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LCMS 2026 Convention Workbook: Reports and Overtures, PDF page 219

2026 Convention Workbook
184 
OFFICER, BOARD, AND COMMISSION REPORTS
Directors”—as these relate to property development—must be to 
develop facilities for “ministry, witness, and outreach,” consistent 
with the general statement of purpose in Bylaw 3.6.4 (see also Op. 
24-3043, Background, Part C, “The ‘Constructive’ Constitutional -
ity of Church Extension Work”). Admitting that ministry property 
may have incidental commercial use (for example, a parking lot 
rented to a neighboring office building during the week, or retired 
school facilities leased to Head Start), the commission finds such a 
situation to be clearly distinguishable from investment or activity 
for the purpose of significant commercial development, even if it 
in some sense is intended to support or facilitate space for ministry. 
In such development, where the commercial aspect is not merely 
incidental to ministry but substantial and significant, the benefit 
to “ministry, witness, and outreach” of LCEF assets or activity in 
support of this aspect would be derivative, not direct. As such, this 
is not development contemplated in the bylaw-assigned work of 
church extension.
Question 2: 
 In connection 
therewith, various special purpose 
entities (“SPEs”) may be created or utilized to ac-
commodate the various ownership and manage -
ment interests of LCEF, the LCMS-related entity, 
and third-party investors and property developers. 
If LCEF is the sole or partial member of an SPE 
that functions in an ownership or investment role as 
opposed to a development role, does that SPE need 
to meet all the requirements of an “agency” under 
LCMS bylaws, resolutions and CCM opinions? 
Question 3: 
 If LCEF 
either directly or through an SPE of which 
it is a member has a partial membership interest 
(more likely a minority interest) in an SPE that has 
the primary development role of a project (a “De-
velopment SPE”), does that Development SPE need 
to meet all the requirements of an “agency” under 
LCMS bylaws, resolutions and CCM opinions con-
sidering that other third-party stakeholders will also 
have an interest in that Development SPE?
Opinion:
 For purposes 
of answering these questions, we assume 
that the hypothetical development project is one that satisfies the 
requirements set forth in our opinion on Question 1 above. 
Regardless of what the ownership structure ultimately looks like, as 
set forth in our Op. 23-3005A (see minutes of August 9–10, 2024, 
item 44), the new entity here would be, as an agency of LCEF and/
or the LCMS-related entity, an agency of the Synod. This is true 
regardless of how many levels there are between LCEF and/or 
the LCMS-related entity and the ultimate property-owning entity. 
Starting with the entity that LCEF and/or the LCMS-related enti -
ty are directly members of, that entity would be an agency of an 
agency, which makes it an agency of the Synod as well. Were that 
entity a member of another entity, then that entity would likewise 
be an agency of the Synod. This would continue down throughout 
the ownership chain until it terminated with the property-owning 
entity, which would also be an agency of the Synod. Since all the 
entities would be agencies of the Synod, the requirements related 
to agencies generally would apply to all of the entities in such a 
development. 
While not directly asked, it is important to note that one of the re-
quirements of an agency that is created by another agency is that 
the creating agency must be the sole member of the new agency 
(see 1981 Res. 5-07). All of the background provided by LCEF 
eligible borrowers of LCEF under LCMS bylaws and related reso-
lutions. Such development work, as it relates to this question, would 
include third-party investors and developers that may be for-profit 
entities. Per LCEF, LCEF would not be making significant capital 
contributions to the project. The LCMS-related entity would retain 
some yet-to-be-determined ownership or control over some of the 
property for ministry purposes post-development. Other portions of 
the property could be used for other purposes, including housing or 
commercial use.
Question 1: 
 Is such 
LCEF development work consistent with 
Synod Bylaws 3.6.4 and 3.6.4.4.1?
Opinion: The question 
here boils down to whether development 
activity that includes some ministry-specific purposes and other, 
non-ministry purposes falls within LCEF’s charge under Bylaw 
3.6.4, which provides that LCEF “is operated ... to further the 
objectives and duties of the church extension fund by providing 
financial resources and related services for ministry, witness, and 
outreach” within the Synod and in limited circumstances beyond 
the Synod. The answer to this question will depend on the specific 
development project being presented; a blanket answer that all are 
permitted or all are not permitted is not possible. The answer for a 
specific project involves looking at two factors—the who and the 
what.
As to the who, LCEF is permitted to provide financial resources and 
related services within the Synod, to and within partner churches 
that are in altar and pulpit fellowship with the Synod and, upon 
the recommendation of the President, to certain Lutheran entities 
formed and operating outside of the United States (which are not 
understood to be at issue here). If the recipient of the financial re-
sources is a professional church worker, a congregation in the Syn-
od, or an agency of Synod, then the resources would be “within 
the Synod” and this factor would be satisfied (as it would be if the 
entity is, or is within, a partner church with which the Synod is in 
altar and pulpit fellowship, subject to Board of Directors approval). 
However, if, as the background from LCEF suggests, the recipi -
ent of the financial resources is, directly or indirectly, a subsidiary 
of, or a joint venture with, persons and/or entities that are not pro-
fessional church workers, congregations in the Synod, or agencies 
of the Synod, then the recipient would not be “within” the Synod 
(similarly, with a partner church). In such cases, providing financial 
resources would be beyond LCEF’s authority. 
As to the what, the development would need to “further the objec -
tives and duties of the church extension fund” (Bylaw 3.6.4). The 
“purpose, function, and assigned areas of responsibility” of a syn-
odwide corporate entity are “set forth in [the Synod] Bylaws” (By-
law 3.6.1, see opinion to Question 2, Op. 24-3043, minutes of Feb. 
3, 2025), and the entity operates within such limitations (Bylaw 
3.6.1.6). With regard to LCEF, the bylaws specify that it provides 
“financial resources and related services for ministry, witness, and 
outreach” (Bylaw 3.6.4). It does so by providing “financing and 
services for the acquisition of sites, for the construction of facilities, 
for the purchase of buildings and equipment, for operating expenses, 
for professional church worker education, for the residential hous-
ing needs of professional church workers, for promoting strategic 
ministry planning and assisting in capital campaigns; and for other 
purposes approved by its governing board and the Synod Board 
of Directors, which purposes shall be consistent with the ministry 
and mission of the Synod” (Bylaw 3.6.4.4.1). The commission un-
derstands that the specifically enumerated activities and any “other 
purposes approved by its governing board and the Synod Board of