Monday, July 18, 2011


Whether you are watching TV, a movie, or looking at a photograph in the newspaper or a magazine, it is difficult to tell if the images are real or not. Video games are nearly as realistic as film. There is a blurring of the lines between virtual and real.

The blurring of lines can be a challenge when it comes to truth telling—sometimes we call it shading the truth—changing it enough to suit our desires.

People are desperate to know the unvarnished truth. Whether in advertising, politics, or the news, people are skeptical about what they see, hear and read—there is so much blurring.

Recently a witness in a murder trial was accused of “falling on the sword” for her accused daughter—a thinly disguised phrase suggesting the witness lied. A politician made a false statement in an interview and his or her staff later “walked back” the comments—more blurring.

Is it the real deal or are we looking at graphically-enhanced pictures, hearing slanted news, or reading bloviated stories? Who can we believe?

The ninth commandment is part of a broad biblical condemnation of sins through speech (and a correspondingly vigorous promotion of speaking the truth). While false and deceptive witness was clearly and repeatedly condemned, several famous stories indicate the rule was not always strictly observed, even by the heroes of the faith. For example, Jacob was frequently engaged in deceptive witness, Isaac bore false witness about his own wife Rebekah, and Samuel deceived some of Saul’s people when he went to anoint David as Saul’s successor.1

Despite this inconsistent performance by biblical characters, the teaching of Scripture is constant. The book of Proverbs is especially full of counsel about our speech. Two of the “six things that the Lord hates” and that are an abomination to him are “a lying tongue” and “a lying witness who testifies falsely” (Prov. 6:16-19).

The other side of this broad condemnation of false witness is the equally extensive praise of truthful witness. Proverbs commends wise, noble and true words: “A word fitly spoken is like apples of gold in a setting of silver” (Prov. 25:11).

Truthfulness is an underlying principle of ECFA’s standards—everything done in the name of our Lord should reflect truthfulness.

One of the key elements in good relationships between a church or charity and their givers is truth telling. Once trust is gone, a relationship is difficult to restore. Failure to tell the truth can be done so subtly that it goes unnoticed. We begin by blurring the truth about “small things” that “don’t matter.” Then a pattern develops. Soon valuable credibility is lost.2

ECFA especially focuses on truth-telling as it relates to how our members secure charitable gifts. The relationship between a giver and an organization is one built on trust. That trust is developed and maintained through truthful, honest, reliable, and trustworthy communications.

The concept is so vital that two decades ago ECFA established separate standards to especially ensure that a member’s relationships with those who financially support a member are maintained at a high threshold. Under these standards, ECFA members commit to represent facts truthfully when communicating with those who are considering whether to provide a charitable gift.

When communicating a giving opportunity, it is important to consider how it will be understood by a giver. After reading or hearing the appeal, the giver’s perception of the giving opportunity should be as close to the actual facts as possible. The accurate representation of words, pictures, graphs, and other information is vital.

And thinking like Jesus doesn’t only apply to raising resources—it applies to everything we do; it’s all covered when we think His way.

Telling the truth is a fundamental concept as we strive to be a reflection of God. May it always be our witness!

1 Doing Right, David W. Gill, Intervarsity Press, 2004, page 283-4
2 Based on Honesty, Morality & Conscience, Jerry White, Navpress, 1996, page 51

Tuesday, June 14, 2011

Much Ado About Little

Reporting on the recent revocation of tax status of 275,000 nonprofit organizations, the New York Times reported the action shrinks the nation’s nonprofit sector by roughly 17 percent, to about 1.3 million charities, trade associations, membership groups and labor unions. The IRS took action against charities that failed to file required paperwork for three consecutive years.

While it shrunk the number of nonprofits on the IRS’ list by 17 percent, it certainly did not reduce the number of nonprofits by 17 percent since most of the 275,000 organizations were apparently non-existent for many years. The IRS indicated about one-quarter of the 275,000 received tax exemptions before 1980 and many simply stopped operating without telling the IRS.

Until a change in federal law in 2006, only organizations with annual revenue of $25,000 or more — roughly one-third of the 1.6 million nonprofit groups — were required to file.

That law, the Pension Protection Act, required all organizations to file returns, but because it was embedded in 393 pages of a law that otherwise dealt with pension issues, many nonprofit groups did not know that.

