step-by-step€¦ · 3 SIMPLE | SMART | STEP-BY-STEP step-by-step churchsafety.com ChurchSafety.com is an online safety service for America’s churches and related ministries. It

1

SIMPLE | SMART | STEP-BY-STEP

churchsafety.comstep-by-step

ChurchSafety.com is an online safety service for America’s churches and related ministries.It is co-sponsored by Christianity Today International and Brotherhood Mutual Insurance Company.

© 2008 Brotherhood Mutual Insurance Company and/or Christianity Today International.

Managing Church Facility Use | If You Suspect

Managing Church Facility Use

step-by-stepPractical strategies to protect your ministry

Ground Rules for Sharing Church Space 2

OveRview | What members and visitors need to know about your facilities. By Lindsey Learn

Developing a Policy for Outside Groups 3

ASSeSSment | Create clear understandings for facility use.By John Throop

managing Church Facility Use 5

HOw tO | Use these principles to guide your policies. By John Throop

Guidelines for Sharing Church Space 9

HOw tO | Customize this sample for your own facilities use policy. By BuildingChurchLeaders.com

Pre-nuptial Policies 18

HOw tO | Set the expectations for facility use during a wedding. An example from Community Church

Before You Share Your Space 21

tHe leGAl SiDe | What you need to know to avoid jeopardizing your tax-exempt status.By Frank Sommerville, JD, CPA

tax and liability issues with Sharing Your Facilities 25

tHe leGAl SiDe | Know your risks.By Richard R. Hammar

Resource Center 28

leADeR’S GUiDe | Quick tips and recommended resources.

Articles compiled and edited by Lindsey Learn.

2


churchsafety.com


step-by-step



| Ground Rules for Sharing Church Space

OveRvIeW

Ground Rules for Sharing Church Spacewhat members and visitors need to know about your facilities.by Lindsey Learn

It is a land the Lord your God cares for; the eyes of the Lord your God are continually on it from the beginning of the year to its end (Deuteronomy 11:12).

Like our own homes, the church is a place where we extend hospitality to family members and to guests. We wouldn’t invite strangers into our house without having certain safeguards in place, such as making sure our children are in a safe place and are well supervised, or putting away valuable possessions. Similarly, churches need to develop policies and procedures that make their facilities available for additional use, and yet keep all of its assets protected. I’ve been to several church functions when strangers entered the church, and jackets or purses had been stolen. I’ve also arrived at church in the morning with the kitchen a mess, because no one had cleaned up from the wedding the day before. These types of situations can be avoided if you have the right practices in place. In his article, “Managing Church Facility Use,” John Throop suggests five factors that demonstrate why churches need up-to-date policies and practices: coordination, responsibility, cost, liability, and security. Addressing these issues will help your church grow in better communication and will help protect your church from undesirable situations. The following articles are designed to help equip your church to host members and strangers in your facilities. Begin with the “Developing a Policy for Outside Groups” assessment. This will help you assess how well developed your church’s facility policies are, and what you need to do in order to improve them. Sharing your ministry space is a great way to steward the resources God has blessed you with. This download will help you apply best practices to facilities management.

Lindsey Learneditorial Coordinator Your Church Resources [email protected]

3





Managing Church Facility Use | Developing a Policy for Outside Groups

ASSeSSMenT

Developing a Policy for Outside Groups Create clear understandings for facility use.

by John Throop

I will lie down and sleep in peace, for you alone, O Lord, make me dwell in safety (Psalm 4:8).

Well-developed policies regarding the use of church facilities create a clear understanding between church leaders and users of the facilities—critical to good relationships with members and non-members alike. They also help to limit the church’s exposure to property damage and injury claims, should something go wrong in the use of the facilities. How clear are your facilities-use policies in these areas?

ReSPOnSiBilitY CRYStAl SOmewHAt UnCleAR CleAR ClOUDY

How much space preparation must be done by church staff?

How much by users?

Is the name and contact information for our church insurance agent easily accessible?

How will the space be protected from damage?

Who does what in cleaning up and returning the space to the best condition?

What happens when space is misused or damaged?

COSt

Who pays for facility use?

How much for which space—and for how long?

Are there different rates for members (if any cost) than for non-members?

Between individuals and organizations?

4


churchsafety.com


step-by-step



| Developing a Policy for Outside Groups

COmPleteD BY: DAte:

liABilitY CRYStAl SOmewHAt UnCleAR CleAR ClOUDY

What happens when there is physical damage?

Personal injury?

How are repairs made?

How and when are damages assessed?

How does the church protect itself against liability claims?

In what circumstances must users provide proof of insurance?

SeCURitY

Who oversees the safety of the building, its contents, and the people on the property at any given time?

Which areas of the church are available to public use?

Which are always off-limits?

Who maintains a facilities calendar?

Who meets with outside users and when?

Who conducts a post-use review?

thought Provokers

• Do church groups always have priority over non-church groups in facilities use? Why or why not?

• When was our facilities policy established? Do the results of this assessment suggest that this policy needs to be revised?

