Now What? Part 2

Episcopalians cannot but be pleased with Friday’s court order requiring that control of substantial assets be transferred from the control of Archbishop Robert Duncan and his minions to the Episcopal Diocese of Pittsburgh. The sudden acquisition of these assets, however, probably valued at $25 million or more, comes with their own set of challenges and obligations. I don’t know if the diocese has been preparing to deal with the day that is fast approaching, but, whether it has been or not, some independent reflection of what needs to happen next may be helpful.

Real Estate

No doubt, people on both sides of the Pittsburgh divide were surprised at how much real property is owned by the Board of Trustees. Some items on the special master’s list that is Schedule C are of minor significance. The governing board of Sheldon Calvary Camp, an institution that traces its beginning to Calvary Episcopal Church, has always been loyal to The Episcopal Church, and it will pursue its mission as it always has. Of course, there are some oddities on the list. I had no idea that the diocese would be re-acquiring two cemeteries, and I must admit that I know nothing about them and nothing about what it means to own them. They may be significant assets; they may be significant liabilities.

Church properties—there are more than 30 of them—are another matter. Some of these properties already have Episcopal congregations (St. Brendan’s, Franklin Park, for example), and the court order is of little consequence for them. At least one (Emmanuel, North Side) has participated to a degree in both dioceses. That title to its building is now vested in the Episcopal diocese may make it easier for the congregation to decide where its allegiance should be.

Many churches now owned by the Episcopal Diocese of Pittsburgh are housing non-Episcopal congregations. What is to be done with them?

The diocese has several fiduciary responsibilities. First, it needs assurance that the buildings are adequately insured and that any mortgages are being paid. Loans payable to the diocese (detailed on Schedule B of the special master’s report) also need to be paid. Because the properties have not been subject to diocesan oversight for some 15 months, physical inspection is probably in order. Diocesan canons require diocesan approval for projects that modify buildings substantially, so the diocese should be aware of construction projects accomplished, in progress, or anticipated.

What of compensation by non-Episcopal congregations for future (and perhaps even past) occupancy? The Episcopal Diocese of Pittsburgh does not exist to provide churches for non-Episcopal denominations. Renting or leasing is an obvious possibility here. Requiring no compensation would constitute fiduciary malfeasance.

Renting church buildings occupied by non-Episcopal congregations is bound to be controversial. Some will see requiring rent as uncharitable; others will see allowing “Anglicans” to use the buildings at all as unacceptable. Two issues must be kept in mind, however:

1. Judge James has declared that building occupants cannot be evicted without permission of the court nor property sold without such permission.
2. The diocese is not prepared immediately to assume the maintenance of 25 or more empty churches.

As for the restriction on eviction of breakaway congregations, no one knows what it would take for the judge to give his permission to remove a congregation (or to sell a building). I am told that Judge James has expressed concern for people who might be deprived of their worship space, but this is the situation in which many Episcopalians have found themselves. Moreover, the reluctance of Judge James to evict interlopers seems to be a personal concern, rather than one rooted in law. In any case, if only for the sake of the buildings in wintertime, it is best not to empty “our” churches all at once—certainly if no Episcopal congregation is prepared to occupy them immediately. Requiring rent has the dual advantage of replacing lost assessment income to the diocese and, if the rent cannot or will not be paid, giving the judge a reason to allow eviction.

The diocese will have to decide how to set a fair rent. In most cases, I suspect that it will be difficult to identify comparable properties that could suggest a fair monthly rental. The diocese could, of course, base rent on the assessment that would be required of an Episcopal parish, but this would be substantially blow the market rate for rental property, which is what these churches would become, at least in the short term.

In some cases, of course, there may be a substantial number of former parishioners willing to return to a building they have abandoned to the “Anglicans.” If so, the diocese may be able to convince Judge James that eviction of the “Anglicans” is neither unfair nor unreasonable.

