MCA

Members for Church Accountability Inc.

2000 First Quarter

This is the quarterly newsletter of Members for Church Accountability. The objective of this organization is to promote accountability within the Seventh-day Adventist Church. MCA itself is primarily an umbrella organization within which representative/agents and their supporters can work to further this objective.

Section 1 - Financial Report

Summary financial statement for first quarter 2000:

Stmt_1q_00

Section 2 - Trustees' Reports

Norm Smith - Secretary Treasurer

For any of you that would like to contact us by e-mail our address is: advmca@aol.com. Our web site address is: www.advmca.org. Again we would like to encourage MCA members to read this web site and to invite their friends to read it. If you don't have access to the web, perhaps you could ask a friend who does, to let you read it. This is an economical means of spreading the word about MCA. Mailings are quite expensive by comparison. Information about a web site can spread quickly on the Internet. If each person mails the site address with their recommendation to several friends, and they in turn tell others, the word is soon passed to a large number.

I would like to express appreciation to all of you who told us of your concern and were tolerant of my falling behind schedule with MCA tasks, during the time my father was staying in our home with ALS. He passed away in January. We are still quite involved with getting all things settled. He was a remarkable and brilliant man who was a church employee for about 55 years (50 at Union College). We miss him greatly.

Section 3 - Amendments and Elections

  • Nothing this quarter.

Section 4 - Member Letters

This section is for printing the letters that members send in. It provides the means for members to communicate with one another. It is also one way that representative/agents can communicate with those in their group. Needless to say, these letters do not speak for the MCA organization itself. So far as time and budget allow, we intend to print all letters from members which appear to be written for inclusion in the newsletter (please say so if you do not wish your letter to be printed). We will print the shortest letters first. Where it seems appropriate, the editor will make comments in response to letters.

Louise Johnson writes (in part):

I especially grieve at the closing of our New England San. & Hosp. in Mass. I was a nurse there in the 1930's. Everyone sacrificed to keep it going. Most of todays leaders do not know what sacrifice is. All they seem to be interested in is fat pay checks. I shall continue to pray for our church and your efforts to remedy the sad situation.

EDITORIAL COMMENT: While individually we can appreciate your sentiments, it would be good to note that MCA has not made these accusations against church leaders.

A member wrote to George Grames:

Please remove my name from your mailing list. I don't need to read all that gossip and that is what you are trying to spread. Some may be true but God can take care of that. Please work for the uplifting of the church, -not its tearing down.

GEORGE GRAMES WROTE IN RETURN:

This letter is in response to your letter requesting removal of your name from Members for Church Accountability (MCA). We certainly will honor your request. However, we respectfully disagree with you that we are trying to spread gossip. We do not spread gossip. On the contrary, we are concerned with the truth that is very painful for all of us. It is for that reason that we exist. Despite a plethora of official church policies, we are witnessing an unparalleled breach of trust by our church officials. Clearly there is no system of discipline for officials that misuse church funds or officials that are involved in conflicts of interest.

As evidence of the never-ending malfeasance are the recent events at Boston Regional Medical Center (BRMC) in Massachusetts and Shady Grove Hospital in Maryland. Enclosed are newspaper articles from the Boston Globe and the Washington Post. With the bankruptcy and loss of Boston Regional Medical Center, the local SDA Church and SDA Academy may also be lost because they are on hospital ground. There are a series of articles in the Washington Post on Shady Grove Hospital. To be quite honest, they are very embarrassing, and we as church members are powerless to effect meaningful accountability unless large numbers of us address the issue. Therefore, I am requesting that you reconsider your withdrawal from MCA.

From a writer (we are not sure he wishes to be identified):

I have worked in administration as a therapist in the Adventist health system for years and seen the corruptness and tolerated it. I left the system in 1990 and have had the best years of my life working and enjoying what I do best. Upon review of what I saw in the health systems, it appears that the church hierarchical structure is the same. This is a reality factor that I have not wanted to face, however, now the gestalt of our church does not allow me the privilege of denial!

I am angry that nothing more has been released about Folkenberg and is not discussed at all by the church. Even more, how do we prevent this from happening again. As I review the internet I find numerous pages of what my church has not told me and appear to back their statements up with facts.

I am trying not to be angry with my church, and have decided that this is my problem. I need not believe what is being told first without researching it out. Also the credibility of my church is very poor and I have quit paying tithe and directed the funds instead to the local church school (Adventist). Many others in my church have done the same!

