Clergy Housing Allowance Ruled Unconstitutional in US District Court - What You Need to Know

My comments will likely upset some people, but here are my thoughts about this situation specifically and pastoral compensation in general:

1. Churches are getting smaller, and can afford to pay a pastor less and less.
2. Pastoral salaries are already generally awful, and they will get worse.
3. Most pastors struggle to meet often unrealistic expectations of ministry with pathetic pay. Wives are often pressured to work to make ends meet, and provide some health insurance benefits, because the church often can’t do any better than a contribution toward a cost-sharing plan. The end result is a strained homefront, and a trip to Applebees is often seen as an insane splurge.
4. Many pastors are unable to make ends meet, for some of the reasons above, and are forced to turn to extra employment. They often have no marketable skills to make a decent wage, because they only studied bible for their undergrad, so they subsist on low-paying jobs as contract security, clerks, etc.
5. Many churches are unwilling to reduce the pastor’s performance expectations (e.g. several sermons per week, on call always) in light of these difficulties.
6. The end result of these compounding problems can often be that pastors burn out like candles in a stiff wind, pastor’s wives become bitter and unhappy (with good reason), and pastor’s children can be soured on the entire thing because they’ve grown up watching their parents be treated like slaves, with no health insurance, unrealistic performance expectations and little to no money.
7. Now, the FFRF (and others) continue to wage their relentless war against Christianity in America.

I am only more convinced than ever of the following:

1. The “single pastor against the world” model will continue to be harder and harder to pull off. There will be some pastors who will stick to it, while working themselves to death with second jobs and trying to eke out four sermons per week, while their wives slave away teaching Abeka at the local Christian dayschool for $15/hr or working at the mall.
2. The dual-pastor model is more biblical, less stressful, and the two (or more) men can split responsibilities while working in the real world. Maybe they can take their family to Applebees once and a while, too.
3. Housing allowance will go. It might not go now, but to will. Prepare to lose it. I think churches should restructure their compensation plans accordingly, as they’re able.
4. I also think churches need to look at the age of their congregations, the annual income trends, and the realistic salary expectation for a young man with student loan debt and a family in their area. Would you work in Olympia, WA for $35,000 per year? Is it even fair to offer that to somebody?

Prepare to lose housing allowance. It won’t last.

What Tyler says; I just interviewed a guy who burned out of pastoring and doubled his pay working construction. Think about that one a moment. The guy was not exactly quitting the pastorate to take a job as a lawyer or corporate executive or anything like that. Construction worker, probably not certified to drive heavy equipment, and he doubled his income.

One might infer that due to the property tax exemption and the housing allowance for pastors, that church members are willing to pay for their own homes, their own businesses, their pastors’ homes (especially megachurch pastors’ McMansions), and church buildings, but not other expenses for those who actually teach them the Word of God.

Or, more scarily yet, maybe a lot of pastors have clued in to what’s really important to their church’s members, and they’re not teaching them what they need to hear. We could well find that the best thing that could happen to our churches’ spirituality would be to end these tax exemptions.

Compared to health care expense, insurance, staff salary…the housing allowance is typically a much smaller part of the church budget.

Housing is very tax advantaged, a good accountant should be able to soften the blow even if the housing allowance disappears completely.

Furthermore, if churches own the property that the pastor lives in, this financial arrangement becomes unnecessary.

If the church owns a parsonage, they need to sell it. A pastor would be better suited by owning his home.

$15/hr for a Christian school teacher is “very generous.” Most make around $10-$12/hr. My cousin had a masters degree in Christian education, worked for a Christian school in Florida, and didn’t make enough money to cover her medical insurance (which the school didn’t provide). Her dad had to pay for her insurance payments. She ended up quitting, going back to school to be a medical technician, which started out making 2x what she was making with a masters degree in education.

I believe most church staff are underpaid. Our church secretary makes $15/hour (she’s been the secretary for more than 15 years). She receives an annual 1% raise… because we’re a non-profit. She is the glue that keeps our church office, activities, and personnel functioning. In the corporate world, with her experience she could easily make $25-$30 / hour as an office manager.

If the church owns a parsonage, they need to sell it. A pastor would be better suited by owning his home.

In many cases, the opposite is actually true. A smaller church can’t afford to pay a pastor enough to buy a house, but because they own a house he can live in it for free and they can pay enough cash to support him. This gives the added advantage of not having to pay property tax. So a pastor is frequently better off when he is not forced to live beyond his means to afford housing. It is also advantageous for the pastor in a case such as he leaves the church. He has one less thing to deal with since he doesn’t have to sell his home. In addition, even if a pastor owns his own home, having a parsonage can be good for an assistant pastor or an intern or some such.