Ultimately, the Episcopal diocese will have to deal with all parish property occupied by departing congregations, whether in buildings owned by the diocese or buildings merely dedicated to Episcopal Church mission by the Dennis Canon and other instruments. The diocese will, I suspect, make as few distinctions between these two groups as possible. Recall that the stipulation agreed to in the Calvary litigation distinguished diocesan property from parish property. Although there still may be quibbles about what is and is not diocesan properties, the court orders of October 2009 and January 2010 have settled the diocesan property issue—the property belongs to the Episcopal Church diocese.

Paragraph 2 of the stipulation requires that:

In the event a parish in the Diocese (hereinafter “Parish Church”) shall elect to disaffiliate with the Diocese, the Parish Church shall give written notice of that election to the Diocese by delivering a copy of the notice, signed by the Rector and the Vestry, to the Diocesan Bishop (hereinafter “Bishop”), to the Board of Trustees of the Diocese (hereinafter “Board of Trustees”), to each member of that Parish Church and to the Rector and Vestry of each other Parish Church of the Diocese.

There follows description of a procedure involving negotiation and, if necessary, mediation and litigation. In this paragraph, “Diocese” now refers to the Episcopal diocese. It is difficult to see how, given the Dennis Canon and the disciplinary canons of The Episcopal Church, the diocese can relinquish its claim to the property for anything less than fair market value. The Presiding Bishop, in fact, has made it clear that she does not want to see churches sold to breakaway “Anglican” parishes at all. This may not be a practical stance where so many church properties are involved. Sales or short-term leases may have to be granted. (The latter would make it easier for a congregation to return to the Episcopal fold later.) Unfortunately, the Paragraph 2 process may, in many cases, not lead to a quick agreement, and the court may again have to step in. One could argue, of course, that none of the breakaway congregations gave the necessary notice required by Paragraph 2 and that those parishes are therefore ineligible to participate in the negotiation process outlined in the stipulation.

Some Episcopalians have argued that we should be generous in giving away parish property because it is either old and expensive to maintain or new with an expensive mortgage and, in any case, of no use to anyone other than its current congregation. This, of course, is nonsense. It is impossible to generalize here, but some churches simply should have been closed and sold off years ago. Others could flourish with less intolerant leadership. In some cases, the real estate could bring in a large windfall if the land were subdivided for suburban housing or used for condominiums. The Episcopal diocese can put the money derived from such sales to better mission use elsewhere. The Pittsburgh diocese has, in the past, closed parishes in undesirable locations and used the money for new, better sited parishes. My own church benefited from such an action.

Cash and Investments

The most immediate effect of the court order will be to put various investments back under the control of the Episcopal diocese. This will improve the balance sheet of the diocese and will restore access to their investment funds by individual parishes. My own church normally receives more than $7,000 each year in earnings from a trust fund held by the diocese. It did not receive any money in 2009 because funds had been frozen by the court. At our annual meeting last Sunday, parishioners were told to expect two year’s worth of earnings from the fund in 2010.

In its press release about the recent court order, the Episcopal Diocese of Pittsburgh said that it “plans to quickly make arrangements so that all parishes may again have access to their investment funds that were frozen by financial institutions during the legal proceedings.” According to a story in today’s Post-Gazette, diocesan spokesman Rich Creehan, in response to a question from reporter Ann Rodgers, said that “any parish that had been participating in that fund from whatever time, we are making arrangements so they can access those funds.” If this is the intended policy of the diocese, I hope that it will be reconsidered. If someone has given you something of value to hold and has, at the same time, stolen some of your property, prudence (and, in this case, fiduciary obligation) might suggest that you should hold on to their property at least until your own belongings have been restored. How can the diocese argue that real estate must be returned because, as an Episcopal parish, assets were dedicated to the use of The Episcopal Church, whereas cash and investments were not? The intention to allow breakaway congregations access to their funds is a bad idea.