• Who is responsible for tracking building use? What forms are used and to whom is this use reported?

5





Managing Church Facility Use | Managing Church Facility Use

HOW TO

Managing Church Facility UseUse these principles to guide your policies.

by John Throop

For the Lord gives wisdom, and from his mouth come knowledge and understanding (Proverbs 2:6).

Many communities struggle with a shortage of public space in which to hold meetings, events, and offer education. These communities often view local churches and their facilities as accessible and welcoming places that meet their needs. When it comes to such use, however, church leaders often are challenged to develop consistent facility policies and practices. Yet careful building use can be an excellent form of congregational stewardship, providing hospitality and, in some cases, evangelistic opportunities.

why Church Facilities Policies Are essential Five factors demonstrate why churches need up-to-date policies and practices on facility use.

Coordination. There is a limited amount of space in a church. Some rooms are more appealing than others for different groups. Does the church want its ministries to have priority over outside organizations in facility use?

Responsibility. Churches need to define the who, what, when, and how of facilities use. How much space preparation must be done by church staff? How much by users? How will the space be protected from damage? Who does what in cleaning up and returning the space to the best condition? What happens when space is misused or damaged?

Cost. Who pays for facility use? How much for which space—and for how long? Are there different rates for members (if any cost) than for non-members? Between individuals and organizations?

Liability. What happens when there is physical damage? Personal injury? How are repairs made? How and when are damages assessed? How does the church protect itself against liability claims? When must users provide proof of insurance?

Security. Who oversees the safety of the building, its contents, and the people on the property at any given time?

Well-developed policies regarding the use of church facilities create a clear understanding between church leaders and users of the facilities—critical to good relationships with

6


churchsafety.com


step-by-step



| Managing Church Facility Use

members and non-members alike. They also help to limit the church’s exposure to property damage and injury claims should something go wrong in the use of the facilities.

Steps in Facility Policy Development

• Think through the practical side of the church’s mission. While mission statements can have lofty language about reaching into the community and making facilities available for the needs of individuals and groups, church- related groups and programs have basic needs for property use. Some church members become agitated if “outsiders” are using rooms for which they believe they have priority. A policy statement from the church board or executive team can help set priorities and resolve conflicts.

• Identify different facilities and sections of property. Often, requests for space seem reasonable and limited. “We’d like the church meeting room for our small group,” someone will say—but they forget that they also need the adjacent kitchen for preparing refreshments, and the restrooms for participant needs, and the children’s play room for childcare, and, and, and…. the list goes on. Do an audit of every interior facility and any usable outdoor space to define what is available and what is off limits to public use.

• Consult with insurance providers for practical tips regarding liability. The church’s insurer often has a guide with tips on the use of church facilities—or, even better, generic language for assignment of liability and the church’s waivers of responsibility. Depending on the level of physical or human risk, the insurer may strongly urge the church to get a copy of an outside group’s certificate of insurance coverage.

• Review security and safety issues. Just like community facilities, churches need to include security and safety policies in any room use agreement, even for member directed ministries. These policies can include limitations on the use of the security system, access to rooms other than those being contracted, and even access to office and computer equipment, play equipment, and other property that, if used wrongly, can create major problems. Also, it is important to stress fire risk, whether from smoking on the property, use of matches, or use of kitchen range burners.

• Develop policy statements and/or a guide to facility use. Even small churches will find it useful to create a facility use handbook that will spell out basic policies for all users and specific policies for those who are not church members. Standard forms can be developed and made available online for completion and submission. Further, a facilities calendar can be made available for review prior to planning use of space.

7





Managing Church Facility Use | Managing Church Facility Use

• Establish a cost structure for different parts of the property. Churches should not use facility rental costs as an income stream, but rather as a cost-recovery means. Do not set fees arbitrarily. Determine overhead expenses (utilities, security, insurance, maintenance, and administrative costs) and factor them into fees based on “impact” of use. What does it cost to provide the church sanctuary and rooms for a wedding? What is the expense of the church hall and kitchen? Is there a cost difference between “normal use” (meetings and social gatherings) and “special use” (weddings, regional gatherings)?

• Determine who on staff is responsible for tracking use. Some churches assign this oversight to a maintenance manager. Others split the responsibility between the executive assistant and custodian. In another case, a pastor may have to do this work. Tracking building use ensures accountability and good working relationships.

Systems to implement Developing and administering facilities use policies can test a church’s management capabilities. Thinking through responsibilities and priorities can make this process run much more smoothly—and help recover costs.

• Develop a facilities calendar. This internal calendar will list room users and dates. It also will function as a flow chart for room preparation and breakdown, as well as for periodic facilities cleaning and repairs, which will put certain rooms out of use.

• Develop a document tracking system. A filing system should be in place for room use forms. A checklist of required support materials (i.e., insurance certificates) can help document the completion of the contract arrangements.

• Meet with users. For first-time users of the facilities, or after any changes have taken place, a designated staff person should meet with users to go over all policies and to double-check on particular needs.

