Dissolution_inlineAt last year’s GARBC conference in St. Petersburg, Florida, I was blessed to have many opportunities for good fellowship. However, not every discussion was encouraging and uplifting. One discussion, in fact, was particularly discouraging.

A pastor shared with me that a church he had pastored many years ago had recently dissolved. The current pastor desired to merge with another local church—one with a far different doctrinal statement and belief system. The congregation of the Baptist church refused to vote to merge with that church. The events that unfolded from that point were disturbing and illegal.

Frustrated that his body of believers would not merge, the pastor decided to lead the church through the closure process. He got the church to approve the dissolution and to sell its assets. What happened next? First, the pastor got his way when the other church acquired the property for a really cheap price. By the end of the transaction, the church had sold the property and covered the expenses. The church’s bylaws stated that upon dissolution, any remaining church assets would be dispersed to Regular Baptist–­approved agencies or like-minded ministries. But the pastor decided there were no longer any Regular Baptist–approved agencies, so the remaining proceeds were given to another ministry—the one that had just purchased the church facilities, the one that was not Regular Baptist or even in agreement with the congregation’s doctrinal beliefs!

A Couple of Facts

A church needs to be aware of certain facts in a situation like this. First, as a 501(c)(3) organization, the church must have a dissolution clause. Second, in the event of dissolution, proceeds cannot benefit or be given to an individual; instead, they must be given to another 501(c)(3) organization. Had that church’s dissolution clause simply stated that “proceeds must be given to another 501(c)(3) organization,” the pastor’s move to give the proceeds to another church not doctrinally in line with the congregation would have been unethical but legal. However, that church’s dissolution clause clearly stated that in the event of dissolving, proceeds should go to Regular Baptist–approved agencies or like-minded ministries. Since those two criteria were in the dissolution statement, the pastor’s move was both unethical and illegal.

Regular Baptist–Approved Agencies

There are four Regular Baptist–approved agencies doing ministry today. They are

Ignoring these “Regular Baptist–approved ministries,” which were clearly covered in the dissolution clause, was illegal. The pastor further committed an illegal act by giving proceeds to a ministry that was clearly not “like-minded,” clearly in doctrinal disagreement with the church, clearly carrying a completely different heritage and polity.

Precautions

Churches and those in leadership should first check and review their dissolution statement. It may be time to update, but make sure the church follows its own bylaws. Next, to complete the update of any articles of incorporation, the church will need to file the proper documents in its state.

The Benefits of Association

If your church is facing the possibility of dissolution, please give the GARBC Resource Center a call, 888-588-1600, ext. 853. We can help with various consulting matters to avoid a closure.

If closure must occur, the association can help ensure that everything is done properly and legally. We have a network of legal and professional advisors to help guide through these difficult processes.

We are also here to help in other areas, such as church finance and business (budget management and fiscal efficiency), Internet technology assistance, and development (financial strategy and approaches, such as tithing, capital campaigns, and the like).

Michael Nolan is director of Baptist Builders Club.