The Business Administration of the Church

There are several business aspects to the operations of running the church as a non-profit entity. Included are legal aspects to this, which, if not done correctly, can cause the loss of the non-profit tax status, in addition to reputation, fines and other risks. While we certainly know and agree that the Church's ownership and leadership is Jesus Christ, there are still several practical applications we can take from the business world to make the operations of the church organization more efficient and carry less risk. On a more practical basis, it provides information for future leadership.

My experience is that many of our RB Churches have a tendency, due to  extreme busy schedules, are not as organized in the administrative and/or operational matters.  Since we are all independent and not part of an organized conference, these very important, critical matters may not get the attention warranted.

Your organization should know and understand what disqualifies a 501c3 organization. If you are conducting activities that are not aimed at the exempt purpose it qualified for including an unrelated trade or business there can be an issue. As long as your income comes from activities related to your stated mission and purpose, your profits are tax-exempt. You may need to set up another organization so the unrelated efforts may be taxable for income purposes. Consulting with your tax advisor is especially helpful in this area.

As far as documentation goes, The Five Solas Foundation can provide the specific templates and the consulting you may need and help your Church Leadership get started in the process of documentation. You may be asking, why do we need the items on this list (and there are probably more based on your specific needs and circumstance). Some of the points on the list are obvious and others may seem time consuming with no benefit. We could say that like your Church Constitution, the operations of the Church should be clear to those who need to know the information and provide a turn key operation when leadership changes, duties realign, or a new Pastor is brought on to the ministry. This information can be kept in a binder or virtually in a computer file, or both. These become working documents which should be reviewed for any changes in your leadership meetings. It may be the information at first may be basic, however as you give careful thought to these matters, you will, most likely, add depth of detail. Some examples of important documentation:

1. Minutes of Pastors and Deacons Meetings
2. Minutes of Church Membership Business Meetings
3. Job Descriptions of Pastors, Deacons and Officers
4. Who is granted access to the building; for what reasons, who has keys to the building and what are the duties. What is the process for having the keys returned when appropriate
5. Salary composition for Pastors including what calculation for COLA used
6. Current philanthropy process
7. Any compensation for others including members that contribute to the work of the Church
8. Any income which is out of the ordinary Church business (renting out building or parking lot, etc.)
9. Contractors and professionals who have worked in or on the building for future repairs or liability protection
10. The list is not exhaustive, although it may be all you need, or you may decide on a few of these tasks. At the time of this writing, the plan, Lord willing, is to assemble samples of these documents from pastors and churches who have written them and willing to share upon request and with permission from the originator(s). In the meantime, we can help you with discussions to clarify your most important needs, and you may want to work on customized templates for your organization.

These documents will clarify the organization and operations of the business of the Church and prove to be very helpful if ever needed for legal reasons, or when the Church is considering adding another member of the leadership team.