I have lived in a church owned house and a personally owned house so I know both sides. And the church owned house has some advantages that owning a house doesn’t have. So a church should think very carefully before selling a parsonage and, in most cases IMO, they should not do it.

Agree w/Larry that sometimes the only affordable way to do it is a parsonage that is already paid for. Especially the case with smaller congregations.

Tyler, on the two-man idea: wouldn’t that cost twice as much and double the problem? What I see slowly happening is that the big churches get bigger and the small churches get smaller. Eventually that hits some kind of bottom and things go some other direction (back the other way?). But in the mean time, we’re more likely to see circuit preachers again in rural churches (though probably not on horseback ;-) ). Not two pastors for one church, but several churches for one pastor.

To JBL, in what way would housing be tax advantaged without the housing allowance? I’m not seeing how that would at all be the case.

I think the old concept of “full-time Christian service” as the endgoal for ministers isn’t necessarily biblical or logical going forward.

The other side of this is that “those who preach the gospel have a right to live of the gospel” and “the elder who rules well in preaching and teaching is worthy of double honor.” So it seems to me that “full-time Christian service” is the biblical ideal of a pastor.

IMO that raises a problem with churches who require that a certain number or percentage of elders/pastors be lay elders. I think that, at least in principle, requires them to forgo something they have a biblical right to. An elder can follow the example of Paul and refuse compensation for the good of the body or because he chooses to work elsewhere, but can that be required of him biblically? I am not sure it can be. Of course, everyone would look askance at an elder who refused to be an elder because he wasn’t being paid. So it seems to me that the church is putting elder or potential elders in an awkward position. It may well be that most people who have full time jobs would gladly refuse compensation, but they should be the ones to make that choice, should they not? I don’t think the church should make it for them.

I think we should be training others to do the work of the ministry and that relieves a large burden from the pastor. And in certain neighborhoods or areas, an “indigenous church” (so to speak) can’t support a full time pastor. But we need to approach the thinking from a different perspective, IMO.

Larry has hit several nails on the head. Many pastors and churches are clearly struggling to address the financial costs of supporting one pastor, much less two or more. But in this area, as in every other, the Bible, not tradition nor human reasoning should be our guide. I am oft amused at the necessity some churches feel to acquire a plurality of elders at the expense of following Biblical patterns of elder-ship, including the command to support elders financially. How does achieving one Biblical goal (plurality of elders) at the expense of another Biblical goal (financial support of elders) improve the fidelity of churches? Even when “lay” elders are utilized (which I consider a good idea), if the long-range goal is not to eventually support them financially, is that church Biblical in its approach?

I have long believed that willingness to be financially supported by the church is actually an over-looked qualification for Elder. Many men could make more in public work. Are they committed enough to the work of the ministry to take a cut in salary to become a pastor? If not, they should probably not be ordained as an elder. Let them serve the church as laymen according to their gifts and desires. Our church has three former pastors in active membership whom we do not financially support nor recognize as elders, but do outstanding work in the ministry. There are surely many factors to weigh on this subject.

One huge advantage, beyond tax considerations, is that if it’s adequate for most pastoral families, the pastor does not lose 10% or so of the value of his home every time he takes a new pastorate. You need to make sure he’s getting some funds for retirement, but we knew that anyways, no?

The people commenting here have lots of experience. My main concern is that we’re seeing (and will continue to see) an attack on Christianity which will make it increasingly difficult to sustain the model of “single fulltime pastor” we often see here in America. Bro. Barkman asked:

How does achieving one Biblical goal (plurality of elders) at the expense of another Biblical goal (financial support of elders) improve the fidelity of churches?

My answer is that, for most churches, they will never be able to sufficiently support a pastor fulltime financially (including healthcare), and this situation won’t change - it’ll get worse. I’m not talking about “scraping by,” I’m talking about actually compensating his family appropriately. I believe a dual-elder, bi-vocational model is more realistic, and it is not un-Biblical at all. Wjy does the pastorate have to be fulltime? Why does it always have to be one guy? It doesn’t. Churches are crippling themselves by sticking to a model that isn’t necessarily the best thing going. I already gave myself as an example. To add to it, I work with an attorney who is a conservative Presbyterian who also has an MA in theology. He teaches at his church. This is the kind of person who would excel at being an associate pastor, relieve burden from the “fulltime guy,” and not need any pay at all - because he doesn’t plan to stop being an attorney!

