Tacoma area churches received millions in government money they might not have to pay back
More than 20 churches and faith-based groups in Pierce County were recipients of up to $14 million in federal Paycheck Protection Program funding.
The PPP loans are meant to help small businesses and other organizations stay afloat during the COVID-19 pandemic. Congress allotted $719 billion into the PPP. Additional funds were added to the program in April.
The low-interest loans can become grants if the churches apply for forgiveness and meet requirements such as job retention. The program is intended to encourage businesses to keep employees on the payroll.
What exactly most of those millions of dollars went to fund is known only to the churches and religious organizations. Only three church officials and a spokeswoman for the Seattle Archdiocese responded to queries from The News Tribune.
“We proceeded with the PPP loan because our heart is really for the community, and our community would be hurting without the ministry and the partnerships that we’re a part of,” said Our Savior Lutheran Church pastor Tim Bayer. “We genuinely believe that our community would be worse off. Not better off.”
The award amount is determined by average monthly payroll costs, minus employees who make more than $100,000, according to the application.
The Trump administration opened the federal COVID-19 loans to religious entities, stating that it was discriminatory not to include them.
Our Savior received a roughly $175,000 loan, Bayer said. Other Pierce County churches got more.
Life Center, a so-called mega church in central Tacoma, received a loan between $1 million and $2 million, according to government records.
Life Center’s annual income isn’t public. Churches are not required to file tax returns.
The church runs a pre-K-12th grade school, Life Christian Academy, and an assisted living center, Life Manor.
Currently, the church is holding its services online and in its parking lot at 1717 S. Union St.
Life Center’s chief operating officer, Michelle Cox, said the loan assisted all five of its churches and campuses as well as its school. She did not disclose the amount the church received.
In its application for the loan, Life Center stated the money would retain 302 jobs.
“The ripple effect of keeping those individuals employed is seen in the community impact that we started or continued during the pandemic,” Cox said in an e-mailed response to The News Tribune.
Cox said the church gives out or delivers up to 500 bags of groceries weekly to vulnerable people. The church also was able to expand its food bank at its Parkland/Frederickson campus and provide child care for first responders and other essential workers.
Champion’s Centre, a mega church located on Tacoma’s Eastside, received between $350,000 and $1 million in a PPP loan, according to government records. On its application, the church said 49 jobs would be saved.
The church and its lead pastors, Kevin and Sheila Gerald, did not return repeated messages from The News Tribune.
Catholic parishes and schools in Pierce County received up to $6 million in loans. Helen McClenahan, a spokeswoman for the Seattle Archdiocese, would not provide an exact amount.
“The money parishes applied for reflects their payroll and payroll-related expenses, as well as the other items allowed by the Small Business (Administration),” McClenahan said in an e-mailed statement. “It also ensured our school and parish employees could continue serving our students, families and communities during this unprecedented time.”
McClenahan said schools and parishes are funded by donations and tuition.
“Both of which have taken significant hits,” she said.
Serving the community
Our Savior was one of several churches which got loans in the $150,000 to $350,000 range. The church wanted the money to help its staff and its community.
“If a church is just doing it to pad their own pocket, I would struggle with that,” Bayer said.
Bayer said the PPP loan was used to keep the church’s 20-person staff employed. The decision to get the loan was not made lightly.
“We had long talks with our board and with our bank about it,” Bayer said. “We consulted other attorneys and other congregations to get perspective.”
Bayer and his directors were committed to keeping their staff employed.
“We actually met a couple days before Gov. Inslee issued the restriction on March 11. And we talked and we prayed about it long and hard as a directors team,” Bayer said.
Like other churches, he’s been holding virtual services for his 600-plus member congregation. He doesn’t see that ending anytime soon.
“Why would I put our community at risk by gathering a group in a church?” Bayer said. “That just doesn’t make sense to me. It’s not like we have a spiritual reunion card where we get a pass.”
The church, which Bayer calls moderately progressive, continues to run programs, including a preschool (now virtual), food giveaways, educational partnerships and “abundance gardens.”
“Our identity is really to come alongside of our community and serve,” Bayer said. “That’s a part of our organizational DNA.”
The church operates a backpack food program in partnership with the Franklin Pierce School District. It also gives away weekly food bags, which, Bayer said, will probably become daily food bags in the fall.
Our Savior has an annual operating budget of $1.8 million About 80 to 85 percent of that comes from tithing.
The vast majority of giving occurred at services, Bayer said. The church is transitioning to online giving, but it’s seen a drop in tithing since in-person services were canceled.
“Some people opted to just send it in via mail and they sent a big stack of checks,” Bayer said. “Others jumped online right away and did recurring giving. Other folks just got frustrated because their banks couldn’t talk to our bank.”
The church owns its building and has no outstanding debts.
Part of its income came from the preschool. The church is no longer charging tuition for its virtual school.
