Answer: Yes, and the answer to this question depends upon how one defines the word 'synod'.

Concordia Seminary is an institution owned and operated by the The Lutheran Church—Missouri Synod. As a denomination-owned seminary, Concordia receives nearly all of its financial support from the people of the LCMS. There has, however, been a dramatic shift in how the people of Synod send financial support to Concordia Seminary.

In the past, significant dollars came through established organizational channels and an established process. A portion of each person's Sunday morning worship offering was forwarded to the district of which their congregation belonged. That district then forwarded a portion of what it received on to the national headquarters (synod) to be allocated by the LCMS Board of Directors via the "corporate synodical" budget. A portion of corporate synod’s annual unrestricted budget has traditionally been allocated to Concordia Seminary as "synodical ‘subsidy’.

For the fiscal year ending June 30, 2010, Corporate Synod intends to provide $400,000 in subsidy toward Concordia Seminary's $18,516,000 operating budget (2%).

The remainder of Concordia Seminary's income is anticipated to come from:

individuals, congregations and organizations who give direct or deferred charitable contributions given for the benefit of Concordia Seminary (56%);

the Seminary's endowment (0%*), which is comprised of donor gifts permanently or temporarily invested to earn an annual distribution of income (see note * below);

tuition and fees not covered by Seminary financial aid (29%);

other service fees and revenues (13%).

Click to enlarge

Since some congregations, nearly all districts and some auxiliary organizations such as the LWML provide financial aid directly to local students, the amount of annual income funded by students is actually much less than the net tuition and fees number above would seem to reflect.

Given how income flows into the Seminary today, it is evident that the people of the LCMS (Synod) provide nearly all of the financial fuel that powers Concordia Seminary but do it in ways other than funding synodical subsidy via the national office.

For a thorough review of issues surrounding the Synod's funding of theological education at Concordia Seminary, read Stress Test by President Dale Meyer in the Spring 2009 Concordia Journal. Click on the cover image to download a PDF of this article.

Note * - Due to the Great Recession of 2007-??, income and gains on permanent investments is being reinvested back into the permanent endowment per Board policy and Missouri state law (Uniform Prudent Management of Institutional Funds Act) in order to restore the full value of endowed donor gifts. As a result, no money is expected to be available for scholarships or program support until the market value of endowment exceeds the book value of donor gifts.

Question: Why doesn't corporate synod provide more funding via 'subsidy'?

Answer: The Board of Directors of the LCMS simply does not have the money that would be needed to increase seminary subsidy levels.

Subsidy must come out of corporate synod's unrestricted income. To increase the Seminary's annual subsidy out of its current unrestricted budget, the LCMS Board of Directors would have to make drastic cuts in support for other worthy programs, organizations and boards.

The vast majority of money that flows INTO the national office has been restricted by congregations, districts and individuals for a specific use such as missions, human care, university education, etc. and cannot be arbitrarily redirected by the Board of Directors to Concordia Seminary.

Recognizing that donors increasingly want to designate (restrict) how a gift is used, corporate synod solicits donations for its seminaries via The Joint Seminary Fund administered by the Board for Pastoral Education and the LCMS Foundation. These restricted gifts are part of the 57.9% in charitable contributions reported in the previous Q & A.

Question: Why does Concordia Seminary solicit donations by mail and telephone?

Answer: This Seminary must solicit donations to carry out its mission.

The most inexpensive method is by mail. Because Concordia Seminary does not know when each potential donor is ready to give a gift, several letters are sent out each year giving prospective supporters the opportunity to give an offering when it is most convenient for them. Concordia Seminary does not expect those who receive appeals to respond to every single letter.

The most cost-effective way to solicit gifts is by telephone. This is a much more personal way of engaging people in supporting Concordia Seminary. Short of a face-to-face visit, asking prospective donors for a gift over the telephone gives the Seminary the opportunity to ask, listen and respond to questions—as well as receive prayer requests.

Some people prefer to be asked for a donation over the telephone, while others prefer to receive solicitations in the mail. Concordia Seminary can customize its solicitations based on each donor's preferences.

Question: I thought tuition was free! You’re telling me its not?

Answer: While it is true that in the past some students received enough financial aid to cover the entire cost of their tuition, financial realities in the church today mean that seminarians will likely pay half of their annual tuition unless additional financial aid is made available.

Concordia Seminary makes a heavy financial commitment to keep the student's final tuition bill as low as possible. This year, the Seminary has budgeted students tuition discounts totalling more than $5 million. The amount of aid available to help students depends almost entirely on how much Concordia Seminary receives in donations restricted for student aid.

