Editor’s Note: The following article was written and provided to The Baptist Paper by Ken Camp, managing editor of the Baptist Standard, news journal of the Baptist General Convention of Texas. Some details have been added/updated by the staff of The Baptist Record.
FT WORTH, Texas — (The Baptist Paper and local reports) – The financial health of what was once Southern Baptists’ largest seminary steadily declined during the past two decades under the administrations of former seminary presidents Paige Patterson and Adam Greenway, according to a financial overview released June 7 by the seminary’s board of trustees.
From 2002 until 2018 when trustees fired president Paige Patterson and then again under his replacement, Adam Greenway, who resigned in 2022 under pressure from the board, annual operating expenses at the seminary rose 35% while full time enrollment figures dropped 67%, resulting in a cumulative $140 million operating deficit.
The amount of cash on hand at the end of the fiscal year averaged $5.6 million from 2002-2008, the report from the trustees stated. From 2013-2019, unrestricted cash on hand at the end of the fiscal year averaged less than half that amount: $2.1 million.
The averages exclude the years MacGorman Chapel on the seminary’s Ft.Worth campus was constructed and the years the seminary received a special distribution from endowment, a federal PPP loan, and a legal settlement.
19 years of deficits
From 2002-2022, Southwestern ran an operational deficit for 19 of those years, the trustees reported. The board document concluded the cause of the seminary’s financial issues was spending an average $6.67 million more than it received in revenue for those 19 years.
“This pattern of deficit spending is due in large part to inverse trends between annual operating expenses and enrollment,” the board-issued report stated.
A chart included in the report shows full-time enrollment of about 2,500 in 2002, dropping steadily to about 750 in 2022. During that same period, expenses rose from slightly more than $30 million to about $42 million.
During the same period, the portion of the endowment managed by the seminary decreased in value by 5.45%, in spite of $24 million in contributions to endowment.
“This failure to realize the growth potential of the endowment can be attributed to the timing of the transition to Southwestern Seminary Foundation in 2008 and the decision to take special distributions from the endowment in 2010, 2017, and 2020.
“These factors have resulted in an endowment with reduced purchasing power and unrealized potential revenue that could have offset increases in operational expenses,” the report from the trustees stated.
Greenway review
At the same time the seminary trustees released the financial overview, they also published a summary of findings by a task force created to review Greenway’s expenditures and financial practices.
“The task force concluded that Adam Greenway engaged in a pattern of spending that the task force believes did not reflect proper stewardship of seminary resources. This pattern of spending occurred without deference to financial controls and seminary financial policies,” the summary of findings stated.
The summary document noted $1.5 million spent on renovations to the president’s home and more than $500,000 for renovations and furniture in the president’s office.
“The task force found that a significant amount of the work done on the President’s home was carried out by the seminary’s facilities team, creating an unsustainable demand and contributing to poor morale and high turnover.
“It was reported that employees were often asked to do the same job multiple times to meet Greenway’s demanding expectations. Multiple change orders were also true with outside contractors, increasing costs of the projects,” the summary reported.
The task force reported expenditures for the president’s home included $59,865.79 for Christmas decorations, more than $25,000 for artwork, and more than $11,000 for an espresso machine and accessories.
“These expenditures were made at a time when the seminary was making significant budget cuts, including the reduction of faculty personnel and positions,” the summary document stated.
The task force also noted personal expenses charged to Greenway’s seminary-issued credit card, including more than $9,900 for first-class airfare to Anaheim, Calif., for the 2022 Southern Baptist Convention annual meeting for Greenway, his family, and a family friend.
Other charges included more than $4,800 to frame personal diplomas and $920 for a metal University of Florida gator head decoration.
The Baptist Standard offered Greenway an opportunity to comment on the documents released by the board of trustees, but he declined.
The task force acknowledged the financial problems at Southwestern predated Greenway. “Unfortunately, the trustees’ hopes of correction in this financial trajectory in the 2019 election of Greenway were not realized,” the summary of findings stated.
New president, chancellor chosen
The document included a statement from trustees expressing support for new Southwestern president David Dockery, a professor at Southwestern and interim president after Greenway’s departure, and Chancellor O.S. Hawkins, retired former president of Southern Baptists’ GuideStone Financial Services in Dallas.
Both men were appointed to their positions by trustees in April 2023. Both men hold graduate degrees from the seminary.
‘Financial challenges remain’
“Although we must be candid to note that significant financial challenges remain, the new administration has made difficult decisions to reduce spending, including in overall staffing of the institution, while prioritizing the educational mission of the seminary.
“These reductions, coupled with promising increases in undesignated giving and upticks in enrollment and credit hours taken, are important first steps to stabilizing the institution’s financial standing,” the document stated.
The report notes since last September, the seminary has taken steps to cut spending to ensure expenses are less than revenue.
The complete trustee report can be accessed here. The summary of findings on Adam Greenway’s tenure can be accessed here.
