LDS Revenues and Assets

Here's a follow-up to yesterday's post on where tithing money goes--I feel like, having broached the subject, I should post what numbers are available. Chapter 7 of the Ostlings' Mormon America (HarperSanFrancisco, 1999) provides reasonable estimates of LDS assets and annual tithing revenues, based on publicly available data, prior estimates by other authors and journalists, and their own interviews of LDS leaders and informants.

As of 1999, estimated annual revenues were $5.9 billion, of which approximately $600 million was income from securities and Church-owned businesses, and the balance from tithing (p. 115). When these figures were first published, the official response from the Church was that the authors "greatly exaggerated" LDS income and wealth, but the LDS spokesman "did not provide even the vaguest hints as to what was wrong and what the truth might be . . ." (p. 115).

The asset estimates were presented in an appendix, which put total LDS assets as of 1999 "in the range of $25-30 billion" (p. 400). This was composed of investments (a portfolio of $1 billion plus direct investments like Beneficial Life and Bonneville totalling about $5 billion), real estate (ranches and farms, $5 billion), LDS schools and universities (about $1 billion, mostly BYU), and chapels and temples ($18 billion, which includes both the land and the structures) (p. 398-400). They quote an estimated price tag of $18 million per temple (p. 399), but that may derive from the traditional mega-temple architecture (San Diego, Washington DC) rather than the newer suburban (Newport Beach) and mini-temple designs. Excluding chapels and temples, and figuring about 6 million active Mormons, that works out to assets of about $2000 per active Mormon. Maybe I've been living in California too long, but $2000 per person doesn't seem like that large a figure to me.

Another interesting figure offered by the Ostlings is expenditures on humanitarian aid. They say the Church reported humanitarian aid expenditures of $30.7 million in total from 1984 to 1997 (p. 128). Compare this with the similarly-sized Evangelical Lutheran Church of America, which provided humanitarian cash to the tune of $15.44 million in 1997 alone, not to mention various "assistance programs" providing "medical and educational" help (p. 129). This lends some credence to the idea that most LDS have an exaggerated idea of the extent to which tithing donations are directed to humanitarian purposes. It also offers a possible rationale for the recent emphasis on service projects by local wards and stakes, a non-cash vehicle for filling a perceived humanitarian services PR gap. Finally, I should note that the Ostlings do note that "in their commodity production and welfare systems, the Latter-day Saints have created and maintained a remarkably massive and efficient mechanism for meeting human needs of their own members" (p. 129).

Comments

[Nathan Shumate]

I don't know that I'm that typical (best opening you're all going to have all day), but I've never assumed that any significant degree of tithing was going to humanitarian aid. The Church has never been, to my mind, an organization principly or even significantly dedicated to physical relief or aid; there are plenty of other organizations that do that, and do it well, and I don't expect the Church to try to institutionally do all good things, any more than I expect the United Way to attend to the saving ordinances.

[Yeechang Lee]

$25-30 billion in total assets as of 1999, including $1B in marketable securities and $5B in total investments, does not strike me as being very large for a then-10 million member organization. The endowment of Harvard University, long the world's wealthiest university, was $18.3 billion in 1999 for 29,000 faculty members, employees, and students, and this of course excludes the school's substantial non-investment asset base such as buildings. Thrivent Financial for Lutherans, a religious-oriented nonprofit investment company, had $60 billion under management as of 2003.

From the viewpoint of a bulge-bracket investment bank, $1B in securities would be thought of as nothing more than an above-average sized hedge fund or a very, very, very small mutual fund, as the Thrivent example above implies; Fidelity, the world's largest investment company, manages $1.2 trillion in assets.

[Dave]

Nathan, I think your perspective is actually that of the majority of Mormons. Given how "the world" has treated Mormons and the Church until the last few decades, it's not like Mormons owe anything to the rest of society. The comments one sometimes hears referring to LDS humanitarian expenditures to justify paying tithing are problematic (first because largely incorrect and second because somewhat factually misguided), but as justifications go "humanitarian aid" is a pretty good one.

YL, I don't think university endowments or investment companies are the proper comparison here. Comparable asset holdings (not their retirement plans) by similarly-sized religious denominations would be the proper comparison. However, that's not a normative standard. I don't know that one can easily fill in the blank in the statement, "A religious denomination should hold approximately X thousand dollars per active member."

[Nathan]

Nathan, I think your perspective is actually that of the majority of Mormons. Given how "the world" has treated Mormons and the Church until the last few decades, it's not like Mormons owe anything to the rest of society.

