The Opportunity Cost of Pastoral Formation (Revised) - Why the Future of the LCMS Depends on Rethinking the System

In the first release of this piece, I made a methodological error by taking total institutional cost of education and treating it as if it were an annual per‑student cost. That was careless. I own that mistake without qualification, and I regret the confusion it created. I am grateful to those who challenged the data directly and forced a needed re‑examination.

This revised version now relies strictly on ATS‑reported “Cost to Educate per Student” annual figures, which are publicly available, standardized, and verifiable. I also want to acknowledge plainly that different institutions account for costs in different ways, and there are legitimate variations in methodology (what gets included, how overhead is allocated, how programs are bundled, etc.). That reality is not unique to the Concordias—it applies equally to ILT, Kairos, and every other institution in this conversation. It is precisely for that reason that I am using the ATS tables as the common standard of comparison, so that we are at least working from the same publicly reported baseline. My core argument remains the same—but it now rests on numbers that everyone can independently validate.

I also want to publicly thank Seminary President Bruss for directly pointing out that our original figures were nowhere near the correct ballpark. He was right to challenge the math, and that challenge prompted this necessary correction.

One additional clarification in light of his response: ATS "cost‑to‑educate" figures reflect total institutional operations, not only residential MDiv instruction. That includes multiple degree programs, global partnerships, continuing education, governance work, and auxiliary functions. The same is true—at different scales—for other institutions in this comparison. My argument does not claim that these totals equal the pure instructional cost of the MDiv; it uses ATS as a consistent system‑level benchmark to frame a stewardship conversation across models.

Before we begin, let me be clear: I am making a conscious effort in this revised version to temper my tone and be careful with humor and sarcasm, in service of clearer dialogue across the Synod. At the same time, I am not downplaying the value of residential seminary education. It has formed countless faithful pastors, including many I deeply respect. It is a good and often life-giving path for many students. But it simply cannot be the only path—because the needs before us far exceed what a single, high-cost, slow-scaling model can supply.

For decades, the LCMS has upheld the residential seminary model as the gold standard of pastoral formation, and for many faithful pastors and congregations, that model has borne real and lasting fruit. The claim is simple: residential is superior. (Superior in the same way a $9 coffee is "superior"—sure, maybe, but at what point are we just paying for the vibe?) In many ways, the residential experience is rich and deeply meaningful, but here’s the question we can no longer avoid: Even if residential formation is somewhat better in some cases, does that justify a system that is 4–11× more expensive and produces only ~100 pastors per year? At a time when hundreds of LCMS congregations are vacant and thousands more are heading toward pastoral retirement cliffs, this question is not academic—it is mission-critical.

The future of our congregations, church plants, schools, and outreach hinges on whether we are stewarding our formation dollars to create a sustainable pastoral pipeline. This blog post explores the real costs, the opportunity cost, and the stewardship implications facing our church body.

1. The Real Cost of Residential Formation (ATS Benchmarked)

Residential seminary tuition may be free to students—but it is very far from free to the LCMS, and ATS data gives us a standardized way to examine those costs across institutions.

Using ATS-reported Cost-to-Educate figures (Table 1.2 methodology):

• Concordia Seminary St. Louis (CSL)

• Expenses: ~$34.5M

• Headcount: 591

• Cost to educate: ~$58,353/student/year

• Concordia Theological Seminary Fort Wayne (CTSFW)

• Expenses: ~$22.2M

• Headcount: 279

• Cost to educate: ~$79,544/student/year

For comparison (also ATS‑reported):

• Institute of Lutheran Theology (Christ School of Theology):

• Expenses: ~$1.331M

• Headcount: 97

• Cost to educate: ~$13,721/student/year

• Kairos University:

• Expenses: ~$8.706M

• Headcount: 1,157

• Cost to educate: ~$7,524/student/year

Even using ATS‑reported baseline numbers without any endowment adjustments, LCMS residential formation still runs approximately 4×–11× more expensive per student than contextual alternatives.

Source: Association of Theological Schools (ATS), 2024–2025 Annual Data Tables, Table 1.2 https://www.ats.edu/files/galleries/2024-2025_annual_data_tables.pdf

2. What Else Those Dollars Could Do (Using ATS‑Safe Numbers)

Using ATS baseline figures, a residential seat costs ~$58k–$80k per student per year. By comparison:

• ILT: ~$13.7k/student/year

• Kairos: ~$7.5k/student/year

That means, on a per‑student annual basis, the residential model is:

• ~4.2× to ~5.8× more expensive than ILT

• ~7.7× to ~10.6× more expensive than Kairos

Put differently, one year of residential formation dollars can fund 4–10+ students in lower‑cost contextual models.

What That Means in Actual Dollars

Using ATS headcount for both Concordias (591 + 279 = 870 total students) and their combined annual expenditures (~$56.7M):

• If those same 870 students were educated at ILT’s ATS cost (~$13.7k/student):

• Total annual cost ≈ $11.9M

• Potential annual dollars freed up: ≈ $44.8M

• If those same 870 students were educated at Kairos’ ATS cost (~$7.5k/student):

• Total annual cost ≈ $6.6M

• Potential annual dollars freed up: ≈ $50.1M

Even allowing for substantial transition costs, infrastructure limits, and hybrid models, this frames the real stewardship question very plainly: Are tens of millions of dollars per year being optimized for multiplication, or concentrated into a model that cannot scale fast enough to meet the mission field?