This process is another example of legislation which, while well-intended, provided little benefit while creating an enormous amount of work—both for those in the government sector at taxpayer expense—and for charities, requiring perhaps millions of dollars of charitable contributions to fund the expenses of impacted charities.

Click here to read more.

Wednesday, June 8, 2011

Giving to ECFA Members Exceeds National Trends

While the dominant headlines during the recession have focused on the decrease in giving to nonprofits, this is not the entire story.

We have just completed an analysis of giving to ECFA members. It revealed that for ECFA members renewing membership in the last six months there has been a net gain in giving of 2% from 2009 to 2010. Pre-recession giving compared to three years later was $6.18 billion in 2007 and $6.32 billion in 2010, or an increase of 3.3%.

It is very significant that this segment of the giving world was resilient and maintained itself during a difficult economic time. This suggests a strong commitment of givers to the Christian faith and the generosity of God’s people.

The recessionary impact on giving was more significantly felt by smaller charities. Organizations with annual revenue above $10 million reflected an increase in giving for the 2007-10 period of 3.1%. While the organizations under $10 million annual revenue saw a decrease of 3.2%.

Of the 552 member’s data studied, 43% reflected an increase in giving between 2009 and 2010, 44% showed a decrease and the data for 13% was about the same (plus or minus 2%).

Click here to read more.

Wednesday, June 1, 2011

The Challenges of Charitable Solicitation Registration

There are few topics as confusing as state charitable solicitation registration. Nearly everyone who is in a charity leadership position is familiar with the concept but few clearly understand the implications of the laws in the various states as it relates to their charity.

One of the reasons this issue is so confusing is that it is a state, not a federal issue. With so much variation between the charitable solicitation laws in the 50 states, it is no wonder this matter leaves charity leaders puzzled.

Charities that seek contributions nationally must typically register in 39 states and the District of Columbia before starting to solicit. Since many states are increasing their enforcement efforts to ensure that charities and fundraisers are complying with initial and annual registration requirements, it's important that charities and fundraisers abide by these statutes—especially since noncompliance can result in the imposition of significant fines and penalties.

We have some excellent resources on the ECFA website to help you wade through the details of charitable solicitation registration including a state-by-state summary prepared by our friend and attorney, Chip Watkins.

To better understand these issues, join us for a special Charitable Solicitations Issues Webinar on June 22 at 1 pm EST. The two presenters, Karl Emerson and Dick Travis, are among the most knowledgeable individuals on this topic in the U.S. Karl is an attorney with Montgomery, McCracken and is the former director of the Bureau of Charitable Organizations of Pennsylvania. Dick Travis consults with many nonprofits on charitable solicitation issues and is the president of The Travis Group.

Click here to register.

Tuesday, April 26, 2011

A Time for Discernment

Decisions by leaders and boards of Christ-centered organizations are made constantly. For leaders, decisions are made nearly every day. Boards make decisions every time they meet.

Many of these decisions are seemingly small or routine—sometimes made offhandedly and without much thought. Other decisions are of organization-altering magnitude. Especially with these more significant issues, spiritual discernment is fundamentally important.

As leaders and boards, we are confronted with new perspectives, emerging trends, and economic and regulatory developments. It is a daunting task to make biblical decisions against a mosaic of options!

We focus on the Bible, prayer, faith, and wise counsel—all important elements in biblical decision making—but too often we do not consider spiritual discernment in the process.

In I Kings 3:5-9 (ESV) we learn that while Solomon was at Gibeon to offer sacrifices to the Lord, God appeared to him and said simply “Ask what I shall give you.” We are commonly taught that Solomon asked the Lord for wisdom but he requested more than wisdom; he asked for discernment. He became both wise and discerning. This teaches us that God honors discernment and those who seek after it.1

Discernment is evidence of God at work and is deeply rooted in both the Old and New Testaments. The early church used the language of discernment. Paul and Barnabas were sent to Antioch with a letter that said,

"For it seemed good to the Holy Spirit and to us to lay upon you no greater burden than these essentials” (Acts 15:28-29 NASB).

This is the language of discernment.2

Romans 12:2 (ESV) directly refers to discernment, “Be transformed by the renewing of your mind, that by testing you may discern what is the will of God, what is good and acceptable and perfect.”

