The Sunday after the Ark of Safety Christian Church in Upper Marlboro filed for bankruptcy on June 15 it was worship as usual. Two services were held at its mall-turned-church facility with hymns, scripture readings and a reflective sermon.
C. Anthony Muse, bishop of the church and a state senator who represents Prince George's County, said that is as it should be. The church is optimistic that filing for Chapter 11 bankruptcy protection will allow it to restructure its finances and emerge stronger.
Muse said the church faces the same financial crises as many of its congregants.
"We are in a recession, declining revenue," said Muse. "We have lost our equity...We don't have the same financial support."
Muse, who has been leading the Ark for 13 years, said the church's financial woes are the result of $4 million loans to remodel its existing facility that have skyrocketing interest rates and the plummeting value of 29 acres the church owns in Fort Washington. Three to four years ago the value of the church and land totaled $13 million, but today it's worth $7 million, Muse said.
"We're upside down," said Muse. "We can't get a modification."
He added that offerings from Sunday services, which attract about 2,000 worshippers, have declined.
"Many of our members are out of their homes," Muse said. "They are out of jobs. They have been hit hard in Prince George's County by the recession."
Muse said that during one year the church has made $500,000 in loan payments, however, all of it has been interest and the principal has not been touched. They sought modification of their loans [with interest rates ranging from 15-20 percent] but didn't get any relief from financial institutions, he said.
Muse said he and the congregation are committed to making good on the loans. About a month ago, 300 church leaders met and decided to stop making payments on their existing loans and file for bankruptcy, he said. Now he's hopeful that the bankruptcy court will do what the church could not – get the banks to lower their interest rates.
"We didn't file to walk away," said Muse. "We filed so we can pay the debt."
The financial mess has also hit Muse and his family personally. Several years ago when the real estate market was "in its heyday" Muse and his wife, Patricia Lawson Muse, a news anchor with WRC-TV [Channel 4], took the equity out of their home in Fort Washington, more than $600,000, and invested it into the church remodeling project. Now their home is upside down, he said, meaning it's worth less than the remaining loans on it.
"We are not screaming to get that back," said Muse of the money they put in. "That's our church."
Tony Chapman, 45, a trustee at the church, confirmed that the Muses poured more than $600,000 into the church and the couple is one of its debtors.
He said that it was the congregation's decision to move forward with the bankruptcy filing and that in their church the pastor has a say in financial matters pertaining to the church but is "not the final decision maker."
"When you look at the numbers and when you look at what the banks were attempting to do to us, which was to put us in an impossible situation ... it was clear it was not going to work," Chapman said.
Chapman, a resident of Waldorf who said he has been a member of the church for 15 years, said the banks caused the church "a lot of unnecessary drama" by agreeing to renegotiate their loans, then changing their minds.
"The banks have a history of decimating churches," said Chapman, adding that they've heard from many other churches in Prince George's County and throughout Maryland that are in similar financial predicaments.
Muse ran unsuccessfully against U.S. Sen. Benjamin Cardin (D-Md.) for a state senate seat in April 2012.
Chapman describes Muse as a politician who "goes against the system," noting he voted against redistricting and a proposed tax hike on small businesses.
"We understand we have a pastor in politics," said Chapman.
Muse also wants to set the record straight. He said reports in other news media that he previously was involved in another church financial crisis are inaccurate.
He said he was an employee of the United Methodist Church while he was pastor at a church in Brandywine, Md., and had no authority over the church's financial affairs related to construction projects.
"I had no banking authority, no loan authority, no checking authority," said Muse of his 15 years at Gibbons United Methodist Church, which later became Resurrection Prayer Worship Center United Methodist Church. "They made those decisions. It was not my debt."
Muse left the church in 1999 and a large portion of the congregation followed him to his new church.
However, a report from the United Methodist News Service from June 2002 indicates that the Brandywine church building project which started in 1995, ended up costing double the building's appraised value and was never completed. It states that the church sued Muse "to get an accounting of its financial status and to ascertain if equipment had been taken by the departing pastor or members."
The United Methodist News Service states that Muse left behind a debt of nearly $6 million.