ABC District elects new president, discusses CEF/DIL situation

President Elect Glenn Schaeffer.

CALGARY – May 23 saw the Alberta-British Columbia District Convention elect a new District President: Rev. Dr. Glenn Schaeffer.

President Elect Schaeffer was elected District President on the fourth ballot, receiving 75 votes to Rev. Laverne Hautz’ 71 votes (there were five spoiled ballots). Dr. Schaeffer has served as the ABC District’s Executive Assistant for Outreach since 2005. He received his doctorate in Mission Studies in 1997 from Concordia Theological Seminary (Ft. Wayne, Indiana), and has served as an adjunct faculty member at Concordia Lutheran Seminary (Edmonton) since 2006, among various other areas of service to the church at large.

Outgoing President Donald Schiemann had announced in the summer of 2014 that he would not be seeking reelection.

As a result of a resolution adopted during the first business session May 22, the new District President’s work will focus on the District’s corporate affairs, especially as they pertain to the current Church Extension Fund/District Investments Ltd. crisis. The ecclesiastical duties normally associated with the District President will instead be assumed by an Interim Pastoral Leader to be appointed by Lutheran Church–Canada’s President and Board of Directors.

Elected as Vice Presidents were Rev. Roland Kubke (First Vice President), Rev. Fraser Coltman (Second Vice President), and Rev. Darren Siegle (Third Vice President). Dennis Woolsey was elected to serve as Secretary for the District.

The CEF/DIL Crisis

Vanessa Allen of Deloitte Restructuring Inc. answers a question from the floor.

Much of the morning was devoted to discussion of the CEF/DIL situation. Representatives from the Court-Appointed Monitor, the Chief Restructuring Officer, the Restructuring Committee, and the District Review Task Force all reported to the convention.

Rev. Michael Schutz and Marlis Kreuger spoke on behalf of the District Review Task Force. The task force is assigned with providing an arm’s length analysis of what happened in the District’s past that may have contributed to the current situation. That means looking not only at decisions directly related to the CEF/DIL crisis, but also seeking out larger underlying problems in the structure, auditing policies, and other aspects of District going back 25 years. The task force will report to the newly elected District Board of Directors in October, and will present a final report by the end of the year that will be made available to the church at large.

Rev. Bill Ney spoke on behalf of the Restructuring Committee, which began service in early February. This committee was involved in selecting the Chief Restructuring Officer (CRO). They meet weekly with the CRO and also consult with the Court-appointed Monitor, Deloitte. The Restructuring Committee has, among other work, been providing input to the CRO on the development of a restructuring plan. The primary concern from the committee’s perspective is to maximize returns to depositors as quickly as possible—something that would inevitably mean restructuring the ABC District significantly. Rev. Nye stressed that the Restructuring Committee is independent and receives no direction from either District or Synod.

Vanessa Allen spoke on behalf of the Court-appointed Monitor, Deloitte Restructuring Inc. She updated the convention on the current status of CCAA proceedings. The Monitor, she explained, acts as the “eyes and ears of the Court.” It does not work on behalf of the District, as some have feared. Allen explained the roles of the CEF and DIL creditor’s committees and the tasks they are currently working on.

Cam Sherban and Charles Bougie spoke on behalf of the CRO, Kluane Partners. Their initial work focuses on speaking with the affected parties, to better understand their desires. Through phone calls and presentations, they estimate they have spoken to approximately 1,000 depositors to date. They report that most depositors seem to fall into three groups:

1. Elderly people who had invested their life savings and need their funds as soon as possible.
2. Those who have invested funds but are able and willing to wait to maximize their returns.
3. Those who need some funds as soon as possible but want to wait on the rest to maximize their returns.

This particular CCAA process is going very quickly, Sherban further noted. CCAA processes often take a very large period of time, but the Court has commended the District for working very quickly. Sherban also said that CCAA protection was the right decision for this situation, as the process is likely to maximize returns to creditors whereas straight receivership would likely lead to much sharper losses for creditors.

As they develop a plan for getting funds back into the hands of creditors, there are two different situations facing creditors, depending on whether they are depositors in DIL or CEF. DIL assets are primarily cash and mortgages. Once a Plan is voted on by creditors, the liquid cash could be distributed immediately; congregations with mortgages are being asked to seek other financing for their mortgages, and these funds would be distributed to depositors as they are recouped.

The CEF on the other hand has a mix of assets. Assets like buildings could be sold in order to recoup costs, but this would be done over time to maximize returns, as opposed to immediate liquidation which could result in lower returns. The Prince of Peace complex in Calgary however, Sherban said, could maximize returns to creditors by transferring the complex to be run by a new for-profit company. In such a case, the complex would be run by an independent organization governed by external experts and not by anyone involved with the church body.

Following their reports, the floor was opened to questions and comments from the floor. In a break from normal convention procedure, the floor was opened to everyone at the convention, meaning anyone was free to speak from the microphone and ask questions. Normally, only voting and advisory delegates are allowed to speak from the microphone at a convention.

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