We do not get to listen to God’s voice thundering on the top of Mount Horeb. Instead, we must rely on the more subtle dynamics of the Holy Spirit witnessing with the human spirit about things that are true.

Discernment presents unique challenges in contemporary Western culture, because it requires us to move beyond our reliance on cognition and intellectual hard work to a place of deep listening and response to the Spirit of God within us and among us.3

Discernment involves thinking in a specifically Christian way about each issue. At the same time, our hearts have to be engaged in devotion to Christ. Then, and only then, will we find ourselves in tune with the mind of God and be able to make good judgments and appraisals, because to the believer is promised the presence of the Holy Spirit.4

Discerning God’s will is a spiritual dynamic beyond human wisdom. Always a key principle for leaders of Christ-centered churches and non­profits, with national and world events occurring at a frenetic pace and the second coming of Christ closer than it has ever been, the importance of spiritual discernment is vital.

We hear countless voices in a given day—some belong to co-workers, the media, or friends. Other voices exist within us (memories, emotions, or desires), and these can be the hardest to filter. For the believer, hearing the Lord is most important, so discernment becomes critical in distinguishing His voice from the others.5

As leaders and board members, we are expected to pursue discernment; the Bible repeatedly cries out for this.

1 The Discipline of Spiritual Discernment, Tim Challies, Crossway, 2007
2 “Discerning God’s Will Together: A Spiritual Practice for the Church,” by Danny E. Morris and Charles M. Olsen
3 Strengthening the Soul of Your Leadership, Ruth Haley Barton, InterVarsity Press, 2008
4 The Lost Art of Discernment, R. C. Sproul
5 “Developing Spiritual Discernment,” article by Charles F. Stanley

Thursday, January 20, 2011

Trust the Processes

The last 24 to 30 months have brought mind-numbing financial challenges for a few churches and ministries. For others, the days have been challenging to say the least.

For years, it seemed so easy. Revenue increased nearly every year; expenses were allowed to proportionately increase. Everyone received a salary increase each year; there were few lay-offs. The number of people served by our programs went up. Reserves often increased.

But then, revenues began to decline. There was no certainty on how far they would go down. Budgeting principles, as we knew them, were out the window.

Organizations cut expenses but many found themselves behind the curve. Some looked for a “new normal.” While “normals” feel permanent, they never are—they just don’t stick around very long. It has been a process.

It is a sobering thought but a vital one. The things I know best about Him are things I learn through the process of day-to-day ministry and life.

You wake up in the middle of the night—you hear a voice that quietly but firmly points out that there is One who can gather up the circumstances of our ministry and use them to His purposes and to our good.

It is partially, at least from this perspective of bad times and good times, that I so strongly see and believe this fact: one can come to know that God is infinitely willing and abundantly able to bring good out of the processes of our ministries.

In Dorothee Soelle’s book, Death by Bread Alone, she suggests “the language of religion is experience.” She writes about a deep experience she went through: “It began to dawn on me that people who believe limp somewhat, as Jacob limped after wrestling with God on the shore of the Jabbok. The experience of the sufficiency of grace for our life, and the experience that nothing—not even our own death—can separate us from the love of God, are experiences we can recognize only after the fact. Such experiences are not written down and incorporated in drawings and plans which we can examine and check during the course of construction.”

The processes of life are when we come to know Him as we should. We start out with a “profession of faith.” It is not that what we are saying is not true—His promises are definitely real. But we do not own these beliefs yet because we have not bought them with the experiences of our journey. In the last couple of years, many Christian leaders paid the price of buying their beliefs while working through the processes of ministry.

When I was younger, I was a frequent attender of Christian retreats. Bob Benson, an executive with Benson Publishing, was my favorite retreat leader. In one retreat prayer time, he asked us to envision a blank sheet of paper with a horizontal line across the middle. Then, giving us time for reflection, he asked us to remember the good things that happened over the last couple of years—to think about them and rejoice over them. He asked us to put those things above the line.

Then, to help us get a truer perspective of how God works in our lives, he asked us to recall the negative things that had come to us as well—the dark, deep, troublesome times that threatened to engulf our souls. He asked us to list those below the line.

