Financial Relief for Parishes during COVID-19

Financial Relief for Congregations During the COVID-19 Pandemic

Dear Members of the Episcopal Diocese of Wisconsin:

Last Friday, April 3, 2020, the Standing Committee approved a resolution granting all parishes in the Diocese permission to seek loans under the CARES Act.  All guidelines are to be followed.  In addition, each parish that applies is to notify the President of the Standing Committee, the Reverend Scott Leannah or Canon Huddleston in writing.

This page is being updated as new information becomes available. Last update  on April 6,  2020 at 10:03 am. Substantive updates made on the morning of April 6  include: a) link to new FAQ for faith-based organizations from SBA; b) clarification on how to handle the “owner” fields on the application form. Substantive updates made on the morning of April 3 include: a) link to new application form, b) specification that housing allowance does appear to qualify as a payroll expense, c) link to Interim Final Rule issued by Department of the Treasury giving detailed guidance to lenders and borrowers, d) removal of any reference to 1099 contractors as Treasury has clarified they do not qualify as a payroll expenditure, e) update to the loan interest rate, now set at 1%. f) updated fact sheet for borrowers.

Here is a link to a website which I trust and provides accurate and up-to-date information:


Canon Huddleston
Interim Canon for Finance
Episcopal Diocese of Milwaukee


The two trillion-dollar federal economic stimulus bill known as the CARES Act was passed and signed last Friday. It includes a provision offering forgivable loans to small businesses, including non-profits, for the purpose of maintaining payroll and paying other qualified expenses, including mortgage interest, rent, and utilities. The maximum amount of the loan is 2.5 times the organization’s average monthly payroll expenditure over the previous twelve months, including most employee benefits, pension contributions, and employer 403(b) contributions. The application period opened on Friday, April 3. The application period ends on June 30, but because the amount available for these loans is capped, churches should apply as soon as possible.

The loans are backed by the Small Business Administration but are administered by banks. You may seek loans from any Small Business Administration-approved lender. Due to the size of the program, banks that have previously not worked with the Small Business Association are now doing so. Contact your bank to see if you can apply through them.

You can find the loan application here, and a FAQ document for faith-based organizations here. Here are some notes for completing your application:

  • We have received reports that banks are creating their own forms that are based on the loan application the treasury has published, but not identical. Filling out the form may turn out to be a useful exercise for pulling information together, but do not be surprised if your bank requires something different.
  • The application asks for information about and signatures of owners. Nonprofits, including churches, do not have owners, but some banks are not allowing these fields to be left blank. If that includes your bank, we recommend the guidance from the Diocese of California, namely “that incorporated congregations use ‘not applicable — nonprofit religious corporation that does not issue stock’.  If you are unincorporated, use ‘nonprofit religious organization.'”
  • The form asks for the number of employees you have. This should be your average headcount over the last 12 months. The count should be number of people – there is no differentiation between full-time and part-time employees and contractors for the purpose of this question. 1099 contractors should be excluded from this count (a change from previous guidance).
  • Special rules apply for any employees whose earnings (including salary and SECA reimbursement) exceed $100,000. See this fact sheet for details.
  • There is conflicting information about whether the portion of clergy compensation classified as housing or utility allowance should be included when calculating average monthly payroll. The Interim Final Rule released by the Treasury Department on April 2 defines payroll costs as “salary, wages, commissions, or similar compensation.” Housing allowance seems to fall under the “similar compensation” category. It would be wise to document housing allowance separately from salary and SECA reimbursement to make recalculation easier in the event an alternate interpretation prevails. Follow your lender’s instructions.

You can use this PPP Payroll Calculation Template (developed by Earl Pickett in the Diocese of Central Florida) to calculate your average monthly payroll for the purposes of your loan.

While we are still awaiting specific guidance about exactly what documentation will be required alongside the application, congregations can begin preparing by assembling the following information. It is possible that not all of this information will be required. It is also possible that other information not listed here will be required. This list is based on the guidance we have at the moment, and additional information is emerging quickly.

