To some former Tri-City Ministries members, Pastor Carl Herbster’s relationship with Security Savings Bank CEO Don Bell seems like an unholy alliance.

Blessed Are the Moneymakers 

To some former Tri-City Ministries members, Pastor Carl Herbster’s relationship with Security Savings Bank CEO Don Bell seems like an unholy alliance.

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The original plan was for the church to find a rent-paying tenant to occupy the first floor; Herbster's organizations would use the second floor. But in 2002 the church decided to lease the entire building to the Jackson County Election Board. The county signed an $11,250-a-month lease with an option to buy.

DeMo says he helped arrange the church's purchase of the bank building and supervised some of the remodeling work, paying an employee at his carpet business (DeMo is now retired) to assist church volunteers. DeMo says he put in the effort on the understanding that any profit the building generated would be used to fund scholarships at Tri-City Christian Schools. DeMo, who attended a Catholic school in his native Birmingham, Alabama, prizes Christian education. "I think it did me good, going to a private school instead of a public school, and I want to help afford the same opportunity to other kids," he says.

But from what DeMo knows, the scholarships were not funded.

"I was under the impression that all of that [rent money] would go to scholarships. And then I was told it didn't," he says.

Public records support DeMo's understanding of the situation. A document filed with the county in January 2003 shows that Tri-City assigned the rents from the building to Security Savings Bank to service a $1 million loan.

The loan may explain why Herbster refuses to sell the building to the county. The county sued Tri-City last year, claiming that the church violated the lease-purchase agreement. County officials suspect that Herbster wouldn't sell because their option price -- $550,000 -- would not cover the debts assigned to the building. The county asked in court papers for the church to produce a number of financial documents, even minutes of church meetings.

Herbster told the Star last year that Tri-City wanted a "fair price."

The case is scheduled for mediation May 3.

By one former member's calculation, Herbster spent $6 million to $7 million without a vote of the membership. But Herbster's presidency was never put to a vote of the congregation -- the deacons would not allow it.

In the fall of 2002, one deacon, Dave Hawkins, wrote a seven-page letter to address "common misperceptions" that members of the church might have held. Hawkins argued that Tri-City was in a sound financial position because of its land holdings. In fact, the church had two offers on the table for $15 million, according to the document (which the Pitch has obtained).

Hawkins wrote that Herbster had acknowledged that it had been "unwise" to borrow the $1.6 million without a vote of the congregation. "But we Deacons are UNANIMOUS that he IS DOING A GOOD JOB and he is no way deserving of even a reprimand," read the letter (which made frequent use of all caps).

The deacons' unanimity did not prevent the church's troubles from becoming well-known. The Kansas City Star reported the $15 million debt in an April 2003 story that described Herbster as being on the defensive with his flock.

Herbster also had to contend with state regulators. For several years, the church had sold securities to its members, who were told that an investment in Tri-City was as safe as money in a bank.

The church, though, did not bother to register its securities with the state, as is required by law. The Secretary of State's Office began an investigation.

Herbster defended his stewardship. He told the Star that the church owned assets -- the land -- to support the debt. The church securities, he insisted, were a good deal for the church members who had chosen to invest.

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