• Have a post-use review. Especially after large gatherings, or when there has been a facility problem, it is important to have a post-use review to determine whether an insurance claim needs to be filed, a policy needs to be changed, or even if a long-range plan should be developed for renovation.

8


churchsafety.com


step-by-step



| Managing Church Facility Use

thought Provokers

• If we have a facilities policy, is it up-to-date? What have we already done to create a policy, and what do we still need to do?

• Who do we need to speak to who will help us implement a solid facility policy? (Insurance company, Facilities manager, etc.)

• What sort of tools will we need to keep ourselves organized?

9





Managing Church Facility Use | Guidelines for Sharing Church Space

HOW TO

Guidelines for Sharing Church SpaceCustomize this sample for your own facilities use policy.

introduction (Your Church name here) is a busy place. Its primary purpose is to carry on the ministry of the local church. (Your Church name here) has an active ministry to children, youth, adults, and senior adults. It has a significant outreach into the community through the local Family Shelter and other social services. The music program of the church is one of the finest in the city. The programs and people are the top priority when it comes to building use.

Building use activities fall under the jurisdiction of the Board of Trustees. The Church Administrator manages building use. No commitment for building use is finalized until the Room Use Agreement has been completed and executed by the Church Administrator.

(Your Church name here) has a number of long-standing relationships with several community organizations for ongoing use. Availability for such ongoing usage is limited but can be considered. Local organizations and individuals for one-time or short-term usage also use our facilities. When possible, we attempt to make our facility available for such groups. Our first priority is to programs and membership needs of the church. Priority is then given to nonprofit groups that are supported by the church, and finally to other nonprofit organizations.

Approval of the use of the grounds and facilities does not constitute or imply endorsement of a group, their mission, or their positions. Groups approved to use facilities must not advertise the event in such a way as to imply endorsement by the congregation. No activities or advocacy may take place within our buildings or grounds that conflicts with the bylaws and the practices of this congregation and the denomination.

Included in this guide are the following:

• Steps to Facility Use Scheduling• Fees for Facility Usage• Rules and Regulations of the Board of Trustees• Room Use Agreement Form• Release and Indemnity Agreement Form

Steps to Facility Use Scheduling• Fill out a Room Use Agreement. One is included in this guide or you may obtain one from the church office or at our website: www.yourchurchname.com under the Contact Us tab.

10


churchsafety.com


step-by-step



| Guidelines for Sharing Church Space

• Attach any additional information you feel might be useful in helping us determine if we can accommodate your group.

• Return the Room Use Agreement to the Church Administrator who will evaluate your request and notify you if it is approved or not approved.

Fees for Facility UsagePlease note the fee schedule below. Also, be sure to review the Impact Fee schedule following the basic fee table.

type A Receptions and Special eventstype B educational and other activities that are considered an extension of

our ministry as evidenced either by our financial support or application through our Leadership Council

type C Civic and service activities, including musical groups, service clubs, fraternal organizations, etc.

ROOm type A type B type CSanctuarySocial HallSocial Hall KitchenFiresideChapel/ChoirGymRoom 202/KitchenAdult ClassroomChildren’s Classroom

Fees are based on one segment of time (Morning, Afternoon, Evening)Groups in the categories of Type B or Type C are not eligible to use the Sanctuary, Social Hall or the Social Hall kitchen on Saturdays or Sundays. Also, the Fireside Room is not available on Saturday evenings or Sundays.

impact Fees0-20 people 21-99 people 100+ people

minimal Set Up $25 $35 $50Substantial Set Up $50 $75 $100

11






Impact fees are charged at the discretion of the Church Administrator taking into account factors such as setup requirements, number of participants, use of any special equipment, food and drink, etc. Based on these factors, impact fees may be in excess of these guideline amounts.

Rules and Regulations of the Board of trustees BreakageAll persons and/or groups using our facilities are expected to exercise reasonable care and judgment in such use in order to prevent defacement, damage, or breakage. The persons signing the application for use shall be responsible for paying costs incurred by the church in cleaning, repairing, or replacing any part of the building or its furnishings and equipment which in the judgment of the church administrator has been carelessly or irresponsibly subjected to more than normal wear and tear by the persons or group involved.

Room SetupsAll rooms have been designated with a standard room setup. The Church Administrator will provide each group with a diagram of this standard for the room they are interested in using. Any setup changes requested by the group are subject to approval by the Church Administrator and are considered in the calculation of Impact Fees noted above.

Organ and Piano UsePermission to use the organ, harpsichord, or piano must be granted by the Executive Director of Music. If the user wishes to have instruments tuned, they will be tuned at the user’s expense by a craftsman approved by the Executive Director of Music or Organist. Pianos cannot be moved except by permission from the Executive Director of Music or the Church Administrator, and may require the assistance of professional movers in the case of grand pianos. If professional movers are required, the requesting group must pay for the moving and for tuning the piano after moving.

Sanctuary Sound System The Sanctuary sound reinforcement or recording systems are available upon request. The systems may be operated by the church sanctuary sound technicians (at a cost of $75 per event) or by technicians pre-approved by the Church Administrator. Group-provided sound, recording, or video equipment may not be attached to this sound system through cables or connectors without prior approval.