Bob asked us to commit the whole paper to Him—He is the God of the list on the top and God of the list on the bottom.

That day as I made my list, there were some things, for the life of me, I didn’t know where to put them. Some of the things were so evil it would seem their place would be a foregone conclusion. The day they happened, I knew, all right. The bottom of the bottom wasn’t low enough. I did not know whether I would make it or not. But looking back, I could see how God used for good what seemed so bad at the time.

That retreat with Bob Benson was years ago and he has gone on to the treasure laid up in a life-time of devotion, discipleship, and dedication. Still today, even the worst things that have happened to me in the last few years, I find them creeping up, over the line—illustrating that even out of the direst circumstances His call to us can be heard.

Listen to all your ministry has to say to you. He calls you from the processes.

Based on Bob Benson’s book He Speaks Softly, Word, 1985.

Tuesday, January 18, 2011

The Long View

We live in a 24-hour news cycle, results-now world. In contrast, our God takes the long view.

Seeking immediate results is rarely more common than when our ministries are impacted by an economic recession. All of our measurement tools are in place to report short-term measurable “success.” We impatiently scan our ministry reports for positive data indicators.

Are concerns about short-term data important? Yes, par­ticularly if questions of sustainability of the organization are in play.

Yet sound guidance of a ministry is more like running a marathon than a sprint. It is focused on the Great Commission with an appropriate desire to attain short-term effectiveness.

Matthew 14:15 records the recommendation of the disciples to Jesus as they told Him, “This is a remote place, and it’s already getting late. Send the crowds away so they can go to the villages and buy food for themselves.” In his recent book, The Longview: Lasting Strategies for Rising Leaders, Roger Parrott, president of Bellhaven College, suggests “the committee’s decision seemed like a reasonable solution.”1

But Jesus took a long view perspective in mentoring these disciples, knowing the solution had sweeping ramifications beyond where to get dinner. Bolstered by the miracle on the hillside, Peter found the faith to step out of the boat and walk on water. That evening had long view implications.

God often builds his church using the long view principle. William Carey, the first missionary to India, worked for seven years before he had his first convert. Robert Morrison, the first Protestant missionary to China, labored for a quarter century and had fewer than a dozen converts.2

When taking the long view, the following principles are fundamental.
  • Remembering. We are often so focused on the current challenges that we do not take time to remember. How has God helped us in the past? Has he ever failed us? What lessons did He teach us in past challenging times?
  • Reflecting. Identify the season your organization is in by reflecting on your environment. Bill Hybels refers to the seasons of growth as consolidation, transition, malaise and reinvention. He traces the seasons idea back to Ecclesiastes 3:1, which says that “there is a time for everything, and a season for every activity under the heavens.”3 Simply naming the season we are in is the basis of determining the implications of the season.
  • Vision-casting. “God’s vision for your ministry will not change quickly, nor will it be something you will accomplish rapidly. His vision will require years of active pursuit. The vision itself may even outlive you!
“Thus, the heart of the vision will remain unchanged over a prolonged period. Some of the details lying at the outer edge of your understanding of the vision may shift somewhat over the course of time. But the core of the vision—the people you have been called to reach, the task you have been called to do, the purpose for which you exist—will remain constant.

“Because He is not a God of confusion but of order, because He is a God who is in control, because He takes great pleasure in seeing us find success in our service, He will be faithful in His support of the vision.”4

Reflecting on these principles, have you made short-term decisions in the last 12 months impacting the budget, programming, personnel, and much more? You probably have and this was important to do in the short-run. But even the short-term decisions can and should be made with the long view foremost in mind.

1 The Longview: Lasting Strategies for Rising Leaders, Roger Parrott, David C. Cook, 2009.
2 Ibid.
3 Axiom, Bill Hybels, Zondervan, 2008.
4 The Power of Vision, George Barna, Regal, 2009.

