• BREAKING NEWS ABC shows live and on-demand -- Download the WATCH ABC app!

Crystal Cathedral spending under scrutiny

November 18, 2010 12:00:00 AM PST
The bankrupt Orange County megachurch, Crystal Cathedral, is under scrutiny for generous spending on three of its employees.The church filed for Chapter 11 bankruptcy in October, claiming the slow economy and a drop off in donations led to financial distress. It's debts total $60 million and it cut about 150 employees.

Now the U.S. Trustee, which oversees bankruptcy proceedings, is questioning the salaries of employees whose jobs appear to be redundant. The church is asking for compensation for workers while the bankruptcy goes forward.

According to documents, the church's chief financial officer, Fred Southard, received more than $130,000 for a housing allowance, which allowed him to largely avoid paying federal income tax on the sum.

Records show his home in Newport Coast was assessed at more than $2 million. He's held the job since the 1970s even though the church has an accounting staff.

Crystal Cathedral employs more than a dozen family members of the church's founder, Robert H. Schuller. The U.S. Trustee is questioning the salaries paid to his youngest daughter, Gretchen Penner. She receives nearly $70,000. Her mother-in-law, Neva Penner Klaassen, gets paid more than $55,000. Penner produces the "Hour of Power" broadcast and Klaassen is a programming manager.

The U.S. Trustee said their duties overlap and asked for a hearing to decide if their jobs are needed given the financial state of the church.


Load Comments