Smoking Policy All members of all groups using our facilities shall abide at all times by a “no smoking” rule in all parts of the building, including corridors and restrooms. Violation of this rule is sufficient ground for a staff member to withdraw immediately any group’s use of the facilities and/or to deny use in the future.

12


churchsafety.com


step-by-step




Alcohol PolicyThe serving, consumption, or use of alcoholic beverages, marijuana, or narcotics shall not be permitted at any time on church property, including the outdoor courts and parking lots.

no Games of Chance Denominational church policy prohibits the use of games of chance or gambling on the church premises. This would include such activities as raffles or lotteries.

Final DecisionsIn case of doubt or uncertainty by any outside person or group about the application or interpretation of these regulations, or in our customary practices not specifically mentioned here, the Church Administrator or their delegated representative shall decide the matter and all individuals and groups shall abide by the Church Administrator’s directions or forfeit immediately the use of any part of the facility.

Supervision of Children and YouthThis church has adopted the policy of Safe Sanctuaries for children and youth. All users of the facility are expected to follow the guidelines of this policy including the following:

• No fewer than two adults must be present at all times during any program or event involving children.

• These adults must be 18 or older and must be at least 5 years older than the children with whom they are working.

• At least one of the adults present must be currently certified in First Aid and CPR.

• The adults involved with the children must receive annual training related to child abuse prevention.

Any questions regarding this policy should be directed to the Children and Family Ministry Coordinator.

nursery Use The nursery facility is available by arrangement at least two weeks prior to the event by contacting the Children and Family Ministry Coordinator. Our safety standards require that two nursery care providers must be present to operate the nursery. At least one of these must be a (Your Church name here) qualified caregiver; both must be adults over the age of 18.

13






Food and DrinkThere is no food or drink allowed in the Sanctuary or Chapel/Choir except water bottles. All other food and drink requires approval in advance as noted in the Room Use Agreement.

DecorationsDecorations may be attached to the walls, doors, and light fixtures with masking tape only. No decorating is permitted in the hallways. All such decorations must be removed immediately and completely following the event.

Starting and ending times • Monday through Friday from 8:30 a.m. through 9:00 p.m. • Weekends from 9:00 a.m. through 6:00 p.m. The building must be completely cleared not later than 9:30 p.m. (or 6:30 p.m. on Saturdays) to allow the building to be closed promptly. The Gym must be vacated by 8:00 p.m. all evenings to accommodate the Family Shelter. Exceptions to these times must be approved in advance and will be subject to a custodial surcharge.

emergency Scheduling ConflictsThe church reserves the right to pre-empt any facility use for its own in cases of emergencies, such as funerals. Notice will be provided as early as possible.

RecyclingRecycling is a policy of our church. As a part of that policy, no Styrofoam cups, bowls, plates or other articles are to be used by anyone at the church. Receptacles for recycling glass, tin, aluminum and paper are available for your use. Every organization is responsible for complying with this policy.

StorageThere is no excess storage available for organizations other than church groups and, as such, all organizations using the facility will be responsible for storing props and accessories offsite.

Bicycles and Skateboards No bicycles or skateboards are allowed inside the church facility. Bicycle racks are provided at the front entrance and outside the Social Hall.

Parking Parking on the church campus is available only during the period of time that a group has contracted to use the facility. Parking is available on a first-come, first-served basis and excludes certain spots specifically reserved at all times for staff of the church. Any damage to vehicles is at the owner’s expense; the church is not responsible for theft or damage to personal property.

14


churchsafety.com


step-by-step




SecurityOur church works to maintain a safe and secure environment within the facility, however, no systems are foolproof. We ask that all users pay close attention to personal property and valuables, not leaving them unattended. The church is not responsible for theft or damage to personal property.

SAmPle FORm

Your Church name hereStreet Address

Any town, Any State, Any Zip CodePhone: Fax:

e-mail:

ROOm USe AGReementPlease Complete entire Form

name of Organization

Responsible Person

non-Profit Status: Federal iD no. (attach IRS determination letter)

Address

Organization Day Phone Fax

e-mail

Organization’s Purpose

event name and Description

Date of Request

Contact Person’s name

Date(s) Requested

15






Start time

end time (Dates may not be scheduled more than nine months in advance, except with specific permission.)

will the event be recurring: q One time only q Monthly q Weekly q Multiple days

which day of the week:q Monday q Tuesday q Wednesday q Thursday q Friday q Saturday q Sunday

Room(s) Requested:q Sanctuary q Chaqel q Gym q Fireside Roomq Social Hall q Youth Roomq Social Hall Kitchen q Room 202 q Adult Classroom q Children’s Classroomq nursery (available only by special arrangement with the Church Administrator)

Anticiqated number of Participants: __________

will a participant fee be charged? q Yes q no

will food or drink be consumed? q Yes q no

Special needs or Requests:

Set Up instructions:

Release and indemnity This Release and Indemnity Agreement is between the above-named organization (“Organization”) and our church.

