Two folding chairs, a card table, and the passive endorsement of the nation’s largest retailer are all it takes to fund an empire. It may sound far-fetched, but Bishop Luke Edwards is at the helm of just such an organization and for the past thirty-three years he has prospered through a complex amalgamation of uncompensated labor, charitable donations, and questionable business deals.
Edwards’ empire operates under many monikers such as Reach Inc, The Holyland, and Christ Temple Church. Since its humble beginnings as a Mississippi-anchored congregation, the organization has amassed some enviable assets including airplanes, truck stops, shopping centers, and restaurants that by 2000 had inflated the Holyland’s net worth to just over $11 million.
These accomplishments are all the more impressive considering that in 1977 the organization consisted of just a modest congregation, the majority of which sustained themselves on government assistance. Bishop Edwards believed then, as he does now, that “most churches collect and never do anything for parishioners,” a financial model that he was determined not to imitate. He began collecting and pooling member’s food stamps and in turn, provided them with groceries. This gradually began generating enough revenue for the church to make preliminary investments in businesses which in turn generated more revenue for the church.
Eventually, the church began providing food, shelter, and even clothing to members who agreed to work at these church-operated ventures. This was done in lieu of a paycheck and provided a steady stream of monetarily uncompensated employees to staff the growing collection of business ventures. Eventually, the church constructed a commune in Sumter County, Alabama, which was for the hundreds of parishioners that were dependant on the church for their basic needs, thus The Holyland was born.
By any objective standards, Sumter County is an economically depressed area. In 2000, over 38% of its 14,000 residents lived below the poverty level and the median family income just barely cracked $23,000 a year. Sumter County’s true claim to fame is housing the largest hazardous waste landfill in the United States which resides in the tiny town of Emelle, AL where The Holyland also holds property. It is not difficult to imagine that Edward’s message of self-reliance and freedom from poverty was embraced with open arms.
On the surface, all this reads like an awe-inspiring journey of one minister leading his flock out of a government subsidized existence and into a self-sustaining collective, but the reality is far more complicated. In the late 70’s the church formed a charitable arm called Citizens for Research, Education and Community Hope Inc. (more commonly known by its acronym R.E.A.C.H. Inc) which began soliciting for donations outside popular retailers such as Wal-Mart. Members were instructed to obtain the donations under the banner of “child abuse” as it easily loosens the purse strings of store patrons.
As part of their contribution, some commune members were required to participate in this child-abuse fundraising circuit, known internally as “The Route”, sometimes being shuffled hundreds of miles from home. In an interview with The Birmingham News, former member of seventeen years, Gail Walker, recalled how she spent six days a week on “The Route” for an entire year and was not even given leave to attend her own mother’s funeral.
“We were getting beau-coups of money,” Ms. Walker said in an interview. Gail claims that in one year she personally collected $65,000 in donations for abused children and it was not unusual to clear $5,000 a week. The money would be deposited in various bank accounts that would flow back into the organization’s coffers.
Tax Structure
Where does all of this money collected on “The Route” go? In 2000, REACH, INC claimed that they only received $8,515.53 in contributions and declared $7,589.10 in expenses such as bank fees and supplies. In 2001, the organization’s declared donations fell to $5,053.41 and their expenses dropped by almost 60%. Even more unusual is that an organization that collects less than $10,000 a year claims assets in excess of $230,000 and lists a president, vice-president, treasurer, and board member, none of whom receive salaries on paper. These figures paint a much different financial picture than that claimed by ex-members such as Walker.
This is possible because the majority of the Edward’s organization operates as an “Apostolic Association” filing under IRC 501(d). There are numerous perks for this type of structure:
· It is a federal tax designation specifically for communal religious communities whose primary activity is farming or manufacturing.
· All income can be placed in a community treasury and distributed by the organization with minimum oversight from outsiders since this designation is not required to file a Form 990 or other public documents disclosing the money’s use.
· 501(d) organizations are tax exempt as long as they have a common treasury, even though they engage in business for the common benefit of the members.
· The organization simply reports each member’s “share” of the pie instead of any individual income.
The real question is why would Bishop Edward’s organization bother to create a 501(c)(3) in the first place? Certainly they are entitled to an inordinate amount of both fiscal privacy and tax freedom under the 501(d) structure. Why would they open themselves up to outside scrutiny? Again there are several reasons:
· Contributions to a 501(d) are not tax deductible.
· A 501(c)(3) is necessary to become eligible for a large number of government grants including several for farming and agriculture.
· It allows them to solicit outside large retailers like Wal-Mart who require this designation.
The beauty of this arrangement is that the group can solicit cash donations under REACH, Inc. and deposit the proceeds into the community treasury to be utilized for expenses. Within this structure, the leaders of the organization determine what income they will choose to report as charitable donations to REACH, Inc and what will go into the communal pot. The result is a complex shell game that allows maximum tax advantages with minimum public disclosure.
It seems unbelievable, but one of the components that make such an operation possible is the solicitation policy of large retailers like Wal-Mart and SAM’s Club. Because there is no official chain-wide solicitation policy dictated from a corporate level, each store’s policy is created and enforced by the manager and local outreach liaison. Some locations allow no solicitations at all, but most will allow anyone who can produce written documentation of 501(c)(3) status. For instance, my local store has hosted Reach, Inc several times and other than a stipulation that Wal-Mart has the right to dictate their physical location, time slot, and frequency, the parameters are surprisingly lax.
