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Crystal Cathedral insiders received hefty compensation, housing allowances

December 2, 2010 | 11:50 am

Crystalcathedral Financial documents filed Wednesday in the Crystal Cathedral bankruptcy case show that the church gave generous compensation to insiders and family members in the year before the Garden Grove-based mega-church filed for Chapter 11 bankruptcy protection.

The documents show the church paid out more than $1.8 million to 23 insiders and members of founding pastor Robert H. Schuller's family in the last year. That sum included $832,490 in tax-exempt housing allowances given to eight people.

Churches and other religious organizations are permitted under federal tax law to give housing allowances to ordained, licensed or commissioned ministers who perform certain duties, though it is unclear if the eight housing allowance recipients meet that criteria. These allowances are exempt from federal income tax.

The U.S. Trustee overseeing the bankruptcy proceedings has already objected to the $132,000 housing allowance paid to one insider, saying there was "no justification whatsoever" for an allowance of that amount. The insider, Chief Financial Officer Fred Southard, said it was a benefit he is entitled to as a minister ordained by Crystal Cathedral.

The newly filed documents show that at least three additional people received housing allowances of more than $100,000: Schuller's son-in-law Paul Dunn, who writes and directs the annual Glory of Christmas pageant; Schuller's daughter Carol Milner and his son Robert A. Schuller.

Founder Robert H. Schuller, who still sits on the board with his wife Arvella, also received an allowance, as did Schuller's son-in-law James Coleman, who is president of Crystal Cathedral Ministries; James Penner, another son-in-law who produces the "Hour of Power" television program; and CFO Southard's son-in-law William Gaultiere, who is part-time pastor of Spiritual Formation Ministries.

Dunn, who lives in Hawaii, received more than $300,000 in housing allowance and vendor payments in the last year and was still owed $64,758, according to the financial statement filed Wednesday.

Meanwhile, revenue was flagging dramatically. From the beginning of 2010 to Oct. 18, when the church filed for bankruptcy, Crystal Cathedral reported $22.3 million in revenue, down from $41.2 million in 2009 and $54.6 million in 2008.

The church currently owes $48.5 million to its creditors, according to the document.

RELATED:

The Schullers: A tale of two churches

Bankruptcy official questions Crystal Cathedral compensation

Crystal Cathedral files for bankruptcy protection

Documents: Crystal Cathedral Bankruptcy

-- Abby Sewell

Photo: Crystal Cathedral in Garden Grove. Credit: Anne Cusack / Los Angeles Times

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