel good that the church is paying your health insurance along with some contribution to your retirement.

It all adds up to $72,840 which does not include cash payments that most ministers receive as accountable reimbursements (mostly for use of their car, calculated by mileage) or for incidental reimbursements for convention, books, etc. Ministers who live in church owned housing receive some of the $60,774 in the form of housing rather than cash.

LifeWay and GuideStone collaborate on the compensation survey. The  latest is available here.

Baptist Press trumpets that full time senior pastor pay is outpacing inflation and that it has risen over 6% since 2010.

Observations:
1. The survey is not random and likely over reports larger churches and higher paid ministers, which is not a bad thing. You can take the overall average, probably higher than your present pay, and say that you are below average.

2. You can manipulate the data. In my state the senior pastor of an average sized church (bewteen 75 and 199 in attendance) would be making $52k in salary and a package of $60k.

3. Significant increases in compensation will not come until you have a church of 300 or greater in attendance, a level that only a fraction of ministers will ever reach.

4. In my state until you have a church with a budget $200,000 or over, the senior pastor is going to have a total package of under $60k.

5. When the senior pastor hits his mid thirties, or let's say forty, he is very close to topping out in his compensation. Chew on that one.

6. A pastor making the SBC average whose wife is a teacher, nurse, or other professional will likely easily have a six figure family income. 

How does this compare to what you are seeing on the ground?

How about means testing the clergy housing allowance?

As a result of the election last week, it seems we will be in a mode for what are euphemistically labeled 'revenue enhancements.' For Podunk First and Last Baptist Church folks that would be tax increases.

Would it be better for country to raise the tax rates or flail away at the tax codes to eliminate some of the staggering numbers of loopholes and special treatments?

And can we not conjure here some haughty and righteous indignation over the scandal of tax loopholes for those disgusting that special interest groups? 

Wait a sec. I almost forgot. We clergy have a very special loophole of our very own, the Minister's Housing Allowance, which frees up a pretty good chunk of the paycheck of every ordained SBC minister, teacher, and administrator from any income tax exposure at all. Not only that, we get to double up by taking the housing allowance and also deducting mortgage interest.

As I have said, 'What a great country!'

Call it our very own special interest red, white, and blue tax dodge.

Got great church which compensates you sufficiently to have a million dollar home? Write that sucker off, brother! Let some poor unordained sap pulling down $800 weekly pick the slack caused by your removing, oh, maybe $100,000 from liability for income taxes.

A very talented SBC minister near me was featured recently in a news article. He has a great church and does wonderful ministry. I'm sure with the size church he has that he is paid quite well. That is their business. Doesn't cost me a dime. God bless 'em.

Oh, look there he is standing in front of what is described as his $1.2 million home. Hmmm, there seems to be some pungency in the air and  I'm getting a whiff of a mammoth housing allowance.

Don't blame me. I did not write the article and he didn't have to pose in front of his mansion but since he did, I can speculate that his housing allowance deduction alone is more than the combined total income of several lesser paid SBC pastors.

So, I ask:

1. Is there some church/state, First Amendment problem with means testing the Housing Allowance?
2. Is there some practical reason that clergy should oppose means testing? The military housing allowance has a cap and, as I recall, is variable based on rank. What would be wrong, objectionable, about this being applied to clergy in the same manner?

Would it cause any harm to religion in America if the housing allowance was not allowed for clergy whose income was, say, twice the SBC average, or about $115,00. That too low? How about means testing it to step it down beginning at $150,000 and be eliminated at, say, $250,000 in income?

What's the problem with that? OK, index it for inflation if our monetary policy is destroying the value of our currency.

It is tough for me to empathize with a pastor whose salary is $250,000 and who whines about losing his tax break. I'm just not feeling that pain and the gift of mercy isn't kicking in on that issue.

One wonders, what would our SBC lobbyists in DC do if a proposal to means test the housing allowance was on the table this year? Would they go to bat for the handful of folks in our convention whose income is north of $250k? Would there be a spirited defense of our loophole for the top earning one percent of clergy?