Controversies
· In 1990, the organization was cited for more than one-hundred child labor violations.
· In 1991, a former church secretary won a $650,000 judgment against Bishop Edwards for “sexual misconduct” and “mind control.”
· In 1993, a Holyland runaway triggered a state child-abuse investigation
· In 1998, four children died in a fire that ripped through one of the girl’s dormitories.
· In 1999, the boys dormitory burned (no one was killed).
· In 2000, a Holyland deacon was acquitted of assaulting a teenager that once lived in the commune.
The group has made its share of enemies over the years. In the 1980’s, one of the group’s businesses purchased a 322-acre hog farm from Hattiesburg, Mississippi resident Tommy Graham for $650,000. The business later defaulted on the payments and Tommy got a court judgment for the money he was owed. The group responded by having that particular business file for bankruptcy and then Reach, Inc was able to re-acquire the land for the commune at less than half the original price.
Not all of the criticism comes from the outside. Phillip Williams, Reach, Inc’s first president, left after concluding that the organization was a “racket” and that the money was not trickling down to the individuals. A lengthy court battle ensued and Williams was eventually granted custody of his then 13-year old son, who testified that while in the commune he rarely got to see his mother and was often denied food for up to four days at a time for misbehavior.
Lakisha Davis Herr grew up inside Edward’s organization and remembers frequent whippings as a child. Other Holyland children confirm Herr’s recollections, with several claiming that they were whipped with horse straps during their residency.
Several former members have contacted me via this very blog to express their solidarity with those who felt betrayed by the organization. Former member, Kimberly Landingham, who is Gail Walker’s cousin, admitted that she felt “abused in every sense of the word” by the commune. Another anonymous reader who claims to have escaped from the group posted:
“We would be gone for 2 or 3 months at a time, away from our children. We were supposed to receive prorated shares of the non-profit 501(d) upon leaving the organization. This information was reported to the IRS as if we received it. I left the organization 3 years ago, with 53.00 in my pocket and a bus ticket from a friend. We worked for nothing... No pay...nothing.”
Surprisingly, some of the most scathing criticism comes from Edward’s own children. Brenda Garris, Edward’s eldest child, admitted that “My father is a mastermind. He’s always been a hustler.” Even more alarming is how she handled comparisons between her father and other infamous commune figureheads such as, Jim Jones and David Koresh, “Jim Jones had nothing on Luke Edwards” she insisted.
So how does Bishop Edwards respond to such criticism? He believes that much of the negative publicity is generated by prejudiced whites and jealous blacks. This excerpt from an interview with Robin Demonia of the Birmingham News is quite revealing:
"You ain't ever seen a black man do what I do," said Edwards, a staunch Republican with a fourth-grade education. "I've been a challenger all my life. . . . They say I can't run a business, and I say I can. They say, 'I'm not going to finance you.' I say, 'I'll finance it myself.' I would not let being poorly educated and black stop me."
The Future
The group has succeeding in keeping a much lower profile in the past decade. In fact, it was the lack of public information on the group that led me to investigate them in the first place. The strategy seems to have paid off, as most of the people whom I spoke to, were surprised to learn that they were still actively soliciting under the Reach, Inc banner. Especially given that my location in West Tennessee is almost 250 miles away from the group’s headquarters. The “charity” shows no sign of slowing down, even having recently created a Facebook page to proliferate their cause.
For the bishop’s newest venture, he has teamed up with Dr. Donald R. Evans, Sr. to construct a private school for disadvantaged children in Sumter County called Greentown USA. Dr. Evans, who holds an honorary doctorate from the unaccredited Saint Stephens Educational Bible College in Los Angeles, is serving as “Director of the National Public Relations & Fund Raising” for the project. Edward’s role is officially listed a “spiritual guidance.”
According to the school’s “admissions office” students will not apply, but rather be referred by the legal system, churches, or parents on a case by case basis. Despite the fact that the project has not even broken ground yet, the school is accepting donations via the website. The school plans to be operational by the fall of 2012.
It is unclear why the school is even necessary considering that Edward’s group continues to maintain the Christ Temple Academy, an educational institution that the bishop created in the late 70’s. The school utilizes the Accelerated Christian Education (A.C.E.) methodology that allows the students to learn at their own pace and according to the schools webpage is designed “to produce children that are capable of running businesses.” The school has no oversight from state officials and one child who was removed from the commune after five years at the school was judged “borderline illiterate.”
Given Edward’s advanced age it is unclear what the next decade will hold for Reach, Inc and The Holyland, but whatever the future brings I have no doubt that your donations will be gladly accepted.
*Special thanks to Robin Demonia of Birmingham News. Her brilliant 2000 expose on the group was invaluable to this piece and the best resource I have discovered. Also thanks to Jay Reeves of the AP for his help and direction.
The Tax Guidelines for a 501(d) Apostolic Organization can be found here:
The official website for Reach, Inc. and the Christian Temple Academy can be found here:
The official website for the Greentown USA project can be found here:
