CEF/DIL: The 2018 ABC District Convention Workbook

Reading through the 2018 ABC District convention workbook, I see that 3.5 years, millions of dollars of professional services fees, multiple court proceedings, and an ASC action which conclusively point to a different conclusion, the ABC District is still peddling the “funding shortfall” story.

From the President’s Report:

Faced with a funding shortfall, the Alberta-British Columbia District and related entities obtained an initial order from the Court of Queen’s Bench of Alberta under the Companies’ Creditors Arrangement Act (the CCAA) on January 23, 2015. The Court appointed an external Monitor—Deloitte Restructuring Inc.—to oversee restructuring efforts by the District.

The impact this has had on the District churches was similarly minimized:

ABC District’s assets have been sold. Congregational loans/mortgages with CEF and DIL were called with some congregations being able to raise the money internally to pay their debt; others were able to receive loans from lending institutions; while a couple congregations were unable to pay their loan/mortgage with the result being that their buildings were sold.

“A couple” of the affected congregations – as well as the seminary – filed reports in the workbook which I’ll quote later.

Accompanying the financial challenges related to CEF and DIL was the challenge of rebuilding trust and addressing the hurt and anger that this financial crisis caused.

And no mention of confessing the offence District and its associated people did to the people that trusted their depositors. Kind of hard to have “confession and absolution” without the confession part.

President Schaeffer and Pastor Astley held town hall meetings in every circuit to listen to the concerns of the depositors and to respond to questions. They made personal visits with individual creditors and congregations as requested. Circuit counselors monitored their local circuit congregations to determine if any individuals or congregations require additional visits or assistance. A number of resources were created by pastors in the ABC District (e.g. sermon series, Bible studies, a devotional booklet) with a focus on confession and absolution (i.e. God’s forgiveness).

Us sinners are always in need of confession and absolution for our earthly sins. What good, however, is confessing our sins to our heavenly Father while refusing to even acknowledge guilt much less repent to the people you’ve grievously offended and harmed? This smacks of the same attitude that Jeremiah rebuked in Jeremiah 7.

Many congregations used these resources. Hurt and anger lingers, but by God’s grace, we pray wounds will continue to be healed, trust restored, and relationships reconciled.

Again – you cannot have reconciliation if the offending party refuses to acknowledge and repent of their sin.


The Alberta Security Commission (ASC) has been conducting a review of the Church Extension Fund and District Investment Ltd. situation. The Alberta Security Commission (ASC) published a Notice of Hearing on June 27, 2018 which makes allegations against the following, and names each as respondents: the Lutheran Church – Canada, the Alberta-British Columbia District; Lutheran Church – Canada, the Alberta-British Columbia District Investments Ltd.; and five individuals who served as officers, directors, or employees of the Alberta-British Columbia District.

You can read the ASC’s allegations and the names of all the accused in their Notice of Hearing. The proceedings page for this action is here.

The ABC District Board of Directors emailed a response to the ASC Notice of Hearing to congregations and pastors in August and it was published in the ABC Connect.

Ah yes – the “critical eye” letter – not one of ABC District BOD’s best moments. Read my series of articles on why.

I would also note the President reported ~$500K was donated to help people affected by the Ft McMurray fire – but not a peep was made about doing anything to support the CEF depositors.

Following are reports from the various members of ABC District on how CEF affected them.

King of Kings Lutheran Church, St. Albert. AB
Following the financial situation of CEF, in which King of Kings held its mortgage with and was unable to repay its full amount, the members relinquished its building to the CEF.

At the last hour after exhausting all possibilities to find a new facility to worship in and face disbanding, Memories Funeral Home of Edmonton opened their doors to the congregation where we now worship.

We lost many members due to a location outside of St. Albert, worshiping in a funeral home and for some no foreseeable plan to build a new facility.
Our average attendance hovers between 40-45.

Hope, Port Coquitlam Hope Lutheran Christian School is currently led by Principal John Lok, after a couple of years of leadership by Susan Eisner (who has transitioned to Vice Principal). Although low high school enrollments causing financial challenges led to the closure of the high school classes in June, 2018, the overall health of the elementary and middle school (K – 8) is still on solid ground with over 300 students populating dual track classes up to Grade 6. One of the challenges for Hope in the current educational milieu of British Columbia is securing suitable Christian teachers for those classes.

