(Underlined words, phrases and sentences link to cited material)
A gaping hole in The Brooklyn Tabernacle (TBT) is an utter and complete lack of financial transparency, along with purported decades of morally, ethically and in some cases, legally irresponsible, mismanaged donations.
Even though churches are not required by law to publish their Form990, an organization claiming to honor Christ desires to submit to full public transparency with their donors and members. Donors, who are compelled to give sacrificially, even at the expense of not fulfilling their own monthly bills, have the right to know where every dollar goes in and out of the church. An organization with nothing to hide, hides nothing.
As a contrast to expected transparency in a Christian organization, one of the only written statements ever provided by TBT regarding finances can be found in the since-removed Topix Discussion in August 2008:
At the time of TBT Pastoral Staff Topix post in August 2008, The Brooklyn Tabernacle had mortgage debt totaling $59,500,000, according to public property records found on the Automated City Register Information System (ACRIS). Between January 2007 and October 2015, TBT paid down about $5,654,858.50 in principal, along with an estimated $30,000,000 in interest.
“The Brooklyn Tabernacle retains the firm of Capin Crouse LLP as its certified public accountants.” Capin Crouse began their partnership with TBT in June 2008, 2 months prior to the Topix statement provided by TBT Pastoral Staff.
“Financial statements are reviewed every quarter and The Brooklyn Tabernacle issues an audited financial statement annually.” Where are those issued financial statements? Who received copies of them? Since the relationship with Capin Crouse was new, who was actually reviewing and auditing up until that point?
“The Corporate Board of The Brooklyn Tabernacle… who provide independent consultation and oversight” must have been formed within the previous year or so prior to making the public statement on Topix, as the TBT Board of Directors as of November 2006 only had a few members who were all internal salaried staff paid by TBT. When and how did the members at large of TBT vote for each of these “six members, three of whom are outstanding Christian business leaders,” in accordance with the church by-laws?
Board of Directors, Church Bylaws, Annual Members Meeting
The Brooklyn Tabernacle (TBT) does not readily provide information to donors and members regarding their Board of Directors, Church Bylaws and the like. Fortunately, Kings County Supreme Court provides public access to documents, providing a small window into some of the information. A limited layout of Church Bylaws and Board of Directors, based on this publicly available information, can be found by clicking the button below.
Upon its incorporation in 1966 and until February 23, 2015, TBT functioned as an Article 8 church (Kings County Supreme Court, 8376-2015, p. 6, July 2, 2015), which includes members formally participating and voting on business matters (NY Religious Corporations, Article 8, § 160 – § 172). Meetings of members, according to New York not-for-profit religious corporations law, are formal, with specific guidelines to be met. These meetings cannot be conducted casually during the middle of a church service.
According to Article V of the 2006 TBT Church Bylaws, “the annual church business meeting shall be held on the second Tuesday of January” (Section 3), “a monthly assembly meeting shall be held on the second Tuesday of each month. In this meeting, the monthly financial reports shall be read” (Section 4), and “the church [members] has the final voice in all important business matters” (Section 2). Article VI states that all Deacons and Trustees “are nominated and elected by the church, Acts 6:3.”
Additionally in 2006, the church claims in a Resolution of the Congregation of The Brooklyn Tabernacle (Kings County Supreme Court, 39658/2006, p. 54-56) that the congregational members approved refinancing $59,500,000 of debt into a new, consolidated loan with America’s Christian Credit Union (ACCU), with “the foregoing Resolution was unanimously adopted by more than two thirds (2/3) of the members of The Brooklyn Tabernacle Church which constituted a quorum of the members at a duly called business meeting called for that purpose and held on the 27th day of August, 2006.”
There were no official business meetings called to order for the congregation, pursuant to Article 8 of the 2006 New York Religious Corporations Law (§163-§164). None of these statements by the church are true or were adhered to in any legitimate, transparent way.
TBT also committed directly to their new bank at the time, America’s Christian Credit Union (ACCU), that as long as they had an outstanding loan with them, “that BT’s Board of Directors shall consist of no less than eight persons and no less than four of whom shall be Independent Directors.“ (39658/2006, p. 48-49)
According to Article V, “Meeting of the Members,” of the 2012 TBT Church Bylaws, “the Annual meeting of the Members of the Corporation shall be held on the second Sunday of January at a time selected by the Board of Directors. The Board of Directors shall cause Notice of the time and place of the Annual meeting to be read at a regular meeting of the Corporation for public worship on two consecutive Sundays preceding such Annual meeting” (Section 1). “A quorum of the Members must be present at the Annual meeting of the Members of the Corporation or at any Special meeting thereof” (Section 3). “All matters or questions shall be decided by a majority of the Members at such Annual or Special Meeting” (Section 4). “In order to amend these Bylaws, the vote of two-thirds of the Members constituting a quorum shall be required” (Section 5).