ReCitAlS • The church is the owner of the real property and improvements located at (specific address) (“Property”).• Organization desires to use the property described above for meetings and other activities.

16


churchsafety.com


step-by-step




AGReement nOW THeReFORe in consideration of this church permitting Organization to use the Property and improvements described above, Organization agrees as follows:

Organization hereby releases, discharges, and covenants not to sue the church 1. or its administrators, directors, agents, officers, members, volunteers, and employees, from any and all liability, claims, demands, losses, or damages arising out of Organization’s use of the Property. If any member, guest, invitee, or participant of Organization makes any claim against the church or its administrators, directors, agents, officers, members, volunteers, or employees,in connection with Organization’s use of the Property, Organization will indemnify, defend and hold the church and its administrators, directors, agents, officers, members, volunteers, or employees harmless from any and all litigation expenses, attorney fees, losses, liability, damages, and costs arising out of such claim.

Organization represents that it carries standard general liability insurance 2. coverage with a minimum of $500,000 per occurrence. Upon request, Organization will provide the church with proof of liability insurance, and if requested, will add the church as an additional insured under Organization’s general liability policy.

ACCePtAnCe OF ReSPOnSiBilitY I agree to be responsible for the conduct of those coming to, or participating in, the activity for which this application is being made, and for any damage beyond normal wear and tear that may occur as a result of this activity. I will remove all signs posted by my group after the meeting has ended. I further agree that the church property will be used in accordance with the Rules and Regulations of the Board of Trustees, and I hereby consent to the Release and Indemnity Agreement.

Signature:

Print name:

title:

viSA/masterCard number (ReQUiReD):expiration Date:Date:

Billing Address:

17






this article appears in the Building Church leader’s download, “Church Facilities management.”

FOR OFFiCe USe OnlY

ROOm USe CAteGORY:

Request Approved _______________________________________

Request Denied __________________________________________

Agreed Upon Fees _______________________________________

thought Provokers

• What benefits will your church derive by making its facilities available for use?

• What kind of agreements and policies will we need in our manual?

• What steps do we need to take to implement a church facilities manual in our church?

http://www.buildingchurchleaders.com/downloads/bestchurchpractices/churchfacilities/

http://www.buildingchurchleaders.com/downloads/bestchurchpractices/churchfacilities/

18


churchsafety.com


step-by-step



| Pre-nuptial Policies

THe LeGAL SIDe

Pre-Nuptial PoliciesSet the expectations for facility use before the big day.

An Example from Community Church

…But set an example for the believers in speech, in life, in love, in faith and in purity (1Timothy 4:12).

wedding Policies and ProceduresHere’s a sample of wedding policies and procedures you can adapt for your church:

(Your Church name here) rejoices in the opportunity to minister to a couple at one of the most important moments in their lives. We see our building as an instrument of God’s grace because it can provide a place for the couple to make a lifelong covenant to each other. We see our pastor as a vessel of God’s love because she can walk alongside this couple as they prepare for a lifelong commitment and then be the one to officiate as they share their vows with each other.

On behalf of the congregation, the Board of Trustees is charged with the supervision, oversight and care of all real property owned by the local church. The trustees have established the following policy to help carry out their directive, to define the pastor’s role, and to make sure our church will remain a welcoming place for future weddings.

Pastoral Requirements Every couple wanting the current pastor to perform their wedding must meet 1. with the pastor a minimum of two separate times. These premarital sessions are a time to plan the ceremony and prepare for a lifetime commitment. Premarital sessions are scheduled through the pastor. 2. Fees for premarital counseling and officiating are paid directly to the church and 3. are outlined in the fee section of this policy.

General Policies for Use of the Facility Any party wishing to book a wedding in our facility must complete and return a 1. Wedding Reservation Form. The wedding must be scheduled through the church office to make sure there are no conflicts in building use. The Reservation Form must include the name and phone number of a contact person who will assume responsibility for making sure the building policies and procedures are followed. This includes members and non-members.

19





Managing Church Facility Use | Pre-nuptial Policies

All participants and guests of the wedding party agree to Christian standards of 2. decorum and activity. Property and persons will be respected. The use of drugs and/or alcoholic beverages is not permitted on the premises. The use of tobacco is not permitted inside the building.

The wedding party is responsible for making monetary restitution for damage 3. or neglect caused while they are using the building or because they used the building. This includes, but is not limited to, paying to have the carpet cleaned.

The wedding party is responsible for set up and clean up. Clean up is defined as 4. restoring the space to the condition found upon arrival. It is possible to hire the custodian for the final clean up. Please see custodian fees and procedures below.

Rooms will be made available for both the bridal party and the groomsmen for 5. dressing at no extra charge.

Only the space requested and reserved may be re-arranged. No furniture is to be 6. moved from other areas of the church and no furniture is to be stored in other areas of the church. Exceptions to this policy must be cleared with the pastor.

No rice or birdseed may be used inside the building.7.