Of course, there is another reason not to allow breakaway congregations to withdraw funds. The position of The Episcopal Church is that parishes (i.e., institutions) cannot be removed from the church, but people, even whole congregations, can depart. The “Anglican” leadership of a departed congregation may legitimately lead that congregation, but it cannot be the legitimate leadership of the Episcopal parish, for which the funds were originally accepted.

Personnel

The Episcopal Diocese has been operating out of a small office with a very small staff. Plans have been in the works to expand both the staff and office space somewhat, but one has to ask if a staff of perhaps two full-time equivalent workers is adequate to deal with the ongoing needs of the diocese and, at the same time, responsibly incorporate newly restored assets and negotiate for others. Simply taking stock of the properties of Schedule C would keep a full-time person busy for a couple of months! Keeping tabs on tens of millions of dollars of assets probably requires more than a few minutes of thought every few days, which is probably all that it can be given now. The diocese needs quickly to assess its needs realistically and to hire appropriate people in temporary or permanent positions to do the work that needs to be done. It is very difficult to do mission successfully on the cheap. If the diocese has inadequate resources to determine and fight for what legitimately belongs to it, it may resort to giving away the store out of sheer inability to do anything else.

Be assured that Archbishop Duncan and his followers will fight for every farthing they can wrest from The Episcopal Church. As Canon Mary Hays was quoted as saying in the Post-Gazette story, “We have always wanted to find a way where both sides could have the resources appropriate to their share.” In other words, “If we can’t steal it outright, we’ll try to con you into dividing it equally.” It is not pastoral sensitivity to fall for this ploy. Doing so will only encourage theft in other diocese. Keep your eyes on Albany and South Carolina.

The Coming Transition

I received an e-mail message from Blogger today that, in less than two months, I will not be able to publish my blog in the same way I am now. If Lionel Deimel’s Web Log is to continue to use Blogger, it will have to reside on a Blogger (i.e., Google) server, rather than on the same server used by Lionel Deimel’s Farrago . If I have understood everything correctly—not at all a surefire assumption—I will be able to make the needed transition without too much trouble, and perhaps without having my blog disappear for 24 hours or so.

It is important for me to make the necessary changes quickly, as I am responsible for at least one other blog whose transition is likely to be more complex, and I need to gain some experience and perhaps warn others that URL’s will need to change for that blog.

If all goes well, Lionel Deimel’s Web Log will continue to be accessible at the address http://blog.deimel.org. Although I am not certain exactly when I will attempt the transition, when I do, I will keep readers informed of my progress on my home page, http://deimel.org. Be sure to check there for an update if my blog seems to have disappeared.

Don’t Ask, Don’t Tell

NPR carried a story this morning about the U.S. military’s finally moving toward eliminating its morally bankrupt “don’t ask, don’t tell” policy. It suddenly struck me that Americans did not invent this policy. “Don’t ask, don’t tell” has long been the policy of the Anglican Communion with regard to its bishops. With the consecration of Gene Robinson, The Episcopal Church began the dismantling of the policy in our corner of the Communion. By consenting to the consecration of Mary Glasspool, we have the opportunity to eliminate this particular hypocrisy once and for all in our own church and to become a beacon of light, albeit an unwelcome one, to the rest of the Communion.

Now What? Part 1

Now that Judge Joseph M. James has ordered property returned to the Episcopal Diocese of Pittsburgh from the breakaway diocese led by Archbishop Robert Duncan, it is time to note some reactions to this development and to begin taking stock of what happens next. (See my earlier posts beginning here.)

Episcopal News service ran a story today about Friday’s court order. You can read it here. Note, however, that the link to information about the litigation given in the story does not actually take you to the proper page. To access the public documents available in Calvary v. Duncan, go here, enter the case number, GD-03-020941, at the top of the page, and click on OK at the bottom of the page.

