GS 2025 Article 167 – CNST (Needy Students of Theology)

1.   Material

• 1.1    Report of the Committee for Needy Student Fund (CNSF) (8.2.4).
• 1.2    Letters from the following churches: Fergus North (8.3.4.1), Willoughby Heights (8.3.4.2).

2.   Admissibility

• 2.1    The report was declared admissible.
  • Ground: It was mandated by GS 2022 and received on time.
• 2.2    The letters regarding the report were declared admissible.
  • Ground: These letters interact with a report to GS 2025 and were received on time.

3.   Observations

• 3.1    GS 2022 (art. 157) mandated the CNSF:
  • [3.9.1] To assess the churches annually as per the number of communicant members in the current Yearbook based on the anticipated funding for the new year ahead;
  • [3.9.2] To report annually to each church of the federation on its activities, and to report triennially to each general synod on the same and to include appropriate recommendations in its report to general synod.
• Further, GS 2022 instructed the CNSF:
  • [3.7] To provide GS 2025 with recommendations, supported by clear grounds, for any changes to the bylaws of the CNSF, which must be made in order to be in compliance with the ITA and the CRA, as well as with CO Art. 20 & 75.
• 3.2    From the CNSF report, the following:
  • 3.2.1    The report covers the period 2021-2023.
  • 3.2.2    The committee financially supported a total of 12 students, with a total of $293,249 being disbursed for costs relative to student grants and administrative costs.
  • 3.2.3    This total represents an increase of $161,033 from the previous three years ($132,216 for 2018-2020), due to a higher number of students, students with larger families, and higher living costs in Ontario.
  • 3.2.4    At the end of 2020 / early 2021, after the fund supported fewer students than anticipated, $40,000 from the fund was invested with Christian Stewardship Services (CSS) to accrue interest on the surplus amounts in the fund. This investment was withdrawn in early 2023 when the fund did not have sufficient funds in the chequing account to cover expenses during the period when assessment cheques were coming in from the churches. Since the withdrawal, the funds have again grown and the investment was replenished back to an appropriate balance with CSS, and more recently, has increased the funds in CSS because the transfer of funds between the chequing account and CSS is quick and efficient.
  • 3.2.5    The committee endeavours to maintain an account surplus to address emergent or unexpected expenditures from students, while keeping all funds in either a chequing account with the Meridian Credit Union or an investment account with CSS. Fiscal accountability is maintained by means of dual signatories, and audits are performed on annual year-end financial statements and reported by the committee to the Council of the Grassie (Covenant) CanRC.
  • 3.2.6    The churches continued to be assessed annually based on projected enrollment and anticipated expenditures, according to the agreed upon formula in the committee’s mandate. This upcoming year, the rate is expected to be $7-8 per communicant member; to avoid large swings up and down in the rate, the committee is attempting to keep a more even rate. With thankfulness, the churches have been able to meet their financial assessments during this triennial period.
  • 3.2.7    A defined process is in place for students who are eligible for financial assistance to follow; after securing appropriate forms and contact information for the CNSF, they submit a request for financial aid, visits are conducted to ensure that aid is given in a spirit of humility and brotherly love. The Committee reports that, with thankfulness, there has been good cooperation and harmony between students and members of the CNSF.
  • 3.2.8    In response to GS 2022 [3.7], the Committee asked Teresa Douma of Douma Law to review the bylaws of the CNSF and determine if the CNSF is in compliance with the Income Tax Act (ITA) and the Canada Revenue Agency (CRA), and CO Article 20 & 75. The lawyer’s opinion is documented in a letter dated September 30, 2024, to Grassie (Covenant) CanRC and reviewed by Rev. John Louwerse and Dr. William den Hollander.
  • Conclusions of this review can be summarized:
    • 3.2.8.1   For purposes of complying with the Income Tax Act and charity law in general, in accepting the responsibility and role as the Committee for Needy Theological Students, the Church had/has to ensure that this activity falls under the umbrella of its purposes and that it has sufficient direction and control over it, so as to be able to say the activity is its own activity. The Church annually demonstrates appropriateness of disbursements through its financial reporting to the churches of the federation, its ‘audit’ and the annual Canada Revenue Agency (CRA) T3010 filing.
    • 3.2.8.2   Based on a plain reading of the Church Order it is not clear on what grounds the current manner in which the Church operates the CNSF would bring it into non-compliance with Church Order Articles 20 or 75.
  • 3.2.9    With thanks for God’s providing hand, the CNSF continues to be blessed with the requisite financial means to support students preparing for ministry in our Lord’s church.
• 3.3    The Fergus North CanRC expresses concern that if the CNSF records are audited by a government agency or reviewed in court, a “plain reading” of the Church Order may not be taken, and instead a more in-depth review may be used and could potentially expose some legal issues. Fergus North requests synod to mandate the CNSF to follow up on the legal review to determine if the Church Order should be updated based on the observations in the legal review.
• 3.4    The Willoughby Heights CanRC expresses ongoing concerns with the Needy Students’ Fund (CNSF) reporting and structure.
  • 3.4.1    Willoughby Heights expresses appreciation for the work done but reiterates concerns raised in letters to GS 2019 and GS 2022, which they believe remain unresolved.
    • 3.4.1.1        Terminological Confusion (CNST vs. CNSF):
      • 3.4.1.1.1     Historically, synods have used inconsistent terminology for the committee tasked with managing support for needy theological students.
      • 3.4.1.1.2     The Committee for Needy Students of Theology (CNST) is appointed by a general synod.
      • 3.4.1.1.3     The CNST, in turn, appoints the CNSF (the fund management team).
      • 3.4.1.1.4     This distinction has been blurred in reports and decisions (e.g., GS 2016, GS 2019, GS 2022), causing administrative and ecclesiastical confusion.
    • 3.4.1.2   Ownership of Activity and Compliance with Church Order:
      • 3.4.1.2.1     According to Church Order Article 20, the churches must provide financial aid to needy theological students.
      • This is currently done via a committee appointed by general synod.This committee is given control over its own money flow.This committee is a church which has charitable status.
      • 3.4.1.2.2     Willoughby Heights argues that, if having charitable status implies having “direction and control” over funds, a church appointed as a committee in control of its own money is in contravention of CO Art. 74 (no lording it over others) and 75 (church property in common).
      • Re CO art. 75: “All property … which belongs to the churches comprised in … general synods … in common, shall be held in trust … by deputies or trustees … and such trustees shall be bound by the terms of their … instruction.” Willoughby Heights believes this to imply that “direction and control” is never in the hands of the deputies (=committee) but always remains in the hands of general synods.
      • Re CO art. 74: “No church shall in any way lord it over other churches.” Willoughby Heights believes that if a single church has “direction and control” over property of the churches in common, that church is lording it over other churches.
    • 3.4.1.3   Implications for other Synod-Appointed Churches:
      • 3.4.1.3.1     If GS 2025 accepts Grassie’s claim of legal ownership as a model, it sets a precedent affecting other churches tasked with Synodical mandates (e.g., Guelph-Emmanuel for the Pastoral Training Program, Carman-East for the General Fund).
      • 3.4.1.3.2     This could undermine ecclesiastical principles of shared responsibility and compliance with the Church Order.
  • 3.4.2    Willoughby Heights requests synod to:
    • 3.4.2.1   Insist on precise use of terminology as acknowledged by GS 2019;
    • 3.4.2.2   Clarify and ensure proper ecclesiastical ownership of synodical activities;
    • 3.4.2.3   Protect the federation’s integrity by ensuring all synod-appointed churches comply with Church Order principles.