Jeez, I hope THAT wasn't what it sounded like I was saying! I believe very strongly in being actively involved in charitable and humanitarian work, in my local community and further abroad. It's never been a question of "owing" to society -- it ain't charity if it's obligatory, after all.

But the Church has never claimed to be an organization dedicated to the alleviation of physical suffering throughout the world. That's simply not what it is. The Church is an organization with a mission, and that's not it -- especially because, as I said, there are literally thousands of charitable organizations which can coordinate that work as well as, or better than, the Church could. To be critical of the Church's relative low level of humanitarian aid is to assign to it a role which is counter to the one it has publicly avowed for itself, and then find it wanting based on that outside role.

[Dave]

Nathan, no misunderstanding. The second sentence was my point of view--given how Mormons have been treated in the past, who can blame us if we feel no heavy obligation to provide material support to society at large?

That said, the money that does get disbursed is not insubstantial. No aid society is going to return a check for $20,000 with a note that says, "Gee, we were hoping for $50,000." And local efforts are difficult to capture in global statistics. Locally, for example, my ward provides a couple of priesthood fellows two or three times per year to do an all-night shift at the local shelter.

[Darren]

Excluding chapels and temples, and figuring about 6 million active Mormons, that works out to assets of about $2000 per active Mormon. Maybe I've been living in California too long, but $2000 per person doesn't seem like that large a figure to me.

This number at first seemed waaaay too low to me. 

I've never thought of it that way. Let imagine that the 6 mill active members are 50% rich westerners with an average family of 5 people with a household income of $40k/year and 50% poor second- and third-worlders with an average family of 7 people and an annual household income of $2,000. 

This results in tithing revenue/year for the westerners of 2.4 billion (((3e6 members / 5 per family) * $40k * 10%) and about 86 million from the rest of the world. Note this is roughly half the famous Time Magazine estimate. That results in about $414 per active person church wide in revenue. Therefore, by amalgamating the entire church body into a multinational fella, that would mean just under five years to reach the $2,000 per member threshold if every red cent was spent on tangible assets. Considering that a significant percentage (75% sounds generous) is spent on intangible religious benefits (just like our year-end tithing statement says) such as salaries, building maintenance, PR consultants, and legal fees; it would take about 19 years to reach the $2000 in physical property assets per member. I guess that what I am saying is that is sounds like a somewhat reasonable number considering the relatively start-over of the 1960s and the ensuing multi-year fix.

I believe this represents some fairly reasonable numbers but by no means suggests any actual research and could be off by may factors (hence useful financial disclosure). 

I should add, that as an organization that has such bold claims to its direct Godly inspiration and its three-fold mission; 500-million for a mall, being the second largest land owner in Nebraska, as well as being the top producers of many farm goods in many states (my parents served a FMC mission in OR, ID, and CA), apparently purchasing an airline in Ghana; the evident financial dealings of the Church grossly mismatch what my opinion of a Christ-led organization would do.

[Nathan]

Again, I have to ask: What WOULD you think a Christ-led organization should do, if it finds itself with resources beyond those it needs for immediate day-to-day operations? (I'm assuming that we don't do anything like "reduce the tithing percentage" -- that strikes me as being as short-sighted as President Bush's plan to give back unspent income tax, the year before a war takes into a deficit spiral.) Should excess cash be maybe buried in the old genealogy vaults? I'm thinking maybe that Christ might have words for a servant who buries his talent for safekeeping. Or maybe, should they invest the assets of the church for added growth and financial security? That's strikes me as a good idea, and a supportable one from both the Old Testament and the New.

[Dave]

Nathan, if you go into the inquiry ruling out "reduce the tithing percentage," then you are pretty much avoiding the more general question "what should a Christ-led organization do?" Surely you can envision the possibility that the being who sent out his messengers "without purse or scrip" would be opposed to running an organization with an investment portfolio (ignoring chapels and temples) of $12 billion.

Here's a different question: What would leaders do if they thought they had too much money? Give it back? No, they'd build more buildings or buy more ranches or hire more church bureaucrats. They are willing to do just about anything with the money except return it to those who contributed it, aren't they?

[Darren]

Nathan, I guess that I would look at what Christ did in his life to guide me in what I think a Christ-led organization would do.

Give it away. Give it all away to those in need. Christ apparently had faith that God would provide a way to do His bidding. If Church leadership had the same faith that Christ had, I think they would be able to comfortably put less in financial investments and invest more in those in need.