Curiously, nothing about the court order has been posted on the Anglican Diocese of Pittsburgh site. (As noted in my earlier post, the Episcopal Diocese has made a statement here.) AnglicansUnited.com, however, has both a press release from the Anglican diocese and a note from “Archbishop Bob.” The press release, from January 29, 2010, the day of the court order, reads as follows:

The Allegheny Court of Common Pleas today issued an order to “transition to” the TEC Diocese “the possession custody and control of the real and personal property identified in the Special Master’s Report” which was presented to the court on January 27, 2010. The Anglican Diocese will appeal this order.

The property identified in the Special Master’s Report includes all of the diocese’s bank and investment accounts as of October 4, 2008. This includes the diocese’s investment accounts with Morgan Stanley which have otherwise been frozen since January 2009. The property identified in the Special Master’s Report also includes all real property deeded to the Board of Trustees for the Episcopal Diocese of Pittsburgh.

With regard to the real property covered by today’s order, the court’s order specifically provides that “no real property shall be sold or current occupants removed without further Order of this Court.”

With regard to parish funds held in the Morgan Stanley investment accounts, the Special Master’s Report provides that “parishes for whom such property is administered have the right to withdraw the cash or investment asset value … at any time….”

The message from Robert Duncan, dated January 30, 2010, reads:

Dear Friends,

Yesterday evening, you received an email describing Friday’s court action, written by our lawyers. We wanted you to have this information as soon as possible. This morning, I wanted to write to assure you that we will continue to work diligently for the protection of all our parishes and for the good of our mission and ministry. We also intend to keep you updated – as fully and quickly as we are able to. Please continue to keep these matters in your prayers, remembering that we serve a faithful and mighty God.

Faithfully,
Archbishop Bob

The reassurances of January 30th are, you might think, somewhat vague and do not reiterate the assertion that an appeal is forthcoming.

My understanding—but remember that I am a computer scientist, not a lawyer—is that Judge James’s order of October 6, 2009, determined that the Episcopal diocese is entitled to diocesan property held by the diocese before its division in 2008. The court order of January 29 only clarified what that property is and how fast it must be transferred from those who currently and improperly are enjoying the use thereof. Although the defendants can quibble about the schedule and the details of the asset list, an appeal to the decision that the property is to be controlled by the Episcopal Church diocese had to have been made within 30 days of October 6. It was not. It therefore appears that no appeal by the defendants will prevent the loss of a majority of the assets of the Anglican Diocese of Pittsburgh.

The asset list prepared by the special master and attached to Judge James’s order did not mention a whole class of assets, namely, office furniture and equipment, computers, photographic equipment, and the like. I would expect that these, too, should be turned over to the Episcopalians. I do not know whether Archbishop Duncan’s vestments are personal or diocesan property, but I suspect that there are some episcopal vestments stored in Trinity Cathedral that also belong to the Episcopal Diocese of Pittsburgh.

More thoughts on the fallout from the court order will be the subject of my next post.

More on the Court Order

Two earlier posts dealt with the court order issued by Judge Joseph M. James today in the Calvary litigation. They are available here and here.

Allegheny County Court of Common Pleas judge Joseph M. James issued an order today in the litigation first brought by Calvary Episcopal Church against then-bishop Robert Duncan and other diocesan leaders in October 2003. (You can read that order here. This PDF version is searchable and has all pages in an upright orientation.) A year later, the parties filed a stipulation agreeing that diocesan-owned property would stay with The Episcopal Church, come what may. The stipulation also described a process to be followed if a diocesan congregation wanted to leave The Episcopal Church. Since a majority of deputies to the diocesan convention voted in 2008 to remove the diocese from The Episcopal Church, litigation has focused exclusively on the diocesan-property issue.

Although Duncan, through his attorneys, argued that the stipulation does not mean what it seems to mean, Judge James disagreed and, in October 2009, issued an order that the Episcopal Diocese of Pittsburgh should “hold and administer the real and personal property that is subject to Paragraph One [which deals with diocesan property].” That property was inventoried by a special master appointed by the court, attorney Stanley E. Levine.