I would like to be involved in your organization or at least become a member to help others not make the same mistake that I have made.

John Troyer writes:

Please take my name off the accountability list, as I don't feel it is going anywhere. The conf. will do what it wants to do. It would probably do more good to write to them? The church should have more information and input, but if the G. Conf. or local conf. won't help then we don't need another sounding board committee. I am sick of politics in religion & family involvement (getting family jobs etc. etc.) All we can do is our part & the Lord will take care of the rest.

EDITORIAL COMMENT: We will do as you wish about your membership, however, we don't agree with your reasoning. We too wish that results were easier to obtain. We believe that this issue of accountability is so important that we must keep working toward change even when we haven't yet seen results. We agree that we should do our part and trust the Lord to do the rest, however, we do need to do our part. It is hard to expect the Lord to work miracles to solve the problem while we do nothing.

Norm Smith writes:

Mr. Troyer does make a good point in the above letter, that without the Lord's help our efforts will likely not succeed. We do believe in prayer to change things in the church. We also believe that the Lord would want church members to take some initiative toward steering the church down the right path. History has examples to show that when church members have not taken the initiative to keep their church on the right course, the Lord has not prevented the church from straying. We need to keep working both to monitor what the church leaders are doing through independent audits and to change the structure through which leaders are accountable to members (with the members accountable to the Lord).

I agree wholeheartedly with the MCA goal of supporting independent spot check audits of church records. There is a problem though if such audits take place only with the permission of church officers. Permission can be withdrawn as easily as it is given. (No permission has been given yet. Elder Paulsen didn't even answer our letter.) I would suggest that the only way to make accountability secure is to change the manner in which members vote on church issues. Nominally, church member are now able to affect church policy through their constituency delegates' votes on conference officers and executive committee members. In practice this voting process is so well orchestrated and controlled by church leaders that member influence is negligible except in times of great crisis. The manner in which voting is structured in the church invites political control by the leaders.

There are two main factors that make it easy for church officers to control the voting process within the church. One is the control the officers have over the agenda at church constituency meetings and presumably at executive committee meetings. The second is the way that constituency delegates are chosen geographically. I will not include in this letter a lot of details for changes I would wish could be made. Further detail can be found in an article on our web site under "Proxy Voting on Executive Committees" under the article "The Case for Accountability Reform".

I work for a very large company yet even the smallest stockholder can submit an item that will be voted on at the next stockholders meeting. Yes, this makes the stockholders vote on some rather flaky suggestions, but that is a small price to pay for taking the stockholder meeting agenda out from under the control of the company officers. We should do something like this at constituency meetings. The constituents should have the right to submit agenda items to be voted on at constituency meetings.

In most companies the voting is done on the basis of one vote for one share. Stockholders who can not attend the stockholders meeting can cast their vote by proxy (or by mail for that matter). We should have a church voting structure where each member can cast one vote. If members wish to assign their vote to a more informed proxy whom they trust they should be able to do so. When voting is done, as is presently the case, by delegates who are chosen by majority vote at local churches, it makes it quite likely that only majority opinions will be represented. This geographic selection of delegates filters out minority issues before the "real" voting takes place. This is so important because important reforms usually start out as a concern of only a minority. When minorities have representation they can bring important issues to the attention of the majority. Decisions on policies and issues should indeed be made by majority vote, but representation should not pass through a majority filter in the form of geographic majority delegate selection. Most governments have such a geographic representation scheme and minority viewpoints are poorly represented in legislatures. The company stockholder model is a much better structure to approximate.

Note again that I am making these suggestions as a regular member of MCA, not in the role of secretary treasurer.

Stewart Shankel, George Grames and Richard Sheldon write (note that Shankel and Grames are the leaders of the General Conference Reform Group within MCA which is supported by the great majority of MCA members):

Throughout a number of years there have been a series of events involving our church that expose a breach in common standards of ethics and integrity. There is a disturbing lack of accountability regarding fiscal management and conflict of interest within the leadership of the Church.

This was illustrated two decades ago when the Davenport fiasco came to light. The church membership was assured that there would be a full investigation, punishment of the offenders, and safeguards placed that would insure that such mismanagement and self-serving conflict of interest would not recur. There was an investigation, but there was no exposure or discipline of those involved. Certainly no "safeguards" prevented what took place in the Family Enrichment Resources (FER) debacle reported in the February 15, 1997 issue of the Columbia Union Visitor. Again there was no appropriate discipline of those who misappropriated church funds. Then, as the millennium closed, disclosures of the General Conference President’s alleged personal financial schemes, facilitated by the legal "expertise" of a longtime General Conference counsel, resulted in his resignation.