  • IRS 501(c)3 letter
  • Vestry or bishop’s committee minutes documenting authorization to apply for the loan.
  • Copies of driver’s license, passport, or other proof of identity, of parish officers (rector/priest-in-charge, wardens, treasurer)
  • Proof of payroll for the last 12 months. Because it is not yet clear exactly what time frame will be requested, you should assemble payroll data beginning January 1, 2019 through the present. This documentation should include payroll summaries and bank statements from the same period. Quarterly IRS forms 940 and 941 may be required. If you do not have this information at hand, please contact your payroll provider.
  • Statements indicating a breakdown of payroll-associated benefits, including pension payments, employer 403(b) contributions, health insurance, and dental insurance (if paid by the employer). 
  • Recent mortgage or rent statements (if applicable).
  • Recent utility bills.

About loan forgiveness:

Most or all of the loan is forgivable, provided the following standards are met:

  • Loan proceeds must be spent on qualifying expenses: payroll and associated benefits, rent, utilities, and mortgage interest, within eight weeks following the issuance of the loan.
  • Staff and payroll must be maintained for the eight-week period after the loan is issued.
  • While not required, it is advisable that churches set up a separate account for administration of loan proceeds, to make it easier to document compliance with these standards.
  • For any portion of the loan not forgiven, payments may be deferred for six months, with a maximum 2-year term, an interest rate of 1.0%, and no prepayment penalty.
  • PPP loans are unsecured, so they may be applied for without the approval of the Standing Committee.


Refundable payroll tax credits: This small-scale relief, which provides employers a 50% credit for their share of Social Security taxes while business operations are suspended, is not available to employers who receive a PPP loan. This provision is not likely to apply to congregations in the Diocese of Milwaukee.

Expansion of unemployment insurance: Church workers are not generally eligible for unemployment benefits because churches generally do not pay into the unemployment insurance system. The CARES Act expands the definition of who qualifies for coverage to include church employees displaced due to the pandemic. Additionally, the act provides $600 per week in addition to the state unemployment benefit to any displaced church worker, including clergy and 1099 employees. States are in charge of administration of unemployment benefits, and we do not yet know exactly how the Wisconsin Department of Workforce Development will respond. Displaced workers should file their unemployment claims online as soon as possible. Processing takes a minimum of 21 days, and the current high volume means it may take longer.


Church Pension Group (CPG) is offering a two-month waiver for payment of clergy pension assessments to congregations who meet a strict set of requirements. Canon Huddleston is reaching out to eligible congregations directly.

For all congregations, CPG is providing a 90-day payment grace period, ending June 30, 2020, for the following payments:

  • Pension assessments;
  • Health and dental insurance premiums due to the Medical Trust;
  • Property & casualty insurance premiums and life insurance premiums due to the Church Insurance Company; and
  • Disability insurance premiums to companies administered through CPG.

Billing for medical and dental insurance premiums is handled through the diocesan office. We will continue to issue bills to congregations on the normal schedule, but congregations may elect to defer payment until June 30. Congregations that intend to defer payment should contact Canon Huddleston.


Same as before.

Addendum A

Applicant Name:
Tax ID No:


The Applicant claims an exemption from all SBA affiliation rules applicable to Paycheck Protection Program loan eligibility because the Applicant has made a reasonable, good faith determination that the Applicant qualifies for a religious exemption under 13 C.F.R. 121.103(b)(10), which says that “[t]he relationship of a faith-based organization to another organization is not considered an affiliation with the other organization . . . if the relationship is based on a religious teaching or belief or otherwise constitutes a part of the exercise of religion.”  

Parishes in the Episcopal Diocese of Milwaukee are affiliated for reasons of ecclesiastical polity, not administrative convenience.  

Community Benefit Financial Company Emergency Fund

In response to COVID-19, the Otto Bremer Trust (OBT) has established a $50 million emergency fund through its Community Benefit Financial Company (CBFC) subsidiary to provide financial support to Minnesota, Wisconsin, North Dakota, and Montana nonprofits and other community organizations impacted by and responding to the pandemic.

The fund will provide resources in the form of short-term loans, lines of credit, and emergency grants.

I am not familiar with this organization and have not reviewed the application.