Today’s order states that:

1. The court accepts Levine’s inventory as a list of property subject to paragraph 1 of the stipulation. It leaves open the possibility that the Episcopal Diocese of Pittsburgh could seek additional property.
2. There is to be both a public and a confidential version of the court order. Since the report of the special master is attached to the order, the public version includes a redacted version of the report that eliminates confidential information such as account numbers. The confidential order is under seal.
3. Financial institutions and repositories holding diocesan funds are to take instructions only from the Episcopal Diocese of Pittsburgh. A similar requirement is placed on trustees and fiduciaries.
4. Real property listed by the special master is rightfully held and administered by the Episcopal Diocese of Pittsburgh. None of the property can be sold or current occupants removed without the permission of the court.
5. Recipients of “altar artifacts” (presumably liturgical furnishings owned by the diocese but on loan to parishes) should take instructions regarding their disposition from the Diocese of Pittsburgh and may not sell, transfer, or move the artifacts to another location without the permission of the court.
6. Persons or entities having taken out loans from the diocese are to take instructions for repayment from the Episcopal Diocese of Pittsburgh.
7. Defendants are to provide to the Episcopal Diocese of Pittsburgh within 20 days financial and other records needed by the diocese to hold and administer the property covered by the order. They are to provide “ongoing cooperation” to implement the provisions of the order.
8. The order takes effect immediately, and the court “retains jurisdiction over the parties and the subject matter to enforce the Stipulation and Order of October 14, 2005, the Opinion and Order of Court of October 6, 2009, and [the current] order.”
   

The order is followed by the report of the special master, which accounts for most of the 32 pages of the document issued today. Highlights of assets enumerated by Levine include:

1. $22 million in cash, cash equivalents, receivables, and investments. This includes some $2.5 million in parish funds held in a common investment pool.
2. Various trusts, not all of which have specific values attached to them.
3. Approximately $1 million in outstanding loans due the diocese (included in the $22 million, above).
   
4. A substantial amount of real property, including the “Donegal Property,” 151 acres of rural property on which Duncan once proposed building a conference center, and Sheldon Calvary Camp, a summer camp facility in Ohio on Lake Erie. Also included is Old St. Luke’s, an historic church without a congregation, and two cemeteries.
   

Perhaps the most interesting fact to come to light in the special master’s report is that the Board of Trustees—which is to say the Board of Trustees of the Episcopal Diocese of Pittsburgh—owns quite a few church buildings, many of which are occupied by departed congregations. Among this group is Trinity Cathedral in downtown Pittsburgh—Trinity claims to be in both dioceses—and St. Philip’s, Moon Township, one of the largest churches in the Anglican diocese.

Update (1/31/2009): My statement above about Trinity Cathedral is incorrect. See comments for more information.

Defendants Have 20 Days

As is now clear, there are public and confidential (redacted) versions of today’s order in the Calvary lawsuit. The Episcopal Diocese of Pittsburgh has on its Web site a story on the court order which includes a link to the public version of the order.

This post will update my earlier post “Judge Orders Asset Transfer?”; I will post more analysis later today.

The bottom line is that Judge Joseph M. James is ordering that diocesan property, as defined in the October 2005 stipulation and inventoried by attorney Stanley E. Levine, is to be turned over to the Episcopal Diocese of Pittsburgh. That property is currently controlled by deposed bishop Robert Duncan, now bishop of the so-called Anglican Diocese of Pittsburgh and archbishop of the Anglican Church in North America.

According to the court order:

Defendants shall, within twenty (20) days of the entry of this Order, provide to the Episcopal Diocese the financial records and other documents and electronically stored information reasonably needed by the Episcopal Diocese to hold and administer the real and personal property that is the subject of this Order of Court. The Defendants shall also provide such ongoing cooperation to the Episcopal Diocese as is reasonably necessary to implement the provisions of this Order.