I don't know but if so, that would be a good way to create some additional Democratic voters, and I'm thinking we already have enough of those.

Consider me wide open for someone to explain what the problem would be with means testing our housing allowance. You can even do it anonymously without being photographed standing in front of your $1 million plus house.

The pastor, job skills, and supplemental income

Even if the average SBC senior pastor is in the $50k salary range, scads of the ministerial brethren are in considerably more meager territory and some will never progress to larger churches and higher pay.

What can be done?

One thing that is not meager in SBC life is opinions. In spite of being short on compensation, we are always rich in opinions and advice. Classify this blog article as pontificatory...and I apologize for it in advance. It is well worth what it costs you to read it.

Here are some ideas, all of which I have either experienced or have had colleagues who have over the years:

• Supplementing income. At various times over the years I have supplemented my pastoral income in a number of ways. While this can be problematic in some pastoral situations, I was blessed to be able to do this. Today, selling merchandise on Ebay or books on Amazon are easily done without interference with pastoral duties.

• The traditional route to extra income is to get invited to preach revivals and the like. Hmmm, invitations are not always easy to come by, so the parson might be proactive and find another route. I have known fellow pastors to do debt collection work, census enumeration, substitute teaching, bus driving and other things. There are opportunities out there.

• The biggest obstacle is probably the attitude of the pastor who may look at his penury and haughtily conclude that it is God and the church's responsibility to provide him with income; consequently, he sits and awaits checks from others. Do I recall something about Paul working to provide his own income at times?

•  I have known some of the brethren to have an expectation of entitlement as a result of their being in the Christian ministry. This leads to unattractive discount fishing expeditions and subtle begging. Tsk, tsk, not very becoming and people recognize this and one's reputation suffers.

• Some of the old ministerial codgers advise younger dudes to have a skill and not take the Bible school undergrad, seminary grad route. Get a business degree, teaching degree, HVAC certification, whatever, but have some job skills. I know of colleagues who have taken time out from pastoring to retrain.

• The Methodists guarantee a church for every minister. Baptist do not. We guarantee a place in the seminary classroom where we will take your tuition money and help you get a sheepskin but beyond that only smiles, recommendations, and back slaps but not a church and certainly not a good paying church.

• God will provide but it is not unspiritual for the minister to prepare and work until God provides that better paying church.

I believe that most state conventions, the seminaries, and LifeWay have resources in place to provide career and other counseling. Associational Missionaries may be sympathetic in this regard but not terribly helpful, but my experience is limited. Sometimes it is beneficial for the isolated pastor to have a third-party involved in looking at his situations.

Did you know that Starbucks is having a special day where if you bring in this blog article and ten bucks or so you can get a cup of some fancy-named coffee.

I am curious to know if many others supplement their pastoral income? How?

Simple, obvious solution to modest clergy pay

The churches I have served were different I many ways but were all mature congregations which ranged in age from 96 to almost 200. One could say that they were quite well established. Some might use the dreaded term, "traditional."

In each congregation the history included a time looked upon with great pride when the church "went full time," an event that occurred in the 1950s for each of the three. Prior to that the church shared a pastor with one or more other churches. 'Half-time' and even 'quarter-time' churches were an important part of the Baptist landscape in those days.

A full time church with a full time pastor is great but the pay scales are not. What I read regularly is that seminary trained and educated pastors have difficulty in smaller and average sized SBC churches. Whatever the expectations of compensation for an MDiv pastor, the reality is determined by the size and income of the church. A smaller church translates into lower pay regardless of the education level of the pastor, regardless of the student debt of the pastor, regardless of the number of children of the pastor, regardless of what the pastor could make with equivalent education in a secular job.

So what is this simple, obvious solution?

Going bi-vocational, of course. 

The average annual salary of a bi-vocational pastor in the SBC is about $20,000. That plus a 'real' job adds up to a decent income. Churches benefit by not having the pressure to provide a minimal living wage to a pastor and family and pastors benefit by having a job for his primary income and the church as supplemental income.  