In a July 15, 2012 petition to the Kings County Supreme Court seeking confirmation to modify mortgage loans, signed by Jim Cymbala, TBT states, “…a copy of a Resolution presented and passed at a meeting of the membership congregation of The Brooklyn Tabernacle held after the meeting of the Board of Directors in Kings County, New York, on the 4th day of March, 2012. The total membership of the congregation as of March 4, 2012 was approximately 9,900. At the business meeting that the congregation held on March 4, 2012 for approval of the Loan, there were in excess of 8,800 members present who unanimously voted in favor of the borrowing by the Petitioner. The members who voted on and approved the borrowing constituted more than two-thirds (2/3) of the members of the Petitioner. The resolution approved the America’s Christian Credit Union $57,213,408.76 Loan and the $1,000,000 revolving line of credit.” (Kings County Supreme Court, 24103/2012, p. 19, paragraph 12)
There was no official “Annual meeting of the Members of the Corporation” called to order, pursuant to Article 8 of the New York Religious Corporations Law. None of these statements by the church are true or were adhered to in any legitimate, transparent way.
According to Article V, “Meeting of the Members,” of the 2014 TBT Church Bylaws, “the Annual meeting of the Members of the Corporation shall be held on the second Sunday of January at a time selected by the Board of Directors. The Board of Directors shall cause Notice of the time and place of the Annual meeting to be read at a regular meeting of the Corporation for public worship on two consecutive Sundays preceding such Annual meeting” (Section 1). “A quorum of the Members must be present at the Annual meeting of the Members of the Corporation or at any Special meeting thereof” (Section 3). “All matters or questions shall be decided by a majority of the Members at such Annual or Special Meeting” (Section 4). “In order to amend these Bylaws, the vote of two-thirds of the Members constituting a quorum shall be required” (Section 5). This verbiage is the same as the 2014 sections provided in the previous paragraph.
In a June 16, 2014 petition to the Kings County Supreme Court seeking confirmation to refinance 2 mortgages, signed by Jim Cymbala, TBT states “…a copy of a Resolution presented and passed at a meeting of the membership congregation of The Brooklyn Tabernacle held in Kings County, New York on the 15th day of June, 2014. The total membership of the congregation as of June 15, 2014 was approximately 9,900. At the business meeting that the congregation held on June 15, 2014 for approval of the Loan, there were in excess of 8,800 members present who unanimously voted in favor of the borrowing by the Petitioner. The members who voted on and approved the borrowing constituted more than two-thirds (2/3) of the members of the Petitioner. The Resolution approved the Investors Bank $56,000,000 Loan.” (10196/2014, p. 15, paragraph 13)
Additionally in 2014, the church claims in their Amended and Restated Certificate of Incorporation of The Brooklyn Tabernacle (8376-2015, p. 108) that “a meeting of the Church was duly called and held pursuant to Article 8 of the Religious Corporations Law at 17 Smith Street, Brooklyn, NY 11201 on November 18, 2014, at which meeting a majority of the qualified voters of the Church, being at least six in number, were present and voted” (#4). “At the meeting, it was decided that the Church should operate as a free church under Article 9 of the Religious Corporations Law of New York….” (#5).
There were no official business meetings called to order for the congregation, pursuant to Article 8 of the 2014 New York Religious Corporations Law (§163-§164). None of these statements by the church are true or were adhered to in any legitimate, transparent way.
Endorsements from Financial Institutions
America’s Christian Credit Union (ACCU)
The relationship between TBT and ACCU began in January of 2007, when TBT consolidated all mortgage debt over to ACCU, totaling $59,500,000. It ended in May 2016 when TBT, with the help of Steven Vornea, reassigned their remaining mortgage debt over to Investors Bank.
Until at least mid-2019, America’s Christian Credit Union (ACCU)’s endorsement inhabited The Brooklyn Tabernacle’s (TBT) Financial Accountability website page:
“America’s Christian Credit Union is very proud of its three-year financial partnership with The Brooklyn Tabernacle. Unquestionably, the recent financial crisis has presented significant challenges for churches and non-profit organizations. Without compromising the mission and ministry of the church, The Brooklyn Tabernacle continues to make sound financial decisions, demonstrating the exceptional quality of their leadership. Our management, auditors, examiners, and Board of Directors possess a high degree of confidence in the integrity and professionalism of their financial processes and hold their ministry in the highest regard.” — Mendell Thompson, CEO, America’s Christian Credit Union
The Brooklyn Tabernacle (TBT) secured their accounting firm, Capin Crouse, in June 2008, 2 months prior to the above Topix statement. Capin Crouse provided this now-removed endorsement which used to be on the TBT website:
“Capin Crouse LLP began providing professional services to Brooklyn Tabernacle in June of 2008, issuing quarterly reviewed financial statements and conducting the annual audit. We have also been engaged to provide additional services that improve the timeliness and accuracy of internal financial reporting and enhance internal control systems. It has been our privilege to act as Brooklyn Tabernacle’s external, independent advisor and to recognize their commitment to financial integrity. Their management has shown a consistent willingness to make critical adjustments as they navigate their growth in this challenging economy and in consideration of the best financial practices in American churches.” — Capin Crouse LLC
Capin Crouse’s relationship with TBT seems to have gone well over the past decade or so, since being hired, with TBT featured until 2019 on their Client Spotlight.
