Critics allege cuts unfairly targeted older employees, question whether capital campaign funds have been used to cover other expenses
A downturn in donations and tithes were behind layoffs and pay cuts this week at the Cathedral of Hope, according to officials at the predominantly LGBT Dallas megachurch.
COH communications director Phoebe Sexton called the layoffs “very painful for everyone here.”
The equivalent of six full-time positions were eliminated, although that included several part-time employees.
Sexton said before the layoffs, the 4,200-member church employed 44 people, including part-time and contract employees. The layoffs affected 10 people, leaving 34 employees at the church. Sexton said that number might change slightly because some contract employees are undergoing renegotiations.
Three top ministerial staff members took “significant, voluntary pay cuts,” according to Sexton. They are the church’s senior pastor, the Rev. Jo Hudson; executive minister, the Rev. Dawson Taylor; and executive director, the Rev. Rachael Sandifer.
Sandifer blamed the layoffs on a shortfall in donations and tithes.
“Not unlike all nonprofits, we are cutting our expenses to the bare bones, as faithful stewards of our resources,” Sandifer said. “We cannot get to the point where we’re in financial crisis.”
She added that the reduction in staff was strictly related to finances.
“We had to look at everybody,” Sandifer said. “Decisions were based solely on where we could absorb ministries and have strength of ministries we’re involved in.”
Hudson said that although attendance is up, “giving is the last thing to come on board.”
Sandifer said the reduction in staff will not be temporary, because the church needs to put money in reserve to avoid a future crisis.
COH board President David White said board members were aware of the financial situation but don’t get involved in personnel matters.
“We’re consulted, and as a board we knew it was inevitable,” White said.
Hudson said Monday — when the layoffs were announced — was “among the most difficult days of my ministry.”
“None of the cuts was made hastily or without thought and prayer,” Hudson said. “I am confident we did our best to honor those employees we had to lay off.”
Sandifer said although church employees are not eligible for unemployment benefits, each person laid off was offered a severance package.
“The people we met with yesterday have been unbelievably gracious,” Hudson said Tuesday, adding that the congregation wouldn’t be surprised by the layoffs.
“Two weeks ago, my sermon laid out the situation,” she said.
She said that a couple of the people laid off said they sensed it was coming.
Attempts to contact employees affected by the layoffs were unsuccessful.
Despite Hudson’s Sept. 23 sermon, rumors and allegations related to the layoffs swirled this week, prompting numerous phone calls and emails to Dallas Voice.
However, no one was willing to be identified and go on record with their allegations.
Allegations related to mismanagement of funds are nothing new at the Cathedral, which was racked by a controversy nearly a decade ago that led to the church’s departure from its previous denomination. The Cathedral is now affiliated with the United Church of Christ.
This time, those who spoke to Dallas Voice accused church leaders of improperly raiding designated funds, such as a capital campaign account, to pay other expenses, and said the layoffs unfairly targeted older employees.
Others noted that the Cathedral recently completed repairs and construction despite its shrinking income.
Sandifer said the repairs and construction had no effect on the budget.
Last November, repairs were made to the John Thomas Bell Wall after hail damaged the structure and it began to leak. Hail also damaged the building’s 20-year-old roof that was replaced this spring. Both were covered by insurance.
Flooding and an electrical fire in the Interfaith Peace Chapel also were covered by insurance. The building’s original electrical contractor paid deductibles.
Sandifer said that an energy audit led to an upgrade of the air conditioning system. But that upgrade was part of a capital improvement and funded through a $60,000 grant from Oncor. The result has been a monthly saving of about $2,000 in energy costs.
Recent upgrades to HD format have begun to be made to the church’s television studio. Sandifer said that the original $800,000 cost estimate was reduced to $200,000 through an in-kind gift, but purchases of cameras and other equipment have been postponed.
Sandifer said money from the capital campaign account — which was started to build a new cathedral designed by the architect Philip Johnson — was spent on design plans for the Great Cathedral and its surroundings, and on construction of the Interfaith Peace Chapel, the first portion of the project. She said the Cathedral currently has no capital campaign or associated account.
According to Sandifer, the church’s annual budget is $2.735 million. In addition to income from tithes and offerings, Cathedral of Hope leases parking to the neighboring Ford dealership on Inwood Road and has income from retail rental property adjoining the church. A grant-writing committee is working to supplement funds.
“We’re charged with being responsible stewards of resources,” Sexton said. “The cuts were made to ensure the financial longevity of the church.”
Cathedral of Hope has helped start churches that bear its name in Oklahoma City, Houston and Bedford. The Oklahoma City church is independent. Houston and Mid-Cities remain parishes of the cathedral in Dallas but are financially independent.
The layoffs at the Dallas church will not affect those churches, officials said.
Susan Gore, executive director of Hope for Peace & Justice, said the cuts do not affect her organization, which is housed at the church but financially independent.
This article appeared in the Dallas Voice print edition October 5, 2012.