Click here for more tuition and student aid information. To discuss this issue in detail, please contact us.

Question: If I give a gift for student aid, will the Seminary take away any aid the student has already received?

Answer: No!

To help understand this answer picture the Seminary Tuition Grant as an empty bucket. As donations for student aid (Adopt-A-Student, endowed grants, etc.) are received, they are used to fill a student’s tuition grant “bucket.” When that student’s tuition grant "bucket" is full, the Seminary moves on to the next student, filling his tuition grant bucket using new gifts.

This approach ensures that all students are treated fairly and equitably given limited resources, and maximizes the impact your donation has on the student who receives it!

What happens if every student's bucket is full? We can't answer that because it hasn't happened yet.

Question: How much of my gift for student aid (or endowment) is used for administration and overhead?

Answer: None of it.

One hundred percent of each gift for student aid is awarded to students as financial aid in order to provide the largest Seminary Tuition Grant possible.

The same is true for gifts to endowment. One hundred percent of each gift to endowment is deposited into the endowment.

Question: What are Concordia Seminary’s fundraising priorities?

Answer: The Seminary's strategic plan incorporates five long-range funding priorities:

Operate within a balanced budget (annually seek unrestricted gifts and restricted donations for budgeted programs). For the fiscal year ending June 30, 2010, meeting this priority will require $5,850,000 in unrestricted direct and bequest gifts. This includes $550,000 directed to Concordia Seminary via Joint Seminary Fund appeals.

Provide significant financial aid to future pastors and deaconesses to offset rising tuition (annually seek gifts for student aid, including Adopt-A-Student commitments, and add significantly to Concordia Seminary's student aid endowment). For the fiscal year ending June 30, 2010, meeting this priority will require $2,850,000 in gifts and bequests restricted for student aid.

Recruit and retain exceptional pastors as professors (seek gifts for endowed faculty chairs); Meeting this fundraising priority requires the funding of 33 additional faculty chairs via direct or deferred gifts averaging $2 million each.

Provide exceptional facilities for living and learning (seek gifts for the renovation of existing campus buildings, including a new Campus Commons, spaces for academic divisions, classrooms and student use spaces); The fundraising goal for the fiscal year ending June 30, 2010 is approximately $4 million, with long-range needs exceeding $32 million.

Provide pastors and Christian leaders with funded opportunities for advanced study (seek gifts for post-graduate fellowships). Meeting this fundraising priority in full requires $38 million in endowed resources restricted for graduate student fellowships, funded over the next ten to twenty years.

Concordia Seminary will work with interested donors to identify giving opportunities which will meet the donor’s philanthropic and stewardship needs, while enabling Concordia to carry out its mission through these five funding priorities. To learn more, contact the Seminary Advancement Office.

Question: What is the most significant challenge facing Concordia Seminary today?

Answer: Meeting the needs of LCMS congregations and RSO's for caring, confessional, and courageous pastors, missionaries, deaconesses and chaplains while simultaneously keeping the cost of theological education manageable for each individual student.

Question: What is the most significant financial challenge facing Concordia Seminary today?

Answer: The greatest financial challenge is meeting the annual commitment for tuition grants while operating within a balanced budget. Concordia Seminary must annually raise nearly $3 Million in direct gifts and bequests restricted for student aid.

Today, Concordia Seminary discounts student tuition by approximately 50%. Without gifts and bequests to fund its financial aid commitments, the Seminary would be forced to make additional, painful cuts in the quality of its educational programs and church- or student-related services.

Question: Times are tough for everyone. Why doesn't the Seminary make cuts in its budget rather than solicit people for donations?

Answer: We have! For the 2009-10 academic year, the Seminary's leaders and Board made more than $5.2 million worth of personnel and program cuts to balance the budget. This represents a nearly 23% reduction - almost 1/4 worth of cuts - in this year's budget ($18,516,000) compared to the previous year ($23,760,266). We have outsourced services (maintenance, groundskeeping, housekeeping) and have ceased operating our campus post office and the our counseling center, which provided free services to students. Many faculty and staff members accepted early retirement offers, and some positions were eliminated. Certain maintenance and building improvement projects have been placed on hold, vacancies left unfilled, and a salary freeze put into effect. While the Board did not increase tuition rates, it did find it necessary to reduce institutional aid by 3% due to the recession. To help offset this painful decision, changes were made to the Seminary's Adopt-A-Student program that removed a limit to how much a student can receive. Individual seminarians may now receive as much aid as a donor is willing to give. This move was in compliance with a resolution on seminary funding passed at the 2007 Synodical Convention.

