GTS, which is in New York City, has leased out its land to a company called the Brodsky Organization. Brodsky has a 99 year lease, for which it paid a lump sum of around $33,000,000 (29 million, plus 4 million more added to offset inflation).
While GTS will continue to operate, the campus on Chelsea Square will be turned into Brodsky's Chelsea Enclave, which contains 53 luxury condominiums for sale to the public.
Dean Ewing is upset because The Chronicle of Higher Education's June 12th issue lists the $33,000,000 as a liability on the seminary's books because, as the Dean explains, "we cannot count the full amount as income; rather we only count what we would receive each year in rent..."
Because the seminary books show this big liability, the Chronicle lists GTS as one of "114 private, nonprofit degree-granting colleges that are in such fragile financial condition...that they failed the Department [of Education]'s financial-responsibility test." (online access to the Chronicle issue requires a paid subscription).
Dean Ewing publishes his open letter to say that this is all a misread of the accounting. "In light of other seminaries' decline, this article will encourage rumors that General Seminary may close. I write to assure you that the event that put us on this list is actually part of the reason we are financially healthier today than we were two years ago."
Fair enough, but let's not overlook the distress that has led General to lease out its historic property for commercial use.
- - Last July, the Dean wrote "Our property was our greatest financial asset--which we would need to leverage to improve our fiscal situation--but it was also our greatest liability in that we faced a rapidly deteriorating plant with over $100 million in deferred maintenance." GTS has ceased to be its own financial master, and has had to lease its campus to commercial interests to make repairs and keep the doors open.
- - In April this year, the Dean sent another letter explaining that "the Seminary successfully refinanced its current indebtedness and closed on a $22 million with M&T Bank. The loan will pay off existing debt, construction cost overruns, and provide working capital for the next two years."
GTS won't "close," but it is operating on borrowed money and the surrender of its property to commercial interests. Yes, accounting can be confusing and misleading, but so can the claim that the seminary is healthy when its resources are so heavily encumbered by non-church interests.
The GTS situation is a reflection of the overall decline of denominational churches generally and the Episcopal Church (TEC) in particular. It is telling that TEC, whose General Convention uniquely chartered the seminary in 1817, has to let the school fend for itself.