So, why not solve pay problems with churches and pastors going back to part time ministry as bi-vocational ministers?

I can only think of a couple of problems with this:  (1) the church does not want to do it, and (2) the pastor does not want to do it. Other than those, I'm thinking it is a slam dunk, done deal. Unfortunately, both groups seem to consider this a backward, regressive move.

My humble hacker and plodder opinion is that this would be a very good move. A little secret in SBC clergy life is that 'full time' pastors often envy their bi-vocational colleagues because the latter have a higher degree of independence. Churches with only part time pastors are forced to lower their expectation for pastoral duties and to assume many of these that have been automatically handed over to the preacher, "because that is what we pay him to do." Happier church. Happier minister.

Alas, our system is not conducive to this. Seminaries are expensive and depend on a head count of warm bodies in classrooms for much of their funding. It would be tough to sell an expensive education on the basis that the student would then serve a part time church. Neophyte pastors are taught to look down the road and see larger churches, more prestige, and better pay and are willing to make a short stop in a smaller church even if the pay is parsimonious.

At the recent North American Mission Board church planting conference Jimmy Scroggins led a session entitled, The Math Doesn't Work: Why Bivocational Church Planters are the Future. The thrust of his session was about a deliberate effort to approach church planting by enlisting and training bi-vocational pastors. Why do that? Well, because the math just doesn't work for full time pastors. I liked the concept.

The pay scale math for many average and smaller sized SBC churches with full time pastors doesn't work too well either. But it will work, however poorly, as long as there is a steady stream of churches who provide such and pastors who are willing to accept it.

Only the Lord and current economic realities may force the bi-vocational solution upon some churches and ministers.

....but what do I know. I'm not even a mega pastor.

What is not said about clergy compensation

While in seminary many years ago, I had one professor who liked to tantalize his classes with the line, "One of you may be the next pastor of Bellevue Baptist Church," Bellevue being Adrian Rogers' megachurch.

Another prof was more sobering with his classes. He would say, "Almost all of you will pastor smaller churches for your entire ministry."

The reality on the ground about SBC churches is that (a) the great majority of the churches are not mega, not mid-mega, not large but average and smaller, single staff with an attendance of under 150 and, (b) most are plateaued or declining in attendance, leading to, (c) most SBC pastors will be single staff with smaller churches and that for their entire ministerial career.

The first prof was the dreamer (he was a large church pastor) the second was the realist (his churches were never large). It would have been more beneficial to pay closer attention to the second.


There is nothing unspiritual about a seminary student or younger pastor  taking a realistic look at his future. It is in the Lord's hands - that is the most salient bit of realism. If he does, then perhaps he will understand that the mega is down the road or the large multi-staff church is not in his future.

A keen grasp of the obvious leads one to recognize that there is no promotion from being the pastor; that is, there is no higher staff position available so the route to better compensation is to get a larger church and the competition for the larger churches is keen.

Some hotshot Air Force pilots with the right stuff get the fighter jets, most get the lumbering and less sexy aircraft. Five or ten percent of SBC pastors get the large churches while most get the average-sized churches.

Here is what the data say from the Compensation Study (Gold star for you if you noticed that I used the older, 2010 study yesterday rather than the current, 2012 study; there isn't a lot of difference in the results):

• If you are a pastor and have over ten years experience, you are not too far from the upper limit of your income producing potential. The difference between a senior pastor with 11 years experience and one with over 30 years experience is fairly narrow, about ten thousand dollars.  Even if one takes the highest earning years, those for pastors with 21-30 years of vocational experience differential is relatively small.

• If you are a younger senior pastor (26-35) your income will not improve that much with age. Senior pastors 56-65 earn less than ten thousand on average more than their younger colleagues. It doesn't hurt to have grand dreams but neither does it hurt to wake up to realistic planning.

