Venue Church files for bankruptcy after pastor’s alleged sexual misconduct

A Tennessee megachurch has filed for bankruptcy and disclosed millions in debt, following a scandal over the alleged sexual misconduct of Pastor Tavner Smith, according to documents filed in federal court.

Venue Church in Chattanooga filed for Chapter 11 bankruptcy Tuesday in U.S. Bankruptcy Court for the Eastern District of Tennessee. His bankruptcy petition shows that the church has more than $3 million in mortgage, car loan and credit card debt.

The church has less than $5 million in assets, even including his church of $4.5 million, according to the filing.

Tom Bible, the attorney representing Venue Church in the bankruptcy, did not immediately respond when The Roys Report (RTR) asked why the church decided to file for bankruptcy.

But the record shows a massive drop in revenue over the past two years. And the bankruptcy filing put a temporary stop to the Venue Church building foreclosure proceedings, reported earlier by RTR.

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A amended list of secured debts shows that Venue Church still owes $2.77 million for its building. That’s about $5,000 less than the original mortgage, foreclosure notice shows.

Bible would have said the Chattanooga Free press that the church intends to repay its debts in full, even if it means selling the building.

This is a different message than the one communicated by Smith less than three weeks ago. He had promised that the church would stay put, RTR Previously reported.

The file also identifies, for the first time, former church board members who had would have resigned in 2021.

The local church was would have a former member of the Association of Related Churches (ARC), one of the largest church planting organizations in North America. As RTR previously reported, ARC is known for restoring and reforming morally fallen pastors. Current and past ARC member churches, including Venue Church, have faced multiple scandals involving money or sex.

The ARC Church style of governance typically places other mega-church pastors, whom it calls “oversights,” in charge of holding a lead pastor accountable.

Ron Carpenter of Church of Redemption in San Jose, Calif., was chairman of the Venue Church board of trustees. Steven Furtick from elevation church in Charlotte, North Carolina, and Benny Perez of ChurchLV in Las VegasNevada, were the other two council members.

ChurchLV is an ARC member church and Perez serves on The ARC team. Furtick’s Elevation Church is not a member of the ARC but would follow the CRA governance model.

The carpenter has connections to the CRA, but no formal association.

Carpenter founded Redemption Church in Greenville, South Carolina. In 2018, John Gray, who in April 2022 sat The ARC team– took over the Church of Redemption and renamed it Relentless Church. Now Gray, who has been repeatedly accused of sexual misconduct, is embroiled in a legal dispute with Carpenter over ownership.

Another former Venue board member is Ron Phillips, senior pastor of Abba’s house in the Chattanooga area. The filing lists him as a member of the board of directors from September 2021 to January 2022. The Chattanooga Free press reported Phillips resigned in early February.

A few months after Phillips resigned, Venue Church sold an LED display wall at Abba’s House on June 20 for $40,000, according to the bankruptcy filing. That same day, according to the filing, Venue Church paid Tavner Smith a total of $15,000 — $10,000 for repayment of a loan and $5,000 as a transfer of Abba’s house.

Although the transactions took place on the same day, there is no explicit link between them. Venue Church’s bankruptcy attorney did not immediately respond when RTR asked for clarification.

What goes up must come down?

Smith started Venue Church 10 years ago. In just three years, it had grown to 2,000 attendees at six Sunday worship services, becoming the seventh fastest growing church in the country.

Venue Church purchased its current building in late 2019. In 2020, during the COVID-19 pandemic, the church received over $3.1 million in revenue, including a Loan of $141,691 which was forgiven through the Federal Paycheck Protection Program.

foreclosure of the local church
Once recognized as one of the fastest growing churches in the nation, Venue Church is located in Chattanooga, Tennessee. (Picture via Google Streetview)

But in late 2021, Smith was accused of kissing a woman who wasn’t his wife. Eight church staff have resigned over the allegations, RTR Previously reported. Smith then took a short sabbatical earlier this year before returning to preaching a month later.

Attendance has would have fallen sharply since the scandal broke. Revenue fell to just over $2 million last year, according to the bankruptcy filing. And Venue has grossed less than $600,000 this year as of August 23.

Debts include car loans, credit cards, supplier bills and back taxes

Venue Church now has less than $500 in the bank, according to its bankruptcy filing. His other non-real estate assets include more than $180,000 in furniture, office and cleaning equipment, musical instruments, and audio-visual and lighting equipment. The church also owns a Ford F-150 and a Chevrolet Suburban, both with approximately 110,000 miles.

Besides her mortgage, the church’s debts include approximately $53,000 owed on the two vehicles, plus an additional $12,000 of debt she deferred from a vehicle she previously owned but was under water, depending on the file.

Venue also owes the city of Chattanooga nearly $8,000 and more than $2,200 to Hamilton County, according to the filing. Government records show it’s for back taxes and storm water charges.

The credit card debt amounts to almost $90,000, according to the bankruptcy filing. Debts to various commercial vendors and Tavner Smith’s ex-wife make up the rest of the church’s debt.

Smith’s ex-wife, Danielle Smith, who had also worked for Venue Church, sued the church in July for breach of contract, Hamilton County Circuit Court Papers To display.

She claims in a court filing that Venue Church owes her monthly payments under a release agreement, but has missed the last three months of payments. She also claims that the church was supposed to transfer the title of her vehicle to her name alone and failed to do so.

The amount Venue Church owes Danielle Smith is not stated in either the church’s bankruptcy filing or the lawsuit filed by Danielle Smith in court. Tavner Smith denied the breach of contract claims in a pro se response on behalf of the church.

This story has been updated to correctly reflect the filing date and location of Redemption Church, which is in South Carolina, not North Carolina.

Sarah Einselen is an award-winning writer and editor based in Texas.

Jerry B. Hatch