Fees for members/non-members

Description non-member memberClergy counseling and officiating $200 $150Accompanist (rehearsal and wedding) $100 $75Sanctuary $100 $75Kitchen/Fellowship Hall $100 $75Custodian $100 $75

*Fees are paid directly to the church and then disbursed from the church treasury. Checks can be made payable to (Your Church name here). Payment is expected in full the Monday before the wedding.

Custodial Fees & Procedures The church custodian is available to do the final clean up after a wedding. 1. However, all belongings must be removed from the church. All furniture must be returned to its original location and arrangement. All dishes must be washed. No food may be left behind without plans for its further use or disposal. The custodian will do the final vacuuming, taking out the trash, wiping cabinets, and sweeping/mopping the floor.

20


churchsafety.com


step-by-step



| Pre-nuptial Policies

The wedding party is not required to use the church custodian. However, they 2. must be willing to take full responsibility for cleanup after the wedding. If the church is found unclean or unlocked, the wedding party WILL be charged the custodial fee.

Keys are available on request so the wedding party can access the church at their 3. convenience. Keys will be issued at the last pre-marital session and must be returned to the church within a week of the wedding. No copies of the keys may be made. A key issuance form must be filled out and it must include a contact person to make sure all building policies are followed.

Use of the Kitchen/Fellowship Hall Kitchen space shall be cleaned after each use. Any spills should be cleaned up. The 1. cabinet tops should be wiped up. Floors should be swept.

All dishes and utensils used shall be washed, dried and returned to the cabinet 2. space designated. Nothing should be left on the draining board or cabinet. Wet towels shall be taken home, laundered, and returned to the church within two 3. weeks.

All trash and garbage shall be removed to trashcans. A clean bag should be in the 4. bottom of the trashcan for replacement.

In case of breakage, please note item broken on the dry erase board hung on the 5. office door.

No food or beverage shall be left in the refrigerator or freezer without plans for 6. its further use or disposal. Please use the available masking tape and permanent marker to record when it was left, what group is responsible for it, and a contact phone number.

this article appears in the Building Church leaders download “wedding Arrangements.”

thought Provokers

• What kind of Wedding Reservation form will best suit our church’s needs and facilities?

• Which fees and guidelines correspond with the ministry of our church?

• How can we begin, and who will we need to speak to, to implement wedding policies and procedures within our church?

http://www.buildingchurchleaders.com/downloads/bestchurchpractices/weddingarrangements

21





Managing Church Facility Use | Before You Share Your Space

THe LeGAL SIDe

Before You Share Your Spacewhat you need to know to avoid jeopardizing your tax-exempt status.

by Frank Sommerville, JD, CP

Because of the service by which you have proved yourselves, men will praise God for the obedience that accompanies your confession of the gospel of Christ, and your generosity in sharing with them and with everyone else (2 Corinthians 9:13).

Churches frequently own large meeting facilities but do not utilize them every moment of every day. By allowing others to use the church’s facilities, the churches become the center of community activities and para-church ministries. Churches also frequently want to serve the needs of their members and staff, so they allow them to use the church’s facilities.

The use of church facilities by non-church entities and individuals creates many federal and state tax issues. In sum, the tax rules will dictate when and how a church’s facilities may be used by outside groups and individuals. This article summarizes the rules, but each church is reminded to seek competent advice before actually agreeing to some uses. Every rule has exceptions, and exceptions to those exceptions are common.

Two levels of taxation must be analyzed before allowing an outside group to use church facilities: federal income taxes and state property taxes. Since the state property tax exemptions vary from state to state, the church should check with local property taxing authorities before allowing outside organizations to use its facilities.

Allowable Use Under Fexeral tax lawThe church may allow any organization to use its facilities that is recognized by the Internal Revenue Service as exempt from income tax and described in Section 501(c)(3) of the Internal Revenue Code. This normally includes charitable, educational or religious organizations. Before allowing the use, the church should have in its files a copy of the determination letter issued by the Internal Revenue Service to the organization. The organization should confirm that the determination letter has not been revoked or otherwise restricted since its issuance. Once the church confirms the current status of the organization, then the church may allow the use of the facilities for no charge, or the church may charge any amount it chooses that the organization is willing to pay.

Another allowable use would be where the use furthers an exempt purpose. Exempt purposes would be use that furthers its religious, educational or charitable activities. For example, most faiths view a wedding as a religious service. The church may allow an

22


churchsafety.com


step-by-step



| Before You Share Your Space

individual to use its facilities to conduct a wedding service without any federal income tax consequences. The key here is that the church is furthering its exempt purposes. Charging for the Use of Facilities I need to insert a word of caution here. If the church charges any amount and the church has a debt outstanding related to the facility, then the church will receive taxable income. Further, if the use involves personal property (such as chairs and tables) and the rental value of the personal property is more than 10% of the amount received, then the amount received from the rent of personal property will always be taxable income. Also, if the taxable amount received is more than $1,000.00 per year, then the church must file Form 990-T even if no profits are realized.