• One gleans from the data the sobering conclusion that most SBC senior pastors are doing about as well financially at 35 as they will be at 60. It's just the way things are. Pay increases will come but they will be merely inflation adjustments, not much in the way of real increases.

• The obvious point here is that most pastors will reach close to their highest level of compensation fairly young and will not see much improvement thereafter...unless the pastor is the fighter pilot who gets the larger, better paying church.

This is somewhat different than many secular jobs. Teachers in my state still get automatic pay increases for additional degrees. Nurses in large hospitals may receive step increases with experience. Pastors with experience and additional education may be more attractive to a larger church but there is no automatic pay increase.

Seminarians, those with mentors, and those younger clergy who have SBC street savvy already see all this. Perhaps there are a few of the brethren who were like I was yea many years ago, fairly aloof and ignorant.

I suppose most of us get to the place where we recognize that our earning potential is limited. One gloomy Monday morning we may accept the fact that we are beyond our peak earning years as a pastor and that  peak may be, well, not too high. Such recognition should always be accompanied by resolution: This as a spiritual issue and I am willing to serve as God has called me with whatever compensation I receive. And I will serve with gladness and faithfulness as long as God allows me. 

May it ever be so.
_____________

Tomorrow: the obvious, incessantly offered but seldom adopted, solution.

 

Average SBC senior pastor pay: $56,845

Average SBC senior pastor pay: $56,845

What's so hard about that?


Don't like it or don't believe it? Then argue with GuideStone whose 2010 Southern Baptist Convention Compensation Study is easy to understand and use.

I admit to a bit of despair over people arguing with me on the housing allowance discussions that the figure is meaningless, irrelevant, or that people make more than the average and bring up those who make lower. For crying out loud, that is why we call it an average.

The sum of $56,845 is for all full time senior pastors who responded to the survey in states where almost all of the SBC churches are located. It is what was reported as salary payments, housing allowance payments, and fair rental value of church owned housing but not including retirement or insurance payments.The figure does not include accountable reimbursement payments or what is generally called automobile allowance.

The figure is an average, the mathematical mean - sum up all of the respondants and divide by the number (there were over 3,000 respondents). It doesn't matter if you don't make this much or if you don't know anyone who makes this much. It is an average. 

We are not all that poorly paid, on average.

For those senior pastors who live in church owned housing, it is appropriate to include the fair rental value as part of his compensation. Five years ago I would have said that including the fair rental value gave a distorted result, since living in a pastorium was a liability in the sense that the pastor is forced to forego building equity in his own home. Building equity in real estate? What a quaint thought.

The average teacher salary in my state, Georgia, is $52,815.

The average registered nurse salary in my state is about $61,000.  

The average police officer pay is just under $50,000.

For those who think we are worth more, I don't disagree but would simply say that market forces are at work for us just like everyone else.

Answer this: Do you know of a church that needs a pastor and is offering a compensation package near the SBC average? How many viable candidates are available to that church? Probably dozens and dozens, ministers figuratively lining up to be considered. If a church has a thick stack of resumes there is not much incentive to increase the compensation package. The pastor candidate who asks for a good sum above the average will likely not find a receptive committee.

Perhaps Obama could issue an executive order that repealw the law of supply and demand.

Of course our $56,845 annual salary doesn't include intangibles such as being loved and appreciated by everyone.

Oh, one note from the compensation study:  

Over the past 16 years, this study has been conducted every two years...It should also be noted that over the 16 years this study has been compiled, compensation for ministers and church has increased at a rate higher than the rate of inflation.

 Not all news is bad news.

There is, however, a sobering reality about SBC pastor pay. It is a fact that is simple and obvious but probably not talked about too much. I will cover that tomorrow.

How do you explain your government tax break, the clergy Housing Allowance?

I have seven articles on the clergy housing allowance, our Sacred Tax Loophole. Seven is a good number, the number of completion, unfortunately there will be more to follow, since there is an active case challenging its constitutionality.

Such is the tension between church and state in America that a 21st Century Jesus might say "the lawsuits over the first amendment you have with you always."

