From: Darrell128@aol.com Date: Tue, 16 Jun 1998 06:49:49 EDT Subject: NR 98055: CRC Synod begins; Potential $11.5 Million Fund Loss Among Hot Topics ... NR #1998-055: Christian Reformed Synod Begins; Potential $11.5 Million Fund Loss Among Hot Topics at Annual Denominational Assembly Will Synod 1998 be a quiet synod - or the beginning of an investigation into investment questions that placed $11.5 million in Christian Reformed funds at risk, led the CRC Board of Trustees to order the denominational paper not to print articles on the topic, and spawned four overtures calling for an investigation into financial and management questions in the denominational leadership? That mostly depends on who's talking. Synod 1998 convened June 13 at Calvin College in Grand Rapids and could run as late as June 20 but will probably adjourn before then. NR #1998-055: For Immediate Release: Christian Reformed Synod Begins; Potential $11.5 Million Fund Loss Among Hot Topics at Annual Denominational Assembly by Darrell Todd Maurina, Press Officer United Reformed News Service GRAND RAPIDS, MICH. (June 15, 1998) URNS - Will Synod 1998 be a quiet synod - or the beginning of an investigation into investment practices that placed $11.5 million in Christian Reformed funds at risk, led the CRC Board of Trustees to issue an order, later rescinded, banning the denominational paper from printing articles on the topic, and spawned four overtures calling for an investigation into financial and management questions in the denominational leadership? That mostly depends on who's talking. Newly elected synod president Dr. Howard Vanderwell was optimistic about the agenda for the synodical meeting, which convened June 13 at Calvin College in Grand Rapids and could run as late as June 20 but will probably adjourn before then. "I hope it will be a synod that enjoys being at the heart of the church," said Vanderwell in an interview following his election on June 13. "We have the opportunity to set aside tensions, divisions, drama, and polemics of the past, and we can consolidate our spirits." Vanderwell is no stranger to synodical debate. A nine-time synodical delegate, Vanderwell first came to synod 26 years ago when serving as a pastor in Iowa. Now serving Hillcrest CRC of Hudsonville, at 1021 members the tenth- largest congregation in the denomination, Vanderwell previously served as synod president in 1990 and 1992, vice president in 1988, and first clerk in 1995. The years 1990, 1992, and 1995 were among the most explosive in the denomination's recent history - Synod 1990 voted to allow the ordination of women subject to ratification in 1992, Synod 1992 rejected women's ordination but allowed women to perform many roles of ordained office as unordained "expounders," and Synod 1995 voted to allow each of the CRC's 47 classes to make its own decision on ordaining women by declaring the word "male" in two church order articles to be "inoperative." Most of the other officers of Synod 1998 also have significant prior experience. Synodical vice president Rev. Jack Vos of First CRC in Barrie, Ontario has previously been delegated to synod 12 times and has been vice president five times, and second clerk Rev. Peter Nicolai of Grace CRC in Chatham, Ontario, has been delegated to synod five times though he hasn't previously been a synodical officer. Elder Stanley Koster of Bethany CRC, the first clerk of synod, has been delegated to synod twice and was the longtime superintendent of the Christian school system in Holland, Michigan. Despite Vanderwell's optimism, the topic of investments by three denominational agencies - Calvin College, the Back to God Hour broadcast minstry, and Christian Reformed Home Missions - in the California real estate company known as IRM came up in the first day of the meeting. In a Saturday evening speech to a joint meeting of the multi-ethic conference and synodical delegates, former racial reconciliation director Bing Goei drew gasps when he asked delegates whether it was minority members or Anglo officials of the CRC who had been responsible for the potential fund loss. Four IRM Overtures to be Considered by Synod; Alleged Censorship of Denominational Paper Draws Fire Goei's comments won't be the last at synod. This year's synod will deal with a number of overtures directly or indirectly related to the IRM situation. Classis Quinte asks synod to "establish an independent financial review committee, free of any conflict of interest, to study the matter of the IRM investments in order to provide the fullest possible public disclosure." In addition, Classis Alberta South and Saskatchewan asks synod to "require that all denominational agencies provide each year, in addition to a financial account of income and expenditures, a full detailed statement of investments." Those overtures don't contain the most fiery language, however. In a late overture from Classis Grand Rapids North written by Grand Rapids attorney Don Oosterhouse, an elder at Mayfair CRC and former member of the CRC's judicial code committee, synod will be asked to review the entire functioning of the denomination's top committee, the nineteen-member Board of Trustees. Classis Grand Rapids North is asking that