This is what I’m suggesting:

1. The single, fulltime pastor model is increasingly unsustainable and unrealistic from a financial perspective, and it won’t get better
2. Churches should consider a dual-elder, bi-vocational model where one (or both) pastors have jobs outside the church, and salary and benefits are provided by a secular employer. They split ecclesiastical duties and responsibilities, according to their own arrangement and gifts, abilities, etc. The church can pay them whatever they want, but it likely won’t take much - they already have jobs.

Some people will scoff. But, I ask, why won’t this work? Why isn’t this more realistic? Why is it un-Biblical? I doubt many people will seriously consider it, because Christian cultural mores and expectations, coupled with the bible college and seminary industrial complex all argue against this kind of model. It would work for me. It would work for the attorney I work with. It would work with tens of thousands of working professionals across our country who are committed, serious Christians wgho have no plans to give up their dayjobs. “Fulltime Christian service” is, in my opinion, a bit of an idol.

Larry wrote:

The other side of this is that “those who preach the gospel have a right to live of the gospel” and “the elder who rules well in preaching and teaching is worthy of double honor.” So it seems to me that “full-time Christian service” is the biblical ideal of a pastor.

I disagree; I think it’s an idol. We’re taught, perhaps subtly or perhaps overtly, that unless you’re in “fulltime Christian service,” you’re somehow doing less than you should or could. This isn’t true. I know too many Pastors who’re more burnt-out than charred toast from worrying about finances. I’ve known too many pastors wives who’ve had to work in miserable jobs for too many years to provide healthcare, who’re not happy people. I’ll always remember one pastor friend who confessed to me that, if he knew how to anything else, he’d have bailed a long time ago. I still remember his wife, who cried and told me that she always wanted to homeschool their children, but she couldn’t - because she had to work fulltime so they had healthcare.

I’m happier, more spiritually healthy, and doing more effective things for the Lord now than I ever did when I was a pastor. I’m part of a team at my church. I als have a good job, we took my son to urgent care last night to get stitches, and the folks didn’t sneer at my Medicaid card - because I don’t have one. I used to. No more; I have a job that allows me to actually take care of my family.

I’m saying the “single fulltime pastor” model is going, and these continued assaults against hosuing allowances are just one more step towards a deliberate marginalization of Christianity in America. Small churches won’t find it easier to attract a pastor. Perhaps they should start thinking outside the box.

I’m ducking for cover now, and heading to get some coffee.

Churches are too small. If the church has less than 80 people, it is near impossible to support a full time minister even if the people are giving like they should. The town I’m in has so many churches with less than 50 people that meet in buildings that seat 400-500 but can’t pay their minister. Then there are growing new works that can afford a fulltime minister but not the cost of having a permanent church location. It would make sense that congregations would merge, but everyone has their fiefdoms with their clutch fist preferences so it continues on.

If the money is there, it is better to have the pastor own their house. One perk in the minister’s allowance is that you are allowed to double up on the housing allowance and mortgage interest deduction. Use the parsonage for a young up and coming minister or staff who would be renting anyway.

From Stewardship Services Foundation:

I have advised churches for over 30 years to get out of the parsonage business.

7. Housing/Parsonage Allowance – I have advised churches for over 30 years to get out of the parsonage business. I think it is very important to get a pastor into his own home as soon as possible for many reasons. Retirement – owning a home at retirement is a key ingredient to retirement planning. Security – for his family particularly his wife, privacy – they can decorate how they want – it’s home. I think it tends to add to longevity – the family feels more attached to the community because there’s a stronger sense of belonging. Tax purposes – income tax law provides for generous benefits to the pastor who is buying his own home. Federal and state income taxes are greatly reduced and sometimes eliminated due to the housing allowance and the double deduction for mortgage interest and real estate taxes.

This is very sound and helpful advice to both pastors and churches.

It strikes me that Tyler is really, in effect, contrasting the lives of the eleven apostles with Paul—Paul having earned, at least prior to prison, quite a bit of his upkeep in tentmaking, while indications are that the other eleven were paid for their services. While certainly the worker is worth is pay, the model Tyler espouses has a lot going for it, too.

Thanks for pointing out the error in my statement regarding tax advantage for housing. While there are significant tax deductions, and also much financial engineering can be done regarding the leverage of equity in the house (thus increasing tax benefit), both of them are available whether or not the housing allowance is in place.