LEASES

A Lease Agreement must be prepared each time a congregation, campground or affiliated church entity leases property to another group or entity. In order to expedite the processing of the lease, please complete a Lease Request Form (PDF) with as much detailed information as possible. The form and a copy of the business meeting minutes approving the lease should be faxed to Legal Services at 816/521-3099. Legal Services will then prepare the Lease Agreement.

1.  Types of Leases. Legal Services has a number of template lease agreements including: leases allowing community groups to use Community of Christ church buildings and campgrounds, commercial leases, day care leases, residential leases and one time use agreements for weddings, receptions, reunions and other single day events.

2. Unintended Consequences. Leasing a church facility to another entity may result in a number of negative unintended consequences which could affect the church, including: jeopardizing the church’s 501(c)(3) tax exempt status, generating taxable unrelated business income, increasing property taxes and increasing the likelihood of an incident occurring on church property where the church would be a defendant.

3.  General Lease Requirements. Before drafting a lease, Legal Services will require specific information about the lease. The more specific the information is, the less likely there will be a misunderstanding between the parties about the scope of the lease. Examples of the types of information Legal requires include: the specific space the lessee will have access to, the hours the lessee will have access to the facility, responsibility for cleaning and maintenance and will the lessee be able to submit a certificate of insurance naming the church as an additional insured meeting the church’s insurance requirements (Risk Management requires day care leases and leases where children may use the facility to have sexual misconduct insurance of not less than $1,000,000.) For a complete list please see the Lease Request Form (PDF).

4.  Terminating a Lease May Result in Unintended Consequences. Legal Services should also be consulted before leases are terminated to determine if there are damage or penalty provisions, which might adversely affect church interests. An improperly terminated lease can trigger escalation provisions, obligating the contracting church entity to a lump sum payment; and may create a cause of action by which the other party sues the church.

5.  Signature Authority and Execution. No lease may be signed without review of Legal Services and approval of the congregation and Mission Center officers.  Once approval is given by Legal Services, in many cases the contract can be signed by either the Congregation's Pastor or Financial Officer, however for significant projects, a Mission Center officer may be required. Individuals signing a lease should always sign in the capacity of their office, i.e., "Joe Smith, Pastor."