“Just to take that burden off of families in our preschool community to say, you know, there’s a lot of things you need to figure out and worry about. Tuition is not one of them,” Bayer said.
Church members tend Our Savior’s abundance gardens at its 112th Street East location. The gardens provide produce for local food banks.
The church spends 55 percent of its annual budget on staff compensation and benefits. That’s average for most churches, Bayer said.
Should churches get government funding?
Bayer looks at the loan as a lifeline.
“We’d have to stop our backpack program,” he said. “We would not be able to do abundance gardens.”
An upcoming school-supply drive for Franklin Pierce schools would be impossible, he said.
“We would be, in a sense, in survival mode,” Bayer said. “And, so, it’s really given us the freedom in our case, because our values are to live generously.”
Churches do pay some taxes. Our Savior pays all the typical payroll taxes for its employees. It also pays property tax on a portion of its land.
“One of our unspoken values is to live within our means,” Bayer said. “You know, we don’t go and search for loans, we don’t operate with a line of credit. The resources that we receive are to be passed through and given for community impact.”
The church will apply to have its PPP loan become a grant, Bayer said.
“It was automatically implied (by the board) that we would apply for forgiveness when the time comes,” he said.
Some feel that a religious organization’s survival becomes even more important during a time of crisis when needed help ranges from the practical to the spiritual.
“We consider the local church to be a ‘hospital’ for the broken-hearted and hurting and therefore essential for the community,” Life Center’s Cox said. “Local churches provide both spiritual and mental health support during times of crisis.”
A lifeline for the community
Tacoma-based Associated Ministries was founded in 1969 to centralize the service arms of more than 100 Tacoma-area churches. Today, it’s developed into a faith-based, non-denominational service organization that focuses on housing, homelessness and other pressing community needs, said executive director Michael Yoder.
It, in turn, has spawned the Emergency Food Network, Pierce County AIDS Foundation, Hilltop Action Coalition and other community endeavors, Yoder said.
Associated Ministries gets most of its operating budget from contracts with Tacoma, Pierce County and the state. And it still gets support from local churches, Yoder said.
The $250,000 PPP loan Associated Ministries received was used to pay employees, Yoder said.
“Because the PPP was available to us, we didn’t have to worry about payroll,” Yoder said. “We were able to do fundraising campaigns to raise money that provided for direct assistance to people in need.”
It’s easier to ask people for helping a charity’s clients than it is for its staff, Yoder said. With the uncertainty of funding, Yoder estimates he might have had to lay off as many as six of the organization’s 33 employees without the PPP assistance.
Associated Ministries will apply for forgiveness of the loan, Yoder said.
Yoder sees the PPP loan as an investment in the community.
“Having a source of funds to keep my staff whole energized me to go out and ask for the community to support funds to go directly to needy people,” Yoder said.
Tacoma area churches/religious organizations receiving PPP loans
▪ First Assembly of God Life Center of Tacoma; $1 million to $2 million; jobs retained: 302
▪ Bellarmine Preparatory School; $1 million to $2 million; jobs retained: unknown
▪ Champion Centre; $350,000 to $1 million; jobs retained: 49
▪ Saint Patrick Parish; $350,000 to $1 million; jobs retained: unknown
▪ St. Patrick’s Catholic Church School; $350,000 to $1 million; jobs retained: unknown
▪ St. Charles Borromeo; $350,000 to $1 million; jobs retained: unknown
▪ The Rescue Mission; $350,000 to $1 million; jobs retained: 85
▪ Christ the King Community Outreach; $150,000 to $350,000; jobs retained: unknown
▪ Concordia Christian Academy; $150,000 to $350,000; jobs retained: 46
▪ Faith International University; $150,000 to $350,000; jobs retained: 23
▪ Holy Rosary Bilingual Academy; $150,000 to $350,000; jobs retained: 25
▪ Our Savior Lutheran Church; $175,000; jobs retained: 20
▪ Resurrection Church; $150,000 to $350,000; jobs retained: unknown
▪ Sound Life Church; $150,000 to $350,000; jobs retained: unknown
▪ South Sound Christian Schools; $150,000 to $350,000; jobs retained: unknown
▪ St. Leo Parish; $150,000 to $350,000; jobs retained: 22
▪ Tacoma New Life Presbyterian Church; $150,000 to $350,000; jobs retained: unknown
▪ Tacoma Bible Presbyterian Church; $150,000 to $350,000; jobs retained: unknown
▪ Tacoma Christian Academy; $150,000 to $350,000; jobs retained: 49
▪ The Associated Ministries of Tacoma-Pierce County; $250,000; jobs retained: 6
▪ The Church of the Visitation; $150,000 to $350,000; jobs retained: unknown
▪ Youths for Christ Tacoma Area; $150,000 to $350,000; jobs retained: 20