Dave - I would be willing to guess that even those that would like a chuck of tithing money back would be just as happy seeing the Church giving way scads of money to help develop clean drinking water in third world countries. Just the 500 million would buy a lot of human-powered well pumps. Or maybe they can use the proceeds from the latest development going into Surprise, Arizona to buy malaria vaccine in Sub-Saharan Africa, where it kills more than one million per year.

[Dave]

Darren, those seem like exactly the kinds of ideas that would be part of the discussion in a more participative model of managing LDS revenues. Members would have an opportunity to give input as to how the money would be spent (say on some of the charitable causes you identify as opposed to the LDS projects it goes to now). Alternatively, members could retain and distribute the money themselves to charities they deem deserving.

[Nathan]

Here's a different question: What would leaders do if they thought they had too much money? Give it back? No, they'd build more buildings or buy more ranches or hire more church bureaucrats. They are willing to do just about anything with the money except return it to those who contributed it, aren't they?

Dave, you sound like you've got a massive chip on your shoulder. Even if you don't believe that the leadership is inspired, would it hurt you too bad to maybe entertain that they are men of good conscience, trying to do what's right?

The Church has gone through bad financial times before; it's conceivable that it could sometime again, trough a major depression, changes in the laws regarding taxation of churches, etc. Your "give it all back" idea seems, as I referenced in my last post, as shortsighted as Bush's "give back the budget 'surplus'" plan a couple of years ago, never thinking that he may need to have a multi-year economic philosophy.

If you'll recall, the Church changed its budget policies fifteen years ago to allow local unit budgets to be paid out of the general tithing. But the idea of leaving the coffers empty and trusting to the Lord to provide when a crisis comes doesn't seem to be in tune with the same Lord who says things like, "If ye are prepared, ye shall not fear."

Again, I simply don't see what it is in the idea of investment of current excess that raises your hackles or makes you think that it's bad stewardship. That seems to be sensible stewardship to me.

Surely you can envision the possibility that the being who sent out his messengers "without purse or scrip" would be opposed to running an organization with an investment portfolio (ignoring chapels and temples) of $12 billion.

I certainly can. And I also assume that that same being, who set the organization up in the first place, won't be caught surprised when the policies he set up for the financial security of the Church actually result in the financial security of the Church.

Darren: Even the original Twelve had a treasurer. It doesn't seem to me that Christ ever trusted the Lord to compensate for his own lack of foresight.

[Dave]

Nathan, it's hard to make a point on this issue without being open to a charge of "having a chip on my shoulder," or even a massive chip. Wow--I guess the only thing worse would be to have two massive chips, one for each shoulder.

I'm not advocating a wholesale rebate of surplus tithing to members. But the concept "surplus tithing" ought to be open to discussion. Rejecting the idea out of hand betrays the same mentality as liberal politicians who simply cannot conceive of a tax cut or rebate, as they think of tax revenues as their money rather than taxpayers' money. This idea that tithing is God's money or the Church's money carries that same kind of cynical idea that organizations and corporate entities (like "the Church") matter more than real people. I think that's a massive misreading of scripture. It's the great and abominable church that amasses assets, not the true one.

Maybe the problem is simply the glut of corporate executives in leadership. They should call a plumber, a farmer, and a teacher, some "real people" who think in more humanistic terms rather than corporate ones. Or possibly a fisherman, a tentmaker, and a carpenter.

[Darren]

Nathan, You are right that an organization should prepare for financial solvency for the immediate and long-term future. However, many charitible organizations, after covering expenses and ensuring future solvency using standard accounting practices, convert those exesses into charitible giving (i.e. overhead versus charity). I would imagine that an organization claiming to be led directly by Christ would at least mettle up to similar standards set forth by mere human-led charities and religious organizations. I think this is a primary beef than many have with the Church's financial situation: it doesn't even come close to the normal (standard of practice regarding disclosure in many religious or civic organizations/charities), ethical (transparency, nothing-to-hide attitude), and moral (charitible donations not going to charitble causes) standards practiced by its peers.

I suppose we could take the tithing model. The church could tithe 10% of its gross revenues (the modern interpretation of 'Increase') and give it to worth-while charities. Of course, it may already do this (but I doubt it given the amounts reported elsewhere) but without financial disclosure, as discussed elsewhere on this blog, the laity has no idea where it is going.