The Evangelical Council for Financial Accountability (ECFA)
The Brooklyn Tabernacle (TBT) has been accredited with the Evangelical Council for Financial Accountability (ECFA) since January 2011. In order to be accredited with the ECFA, an organization must submit 2 fiscal-year audits, which, with the securing of Capin Crouse as auditors in June of 2008, the timing makes sense for a January 2011 certification. This timing also lines up with the IRS Letter of Determination being posted on November 9, 2009, approving TBT’s not-for-profit status as a 501(c)(3) entity, retroactively exempt back to December 15, 1966.
According to TBT’s website, “The Brooklyn Tabernacle is accredited by the Evangelical Council for Financial Accountability, which requires high standards of biblical accountability, board governance, financial transparency, integrity in fundraising, and proper use of charity resources.”
Standard 2 of ECFA’s Seven Standards of Responsible Stewardship™ states that “every organization shall be governed by a responsible board of not less than five individuals, a majority of whom shall be independent, who shall meet at least semiannually to establish policy and review its accomplishments.” Based on TBT’s available Board of Directors lists, having a “majority of whom shall be independent” did not occur until 2015, 4 years after being accredited by the ECFA.
The ECFA has been questioned recently for their significantly delayed response to gross financial malfeasance happening over the course of many years at Harvest Bible Chapel, along with years of inaction amidst severely unethical financial practices at Gospel for Asia.
The ECFA publishes a member-provided summary on their website. Here is a look at what TBT has shared for publication on the ECFA page:
According to their website, where The Brooklyn Tabernacle is listed as a Ministry Partner, “our mission is to protect children and those who serve them.” Forging a partnership with an organization like Ministry Safe likely reduces liability and insurance costs, all of which affect the financial bottom line at churches.
A huge chunk of what Ministry Safe offers is tools and trainings for organizations, which appears to support their mission. Ministry Safe also can be hired as consultants to provide direction and legal counsel when allegations of abuse surface within an organization.
It is in this area of their expertise which has raised some eyebrows, highlighted in a June 2019 New York Times article, as this would align them with the protection of the organization, not the vulnerable whom they claim to protect. Ministry Safe published a public response to the NY Times article, reiterating their mission.
Ongoing Church Building Construction
The Brooklyn Tabernacle (TBT) sold the first and second floors of their 180 Livingston Street property in October 2015 for $51,000,000, with the basement and subbasement (“Lower Level”) remaining as their latest construction project. After receiving $51,000,000 for the sale, it appears as though TBT paid $30,360,000 of their mortgage debt, which at that time totalled $52,845,141.54, leaving them with a debt balance of $22,485,141.54.
This means, of the $51,000,000 TBT had after the sale, they were left with $20,640,000 cash-in-hand. It is assumed that this remaining cash went toward construction costs for the Lower Level. What happened to the remaining $20,640,000 cash-in-hand on the extremely-limited ECFA records? Why is it not visible?
A lawsuit, The Brooklyn Tabernacle v. Thor 180 Livingston LLC et al, is in progress at Kings County Supreme Court (518739/2019), due to leaks on the “Church Unit” property causing significant delays. Lawsuit documents are available in their entirety to the public on the Kings County Supreme Court website, HERE. Further discussion outlining egregious acts reportedly committed by The Brooklyn Tabernacle during the course of this lawsuit are covered in more detail in this section.
The Lower Level construction project at 180 Livingston Street was originally scheduled to be completed in September 2019 (518739/2019, Document #16, p. 4, paragraph 8), in time for the famed Brooklyn Tabernacle Choir to host their Resound Music Conference 2019 while utilizing the newly constructed space. This indicates construction costs would have been more than likely paid in full, before then, to their construction company, Watermark Contractors.
What If The Church Had Kept The Original Property?
180 Livingston Street Hypothetical vs. Actual
According to The Brooklyn Tabernacle Church in their recent lawsuit, the Church Unit “included nearly 58,000 square feet of undeveloped subterranean cellar and sub cellar space” (518739/2019, Document #16, p. 4, paragraph 7). The church claims that the space “has been valued at approximately $52 million” (paragraph 9), which puts valuation for this subterranean property, with no windows or outside light, at approximately $897 / square foot of the undeveloped space, categorized as Special Assets/Other according to the Brooklyn Market Report.