Keeping Up with the Health Care Reform Changes

For all plan years beginning on or after September 23, 2010, employers are required to dole out an array of reform notices to all plan participants. Here are six notices that should be provided to employees:
  • Dependent coverage notice. All health plans are required to offer a one-time enrollment opportunity to participants’ children who are under age 26. In addition, participants must have 30 days to enroll their dependents. Participants must be notified of the changes no later than the first day of the plan year beginning on or after September 23, 2010.
  • Lifetime limits notice. Under the new law, plans are prohibited from putting lifetime limits on the dollar amount of coverage plan participants receive. Participants who had previously reached the limits of their healthcare coverage must be given a special enrollment notice that lets them know they are once again eligible for coverage.
  • Primary care designation and OB/GYN notice. Employers must communicate to employees that they have the right to designate a primary care physician within the plan’s network to coordinate their medical care. Additionally, female employees need to be informed they can obtain OB/GYN care without prior authorization.
  • Grandfathered status notice. All participants must be notified as to whether or not their health plan will retain its grandfathered status. If the plan does keep its grandfathered status, participants must be told that the plan is exempt from certain reform law provisions.
  • Cancellation of coverage notice. Participants’ healthcare coverage cannot be cancelled or terminated retroactively except in cases of deliberate fraud or similar situations. However, if a plan does cancel a participant’s coverage, the individual must still be given at least 30 days advance notice of the cancellation.
  • Claims appeals notice. A notice must be given to all participants who have a claim denied, explaining their right to appeal the denial. It must also outline the plan’s procedures for internal appeals and external reviews of those decisions.
For model language to satisfy these six notice requirements, see Health plan providers may also furnish you with the proper notices.

What You Need to Know About Medical Expenses and 2011

The impact of health care reform begins to pick up speed after 2010. While churches received a reprieve on one health care-related issue, other changes are right on schedule even if little information is available to carry out some of the provisions.

The reporting reprieve. Churches were scheduled to report the value of employer-provided health coverage on Form W-2’s for 2011 to be filed in 2012. However, the IRS has now given churches (and other employers) a one-year reprieve (Notice 2010-69). Reporting the value of the health coverage for 2011 is now optional. The IRS has determined that this relief is necessary to provide churches (and employers) the time needed to make changes to payroll systems or procedures in preparation for compliance with the new reporting requirement. So, the information will now be required on Form W-2s for 2012 filed in 2013.

In addition, the IRS announced that it has issued a draft Form W-2 for 2011. When churches report the value of coverage under a church-sponsored group health plan (optional for 2011 Form W-2s/required for 2012), the data must be reflected in Box 12 with a code of DD.

Remember: The cost of church-provided health insurance is not taxable. The new reporting requirement is intended to be informational only and to provide employees with greater transparency into overall health care costs.

A 2011 change that is right on schedule. Over-the-counter drugs and medicines are not eligible for tax-free reimbursement under an employer-sponsored health plan beginning January 1, 2011 (insulin is not a medicine or drug for purposes of this rule).

A few large churches have cafeteria plans and many other churches have health care flexible spending accounts (FSAs). This new limitation imposed by the Patient Protection and Affordable Care Act impacts reimbursements under these plans (OTC drugs and medicines were never deductible as medical expenses on Schedule A.)

It is very important to determine whether a particular OTC item is a medicine or drug because the new rules do not apply to OTC medical supplies and equipment (such as contact lens solutions, bandages, crutches or durable medical equipment or diagnostic devices such as blood sugar test kits.)

The new OTC rules apply to medicines or drugs (other than insulin) incurred on or after January 1, 2011, without regard to the plan year of the plan. Thus, a plan with a fiscal plan year must begin complying with the rules mid-plan year. And, expenses for OTC drugs and medicines incurred during the two-and-a-half-month grace period following the end of a 2010 calendar plan year must be accompanied by a prescription.

What to do. Churches should make the following preparations:
  • Form W-2’s for 2012 to be filed in 2013. Even though reporting the value of coverage under a church-sponsored group health plan, it might be a good plan to report the data on Form W-2s for 2012 to get ready for the reporting required for Form W-2s for 2013.
  • Establish a flexible spending account. Your church doesn’t have to even be close to megachurch size to have a FSA. The smallest church in the U.S. can set up an FSA at virtually no cost to the church and allow church staff to have amounts reduced from salary and used to reimburse medical expenses tax-free (free of federal income and social security taxes—and often free of state income taxes).
  • Amend existing cafeteria and FSA plans. Existing plans must be amended to reflect the new OTC rules. Fortunately, plans may be retroactively amended effective January 1, 2011 so long as the amendment is adopted no later than June 30, 2011.