In my perfect world, the organization setting the standard for implicit and explicit expectations should meet and exceed those expectations. In this case, the Church is plainly not meeting those standards.

[lyle]

Darren:

Perhaps you might consider Why the LDS Church owns alot of farms, ranches, etc, before being so critical.

Also, I don't think the figures cited above even touch on fast offerings, which are supposed to be the primary vehicle for alleviating hunger/poverty in each local area.

last: if the LDS church spends roughly Two Times as much as a roughly comparable sized church, the ELCA mentioned above, how does this make the LDS look miserly?

[Darren]

Lyle, those farms and ranches are commonly thought soley to provide food for the bishops storehouses and for LDS canneries. If this was the case, I imagine that no mormon would need to buy fresh food ever again due to the abundance of food coming from likely thousands of farms and ranches they own. What is happening is that the farm products are being sold to the open retail market, rather than given away to the needy. My source? My folks who recently served a Farm Management mission in OR, ID, and CA where the church was a significant producer (largest in a few cases) of local products.

True, fast offerings are not counted in the above cases. However, how much do you pay in fast offerings? If you are like most members, not much relative to tithing. When I was a financial clerk for a while, FO were tiny compared to tithing revenues. Addionally, I have heard so many stories of refusal of help due to not being destitute enough...i.e. sell your home, turn off the heat, drain savings, and request money from family before getting any assistance from a charitable organization that the requestor likely has donated ten or even hundreds of thousands too over many years.

Take another look at the figure above, the Lutheran charity sum of 15.4 million was ONLY in 1997, while the 30.7 million sum was between 1984 to 1997, or about 2.3 million per year. The Lutheran donation was 6.7 times the average annual LDS contribution. Pitiful.

[Nathan]

Dave:

Nathan, it's hard to make a point on this issue without being open to a charge of "having a chip on my shoulder," or even a massive chip. Wow--I guess the only thing worse would be to have two massive chips, one for each shoulder.

Well, at least you'd be balanced... :-)

It just seems like the language you used -- "No, they'd build more buildings or buy more ranches or hire more church bureaucrats. They are willing to do just about anything with the money except return it to those who contributed it, aren't they?" -- is more than an exploration of a question. It's condemnatory. The Church isn't doing it the way you think they should, and that's wrong.

Darren:

I would imagine that an organization claiming to be led directly by Christ would at least mettle up to similar standards set forth by mere human-led charities and religious organizations.

Examine the assumptions of that statement:

1) That the goals of the Church and "mere human-led charities" are largely analogous.

2) That the way that "mere human-led charities" do it is the one right way, and therefore if the Church does it differently, it is necessarily wrong.

You and Dave both make a similar assumption here:

Darren: normal (standard of practice regarding disclosure in many religious or civic organizations/charities)

Darren: Rejecting the idea out of hand betrays the same mentality as liberal politicians who simply cannot conceive of a tax cut or rebate, as they think of tax revenues as their money rather than taxpayers' money.

The problem is that both statements assume that the Church IS just like a "normal" corporation or governing body -- one whose allegiance is to the shareholders, citizens, etc. I suppose the fact that the Church recognizes and uses the managerial skills of many members who have gained those skills in corporate pursuits makes it too easy to draw that conclusion.

The problem here is that the Church is NOT beholden to its members in any way analogous to a corporation or democratic government. It exists to serve its members, but not at the behest of its members. The Church claims to be, and governs itself as if it were, the LORD'S, and to find fault with the Church because it doesn't mimic a shareholder-owned enterprise is to more-than-implicitly deny the entire basis of the Church's claims of authority, mission, and purpose. The next step is to say that the LDS Church needs to be more like the Episcopalians, determining doctrine and policy by majority voting instead of ascribing any special calling to its leadership.

A democracy is "of the people, by the people, for the people." The Church does NOT follow that model, has never claimed to, and shouldn't be expected to.

[David]

First of all the $30.7 million in humanitarian aid refers only to special need cases that have arisen over the year. This does not include the assistance provided to members, namely food through the Bishops Storehouse program and other financial relief.

In reference to the commercial interests of the Church, which could be considered to be substantial, if you actually thought about the international make up of the Church you would realise the need for such a network. First you need to consider the facilities and programs that the Church provides(and the members expect) and the finances needed to provide these. Add this to the increasing number of members from third world countries or those with weak economies and there is an imbalance in what tithing can provide, and the facilities that are required.

