My church would really like to have new pews. Many of them look very worn. Some may have broken supports in the seat (which is hidden by the fabric of the cushion). It is not cheap to purchase new pews, though! The church mortgage is paid off, so we planned to raise money for new pews. We thought we might add a few other improvements to our lobby and sanctuary.Unfortunately, the pew project is delayed. After launching the fundraising, the church roof started leaking! The roof project is much more expensive than the pew project and more urgent. We couldn’t let the leaking roof cause further damage. It had to be addressed immediately.
Since we did not have funds for the roof, we secured the needed financing. Another unexpected snag derailed our plans. The local fire authorities informed us that sprinklers were required in the Sabbath School wing under the sanctuary. They won’t let us use those rooms until the job is completed.
Does our story sound familiar? Do you find your church unprepared for large capital purchases such as AC units or a roof needs replaced? Some look to insurance to pay for these deferred maintenance items. Insurance is designed to respond to “sudden and accidental” claims, not those items that should have been addressed through regular maintenance or planned replacement.
How can your church plan more effectively for repairs or replacements? Consider these five steps:
- Deferred maintenance. If you have any deferred maintenance, you must develop a plan to bring things up to date based on their age and expected life. If that is not done before building the ongoing capital reserves, you will always be playing catch up.
- Current replacement value. In today’s dollars, what would it cost to replace the item?
- Expected life. How many years of life are still expected from this item?
- Annual inflation. As you look at the economic environment, what percentage of annual inflation would be prudent to plan on?
- Annual budget. Based on the above four considerations, how much money should be set aside every year?
I hope you will work with your church as you plan to anticipate the need for repairs and replacements in an ongoing way rather than being surprised. I know my church will be able to work through these setbacks. But how many worthy projects will be delayed because money had not been designated to fix the roof which has a known expected life? Don’t let a lack of planning set you back. Plan ahead.