More to follow, including commentary and a more easily read PDF of the order.

Judge Orders Asset Transfer?

(Updated 1/29/2010 at 1:51 pm)

Nearly four months after Judge Joseph M. James declared that diocesan property should be held and administered by the Episcopal Diocese of Pittsburgh and set in motion a process for the orderly transition of assets being held by those who split from The Episcopal Church in 2008, he has issued an order presumably aimed at effecting that transfer. It is expected that Archbishop Robert Duncan and other defendants in the Calvary lawsuit will immediately appeal.

Unfortunately, Judge James’s order is apparently under seal and is not available on the usual Web site, so one can only speculate as to its contents and why it is not being made public. I suspect that the reason the order is not being released is that it contains confidential information (e.g., numbers of accounts to be transferred). It is unfortunate that we do not now know the basics of what is being required by the court.

I hope that more information will be forthcoming shortly, perhaps from the Episcopal diocese.

Not Lovin’ It

I am not a person inclined to rail against materialism, but rampant materialism was at least partly responsible for my being upset when I visited my local McDonald’s for breakfast this morning. In front on the cash register—actually, I’m not sure which side of the cash register is considered the front—was a small sign that said “gift an Arch Card” over a picture of a prepaid McDonald’s cash card.

My first reaction to the sign was to object to the use of “gift” as a verb. Why turn a noun into a verb when a perfectly serviceable verb, namely “give,” is readily available? Moreover, there was no reason that I could see, neither grammatical nor graphical, why the first word on the sign should not be capitalized.

I then began to think more deeply about the use of “gift.” Perhaps there is a semantic difference between “to give” something and “to gift” something. Whereas “giving” stress an act, usually one of generosity—one can give a cold or give heartburn to someone, however—“gifting” emphasizes the (usually material) thing that is given. McDonald’s, apparently, is not so much interested in encouraging generosity as it is in marketing the Arch Card. In this, McDonald’s isn’t much different from most other merchants, though it is perhaps more crass about it.

A visit to the McDonald’s Web site gave me more insight into the marketing of the Arch Card. On the Arch Card page, I found the following text, along with explanations under each heading:

• load it.
• gift it.
• love it.
• track it.

Under “gift it.” was the following: “Givin’ is good. Perfect for business, fun holidays, birthdays, or just because.” The word “business” was linked to a corporate order form. Although I was happy to learn that McDonald’s thinks that “givin’” is good, perhaps McDonald’s believes that the real money to be made is in corporate sales of the card. Corporations are less interested in the goodness of “givin’” and more concerned about the benefits they might reap from giving away trinkets such as Arch Cards. No sentimentality here!

The aforementioned page also led me to realize that the lack of initial capitals is a graphical style recently adopted by McDonald’s. Before now, I had not noticed that the new McDonald’s tagline begins with a lowercase letter. In fact, “i’m lovin’ it” manages to violate two grammatical rules in just the first character.

I’m not “lovin’” McDonald’s corporate folksiness, either, but I’ll spare you that diatribe.

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Note: “Arch Card” and “i’m lovin’ it” are registered tradmarks of McDonald’s Corporation.

Question for the Third Sunday after the Epiphany

   

If Jesus died for our sins, what did he live for?

Eve in a Basket

I’ve been doing laundry and cleaning up in my bedroom. Before I left home this afternoon to run some errands, I had thrown a blanket on top of a laundry basket. When I returned, I found my cat Eve curled up at the bottom of the laundry basket on top of the blanket.

Eve is a Bombay, and Bombays, which are all black, are very hard to photograph. The pose was cute, however, so I decided to grab my camera and have a go at taking a few pictures. The best of the lot—I took four—is below. It shows off Eve’s eyes nicely. (Click on the picture to see a larger version.)