500 miles away, Leslie Topps’ heart broke for the Lewis Street Church of Christ.

“Of all the churches, why would this happen to them? she said after learning that the Little Rock, Ark. congregation building was set on fire amid protests over the murder of George Floyd.

The church was in the midst of a $ 1.2 million renovation of its century-old facility. The flames meandered along the walls and pierced holes in the roof. The renovation was ruined.

Topps, an Atlanta-based publicist, grew up in the church pews on Lewis Street. She still has the certificates that she and her family members received after their baptism there.

Related: Hope from the ashes

She now adores with the Renaissance Church of Christ, who moved to a new place of worship near the Atlanta International Airport in December 2018.

“An African American church can have all of their finances online and still have issues applying for a loan. “

The two predominantly black churches – Renaissance of 1,400 members and Lewis Street of 100 members – had attempted to obtain loans from the major banks where they have accounts. Both were turned down.

“An African American church can have all of its finances online,” said Orpheus Heyward, minister of the Renaissance church, “and still run into trouble when applying for a loan.”

Prior to the construction of its new facility, Renaissance, formerly the West End Church of Christ, owned its $ 2.2 million property mortgage-free, Heyward said. The church had used the same bank for 87 years and had sufficient funds in its account.

Likewise, the Lewis Street Church had accounts with a major banking chain for more than 40 years, Minister Jameel Robinson said. But the church was unable to secure a $ 50,000 loan to fix its plumbing.

Church leaders were told, Robinson said, that this was “high risk” and that the bank “just does not give loans to churches with small members.”

“It just wasn’t a legitimate response for me,” the preacher said.

It didn’t make sense to Doug Crozier either. He is general manager of The Salomon Foundation, a non-profit church extension fund.

“I’ve funded probably over 1,400 churches,” said Crozier. Especially in the case of the Renaissance church, “Every bank should fund this project. It opened my eyes.

The foundation, which serves congregations identified as part of the Restoration or Stone-Campbell movement, provided loans for Renaissance construction and Lewis Street renovation. Since the firebombing of the Lewis Street building, the foundation has launched an initiative to help the church rebuild.

THE REDLINER LEGACY

Since the 1930s, black families in the United States have suffered from discriminatory mortgage lending policies.

The practice of redlining – denying financial services and insurance in a particular neighborhood because of its ethnic makeup – has been prohibited by law, including the Fair Housing Act 1968 and the Community Reinvestment Act 1977.

However, housing advocates say the practice continues in more subtle ways. Black families fell victim to the subprime loan crisis that precipitated the 2008 financial crisis. A November 2019 mortgage loan analysis by law and business professors at the University of California at Berkeley found that Black and Latino applicants were charged higher interest and higher refinancing fees compared to white borrowers.

(This clip from the TV show “Adam Ruins Everything” explains the role that unfair housing practices – including redlining – have played in the development of the American suburb and issues such as income inequality.)

The trend mainly affects black churches, according to a 2017 study by Indiana University. Black congregations are disproportionately represented in bankruptcy filings, have fewer refinancing options, and are more likely to fall victim to predatory lenders.

Earlier this year, pastors of predominantly black churches said they had difficulty accessing COVID-19 relief funds issued through the Paycheck Protection Program administered by the Small Business Administration, according to a report by National Public Radio.

Steve Mack, a banker with 38 years of lending experience, said he hasn’t seen direct evidence of discrimination against predominantly black churches, but he suspects it is happening.

“And I’m sorry to say it,” said Mack, general manager of the San Antonio-based company. Texas Heritage Bank. In the financial industry, “I know we have a track record that is not particularly positive.

Banks grant and price loans based on risk, said Mack, a former Oak Hills Church in Saint-Antoine. Considerations for churches include the size of the congregation, the number of “giving units” (families or individuals), their history of giving and debt service – the proportion of the church’s annual giving that is used to pay off existing debts.

