Just two per cent of people attend church in Brighton and Hove.
Of those, 60 per cent are aged 65 or over.
As a result of the statistics, the Diocesan Pastoral Committee has earmarked several churches for closure in the city.
The committee said: "Change is never easy and there are many people who would like things to continue much as they have always been. This is not an option."
The Archdeacon of Chichester, the Venerable Douglas McKittrick, chaired a working party on the issue.
He estimates each vicar in Brighton and Hove costs more than £50,000 a year, taking into account rent, pensions and other costs.
In 2002 the cost of clergy in the city came to about £2 million, exceeding congregational funds by about £800,000.
Meanwhile, with low congregational collections, the Rev Richard Rushforth, of St Andrew's Church in Portslade, said: "Having a church in Brighton is like having a mortgage you can't pay off or having a credit card you've spent too much money on."
The report by the Diocesan Pastoral Committee says: "We have sought to develop a clear sense of what the church stands for in Brighton and Hove and how it might be best changed to recover its relevance to more people, many of whom now have no contact with any of our churches.
"Central Brighton is where the need for change is most evident. Simply too many splendid Victorian buildings abound for the numbers who would regularly attend."
The committee has decided there are four possible outcomes for struggling churches - conversion to community use, closure, sale or demolition.
St Matthias's Church in Ditchling Road, Brighton, is under review.
The report says: "The church has little contact with its community and in many ways seems to have lost its direction."
St Mary's Church in Kemp Town has been standing vacant since March.
The committee said: "It is architecturally important but it needs substantial maintenance for it's roof. The present church community is ill-equipped to address the growing pastoral concerns of this area."
The Rev Stephen Terry's church, St Leonard's in New Church Road, Hove, is due to close in the next few months.
He said: "Essentially the problem is that there are far too many churches in Brighton.
"There are 55 Anglican churches in a very compact area. We simply don't have the people or the money.
"About ten churches will probably close.
"At the heart of the closures is the reality of 21st century Brighton. If you're looking for a different kind of worship you will probably find it here. The ethos of the people of Brighton and Hove is if you don't find it, you start it yourself. There are many alternatives to the Church of England." Another of the churches Mr Terry serves, St Philip's, also in New Church Road, Hove, was earmarked for closure in 2003 but now looks likely to remain open. Mr Terry says this is because it was able to diversify. The church hall was refurbished and is now used for band practice and social groups.
St Leonard's has not been so lucky and, though it will not be demolished, Mr Terry predicts it will be converted into a conference centre or community college.
The Rev Canon Beaumont Brandie saw one of his churches, St Alban's, in Coombe Road, close this summer.
He said: "In it's final days it had a congregation of about 20.
"We are inheriting a problem left to us by the Victorians. They wanted a church within ten minutes of everyone's front door.
Brighton simply has too many churches."
He also thinks Brighton poses it's own unique challenge for the Church of England.
He added: "I think Brighton has a certain anti-establishment theme. It is remarkably cosmopolitan and remarkably anti-religious at this moment in time. Many people here prefer new wave, modern, charismatic churches like Christ the King in New England Road."
This point is not lost on those who will decide the fate of the churches in the city.
Father McKittrick said: "Brighton is very diverse. Three years ago we opened Christ Church above a pub in London Road. It now has a congregation of about 40 young people and lots of students. It's a great success."
Mr Rushforth, of St Andrew's, one of the churches under review, said: "Over the next few years Brighton and Hove's churches will form groups in the hope that sharing expertise and resources will make them stronger."
Father McKittrick hopes all listed churches will be saved. These include St Peter's, in York Place, St Mary's in Kemp Town and St Julian Kingston Buci, Shoreham.
He said: "The listed buildings might be imaginatively transformed on the inside but their exteriors should remain the same."
But not all closed churches are safe. The committee has acknowledged some churches will have to be demolished and the sites built upon.
He said: "We hope church buildings and church sites are used for a good cause such as affordable housing for people in Brighton and Hove who need it."
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