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For some churches, it is better to repay PPP payday loans no credit check than to forgive

(RNS) – When the governor of Michigan called on churches to stop meeting in person on March 16 last year, Kenton Sanders payday loans no credit check, director of operations at Mars Hill Bible Church, quickly made disturbing calculations.

About 40% of donations to the mega-church in Grandville, Michigan came through in-person services that attracted some 1,750 adults, students and children each week. With the closure of in-person services, donations would surely drop. If that happens, the church would have to lay off some of its staff payday loans no credit check”}” data-sheets-userformat=”{“2″:513,”3”:{“1″:0},”12″:0}”>payday loans no credit check

“It was at the start of the pandemic, we had just logged on and we had no idea what was going to happen,” he said.

So, like more than 120,000 churches and other religious organizations nationwide, Mars Hill requested help through the Paycheck Protection Program, the emergency loan program created by the CARES Act, an aid scheme and a $ 2.2 trillion stimulus passed by Congress in March 2020. PPP, the Small Business Administration would channel funds to local banks, which would provide loans to employers in their communities.

Mars Hill’s $ 295,000 loan, approved on April 14, 2020, would protect two dozen church jobs, at least for a few months.

But less than a month after the loan was approved, Sanders noticed that donations had actually increased. In addition to the regular online offerings, church members have also contributed to a charitable fund, known as the “White Bucket Project,” to help neighbors in need during the pandemic.

After speaking with other Mars Hill executives, Sanders called the bank and paid off the full loan amount.

Mars Hill is one of a handful of faith-based organizations that have taken out large PPP loans just to return the funds without ever withdrawing a dime or paying off the loan in full. According to an analysis by Religion News Service of SBA data, 13,408 religious groups, mostly churches, have been approved for loans of $ 150,000 or more. Of these, 100 repaid the loans without requesting cancellation of the loans. Fewer than 50 other groups were approved for the loans but did not withdraw the funds.

Loans repaid range from $ 4.37 million to $ 150,500 and total just over $ 66 million. Those who repay the loans include 99 Christian groups and one Muslim organization.

Lakewood Church is a non-denominational Christian mega-church in Houston. It is one of the largest congregations in the United States, occupying a former sports arena. Photo courtesy of Creative Commons

At least one well-known congregation, Lakewood Church in Houston, led by televangelist Joel Osteen, recently announced that it will repay a $ 4.43 million PPP loan. A church spokesperson said the loan will be repaid with interest over 60 months.

RELATED: Yes, the Catholic Church Has Received Federal P3 Loans. Good for them.

More than 8,800 religious groups have called for their loans to be canceled – as the program was designed to allow, and a relatively common practice for all PPP borrowers. The status of about 4,500 other remaining loans has yet to be reported to the SBA by local banks.

A total of 11,823,594 PPP loans were approved, for a total of $ 799.8 billion.

For the Philadelphia Baptist Church, based in Deville, Louisiana, the approval of a PPP loan provided peace of mind when such peace was scarce. Pastor Philip Robertson called the first days of the pandemic the most stressful time in his more than a quarter of a century as a pastor.

Pastor Philip Robertson.  Courtesy photo

Pastor Philip Robertson. Courtesy photo

While the church had some reservations about the loan and that it would come with government terms, Robertson said, “We wanted to make sure we were able to keep paying our staff and not have to suffer catastrophic financial implications. ”

Early on, church leaders decided to repay the $ 181,170 loan if they could. The funds were set aside, Robertson said, and were only to be spent when needed.

When donations remained stable, the church repaid the loan in July 2020. The loan repayment cost the church about $ 400 in interest, Robertson said, a small price to pay for the peace of mind that accompanied the loan.

Robertson said he was grateful the church was eligible for the loan – even though it was federally funded – acknowledging that the loan was not found to be necessary and grateful for the continued donation of church members .

“God’s people give because they give out of obedience to the Lord and wanted to support the ministry and work of their church,” he said. “And it was a priority for them. Even in the midst of a global pandemic. ”

Paul Spilker, chief executive pastor of College Park Church in Indianapolis, which repaid a loan of $ 1,157,100, was also surprised by the generosity of church members during the pandemic. The loan, he said, allowed the congregation to pay its staff during a time of great uncertainty. When the donation to the church turned out to be larger than expected, he said, the church leaders decided to repay it.

“We thought, here’s a testament to the generosity of our people,” Spilker said.

Pastor Paul Spilker.  Photo courtesy of College Park Church

Pastor Paul Spilker. Photo courtesy of College Park Church

Spilker and other church leaders who repaid the loans said it was the right thing for their church. But they understand why other groups have made different decisions.

To qualify for a loan forgiveness, churches and other organizations had to certify that there was significant economic uncertainty when applying for the loan – which was the case for almost all for-profit and non-profit organizations. in the USA.

There are some indications that congregations have avoided a major budget cut during the COVID-19 pandemic. More than half of congregations in a fall 2020 study by the Lake Institute on Faith and Giving at Indiana University-Purdue University Indianapolis said donations had stayed the same or had increased. Few (14%) said they had to lay off staff, while two-thirds applied for a PPP loan.

In their loan application, Mars Hill requested enough money to pay the salaries of 24 employees. In total, P3 loans to religious groups were supposed to pay the salaries of 1.5 million employees, half of them in groups that borrowed more than $ 150,000.

Allison Gill, vice president of American Atheists, said she appreciates church groups who have paid off their P3 loans rather than begging for forgiveness.

“It shows an appreciation for the separation of church and state,” she said.

Still, American atheists and other secular groups have expressed concern about the program, especially if religious groups ask for forgiveness. This essentially turned loans into grants to pay the salaries of religious leaders, said Nick Little, vice president and general counsel for the Center for Inquiry, another atheist group.

Little said that having government funds to pay the salaries of pastors, rabbis, priests and other leaders was “constitutionally troubling.”

The 2012 National Congregational Study found that about 25% of congregations had mortgages or other debts. Congregations that described themselves as more conservative (22.3%) were less likely to say they were in debt than those that were more liberal (43.9%).

The uncertainty for many religious organizations, meanwhile, is far from over. At Mars Hill, Sanders said staff remained intact and as the pandemic has abated, around 300 people are now showing up for weekend services. But others continue to attend only online. This makes long-term planning difficult.

“The hard part is we don’t know how many people we have in our church anymore,” he said.

Nonetheless, he is grateful that the PPP loan has been repaid. “I’m so proud to be a part of a church that said, ‘No, we don’t need it, we’ll give it back. “”

RELATED: Willow Creek, LifeChurch Among Churches That Have Received Millions in PPP Loans

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