Rather than speculate about exact ministry outputs per dollar (plants, hires, etc.), the defensible stewardship question is this: What would happen if the same formation budget emphasized multiplication rather than concentration? That shift alone materially changes the scale equation.

We’re not lowering the bar or taking shortcuts; we’re asking whether our formation dollars are aligned with the scale and urgency of the mission. And honestly, we should question whether our current model is being priced as if we're training pastors at a boutique retreat center rather than preparing workers for the harvest.

3. The Output Problem: ~100 Pastors Per Year

Across both seminaries combined, the LCMS currently graduates roughly 85–105 pastors per year. If the system could produce 300 or 500 or 700 pastors annually, the cost might be easier to justify—but the residential model simply cannot scale. It’s like trying to run a megachurch on dial‑up internet—no matter how nostalgic it feels, it’s not built for the load.

Housing limitations, relocation barriers, faculty capacity, and tuition‑subsidy caps form hard limits. With 20–30% of LCMS congregations heading toward pastoral vacancies, this throughput is nowhere near enough.

4. The Alternative: Scalable Formation at a Fraction of the Cost (ATS Comparison)

Contextual, competency-based models like Kairos offer a dramatically more scalable option at ~$7k–$14k per student per year.

Using a conservative $60M annual system-wide residential investment equivalent, the church could:

• At $7k/student/year → support ~8,571 students in formation annually, yielding ~2,143 graduates per year on a four-year cycle

• At $14k/student/year → support ~4,285 students annually, yielding ~1,071 graduates per year

Against a residential output of ~100 graduates per year, this remains a 10–20× multiplication factor, even using ATS-safe numbers.

5. Is Residential Superior? If So, By How Much?

Let’s assume for the sake of argument that residential formation is indeed “better.” The corrected ATS comparisons show residential programs running approximately 4–11× more expensive than contextual alternatives. That means, to justify the premium purely on outcomes, residential formation would need to produce results that are roughly 300–1,000% better on the metrics that actually matter.

If someone wants to argue for that level of superiority, the burden of proof would understandably be high—and today, those outcome measures are largely not being tracked in any consistent, Synod‑wide way: effectiveness in ministry, evangelistic fruitfulness, long‑term congregational health, leadership capacity, and cross‑cultural adaptability.

Residential formation may feel superior to many, and in some contexts it very well may be. But without measurable outcomes at this scale of cost differential, the claim remains rooted in tradition and conviction rather than demonstrable ROI.

6. The Stewardship Question That Cannot Be Avoided

If the LCMS continues pouring tens of millions annually into a formation system that cannot scale and cannot meet the needs of a shrinking church body, then we must ask—humbly and honestly—whether we are stewarding our formation dollars for mission or simply preserving inherited patterns that may no longer serve the moment. Every dollar locked in an outdated formation system is a dollar not spent on church planting, revitalization, leadership development, mission expansion, or youth and family ministry.

Our formation strategy must match the needs of a mission field that is growing more complex—and more urgent—every year.

7. The Scale of the Need: Why 10,000 Pastors Matters for Phoenix

The Phoenix metro area is projected to reach 7–8 million people within the next generation. If we take the Great Commission seriously, the workforce required to evangelize, disciple, plant, revitalize, and shepherd communities is enormous.

This is why our ministry vision includes raising up 10,000 pastors and ministry leaders for the Phoenix metro area. The DAWN Ratio—one gospel proclaimer for every 500 people—helps reveal the scale of the challenge. Applied to Phoenix:

• Population: 7,000,000 (soon 8M)

• Ratio: 1 pastor / 500 people

• Long‑term need: 14,000–16,000 proclaimers

So why aim for 10,000?

Systems produce what they are designed to produce. Our current system produces scarcity. A new system can produce abundance. Because it represents the first major, realistic milestone toward genuine gospel saturation—enough momentum, coverage, and leadership capacity to catalyze a movement that can reproduce itself.

To put this in perspective, if every single residential‑program pastoral graduate from both LCMS seminaries moved to the Phoenix metro area, we would meet the region’s long‑term pastoral need in roughly 100 years.  The output is simply too small for a rapidly expanding mission field.

By contrast, imagine a different approach: if every ministry leader committed to raising up 10 new leaders over the course of their career, and each new generation did the same—and if those leaders were supported by high‑quality, affordable online formation pathways—Phoenix could reach the equivalent of DAWN‑level saturation in just four generations—and honestly, it could be done even faster if the ministry leaders already serving in the Phoenix metro area were equipped and mobilized right now, not ten.

This is the kind of multiplication the early church understood intuitively. And it’s the kind of multiplication our current residential‑only pipeline is structurally incapable of producing.

Seen through this lens, major metro areas across the U.S. are dramatically underserved. We don’t just have a seminary bottleneck—we have a scale problem. A residential‑only model cannot keep pace with this level of need, while a contextual, distributed, scalable model can—and at a fraction of the cost. This reframes the conversation from institutional preference to biblical stewardship and missional necessity.

Final Thought

We are approaching a crossroads. We can defend the old system, protect the institution, and watch congregations shrink for lack of pastors, or we can redesign pastoral formation to multiply leaders, empower congregations, and release thousands into the harvest field. Only one of these paths positions the church to thrive in the next generation.

The goal isn’t to sideline residential seminary or diminish its value but to integrate it into a broader, more scalable, and financially responsible system of formation. The LCMS needs more pastors, more leaders, more missionaries, and more disciple‑makers—all at a pace and scale that matches the realities of our mission field.

We already have the dollars to accomplish this. We simply need the courage to steward them differently. - Jack Kalleberg