Many churches try to disguise rents by using other terminology or by claiming that the other organization is simply giving a donation to the church. Other times the church calls it a “cleanup fee” or tells the tenant to pay the janitor directly for his services. None of these name games work. If any amount is paid by the other organization to the church or the church’s workers, then the IRS and state taxing authorities will likely treat it as rent paid to the church.

Allowable Use Under State laws State property tax exemptions vary from state to state, so you must check with your local taxing authority regarding any allowable use. Frequently, the state property tax exemption prohibits any use by any other entity, including use by another tax-exempt organization. Some states will allow the use by other charitable, educational or religious organizations without causing the loss of tax exemption if no amounts are charged the other organization. Check with your local property taxing authority before allowing any outside use.

no inurement or Private BenefitUnder federal tax law, all churches must use their assets exclusively pursuing its exempt purposes. Most states have a similar requirement to qualify for a property tax exemption. Like many laws, “exclusive” as used in federal tax laws does not always mean exclusive. Under federal tax laws, the courts have interpreted “exclusive” to mean all but an immaterial amount. This means that the church may allow others to use its facilities as long as the use does not otherwise violate federal tax laws and the use is immaterial. This is a time and frequency test. Stated another way, the use one time a year for two hours is likely to be immaterial, but a weekly use for eight hours for fifty-two weeks will likely be material.

Federal tax law prohibits all forms of inurement and substantial amounts of private benefit. The presence of inurement or substantial private benefit allows the Internal Revenue Service to revoke the church’s tax-exempt status. Further, the person benefiting from the inurement is subject to intermediate sanctions up to 200% of the amount of inurement.

23





Managing Church Facility Use | Before You Share Your Space

Inurement and private benefit have technical definitions. Inurement means enriching a church leader, such as a minister or church board member. “Enriching” means the church is providing a benefit, good or service for less than its fair market value to someone or the church is paying more than fair market value for a benefit, good or service that it buys. In the context of this article, it means that inurement occurs when the church allows a church leader to use the church’s facilities for personal use and the leader pays less than the fair rental value of the facility, or portion of the facility. For example, the church has an expensive musical instrument (such as an organ) and the music minister wants to give private lessons using the church’s instrument. The church must charge the minister the same amount as a commercial enterprise would charge the minister to use its instrument and facilities. If the church charges less than the commercial enterprise, then the minister is enriched by the difference between the commercial fair rental value and the amount actually charged by the church. This may cause the IRS to revoke the church’s tax-exempt status. Also, the music minister has taxable income for the difference between the fair rental value and what the church actually charged.

Private benefit is the same as inurement except the person benefiting from the arrangement is not a church leader. Suppose the person wanting to give the music lessons described above is simply a member of the community instead of the minister. The person would receive a private benefit if the church charges that person less than commercial rates for the use of its instrument and facilities. If this difference is substantial, then the Internal Revenue Service may revoke the church’s tax-exempt status. In any event, the music teacher has taxable income for the difference between the fair rental value and the amount actually charged. The church should issue Form 1099 to the music teacher to reflect that difference.

Suggestions Many times a use can easily be structured to fit within the rules described above. For example, since music is central to the church’s functions, the church could hire the music minister to give lessons using its instruments. The church could then pay the minister for giving the lessons at the market rate for music teachers (including a percentage of the amounts collected from the students). The same arrangement would work for the community music teacher.

Another common solution is found in celebrations. For example, a family in the church wants to hold a party celebrating the parent’s fiftieth wedding anniversary. Since the church also wants to celebrate this milestone, the church can make the celebration a joint event between the family and the church. The church provides the facility; the family provides the rest. By being creative, the church can continue filling its role as the community center.

Frank Sommerville specializes in nonprofit tax law for the firm weYCeR, KAPlAn, PUlASKi & ZUBeR, P.C. You can reach him at: [email protected].

[email protected]

24


churchsafety.com


step-by-step



| Before You Share Your Space

thought Provokers

• Are we furthering our exempt purposes through religious, educational or charitable activities? What do we need to improve in order to be under the Federal Tax guidelines?

• What solutions can we come up with that will allow us to lend our facilities out without the extra expenses?

25





Managing Church Facility Use | Tax and Liability Issues of Sharing Your Facilities

THe LeGAL SIDe

Tax and Liability Issues of Sharing Your FacilitiesKnow your risks.

by Richard R. Hammar

May integrity and uprightness protect me, because my hope is in you (Psalm 25:21).

Churches often allow their property to be used by a variety of outside groups. Some churches charge rent for the use of their property, while others do not. Several legal and tax issues are raised whenever a church allows groups to use its property. Assess how your church understands and practices sound policies on these issues.

impact on the Church’s exemption from Federal income taxation qY qn The level of our facilities use by other organizations can be described as “substantial.”

So long as the group’s use of church property is insubstantial in nature, there will be no impact on the church’s exemption from federal income taxation.

Unrelated Business income tax

qY qn We know how much money we collect in rents and fees from outside groups.

qY qn We track the expenses we incur when making our property available.