Question: Why is tuition so high to begin with?

Answer: The answer to this question is complex, and best discussed in person with a staff member from Seminary Advancement. Some of the factors at play include:

A commitment to engaging high-quality faculty, and the size of the faculty in relation to the size of the student body;

Increases in the scope of the Seminary's program offerings;

Increases in operating costs (utilities, insurance, benefits, maintenance, etc.) due to inflation;

A shift in demographics of the student body, and the needs of some students for special services;

Growth of programs and services beyond academic pastoral formation;

Growth in demand for services to seminarians with families;

A shift to a year-round academic program;

The aforementioned decline in the dollar amount of synodical subsidy that Synod's board of directors can allocate from the LCMS unrestricted budget;

A shift in donor attitudes away from giving unrestricted gifts and toward designated gifts for things like student aid;

An endowment that is still far below recommended levels for a graduate-level professional school.

The age and condition of seminary buildings and infrastructure (for example, almost all buildings still have single-pane windows which make buildings expensive to heat and cool);

Societal expectations for transparency and accountability (expanded accounting and PR functions), and the need for Concordia Seminary to engage in direct fundraising to meet budget;

When one understands these issues, it is obvious that tuition is charged in order to make up the difference between income (the sum total of money supplied by Synod's subsidy, gifts from Seminary donors and the return earned on endowment) and the Seminary's expenses (what is required to operate a first-class, world-class seminary). This year, the Board made significant cuts to the expense budget to help close that gap rather than increase tuition rates.

In order to reduce the financial need to charge students tuition - without adversely affecting the quality of education and services provided to students - Concordia Seminary can and must do the following:

carefully monitor and control annual expenses, as the Board did this fiscal year;

recruit more donors (this year over 6,000 new donors have joined the ranks of those who financially support Concordia Seminary);

ask donors to give larger gifts, or to give more frequently as the Lord allows, especially in the area of unrestricted charitable support;

raise more money for permanent endowment, especially endowments that directly underwrite program costs (faculty, services, etc.);

raise money for capital projects (modernize buildings, replacing obsolete and expensive infrastructure, and improve operating efficiencies through the use of modern technology);

encourage congregations, districts and church organizations to identify a seminary student and offer him direct financial help with paying tuition. This kind of gift is not tax-deductible for private individuals; however, some may choose this as an option and forgo the tax deduction.

Without tuition, the Seminary's only options for paying its bills are: soliciting donations (including Synodical subsidy and Joint Seminary Fund gifts), income from endowment, holding or reducing annual operating costs by upgrading its facilities, and seeking creative ways to generate operating revenue through new fee-based programs, partnerships or services.

Question: How much does it cost Concordia Seminary to raise a dollar of gift support?

Answer: Audited financial statements for the past five years show that the Seminary's cost-per-dollar-raised has been $0.12, well below the national not-for-profit standard of $0.20 per dollar raised.

CPDR (cost per dollar raised) figures will fluctuate annually depending on how generously donors respond to appeals, the maturity or strength of various fundraising components (mail, telephone, major gifts, planned giving, grantwriting, etc.), how intensively an organization seeks to engage new donors and whether or not the Seminary implements new strategies or programs to seek gifts (start up costs for new programs are higher than those of established programs).

In addition -- as the elected representatives of Synod's members -- Concordia Seminary's Board of Regents approves the annual budget of the Seminary's fundraising arm (Seminary Support, one unit within Seminary Advancement), and approves its annual fundraising goals. This process ensures that Concordia Seminary's CPDR is reasonable and realistic.

If this is an area of particular concern, the Seminary's Advancement staff can address specific questions in greater detail and provide supporting documentation.

Question: How can I get a copy of the Seminary's audited financial statements?

Answer: Send a written request for audited statements to:

Office of the President
Concordia Seminary
801 Seminary Place
St. Louis, MO 63105-3196

Question: How can I get a copy of the Seminary's 990 form?

Answer: Concordia Seminary is a 501(c)(3) organization under the blanket tax-exemption granted to The Lutheran Church--Missouri Synod by the IRS.

Download a copy of the IRS ruling

Download a copy of our Federal Income Tax Exemption Statement

Because of the nature of this ruling, Concordia Seminary is not required by the IRS to submit an annual 990 form; however, information normally found in a not-for-profit's 990 can be obtained by contacting the Division of Seminary Advancement.

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