The ‘for profit only’ networks of agricultural assets provide revenue to help boost the churches revenue. They have never claimed to be a charity organisation, but have always pointed out that there primary concern is the well being of the members, and spreading the gospel. The MTC certainly does not pay for itself, nor do the dozen or so satellite training centres around the globe.

You may not agree with the mammoth building schedule that President Hinckley has undertaken, but unlike the wasteful 60’s they are all being utilised economically. Some of the new chapels have four wards using them in a tight, but fiscally responsible schedule.

You point out that the Evangelical Lutheran Church contributes a far larger sum to the international humanitarian cause. But how much of that is contributed by their membership specifically for that cause. I think you will find that most Mormons realise and appreciate that their tithing pay for their chapels/temples, the utility bills to provide electricity and water and the extensive resources that are made available to them any given day. This includes the vast and unmatched genealogical network that the Church maintains.

What is the point of my spiel? It takes a great deal of resources to run all the programs of the LDS Church to a level of standard that the members are accustomed to. This is what tithing and commercially derived revenue streams are used for.

[Darren]

I agree, a great deal of resources is needed to run the church. I've heard repeatedly that the Mormon church raises the most money per member of many other denominations, so that begs the question of whether or not all the funds are being spent on things we (well, not me) need. I would also keep in mind that many other denominations offer such freebies or cheapies as pre-school and day-care subsidized by fewer per capita donations. Using that standard, the LDS church should have some awesome programs, beside the annual ham and Jello potluck.

As far as the 30 million of aid over many years, that is still paltry considering its resources. And as far as not claiming to be a charity, in my book, claiming to be the only true Church of Jesus Christ makes you a charity by default. Not only that, but you should be the best dang charity out there among religious charities. Some might say this is a high standard, well yes, it is.

[David]

I am not sure where you got the sum of $30.7 millions dollars, but the figures released by the Church list over $450 million dollars since 1985 have been contributed to global humanitarian cases. I suggest that you check your facts, rather then rely on questionable sources.

[Dave]

David, the failure of the Church to release accurate financial information leaves "questionable sources" as the best sources. That was pretty much the whole point of my original post and this follow-up thread. And the financial estimates disclosed in the Ostling book weren't simply guesses or wild speculation, they were reasonable estimates based on what financial information was available.

It might be helpful if you provided a detailed breakdown of the $450 million figure you cite, or a link to a detailed explanation . . .

[David]

Will get back to you Dave

[David]

Dave, have a look at theses links:

http://www.lds.org.au/newsmedia/showmedia.asp?m={5D051712-CE9A-4448-88ED-5A8518764746}

The link below lists in Australian dollars the value of Church contributions not only in Australia, but also worldwide. The Church in the 90's purchased Kooba Station, one of the largest rurual properties to go on sale in Australia. This was never announced as a non proft 'welfare' farm, but was always identified as a 'for profit' purchase. Some of those proceeds as listed have gone to charitable causes.

http://www.lds.org.au/newsmedia/showmedia.asp?m={272E57DD-1BDC-4C44-B6EC-FD1DFE3A3964}

[David]

Dave,

Sorry this is the addresses in full:

http://www.lds.org.au/newsmedia/showmedia.asp?m
={272E57DD-1BDC-4C44-B6EC-FD1DFE3A3964}

and

http://www.lds.org.au/newsmedia/showmedia.asp?m
={5D051712-CE9A-4448-88ED-5A8518764746}

I think that you will find them useful.

[Darren]

Thanks David, it is good to see some actual numbers released by the church rather than the usual silence. Average annual cash donations equaled about 6.2 million between 1985 and 2003. Using the 30 million number from the first blog entry, it appears that the church has stepped up donations in the past 5-6 years.

Not one to be satisfied, however, I wonder what the number for the value of material assistance represents. I wonder if this includes cash value of the DI donations sent over the world, food & medicine aid, or some sort of missionary salary equivilence.

[J.A.T.]

David, speaking of the jello and ham special dinners, has anyone else heard the rumor that the more 'thrifty' aleader is with the funds and the more that is returned to the general fund, the more 'kudos' one receives? (promoted callings, attention from higher ups, etc.) I've heard the rumor, but it seems that there is a mathematical formula for each ward/branch based on active members and that a ward must use a certain amount based on standard deviations. Are there incentives to 'low ball' it? If not, can we start dispelling the rumor so that resources flow to the people? It would be sad if this misconception hampered leaders from giving welfare assistance, providing quality activities, supporting auxillaries, etc.
J.A.T.