The challenge to the housing allowance is in my view a constitutional long shot and the clergy who live in pastoriums need not worry at all here, since there is parity between their income tax treatment and that of secularly employed workers who live in employer provided housing.

But I would ask my clergy colleagues who own or rent their own home and who receive a housing allowance check each month exactly how  they explain this business to their congregation, deacons, church finance committee, and/or church treasurer?

I envision a conversation like this:

Treasurer: "Pastor, why do I need to write you a separate housing allowance check each month and have this paperwork on file about it?" 

Pastor: "Because tax law gives me an exemption from income I use for my housing."

Treasurer: "Is this something that I can do,  get a separate check for the amount I spend on my housing and have that free from income taxes?

Pastor: "Well, no. You cannot because you are not ordained and because you have a secular job. The tax break is only for ministers."

Treasurer: "So why does the government give you a tax break that they do not give me?"

Pastor: "I guess because there are a lot of low paid clergy and it was thought to be beneficial to the citizenry as a whole that we get some break on income taxes."

Treasurer: "Well, I don't mean to be argumentative but you are not one of those low paid ministers. You are paid about the average around here, $60,000 or so if you include these housing allowance checks. And your wife works and has an income. Come to think of it every other pastor I know around here lives in a two income family and with any kind of second income those families have an income and benefits over six figures. That is hardly poor. This doesn't seem to make much sense to me."

Pastor: "I see your point but would you just write the check, hand it over, and then call our congressman if you don't like the law. I didn't write it."

Treasurer: Scribble, scribble, scribble..."Here you are."

When asked about the challenge to the constitutionality of the housing allowance, our Convention Attorney advanced an economic argument, that the tax break was important to many SBC clergy who are not highly paid.

This is both an accurate statement and is probably the best argument for keeping the tax policy. There are 45,000 or so SBC churches in the SBC and many tens of thousands of pastors, church staff members, and retired pastors. No doubt there are many for whom a thousand dollars or so in tax savings is not just welcome but critical.

But clergy aren't the penurious demographic we once were. Churches by the thousands have sold their pastoriums and their minister no longer has to live in church owned property. Pay has increased and we are about three generations into two income families being the norm.

Life in the Christian ministry isn't perfect but it has improved financially.

Facts on clergy pay for Southern Baptists can be a slippery. I'd speculate that few in your church know how much you are paid, in total, even though they see the financial reports every quarter. One of the ways they are unintentionally misled is by the division of cash payments into a salary and a housing allowance. Members look at the salary check and think, "I don't see how our minister can get by on that," but overlook the housing allowance check which often is the larger sum.

The LifeWay Compensation Study gives state-by-state figures and the average for all of the states where the vast majority of SBC churches are located is around $57,000. That is a 2010 figure and includes salary plus housing allowance but not retirement benefits and insurance.

Get the sum in your head: $57,000, average senior pastor pay. 

Now, take an average school teacher's salary. Here in Georgia it is about $53,000, slightly less than the average senior pastor. The teacher almost certainly has a mortgage and utility expenses but the law does not allow he or she to exclude what might amount to about one-third or so of their salary from gross income as does the senior pastor.

He gets a fat tax break and cuts his gross income for income tax purposes by $20,000 or so. She gets...well...nothing.

Why give a tax break for the minister and not the teacher? Some clergy wag might say because the teacher gets all summer off, to which some lay wag would reply, "But ministers only work one day a week."

We all have our jokes and arguments but the bottom line is that there is not really any persuasive explanation for the clergy housing allowance. It's just a longstanding government tax policy.

Most of us hate the idea of the government arbitrarily picking winners and losers, like with the housing allowance but I suppose we can certainly get used to the concept so long as we are among the winners.

Add to the discussion the reality that some very affluent ministers who earn into seven figures and live in multimillion dollar homes are able to exclude as much as they can justify. It is not unreasonable to presume that there are many ministers who exclude several hundred thousand dollars of income, annually, through the housing allowance. Make some sense out of that.