Since Hope added two classrooms to its school building in the Fall 2014, the 2015 CEF crisis led to some tense financial times for the church and school. But God has provided a second school campus site and financial stability to the point where the mortgage debt is expected to be retired in the spring of 2019.

Bethany Lutheran Church, Campbell River In the last triennium our congregation has faced several challenges, but also experienced God’s ongoing blessings.

Our congregation continued to struggle for the first two years with the fallout from the CEF collapse. We lost access to significant funds, and needed to scale back ministry and educate the congregation on the need for increased donations to cover our expenses. By the end of the third year we were able to not only meet expenses, but even show a small surplus. We are thankful to our members for their generous support, and to God who moved hearts to give so generously and faithfully. In this same two year period we lost several long-time, faithful members. Some moved away, others passed away. Offsetting these losses, we were blessed with several new families who had moved to town, others that had left other churches for theological reasons, and still others who were brought back by our Lord after years of wandering. Following adult instruction, these people joined our congregation and have been an incredible blessing. This year we were denied funding under the Canada Summer Jobs program as we were unable to sign the attestation as required by the government.

While the work of ministry has not always been easy, we are thankful to our faithful God, who blesses us infinitely more than we deserve in both the spiritual and earthly realm. We strive to continue the mission he has laid before us to share both Law and Gospel with each other, and a hurting and lost world, knowing that HE will remain faithful in all things.

Respectfully submitted,
Rev. Tom Kruesel


Fiscal Picture: The combination of the ABC CEF collapse, a significant downturn in the Alberta (and pan-Canadian) economy, decreases in synodical support, and donor trust issues across LCC led to CLS ending 2015-16 with a $159,000 operating loss. We began a give25 monthly debit/credit card/PAD donation program, and received bequests, donations, and other gifts in 2016-17 to not only end with a balanced budget but we need to actively address and begin to resolve the 2015-16 losses. Although the audit is not yet complete, we anticipate posting a balanced budget for 2017-18 and hope to nearly erase the loss. God has been gracious and motivated His people to respond in support of our mission and ministry

ABC District Church Extension Fund (CEF) Impact
CLS had roughly $725,000 (20%) of our $4.2 million endowment invested with ABC CEF. Two term notes were due to mature in January and February 2015. As we began planning to make different financial management decisions with that money, we discovered that the fund was insolvent and our assets were frozen in January 2015.

CLS did receive three payments so far totaling $167,818.85 after some of the ABC properties were sold, but the remainder of our assets were revalued as shares in Sage Properties (the greater Prince of Peace, Calgary, project). In fiscal 2014-15, the CLS auditor wrote down the book value to 50%; values are still uncertain, but with recent Sage action, the property has been divided into three parts with hopes of a better chance of a sale: a) undeveloped land; b) Church and School; and c) Retirement Community holdings. The Sage Board of Directors believe that this will allow the sale of (or management of) each of these portions for the highest share value.

In addition to the freezing of our assets and inability to liquidate those portions of our fund available for operations, the broader impact of the CEF failure is that many of our major donors have their CEF assets frozen and are unable to donate at the rate they used to or have left LCC and/or lost confidence in the institutions of LCC (including CLS).

Of all the reporting bodies only Concordia Edmonton provides details about what’s really happening, how their supporters have reacted, and how it’s affecting them. For that they have my thanks.

One positive outcome is that some of our faithful Churchmen who had money invested in the ABC CEF have donated those shares to CLS. We have received over $150,000 in Sage shares since Spring 2017. (If any of you are interested in doing so, please contact us.)

I would note that donating Sage shares to a charitable institution like Concordia Edmonton can result in a tax deduction. Consult your tax advisor to see how this may work for you.

First Lutheran Kelowna’s report was upbeat and made no mention that District foreclosed on their mortgage, or of the fundraising effort they mounted in order to reduce their indebtedness to a point where they could afford to move from a CEF mortgage with a 30 year amortization to a commercial mortgage with a 25 year amortization. When I consider that many of the people in this congregation were also CEF depositors, all I have for them is admiration and wishes for God’s continued strength and support as they continue doing His work in their community.

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