4.   Considerations

• 4.1    The Committee for Needy Students of Theology (CNST) has faithfully completed its mandate.
• 4.2    For the period 2021-2023:
  • 4.2.1    The CNST diligently assessed the churches on an annual basis and distributed funds to theological students in need with care.
  • 4.2.2    As good stewards, the CNST managed their funds wisely, including the investment of funds to generate interest on surplus amounts not needed in the operating fund at that particular time.
  • 4.2.3    The CNST provided annual financial statements and reported to the Council of Grassie (Covenant) for their oversight.
  • 4.2.4    The committee fulfilled its mandate (GS 2022 art. 157 dec.3.7) with a legal review as a first step to provide GS 2025 with recommendations concerning ITA and CO art. 20 & 75.
• 4.3    Fergus North and Willoughby Heights rightly point out that a more in-depth review still needs to be done to determine if our current structures and practices for funding needy students of theology are in compliance with Canadian tax law and CO art. 20, 74 & 75.
  • 4.3.1    Fergus North requests Synod to mandate the committee to follow up with a more in-depth review to determine if the Church Order needs to be updated based on the observations in the legal review.
  • 4.3.2    Willoughby Heights requests Synod to appoint a study committee to research its concerns and to report to the next general synod whether their concerns are founded and, if they are, how they might best be resolved. Willoughby Heights also requests that this committee consist of at least three individuals with expertise in accounting practices, Canadian tax law, and CanRC church policy, and that all members of this study committee have experience in the practice of our church government.

5.   Recommendations

That Synod decide:

• 5.1    To thank the Grassie (Covenant) CanRC for their work as Committee for Needy Students of Theology (CNST);
• 5.2    To discharge the CNST for the duties completed during the period 2021-2023;
• 5.3    To reappoint the Grassie (Covenant) CanRC as the CNST to look after extending financial aid to those students of theology who are in need of it;
• 5.4    To mandate the Committee for Needy Students of Theology (CNST):
  • 5.4.1    To assess the churches annually as per the number of communicant members in the current Yearbook based on the anticipated funding required for the new year ahead;
  • 5.4.2    To collect and distribute the funds for the Bursary Proposal of the CRTS (cf. GS 2025 art. 154 rec. 5.14);
  • 5.4.3    To submit its report on its activities to the churches no later than six (6) months prior the convening of the next general synod.
• 5.5    To appoint a study committee of at least three members as per consideration 4.3.2 and give this committee the following mandate:
  • 5.5.1    To investigate whether there are conflicts between the Canadian Tax Law and CanRC governance structures and practices (including but not limited to the Church Order, Committee for Needy Students of Theology (CNST) bylaws, and general synod decisions regarding CNST) as per the concerns raised with respect to the function of CO art. 20, 74, & 75, using resources such as Canadian Centre for Christian Charities (cccc.org);
  • 5.5.2    To recommend how any detected conflicts might best be resolved;
  • 5.5.3    To advise whether their conclusions with respect to the CNST also apply to other general synod appointed committees that consist of individual churches (CPTPF, General Fund);
  • 5.5.4    To submit its report to the churches no later than six (6) months prior the convening of the next general synod.

ADOPTED