wfn.org | PJC rules session misspent PDA money

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Note #7374 from PCUSA NEWS to PRESBYNEWS:

08-August-2002
02289

PJC rules session misspent PDA money 
 
Act of kindness called a violation of fiduciary responsibility

by Evan Silverstein

LOUISVILLE - A church session in Charlotte, NC, acted "improperly" when it spent about $1,600 in proceeds from a Presbyterian Disaster Assistance (PDA) account to pay health-insurance premiums for an ex-employee, the General Assembly Permanent Judicial Commission (PJC) ruled on July 14.

The PDA funds originally were intended to help rebuild Matthews-Murkland Presbyterian Church's historic sanctuary after a fire in 1996. 

The commission ordered the Presbytery of Charlotte to form an administrative commission to work with the Matthews-Murkland session to correct financial discrepancies, clarify guidelines for using PDA funds and devise a schedule to repay the funds improperly spent.

 "We will comply fully with the decision and order of the GA PJC," said the Rev. Martha Jane Raedels, the Presbytery of Charlotte's interim general presbyter and stated clerk.

 Raedels said the administrative commission, to be named during the presbytery's Sept. 17 meeting, will help the Charlotte church's session "understand the scope" of the decision and order and "correct any financial irregularities."

She pointed out that the incident occurred more than two years ago, and that many who were serving on the session at the time have since rotated off. 

"It should be a straightforward process," she said of the commission's work, "and I'm certainly not expecting it to be a prolonged matter."

According to the PJC, the session received $200,000 from PDA after the fire. When the church decided not to rebuild the sanctuary, PDA said it could use the money "in developing new channels of ministry within your community," in the words of the PJC decision.

Stan Hankins, PDA's associate for U.S. disaster response since 1995, advised church elder Robert Nelson in a letter dated Sept. 16, 1997, that he believed the general nature of the appeal gave the church "flexibility in using the funds," but added, "Using the proceeds for salaries or normal operating expenses would not, in my opinion, be appropriate."

Hankins said PDA records indicate that the amount provided to Matthews-Murkland in 1996 was $89,077, not $200,000, as stated in the PJC decision.

In 2000 the session decided to use "PDA funds from the general account in excess of $1,600" to pay the insurance premiums of a former church secretary who had resigned for medical reasons in July 1999.

The PJC noted that the session had sought advice from PDA and the Presbytery of Charlotte and been told that "the ultimate decision" on the money's use rested with the session. Nonetheless, the commission ruled, the session was in error.

"Notwithstanding the advice and the opinion given," it said, "any discretion regarding use of the funds must adhere to the broad purposes for which funds were provided.  In expending money from the interest gained from the PDA for church operating expenditures and for the fraudulent expenditures for the health insurance of the former secretary, the session failed to meet its fiduciary responsibility."

The Rev. Alexander Porter, the current pastor of Matthews-Murkland church, has been there for only a short time. He had no comment.

Questions about the use of the money arose in October 1999 when then-member Dianne Carter Bentley Cuthbertson filed a complaint against the session with the Presbytery of Charlotte, alleging improper use of PDA money and claiming that the session had refused to give her access to session minutes. 

The presbytery's PJC ruled that she hadn't stated "a claim upon which relief can be granted." On appeal, the PJC of the Synod of the Mid-Atlantic found no impropriety in the session's use of the money. Cuthbertson then appealed to the General Assembly PJC.
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