Federal law imposes a tax on the net income generated by a tax-exempt organization from any unrelated trade or business that is “regularly carried on.” This tax is called the unrelated business income tax. A church would not be subject to the tax if the premises that are rented are owned by the church debt-free.

Even if the church’s rental activities are subject to the tax, note that the tax is assessed against net earnings. The church is entitled to deduct all of its expenses incurred in making the rental property available. The tax is a prorated tax—meaning that only that percentage of net rental income that corresponds to the percentage of the property’s value that is encumbered by debt is taxable. In addition, the first $1,000 of taxable income is excluded from tax.

26


churchsafety.com


step-by-step



| Tax and Liability Issues of Sharing Your Facilities

Property tax exemption

qY qn We rent some or part of our facilities for profit.

qY qn We assess a “facilities use fee” instead of rent to outside organizations.

Most states deny a property tax exemption to any property that is rented for profit. If a church charges rent for the use of its property, then this may jeopardize the exemption of the church’s property from taxation. Usually, the exemption is lost only with respect to the property that is actually being rented rather than to the church’s entire property, but this is not always the case.

Some courts have ruled that a church that charges a “facilities use” fee, instead of rent, will not lose its property tax exemption so long as the fee simply reimburses the church for expenses incurred in making the property available, such as custodial services and utilities.

liability

qY qn We exercise control over our premises while they are being used by outside groups.

qY qn We require proof of adequate insurance from outside groups wanting to use church property.

qY qn We have discussed this issue with our own insurance agent.

A church can possibly be liable for injuries that occur while another group is using its property. This will depend on the degree of control that the church exercises over its premises while the group is using them. If the church exercises control, then it may be liable for injuries that occur while another group is using its property. Adapted from Church law and tax Report, © 2005 Christianity today international. For more articles like this, visit www.Churchlawtoday.com

www.ChurchLawToday.com

27





Managing Church Facility Use | Tax and Liability Issues of Sharing Your Facilities

thought Provokers

• What factors do we consider when we charge fees? Does the idea of the “facility use fee” charge make sense?

• Have we discussed federal and state tax implications with an attorney and financial advisor? What was their advice?

• What does it mean to “exercise control” over our facilities while they are being used by outside groups?

28


churchsafety.com


step-by-step



| Resource Center

LeADeR’S GUIDe

Resource Center Quick tips and recommended resources.

Guard against what has been entrusted to your care (1 Timothy 6:20).

tips for Using Articles

Consider these options for the use of articles and information in this download:

• Pass the “Developing a Policy” assesment (see “Assessment” section above) around at your next board meeting and have a 15-minute discussion.

• After reading through an article, choose questions to pose at a scheduled meeting and discuss them together.

• Determine what areas your church will need to pay extra attention to in the area of renting policies and procedures and discuss your plans to do this.

• Using the Bible verses found at the beginning of the articles, lead a devotional discussion at a staff meeting on the topic of renting policies and procedures.

• Using the “Thought Provoker” questions, lead a discussion for church leaders.

web Resources

• ReducingtheRisk.com

• BuildingChurchleaders.com, “Church Safety 101”

• Church law today: www.churchlawtoday.com, “Protecting Church Property Against Theft, Vandalism, and Arson”

• Your Church Resources: YourChurchResources.com, Reference and training material for legal and tax issues that affect your church.

• Brotherhood mutual insurance Company: Founded in 1917, Brotherhood Mutual Insurance Company is one of the nation’s leading insurers of churches and related ministries.

ReducingtheRisk.com

BuildingChurchLeaders.com

http://www.buildingchurchleaders.com/articles/2007/070703a.html

www.churchlawtoday.com

YourChurchResources.com

http://www.brotherhoodmutual.com/default.htm

29





Managing Church Facility Use | Resource Center

Books, Kits, and Other Resources

• Church law Special Reports: Quick and easy updates on the critical issues that continually concern the church.

• inspection and Safety Checklists: 12 modules for assessing and improving facilities, and safeguarding activities.

• Risk management Assessment Pack from Christianity Today International.

• Risk management Handbook for Churches and Schools by James F. Cobble, Jr., and Richard R. Hammar.

• Pastor, Church & law by Richard Hammar. The most comprehensive and practical legal reference book ever published for churches and clergy.

• Reducing the Risk 3 Resource Kit: This completely revised Resource Kit includes the Reducing the Risk of Child Sexual Abuse in Your Church reference book, training manual, and DVD set with six video presentations.

• Additional Risk management and Safety resources from Christianity Today International.

Unless otherwise indicated, Scripture taken from the HOLY BIBLE, NEW INTERNATIONAL VERSION®. Copyright © 1973, 1978, 1984 by International Bible Society. Used by permission of Zondervan Publishing House. All rights reserved.

This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. “From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations.” Copyright © 2008 by Christianity Today International. All rights reserved.

Documents

step-by-step€¦ · 3 SIMPLE | SMART | STEP-BY-STEP step-by-step churchsafety.com ChurchSafety.com is an online safety service for America’s churches and related ministries. It