The October 2015 sale of 180 Livingston Street to Thor Equities included 2 completed, above-ground floors and the restaurant space for $51,000,000, a total of 75,000 square feet. Losing the restaurant space meant losing monthly rental income being paid to TBT’s for-profit Churchill’s of Brooklyn, which, at the time of the Sales-Purchase Agreement in early 2015, was $41,837.20 / month, or $502,046.41 / year. (8376/2015, p. 57, Exhibit F)
Hypothetically, if TBT had kept their original property of 2 finished, above-ground floors, 1 finished, subterranean floor, plus the restaurant space which includes monthly rental income, and if they had simply continued paying down their mortgage loans, at their average rate between 2007-2015, they would be in a substantially better position than they are right now.
In reality, as of October 2019, the church already “expended in excess of $40 million“ (518739/2019, Document #16, p. 4, paragraph 9) in construction costs on the Lower Level ‘Church Unit,’ as is identified by the court documents.
An additional $20,000,000 loan was also granted in October 2019, with “the proceeds of the Loan be used for refinancing of existing debt held by Investor’s Bank in the amount of $23,000,000 and the $20,000,000 buildout of certain improvements at 180 Livingston Street… that will include, but not be limited to, classrooms, a gymnasium, computer labs, office space for church staff, and conference rooms….” (3333/2019, p. 3)
As part of the early-2015 Sales-Purchase Agreement with Thor Equities, TBT paid monthly rent to Thor Equities for the “undeveloped subterranean cellar and sub cellar space” until Thor Equities transferred the deed over to TBT on July 25, 2019 (518739/2019, Document #16).
Rent being paid by TBT to Thor Equities, per annum, totaled $780,000 during year #1, $803,400 during year #2, $827,502 during year #3 and $852,327 during year #4, for a total of $3,263,229. (8376/2015, p. 226)
What is the financial justification for the entire building construction project? How was there ever an upside when deciding whether or not to move forward with the initial deal?
Construction Project Questions
1. What exactly is the additional $20,000,000 loan, approved in October 2019 going to cover since the church indicated in a sworn affidavit within the same month that they already “expended in excess of $40 million” on the current construction project? Does this mean that the entire Church Unit construction project is going to cost the church upwards of $60,000,000? Where are the detailed balance sheets tracing this money? Why don’t TBT members and donors have access to these details?
2. TBT reportedly took out a Paycheck Program Protection (PPP) loan for $1,466,105, approved on April 27, 2020, claiming to have retained a total of 149 total jobs at the church during the pandemic. How does this factor into the $20,000,000 loan received in October 2019? Where exactly is the money going? What does their overall revenue look like, month over month, during 2020? Other years?
3. In the Total Expenses row provided by the above 2015-2019 ECFA records, why doesn’t that category reflect the exorbitant construction costs? If reasoning includes the construction numbers falling under a capital budget expense, who has access to those numbers? Why aren’t TBT members and donors able to see them?
4. How does the church justify such outlandish construction costs on the shoulders of donors, especially considering prior to the October 2015 sale, they already had usable space for the Children’s Ministry, along with the generation of monthly rental income from their ownership of the Dallas BBQ restaurant space?
5. With the exception of leaks causing more recent delays, why is the construction project toppling over 5 years to complete? (Some answers may be found in Document #13 of the recent lawsuit) What was the original projected timeline? What was the original projected construction costs?
General Finance-Related Questions
1. A requirement of the ECFA accreditation includes financial transparency. How does The Brooklyn Tabernacle (TBT) remain accredited with the ECFA, when virtually nothing about their financial records is transparent?
2. Who are the current Board Members of TBT? Why are their names not provided by TBT to the congregation and donors? What are the current Church Bylaws?
3. What other business entities are financially affiliated with TBT? A preliminary look into connected organizations birthed this starter list, but it appears there may be others to add.
4. What are the salaries and wages for all full-time, part-time staff members, and consultants at TBT, including pastors?
5. Do TBT pastors receive a parsonage allowance, or does TBT own those homes? Has TBT paid for a portion, such as a down payment, of any pastor’s privately owned home? How does the church handle using paid employees when it comes to personal work outside of acceptable business designations?
6. Are business and personal expenses of church leaders kept completely separate? How and where is this effectively documented?
The Brooklyn Tabernacle, hiding nothing, should readily provide the past 10 years of financial information, including:
•Full general ledger
•Trace of all outgoing cash transfers
•Financial statements, balance sheets
•Construction budget actuals
•Audits from Capin Crouse, TBT’s accounting firm
•Pay for a forensic audit