So, how do you explain this to someone in your church who takes an interest?

I would be curious to know.
________________

Resources:

• General information and a strong argument against the constitutionality of the housing allowance: Here and here.
• Argument that although it is not unconstitutional, it is bad tax policy: Here.
• Abuses of the housing allowance: Here, here, and here.
• All glazed over about the whole thing and don't want to think about it: Here.

Many of the links are to a Forbes blogger and CPA, Peter Reilly, who is among the few who seem to have an interest in the matter. His most succinct and interesting treatment of the matter is, Work, Fight or Pray - Vestige of the Medieval in our Tax Code.

Join the SBC Ministry and Get Rich?

You bet! Tax breaks, clergy discounts, free condo use; people can’t wait to press bills in your palm, give you free suits, tires, food, vacations. What a life!

Well, not exactly.

Here’s an average Rev. Joe, SBC pastor:

He preached yesterday at an average sized SBC church and saw 125 folks in his 11 am primary worship service. When he gets paid, he receives a salary of $46,000. This includes the one genuine tax break that ordained clergy receives, the housing allowance, which for Joe is $16,000. He is blessed to have his own home, complete with mortgage.

Joe’s church wisely and properly has an accountable reimbursement plan which allows Joe to log his business miles, keep receipts for expenses such as books etc, and receive a reimbursement check that is not taxable as income for either income tax or for Self Employment taxes. Joe expenses $8,000 for the year this way.

The church pays his insurance, for the family, spouse and two kids. This comes to around $8,000 per year and also makes a modest contribution to his retirement account, $5,000, not enough but he's grateful for it.

Salary $30,000
Housing 16,000
Reimbursement 8,000
Health Ins 8,000
Retirement 5,000
Total $67,000

The LifeWay Compensation Study is a handy tool for checking out the pay of SBC clergy and staff. It shows Joe as being slightly above average but then Joe is slightly above average himself and, more importantly, his church is slightly above average.

Joe has knowledgeable members including a CPA who could look in the budget and surmise, rightly, that Joe will pay no income tax at all. This is because of the Housing Allowance which takes that $16,000 chunk off the table for income tax purposes.

The CPA would also understand that Joe would be paying Self Employment taxes on his W-2 salary and also on the $16,000 housing allowance. Those taxes on $46,000 would, at the 2010 rate of 15.3%, total $7,038. He hopes Joe is wise enough to set aside the $600 or so each month to make his quarterly payments of over $1,750.

The CPA doesn't have to get to a calculator to guess that Joe's largest bill, by far, after his mortgage is that tax bill. He is grateful that Joe is responsible with his finances, but then the CPA was the one on the search committee that insisted that the church get a credit report on Joe when they were considering him as their new pastor. Joe checked out OK, paid his bills on time, and had a good credit score.

Joe is in touch with the folks in his church and doesn’t complain about a total compensation package of around $70,000. He understands that just because he has a master’s degree earned by doing three years of post-college graduate study, his pay and benefits are determined not by his education but by the supply and demand for SBC pastors.

Joe is a realist. He knows that the Lord may send him to other churches but the likelihood is that he will pastor average-sized, single staff SBC churches all of his career. He is grateful that his wife will at some point work outside of the home because they will absolutely need that second income to plan for retirement.

Joe has disabused himself of thinking that because he is a pastor that someone, somehow, sometime will be there to take care of him financially. He trusts the Lord for that and watches his expenses. He has also weaned himself away from the attitude of entitlement that he sometimes observes among his colleagues.

So Joe keeps his nose to the grindstone. He doesn’t really have a backup plan, unless he can get called to a megachurch. Alas, there are only 177 SBC megachurches and somewhere over 50,000 SBC ministers.

Join the Christian ministry as an SBC pastor and serve the Lord, be blessed, be satisfied, be frustrated at times; meet wonderful people, gain close friends…but don’t expect to get rich. Just don’t complain about it.

[I welcome any correction, criticism, or observation from folks who are familiar with clergy pay. There may well be something I do not know.]