San Francisco Church Wins Legal Fight Against its Own Nonprofit


Recently, a church in San Francisco, and the nonprofit that it founded in 1969, settled a contentious lawsuit out of court. Third Baptist Church sued Third Baptist Gardens because the latter had intended to sell the housing they had built for people on Section 8 rental assistance. Those people, who pay small portions of their rent while federal vouchers cover the rest, were told they could face impossible rent hikes.

The church was having none of it though, and accused the board of the nonprofit of being “blinded by the riches of the gold rush dangles,” they sued. Things got ugly before they settled out of court. The terms of the settlement were that, for dropping the suit, the church got a new governing board out of the deal. All 11 board members were let go, though they helped elect replacements, and are barred from having contact with the new board.

It is, frankly, a rather elegant way to solve the issue. It’s unfortunate that it came to all that, but it’s a relatively happy ending for a situation that could have gotten much worse. Because a nonprofit could lose sight of it’s mission like that is upsetting, but the fact that people were willing to fight to preserve that mission, albeit from outside the nonprofit, is a good sign.

It also might help to establish a precedent for other cases like this. Housing developments for Section 8 people have to pay off a mortgage from the government, and once they do, some might consider doing so following the path of Third Baptist Gardens. Even though the idea of selling low-income housing to private developers who will jack up the prices to evict tenants is repugnant, it isn’t exactly a new idea in real estate. But this case might give other reason to pause, and consider their actions.


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