Our Church’s Decision to Participate in the Federal Paycheck Protection Program (PPP)

“Of those to whom much is given, much is expected.”  Luke 12:48

Life in the difficult COVID-19 era has presented us with many challenges as we continue to explore ways of being the hands and feet of God at a time when we are mandated to be apart from each other.  We have wrestled with a number of issues, but perhaps none more challenging than our decision to accept government funds for our payroll for up to 8 weeks.

As a brief background:  with explicit guidance from the United Methodist Church and the Baltimore-Washington Conference encouraging all churches to seek “Paycheck Protection,” National UMC applied for and received $360,000 from the Paycheck Protection Program (PPP) provided for in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.  PPP offers non-profits, including churches, a loan to cover payrolls for up to 8 weeks.  If we use this money for eligible expenses (including payroll, health plan expenses, rent/lease payments, and utilities), the loan can be forgiven.

At the start of stay-at-home orders in March we imagined numerous businesses and organizations would furlough employees as their roles were deemed nonessential, however we believe our staff is essential for the emotional and spiritual wellbeing of the community now and particularly in the months that follow as stress and uncertainty mount.  But how long could we continue to employ all of our staff if markets continued to decimate our endowment, tenants accepted offers of rental rebates, and regular giving declined with wages?  We could continue to pay our payroll, but for how long?  The CARES Act was a Godsend not only to small businesses, but also to nonprofit organizations like United Methodist Churches and Friendship Place, which offers homelessness prevention through this particular United Methodist Church. We could continue to pay the salaries of our staff whether they were in positions where they could do the bulk of their responsibilities remotely or not.  We were mindful that our staff includes our wonderful, dedicated Metropolitan Nursery School teachers.  Our Nursery School is an integral part of our church, and this very successful program has contributed to the financial, social, and educational life of our church since 1966.  

Nursery Schools in our community are particularly vulnerable in this time of COVID-19 because they are impacted by parents who have lost jobs and cannot pay the tuition for their preschool children.  There are also parents who are no longer willing to pay tuition to a Nursery School when they are themselves providing the educational programs for their children while their families are living with mandated stay-at-home orders.  At this point in time, we already know the Nursery School’s summer camp will not be held this year which will result in a significant loss of income for the Nursery School.  

A special meeting of the Church Council was called on May 11, 2020, to address the implications of our church accepting the PPP funds.  Some of the issues that were addressed included:  concern that our church would be accepting a “Federal bailout” and how that relates to separation of church and state (it was noted that this is not an institutional bailout but rather a good faith effort by the government to stabilize the economy by protecting employment); and whether there is an inherent conflict with tax exempt organizations receiving direct aid in this PPP (it was noted that there is no more inherent conflict than there would be in our receiving assistance from local fire departments if the church were on fire).

A more extended discussion at the Church Council meeting focused on the question of whether our church should accept these funds since we have a sizable Foundation.  Points that were made included:  the actual liquidity of our endowment in this time of market volatility; the key role that the interest from the Foundation plays in our church’s annual budget; the dependence of our church budget on rental income from outside groups (including the Children’s Choir of Washington) as well as from weddings and funerals, and the likelihood that there will be a sizable reduction in income from all of these sources; and the anticipation that we will experience a decrease in donations as church members experience unemployment and bankruptcy.  

A motion was made and passed that the church accept the funds provided through the PPP.  While the application for these funds was a team effort, particular thanks were extended to Pam Murdock, our Finance Coordinator, and Nancy Nelson Cherney, a member of the church’s Board of Trustees, who devoted a lot of time and expertise to the application for the PPP.  Phil Potter, Chair of the Foundation Board of Trustees, and Pam Settlage, Chair of the Finance Committee, also played key roles in the development of a number of documents and in discussions of the implications of either accepting or returning the PPP funds.  

It is with profound gratitude that we celebrate the lives that will be saved and transformed as these PPP funds provide salaries to the Campus Kitchen staff, the staff coordinators at our two Transitional Shelters, the Metropolitan Memorial campus and Wesley campus staff, and our Metropolitan Nursery School teachers.  We continue to seek ways to be the Church of Jesus Christ in the middle of a pandemic, and to be mindful of the difference we can continue to make in the life of our community of faith and the lives of so many others around the city and the world through the many vital ministries supported by our church budget.