More recently we learned from the October 25, 1999 Boston Globe about the mismanagement and resultant total loss of the Boston Regional Medical Center. Then came the revelations in the Washington Post regarding Shady Grove Adventist Hospital. The article on December 1, 1999 reported the extraordinary compensation and multi-million-dollar termination packages paid to hospital administrators. It is noteworthy that Bryan Breckenridge was a major figure in both the Boston Globe and the Washington Post articles. The series of articles in the Washington Post explain in some detail the recent problems facing Shady Grove Hospital.

There seems to be no end to the embarrassment to the Church, perpetrated by some in leadership positions. Over six months has passed and the only official church response to the Shady Grove revelations seems to be one of discrediting the investigative reporter and justifying the compensation, rather than recognizing the problems. In fact, the newspaper reports and the published responses raise a number of serious questions that have not been addressed.

Kenneth B. DeStafano, Adventist HealthCare’s (AHC) general counsel, said, "The board made a reasonable business decision that retirement plans for a number of the executives were not adequately funded in comparison to what they would have otherwise would have received" in a non religious organization. "The decision was made to do a catch-up, if you will." To what board is Mr. DeStafano referring? Who are the members of this board? At least two Shady Grove Hospital board members claim that they were unaware of the executive compensation and the reported lump sum severance pay. Wisbey subsequently referred to an "independent committee of the board of directors" that determined executive salaries. Who were the members of this committee? Were Ronald Wisbey and Bryan Breckenridge members of the "independent committee" that determined executive salaries? Did the "board of directors" specifically approve the individual salaries of the administrators?

When these executives were initially hired what Internal Revenue Service (IRS) approved retirement plan was included in their employment contract? What was the annual retirement contribution as a percent of their base salary? No ordinary employer could afford to make huge lump sum contributions to retirement programs at the time of termination. Further, it is difficult to understand how the IRS would approve a retirement plan that was funded in this fashion or that would exclude all other employees. In a subsequent Washington Post article dated January 7, 2000 entitled, "Chief Financial Officer Quits Adventist Hospital Company", Harry Weis resigned after "less than two years" of employment. His base pay was $200,000 per year and at the time of termination an additional $131,000 went to company retirement contributions. That calculates to an astonishing figure of 32 percent of his base pay per annum for less than two years of employment! Is this retirement percentage the same for the other hospital executives and the 5700 employees? If not, why not?

Adventist Today reported AHC officials as saying "half of Wisbey’s compensation was reimbursed by two other Adventist hospitals in Ohio that also employ Wisbey as board chairman." The implication is that only half of the reported figure for Wisbey was actually paid by AHC. These Washington Post figures came from federal tax returns of Adventist HealthCare Inc., the regional non profit company that owns Shady Grove Hospital, Washington Adventist Hospital, seven nursing homes in Maryland, and Hackettstown Community Hospital in New Jersey. Would Wisbey’s compensation from Ohio appear on these particular federal tax returns? Did Ohio reimburse AHC for Wisbey’s employment in Ohio, or did Wisbey actually receive additional compensation from Ohio?

Wisbey decried the Washington Post’s reporting of his compensation for 1997, 1998, and 1999 claiming that Goldstein "treated the dollar figures on form 990 as if it were a W-2 form." On the contrary Goldstein referred to the figures as compensation and then defined compensation as "salary, benefits, deferred salary and expense accounts." Wisbey included "cashed out, unused sick and other leave accrued over many years" in his compensation. Do all 5700 employees of AHC cash out unused sick and other leave accrued over many years? Since there is a great discrepancy between actual salary and total compensation, an itemization of Wisbey’s benefit package and expense account for this non profit organization would clarify this issue.

We include the following blank for use in recruiting new members. (Make lots of copies to pass around.)

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MEMBERS for CHURCH ACCOUNTABILITY, INC. (MCA) APPLICATION (nl1Q99)

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/__/ I wish to be a member of the General Conference Reform Group

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You will receive the MCA newsletter.

Send to:

Members for Church Accountability, Inc.
PO Box 1072
Morrison, CO 80465

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