a committee be appointed "to review and evaluate the effectiveness of the structure and functioning of the Board of Trustees" of the denomination, a governing committee appointed by Synod 1991 to supervise the other denominational agencies. While the overture cites procedural grounds such as the prudence of a regular review of a new structure and precedents for a five-year review of the Board of Trustees' predecessor body, the Synodical Interim Committee, after various changes were implemented in 1971 and 1976, the heart of the overture focuses on specific problems rather than procedural issues. "The investments in IRM and IRM's default raise questions as to the board's effectiveness in adopting and supervising investment policy," noted the overture. Furthermore, "the spending of substantial dollars over the budgeted amount for the Free to Serve Rallies raises questions as to the adequacy of the board's management of the budget it proposes and synod adopts." The IRM situation involves the potential loss of up to $11.5 million in denominational funds invested in a series of California-based limited partnerships. The Free to Serve Rallies involve an event for which the denomination budgeted nothing in the year ended June 30, 1996 but spent $175,653, and for which the denomination budgeted $629,919 in the year ended June 30, 1997 and spent $863,693. Oosterhouse told his classis that this is the sort of situation the Board of Trustees was established to prevent. "When Synod created the Board of Trustees as a successor to the synodical interim committee, this was an extremely significant change in the way the denomination administers its ministries; this involved a greatly increased centralization of authority that we never had before," said Oosterhouse. "Certainly one of the roles of the Board of Trustees in its centralized authority was financial management but nevertheless these investments were made." "The council believes the only way there can be an effective review of the structure is to have a committee appointed by synod undertake the review so it would be done in an independent manner," continued Oosterhouse, citing a number of problems with the Board's functioning. "There was very substantial overspending in the Freedom to Serve rallies, there are several other incidents that I could mention," said Oosterhouse. "The Banner editor was muzzled at the same time the board was giving releases to the Grand Rapids Press, the head of the loan fund was fired without ever informing the board of the loan fund." Others at classis felt the Board of Trustees was being overly criticized for minor mistakes. "I wouldn't want a review function set up every time an organization overspent its budget," said Elder Marv de Boer of West Leonard CRC. "I think most of us in our churches have fifty percent of our line items over budget and 50% under budget, and we don't get too concerned about that." Others felt the concept of a five-year review was good, but disagreed with Oosterhouse's citation of specific problems prompting the review. However, classical stated clerk Rev. Fred Van Dyk pointed out that without the specific citations of material in the agenda for synod, Synod 1998 would argue the overture came too late to be considered. "Certainly if we take three and four away the General Secretary will say this is something that can wait until later," said Van Dyk. "I wish there were something in the body of the overture itself that referenced something in the agenda for synod, that would strengthen the overture and give the General Secretary no choice but to forward it on to synod, but if we take these out the General Secretary will say 'no' for sure." Oosterhouse confirmed that the $11.5 million IRM problem was the root of Mayfair's overture. "I think that IRM is what got the council's attention; in the discussion of this, some members were very concerned about the power centralization," said Oosterhouse. "There are some people who are concerned that the centralization of authority may have gone farther than Reformed church polity calls for." Classis Lake Erie's overture is even stronger. In an overture sent by the classis where the editor of the denominational periodical pastored before becoming editor of the Banner, Classis Lake Erie is overturing the synod to "declare that synod exercises its authority over The Banner editor through CRC Publications" and to "ensure that the editorial freedom of The Banner, outlined in the guidelines presented to Synod 1993, be protected." The Banner didn't take the publication ban well. In an internal memo obtained by United Reformed News Service along with over a hundred pages of memos and other correspondence, CRC Executive Director of Ministries Dr. Peter Borgdorff warned the editor not to test the limits of press freedom. "I know that you raised the issue of control over editorial judgment and prerogatives," wrote Borgdorff. "If need be we can discuss that further. However, I advise you against testing the boundaries on this one at this moment. It is very clear to me, if not to you, that a premature piece by The Banner could be most unfortunate and would cause great consternation among those who are working on this on behalf of