“The last thing a bank wants to do is seize a church. I really believe that the big banks regard religious loans as unsecured loans. “

Public relations is another consideration, said Ed White, a commercial lender who works for Texas Heritage Bank.

“The last thing a bank wants to do is seize a church,” White said. “I really believe the big banks look at religious loans as unsecured loans.”

The Christian Chronicle has contacted representatives of two major banking chains, Bank of America and Regent Bank, and has yet to receive a response.

MAKE CHURCHES “MORE BANKABLE”

White approved loans to churches, but said he also had to turn down loans because “I couldn’t feel comfortable with the finances.”

He advises churches on what they can do to make themselves “more bankable,” he said. This includes fundraising for construction or renovation projects that receive broad support and financial commitments from church members.

A financing plan may be more attractive to lenders, White said, if the church designs its facilities in such a way that they can be used for other purposes – commercial space or offices, for example – if the congregation later sold the property.

White, who is African American, sits on the board of directors of a Church of God congregation. When her church underwent renovations, she obtained a loan through a lending entity associated with the denomination. Other faith groups have similar entities that provide loans to churches within their fellowships, such as the Baptist Church Loan Corp.

These entities are regulated differently from banks, Mack said, so churches considering such loans need to know the lender’s sources of funding, management practices, and whether or not they are undergoing internal or external audits.

White also advised churches to compare the lender’s interest rates to current market rates. A spread well above or below that rate could be a harbinger of mismanagement, he said.

LOANS FOR AFRO-AMERICAN CHURCHES

The Salomon Foundation undergoes annual audits and follows specific guidelines similar to those followed by banks, Crozier said, including the minimum capital ratio (a borrower’s assets divided by its liabilities) and minimum liquidity ratio. (a measure of the borrower’s debt repayment capacity).

“They don’t dictate how to minister, but they help you manifest the vision. “

The nonprofit is also regulated by entities in each state in which it operates, usually by a state’s securities commission, but sometimes by its banking or insurance regulators, Crozier said.

Solomon has committed 20 percent of its assets to help predominantly black Churches of Christ, a cappella, Crozier said. So far, the association has funded 55 of these loans, worth more than $ 84 million.

“They have great ministries and they do a great job,” said Crozier of the preachers in these congregations. “A lot of them are bi-professionals, which tells me a higher commitment.”

Heyward, the minister of the Renaissance church, said Solomon’s representatives had thoroughly assessed the financial health of the church and made helpful suggestions.

“They don’t dictate how to minister,” he said, “but they help you manifest the vision. “

“A SCHOLARSHIP PARTNERSHIP”

In mid-July, Crozier and other Solomon representatives gathered alongside members of the Lewis Street Church in the congregation’s gymnasium, where the church has met since the bombing . They put on T-shirts for Hope Project, a fundraising initiative to help the church rebuild, and appealed for contributions online.

The foundation has committed matching funds for the initiative, which has raised around $ 400,000 so far, Crozier said.

Robinson, the Lewis Street minister, said he was impressed that a lender’s CEO made the long trip to visit the church.

“We’re talking business, of course,” said Robinson, “but it’s more of a fellowship partnership. “

Since the firebombing – a racist incident that echoes the tribulations of the civil rights era – Robinson said he had received “a wave of compassion and concern” from the community. community.

Members of predominantly white churches engaged him in conversations about what they can do best in terms of race relations. The Mayor of Little Rock reached out and expressed support for Hope Project.

Recently, Robinson and his family went not to the Arkansas governor’s mansion or the White House to seek justice, but to the Solomon Foundation offices in Denver to give thanks.

“You must overcome evil with good. “

“I wanted to show that same type of love that was shown to me,” said Robinson, “so we came to Mile High City.”

After the firebombing and the frustration his congregation endured in trying to secure funds for his future, he hopes that the “fellowship partnership” between the predominantly black church and the predominantly white lender will be a “city in” a hill “for Americans of all races to see.

“You have to conquer evil with good,” said Robinson. “It was a great trip, a learning experience. We are writing history.

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