LCMS Convention Workbook St. Louis, Missouri — 1973, Page 105

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SEMINARY ISSUES 105

and stewardship matters at the St. Louis seminary. We will
be brief, to the point and will not attempt to include all that
needs to be said. We will speak freely because most of the
matters are no longer confidential because it seems at times,
the seminary is run by press releases.

Individual members of the board have repeatedly ex-
pressed themselves concerning many of these problems, but
have achieved little or no success either with the majority
of the Board of Control or with the administration of the
seminary. These problems have disturbed us over a period
of years and we are informing you of these things now
only because it is evident that the Board of Control as a
corporate body is unable to take the action that is so neces-
sary. The reason for this is that almost without exception
the president of the seminary, with the constant backup of
the board chairman, influences every important action of the
board by strongly asserting his recommendations and which,
almost invariably, are slanted to meet his administrative ob-
jectives. It is easy to see that such strong domination de-
stroys the board's ability to function as an independent
and unbiased body.

Let us begin with the difficulty we have repeatedly had
in making our stand clear that, by virtue of the authority
given by the church in the Handbook, it is the Board of
Control that governs the affairs of the seminary and not the
president and his faculty. To illustrate, we bring to your at-
tention several instances where sizable sums of seminary
funds were committed and spent without prior approval of
the Board.

Early in the current president's career at the seminary
he engaged a firm of public relations consultants of his own
choosing to conduct a survey to determine the attitude of
the clergy to the seminary and its teaching. This involved
a large expenditure of funds. The board was not asked for
its approval of this expenditure, it was not asked whether
it approved of the project, it was not told beforehand of the
reasons for which the decision was made and it was not in-
formed of the ground rules for questions to be asked in de-
veloping the information desired.

The document Fact Finding or Fault Finding was pro-
duced and sent out by the seminary president totally with-
out the knowledge of the Board of Control. This involved a
large expenditure of funds. The document also made grievous
charges against the Fact Finding Committee and the Presi-
dent of Synod much of which we feel could not be sub-
stantiated. It is interesting to observe that the document is
elaborately prepared and that considerable time was neces-
sary in preparing the contents and the layout during which
ample time was available to discuss it with the board and
ask for its approval of the expenditure.

The documents entitled Faithful To Our Calling. Faith-
ful To Our Lord were recently published and distributed to
the church without the permission of, or consultation with,
the Board of Control either as to the expenditure of funds
or as to the content of these theological documents. Would
you believe that just the direct expenses of this project cost
$12,000?

On another occasion the President of the seminary in-
formed the Board of Control that after consultation with
several firms of attorneys. he was about to engage a firm in
another city for legal services for himself in his dealings
with the synodical President. the expense of which was to be
borne by the seminary. Bear in mind this was an announce-
ment of an action already decided on and not a request for
approval of the arrangement and the expenses incidental
thereto. To this the board reacted negatively for obvious
reasons and, in fact, managed to pass a resolution to pro-
hibit the seminary president, any member of the faculty or
administration, or any member of the Board of Control to
engage legal counsel without approval of the full member-
ship of the board. This is one example of irresponsible moves
which caused some members of the Board of Control to ask
for directors liability insurance protection against such in-
discriminate and unauthorized action.

In the May 1971 meeting of the Board of Control. the sub-
ject of married student housing was brought up by the semi-
nary administration. The administration discussed at length
the need for married student housing and then asked the
board if, in its opinion, the subject should be “explored.” The
board agreed that because of what it had been told that eve-
ning it should further explore the subject. At the next meet-

ing of the board in June 1971 the board was presented with
a document entitled “Married Student Housing — Analysis
and Proposal,” 27 pages in length and 22 pages of schedules,
maps. and other supporting information which, it was
admitted, was many months in the making — the cost of it
was not mentioned. This was a pretty large pill for the
board to swallow without gagging a little. and it therefore
decided to appoint a subcommittee of the board to study the
matter in depth which it did over the summer months and
submitted its report to the board at the September 1971
meeting. To say the least. the report of the subcommittee was
highly critical of the “Analysis and Proposal” as evidenced
by the following quote from the subcommittee report:
This committee, as members of the Board. is deeply concerned
by the sudden manner in which the whole topic was brought
before the Board at its May meeting without a recommendation
from the student affairs committee. As we recall, the Board was
asked for its reaction as to a study of married student housing
(implying the very consideration brought out in this report) and
if it was not interested the rroposal of a further study would
be dropped. The Board did indicate an interest in probing the
subject. At its June meeting a very lengthy report was pre-
sented, prepared by Mr. Mennicke. which he said was 10 months
in the making —the cost of it was not mentioned, It was
solely promotional without consideration to the many pitfalls
of the proposal. May we again remind the administration that,
because of the Board's responsibility to Synod, it should not
undertake such projects and assume the expenses incidental
thereto without first obtaining Board approval.

Some members of the board are convinced that they are not,
as a board. in control of the seminary. Many incidents can
be recited to substantiate this conviction. Prominent among
these is the letter of the seminary faculty to the church
dated Jan. 5, 1971. It was this letter in which the faculty
attacked the synodical President with reference to his fact
finding endeavor. What disturbed many members of the
Board was the circumstance that the letter from the syn-
odical President to which the faculty replied was not ad-
dressed to the faculty at all. It was addressed to the semi-
nary Board of Control. The faculty and the seminary presi-
dent had assumed the prerogative of answering the mail
of the board before the board was even privileged to dis-
cuss it.

It is difficult for the board in its desire to properly guide
the affairs of the seminary even if at times it is successful in
passing some meaningful and worthwhile resolutions. To
explain what we mean, let us tell you of the happenings re-
lating to the board's receiving. for study, the audit report of
the seminary for the fiscal year ending June 30, 1971, pre-
pared by Ernst & Ernst, Certified Public Accountants, who
were employed by the Synod. The auditors found it neces-
sary to qualify their report because of insufficient documen-
tation in the handling of gifts and grants. (For complete
wording refer to Ernst & Ernst’s letter dated Oct. 25, 1971,
particularly the third paragraph, which is part of their re-
port.) To rectify the criticized procedure, several members of
the staff of Ernst & Ernst appeard befor the board to explain
the procedures they recommended. They also addressed a
letter to the board dated June 15, 1972. giving the board their
professional reaction to a resolution several board members
proposed, so that among other things the books and records
of the seminary would reflect transactions correctly. They
said in that letter “we are pleased to see that the Board is
interested in this important matter.” The resolution was
moved and approved at the June, 1972, meeting of the board.
The resolution begins with the explanation that “to conform
with proper and accepted accounting procedures and prac-
tices, for effective cost controls and to work toward the
elimination of the necessity to issue a qualified certificate in
future examinations of the books and records of Concordia
Seminary by the independent Certified Public Accountants
employed by Synod as they found it necessary to do in their
report for the year ended June 30, 1971. be it resolved that the
following procedures be adopted by the Board to become
effective immediately.” There are then five points of pro-
cedure spelled out in detail in that resolution. Number V
says, “Ernst & Ernst shall be asked to install a proper ac-
counting system.’ So far. so good — until the September
board meeting when the following resolution was moved and
passed: “That the Board reconsider Section V of its resolu-
tion of June 17. 1972 (June minutes. p. 9). reading ‘Ernst and
Ernst shall be asked to instali a proper accounting system.’
since Ernst & Ernst are no longer auditors for the Seminary.”