the CRC and other agencies." Borgdorff confirmed the accuracy of the quote, but said it had been "inappropriate and unethical" to release the memo to the news media and to CRC-Voices, the denominational E-Mail listserv. "That was a private communication to John Suk within the normal channels of communication," said Borgdorff. "I was just aghast that a private memo should be leaked. I've talked to John Suk and he said he didn't release the memo, and I don't know who did. I find it personally reprehensible for people who do not have authority to release that information." In its grounds, classis notes that "on October 27 all IRM investors received a letter concerning this matter, and immediately after that a number of stories were being circulated." "A report by our denominational publication would have been very beneficial in placing this matter in perspective and in defusing some of the rumors connected with it," continued the overture. "Because The Banner was not allowed to report on the story, information about it came via the secular media, and the denomination looked like it had something to hide." Classis also cited a 1993 set of editorial guidelines for The Banner which state that "the editorial staff must be granted the freedom to inform its readers and subscribers about what is occurring in the church (including relevant problems, needs, and concerns) even though some persons, congregations, or agencies may prefer that such information not be disseminated." "We are very thankful that the ban on The Banner's reporting has been lifted," concluded the overture. "We believe that the placing of such a ban violated existing policy and was uncharacteristic of our denomination's relationship to The Banner." After reviewing the overture, Borgdorff said he didn't think its language would have made a difference even if it had already been adopted. "The overture doesn't ask for anything that isn't already the case, inasmuch as The Banner already operates under the general oversight of the Board of Publications," said Borgdorff. "I presume classis wants to say nobody else exercises any authority or oversight," said Borgdorff. "When Synod in 1993 and 1996 defined the mandate of the Board of Trustees, The Banner was not exempted from that, and in fact Synod said the board could enter the administration of any of the agencies." According to CRC Board of Trustees president William Weidenaar, the 1993 guidelines regarding the editorial freedom of The Banner apply to ordinary situations, not extraordinary situations such as that faced by the denomination in light of a potential multi-million dollar investment loss. "To take this extraordinary circumstance and to sort of hone a general principle from it is not wise," said Weidenaar. "The board has never interfered with the publication of anything in The Banner except with regard to the situation I just described. Would the board ever again do that? The circumstances would have to be extraordinary and I can't imagine what it would be, maybe a situation where we had another announcement that a firm would not be making payments on $20 or $30 million in investments." What else could constitute an "extraordinary circumstance?" "I don't want to restrict the extraordinary circumstances to commercial situations," said Weidenaar. "For all I know it may be a non-financial circumstance that has an extraordinary character. I think the history of the board, the history of the administration of The Banner, speaks for itself." Weidenaar, himself a Chicago-area attorney, noted that the denomination made its decision on the basis of legal advice. "By early November the denomination, the Board of Trustees through the executive committee, had convened an investment oversight committee which consisted of various agencies of the CRCNA which had investment in IRM, and also the CRCNA extended an invitation to similarly-minded groups that were not denominational agencies, Barnabas, Trinity Christian College, Dordt College," said Weidenaar. "When that committee convened in early November, that committee had a lawyer present who is conversant in financial reorganization matters," said Weidenaar. "The law firm of which that lawyer is a member issued a letter; the gist of the letter was since The Banner is a publication of the Christian Reformed Church, matters that appear in The Banner could or might be taken to be the position of the Christian Reformed Church." "Under those circumstances and in light of our then state of knowledge with regard to the whole IRM situation, the lawyer's advice was that the Board of Trustees ought not to permit The Banner to do any kind of reporting on the IRM matter lest statements that appear in The Banner be attributed to the Christian Reformed Church or in any way construed to be inconsistent or detract from the position of the Board of Trustees," said Weidenaar. "We published a statement immediately after that was published in The Banner that said we are committed to disclosure but because of these legal restraints it just was not possible to allow The Banner to publish." According to Weidenaar and other reports, the CRC Board of Trustees, the Board of Publications, and investment committee continued discussions