No sooner had the Puritans set foot on the shores of New England than they began to grapple with some of the same church-state questions we still deal with in our churches.

Most of the early Puritans, for instance, believed that ministry should be supported by voluntary gifts, and shun dependence on the state. This was understandable because the Church of England, from their point of view, had grown lax and corrupt from state support. Beholden to the crown, the church had to adjust its ways to placate each new monarch or archbishop. Having accepted everybody’s taxes, the church felt pressure to treat everyone as Christians, even those who—by the standards of the Puritans—were obviously not.

The Puritans knew from experience that accepting government support could undermine their vision of a disciplined and energetic church whose every member took joint responsibility for their great mission in the wilderness.

And so, in the first churches of New England deacons passed the plate and used the proceeds to give alms to the poor and pay the minister.

This worked best in the bigger towns, many of whose ministers had independent wealth (the equivalent, in those days, of a spouse with a good job). It worked less well in smaller towns, whose ministers disliked sharing the plate with the rest of the poor and started to demand that the colonial authorities assure them of a “stinted stipend” or fixed salary. In most places, the only way to manage this was to force townspeople to divvy up. The result was the system of church taxes that endured in most of New England for some time after the adoption of the First Amendment in 1791.

The Puritans spent much of the 1600s arguing among themselves about how to balance the convenience of public support against their vision of a disciplined and covenanted community of saints. I wonder whether it is time for us again to talk about this question.

Public support for congregations endures today in several forms, including exemption from direct taxation and a variety of indirect benefits like the charitable tax deduction and the clergy housing allowance.

As you may have heard, the Freedom from Religion Foundation (what a wonderfully irritating name!) has sued to stop tax-favored treatment of the clergy housing allowance. The case will take some time to work its way up through the courts, which have ducked the issue since 1954 and may duck it again. But what if they don’t? Each of us may soon have to decide how to respond in public to a court decision—either to affirm the constitutionality of the clergy housing allowance or to strike it down.

Leaving aside for now the constitutional question, I would like to hear us talk among ourselves about whether public support—including the clergy housing allowance—actually helps or hurts us in accomplishing our purposes.

One fact needs to be laid on the table frankly: as with most tax benefits, the big beneficiaries of church tax exemption are the big players—large congregations and highly-compensated ministers. A few clergy—those who earn over $100,000 a year—make out very well. Such a minister, married to a surgeon, living in a million-dollar house can save more than $20,000 a year in taxes compared to a non-minister in similar circumstances.

Small, marginal congregations benefit from tax-favored treatment, in the sense that their buildings can sit idle as their numbers dwindle, and sometimes for years afterward. But is this really a benefit to congregations, or to faith? What if failing congregations had to close more quickly, as other non-profits do when they have ceased to serve the public? Might the religious enterprise actually be strengthened?

A sudden loss of the clergy housing allowance as a result of an adverse decision would undoubtedly be harsh and unfair. We should lobby hard for legislation to soften the blow. But if we take the position that tax-free housing is our right, or necessary for the freedom of religion, we risk making ourselves look a bit ridiculous.

Religious institutions have a public image problem. High-profile scandals have confirmed some of the gravest worries members of the public have expressed for years—that “organized religion” cares more about its own material success and power than it does about its message or the people that it serves. This is unfair to most of us, but the public perception is a fact we need to consider as we decide how to respond to court decisions about the special tax treatment we have become accustomed to.

Beyond public perception, we need to pick up the question that the Puritans laid down when they accepted tax support in the mid-1600s: does public support actually help religious institutions to achieve their purpose, or does it weaken more than strengthen them? I would like to hear a conversation among religious leaders about whether it is time to let go of some privilege in the process of reclaiming our vitality.


Comments welcome on the Alban Roundtable Blog  

Dan Hotchkiss is a senior consultant with the Alban Institute .  “Faithful Finances: Special Privileges and Church Vitality” originally appeared in the May/June 2011 issue of Clergy Journal (  



AL251_SM Ministry and Money: A Guide for Clergy and Their Friends  
by Dan Hotchkiss 

Alban senior consultant Dan Hotchkiss uses frank, straightforward guidance to help clergy develop a sound theology of money, as well as skills for church administration. Ministry and Money puts forth a new strategy for self-care, and a confident approach to managing both personal and congregational finances. Hotchkiss wants to help clergy overcome their own anxieties about money matters so they can help others address the personal, social, and congregational aspects of this challenging and often difficult topic.  

AL370_SM Governance and Ministry: Rethinking Board Leadership   
by Dan Hotchkiss 

In Governance and Ministry, Alban senior consultant Dan Hotchkiss offers congregational leaders a roadmap and tools for changing the way boards and clergy work together to lead congregations. Hotchkiss demonstrates that the right governance model is the one that best enables a congregation to fulfill its mission—to achieve both the outward results and the inward quality of life to which it is called. 

AL344_SM Starting Simple: Conversations About the Way We Live   
by Bob Sitze 

In today’s complex and busy world, people yearn for simpler lives. Bob Sitze believes conversations change us as individuals and that most important social changes take place through conversation, so in Starting Simple he invites us into heart-to-heart conversations about simple living.  

AL392 Strategic Leadership for a Change: Facing Our Losses, Finding Our Future  
by Kenneth J. McFayden  

Strategic Leadership for a Change provides congregational leaders with new insights and tools for understanding the relationships among change, attachment, loss, and grief. It also helps leaders facilitate the process of grieving, comprehend the centrality of vision, and demonstrate theological reflection in the midst of change, loss, grief, and attaching anew. All this occurs as the congregation aligns its vision with God’s and understands processes of change as processes of fulfillment. 


epperly,bruce_120 Nurturing the Spirit: Tending to the Holy     
August 30–September 1, 2011
Lake Junaluska Conference and Retreat Center, Asheville, NC

God is in the details of ministry and ordinary tasks can be spirit-centered. Join presenter and author Bruce Epperly and experience the sacrament of the present moment in every aspect of your ministry.
Learn More 


For a full list of learning events, check out
  Alban’s 2011 Event Calendar    

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