on whether the publication ban should be lifted. "When we got into late January, our focus on the IRM situation, though not complete, was much sharper than it was in November," said Weidenaar. "We came to the conclusion that because of what we knew in late January, the directive really had served its purpose and was no longer useful. As a board committee we reported to the executive committee that we had met with the Board of Publications and felt that because we did have a sharper focus on what we were doing the directive could be lifted. The executive committee agreed with us and the directive was lifted." After being allowed to publish, The Banner ran a series of articles on IRM. Suk responded cautiously to the Lake Erie overture. "I think the Christian Reformed Church deserves exactly the sort of denominational magazine it wants and I'm sure one way or another it will get that," said Suk. "If synod would like to talk about that, it's wonderful." "It's the sort of thing that deserves wise and thoughtful deliberation of the sort that synods are known for doing," concluded Suk. Summary of Synodical Overtures In addition to the regular reports of the CRC's boards and denominational agencies and the four overtures on IRM, Synod 1998 will consider 25 overtures, two appeals, and three communications. Five overtures ask Synod 1998 to reject Synod 1997's proposal to revise the property rules for new CRC congregations and those receiving denominational funding; four overtures address women in office by asking Synod 1998 rather than Synod 2000 to make the final decision on allowing women's ordination, preventing a separate vote on male and female candidates for the ministry, allowing denominational agencies as well as local churches to hire women ministers, or making an exception in a specific case to allow a female graduate of Calvin Seminary to allow the military chaplaincy. Other overtures include: * Classis Thornapple Valley proposes a denominational study committee to revise the Form of Subscription to the CRC's doctrinal standards. * Classis Lake Erie asks for the deletion of Question 80 from the Heidelberg Catechism specifying that the Roman Catholic Mass is "a condemnable idolatry." Classis Kalamazoo approved a late overture against the Lake Erie proposal. * Classis Zeeland asks synod to declare that abortion is an "American holocaust." * Classis Atlantic Northeast asks synod to adopt an "inactive membership" category based on RCA procedures. * Classis Lake Erie asks synod to carefully review the terminology used by classes when processing ministers leaving the denomination. * Classis Grand Rapids East proposes an "independent assessment of readiness for ministry" for ministers separated from their churches * Classis Lake Erie proposes another minor revision to the abuse guidelines * Classis Pacific Hanmi (the CRC's Korean classis) asks Calvin Seminary to offer specialized courses for the Korean ministerial context. * Classis Wisconsin proposes a minor revision to the recent rule allowing delegation of deacons to classical sessions. * Classis Holland asks that the funding formula of the Fund for Smaller Churches be revised. * Classis California South asks that a Laotian church be allowed to transfer to the classis from Classis Greater Los Angeles. Cross-References to Related Articles: #1998-003: Classis Zeeland: Abortion is an "American Holocaust" #1998-006: Classis Chatham asks Top Christian Reformed Administrative Committee to Appoint Independent Investigators of $11.5 Million in Questionable Investments #1998-007: Chatham Rejects Effort to Revise Property Rules #1998-019: Classis Lake Erie Asks CRC Synod to Review "Honorable Release" Declarations for Seceding Ministers #1998-020: Christian Reformed Synod Asked to Delete Anti-Catholic Statement from Heidelberg Catechism #1998-021: CRC Synod to Consider Inactive Membership Category #1998-022: Church Property Rights Focus of Four Synodical Overtures #1998-025: Classis Thornapple Valley Proposes Revising Form of Subscription to Christian Reformed Doctrinal Standards #1998-028: Classis Lake Erie Overtures Christian Reformed Synod to "Ensure the Editorial Freedom of the Banner" #1998-029: Classis Zeeland Asks Synod to Overturn CRC Property Rules #1998-033: Three Reformed Denominations to Hold General Assemblies or Synods this Year in West Michigan Contact List: Dr. Peter Borgdorff, Executive Director of Ministries, Christian Reformed Church 2850 Kalamazoo Ave. SE, Grand Rapids, MI 49560 O: (616) 246-0832 * H: (616) 957-3288 * E-Mail: borgdorp@crcna.org Dr. David Engelhard, General Secretary, Christian Reformed Church in North America 2850 Kalamazoo Ave. SE, Grand Rapids, MI 49560 O: (616) 246-0744 * H: (616) 243-2418 * FAX: (616) 246-0834 * E-Mail: engelhad@crcna.org Rev. John Suk, Editor, The Banner 1510 Seminole Dr. SE, Grand Rapids, MI 49506 O: (616) 246-0791 * H: (616) 243-5695 * FAX: (616) 246-0834 * E-Mail: sukj@crcna.org Pastor George Vander Weit, Stated Clerk, Classis Lake Erie 2901 Waterloo Dr., Troy, MI 48084 O: (810) 645-1990 * H: (810) 649-5388 * E-Mail: northhills@juno.com ---------------------------------------------------------- file: /pub/resources/text/reformed/archive98: nr98-055.txt .