Communicating the Priority of Sustainable Funding To – and Through! – Your Building Committee


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GL Barron Construction | First United Methodist Church | Coppell, TX

You dreamed it.  The architect designed it.  You want you to build it.  And you’re ready to fire off a capital campaign to pay for it.  Good to go, right?

To borrow from a classic Hertz™  commercial, “Well, not exactly.”

Many churches regard a capital campaign as a stand-alone, short-term financial objective, instead of being viewed as one of several crucial elements contributing to long-term, sustainable funding.  In light of the upcoming project, leaders and building committee members enjoy a prime opportunity to communicate the role the campaign will play.  As part of your “Big Picture,” an effective church capital campaign works in concert with budget support (tithing), missions funding (outreach), and legacy giving (forward thinking) to provide a foundation for long-term financial stability.

Your committee must grasp and convey the real-world ministry impact, moreso than the achievement of new space, that the campaign is going to set in motion.  Helping believers see beyond the fundraising will enable them to value the project within the context of long-term ministry goals.  This critical step promotes collective ownership of the vision, and where your member’s heart is, so is his or her treasure.

To get your building committee thinking along these lines, come to a unified perspective on the following:

  • How will the new or improved facility promote and affirm the vision of the church? The building is the means, not the end.  This may sound basic, but people, processes, and priorities can easily undermine momentum and cloud perspective.  Keep them on track and looking ahead.
  • How will the capital campaign mesh with existing financial needs? This is where Big Picture thinking is essential, not some novel idea.  If a campaign becomes a simple matter of asking for “extra” money, you run the risk of diverting budget support and remaining flat in total giving.
  • Who is driving the communication of the campaign-specific goals within the context of the ministry vision as a whole?  Nurturing buy-in to the project, and releasing the resources to pay for it, depend on this critical activity.  Understand the value of communicating early, and often, to the congregation about how the upcoming project is a critical part of what is yet to come.

Learn more about Impact Stewardship. ▶

Since 1999, Impact has helped raise over $950 million to expand ministry space, enhance mission outreach and retire unnecessary, excessive church debt. Our team brings together decades of experience in stewardship teaching and curriculum resources, capital stewardship campaign consulting and capital campaign media to help your ministry implement a spiritual plan that enables a wider reach to your community.


Choosing the Right Lender for Your Project

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JH Batten & Custom Sound Designs | Raleigh First Assembly | Raleigh, NC

By Jon Huskins of Crossbridge Funding Group
Provided by NACDB Member: Kurt Williams from T&W Church Solutions

Churches and Nonprofits: Preparing for Financing or Refinancing

While the Great Recession of 2008-2009 may seem like something of the past, the reality is we’re still living with its consequences. In fact, it greatly impacts today’s economic environment.

In 2008-2009, many businesses failed. This resulted in foreclosures and high unemployment rates. At the same time, real estate values collapsed—and banks, in particular, sustained tremendous losses. This economic slowdown was fueled by increased regulatory scrutiny, fewer available loan sources and more conservative lending practices.

While the economy is in better shape today, Jon Huskins, President of Crossbridge Funding Group, says the effects of the Great Recession are still felt today.

“Not surprisingly, our nation’s economic recovery has not been speedy,” Huskins says. “It takes years to recover from economic downturns.”

The Turning Tide of Lending

For the first few years after the recession, loans were hard to obtain and the underwriting process was an even more rigorous process than normal. Now, several years later, banks are more confident in the market. It’s a great time for churches and other nonprofit organizations to refinance or move forward with building projects.

“Banks are still conservative in their lending practices,” Huskins says, “but they are eager for good quality business—and churches are the ideal client.”

He says that with banks competing for business once again, bank liquidity is high and churches can get loans at attractive interest rates. He cautions churches to conduct a thorough review of banks.

“Churches shouldn’t just be looking for a loan, but a funding partner,” explains Huskins. “With more options today, churches should evaluate their choices carefully—not all lenders are the same.”

He points to Luke 14:28-30 as a guide: “For which of you, desiring to build a tower, does not first sit down and count the cost, whether he has enough to complete it? Otherwise, when he has laid a foundation and is not able to finish, all who see it begin to mock him, saying, ‘This man began to build and was not able to finish.’”

What Church Borrowers Need in a Bank Partner

There are a variety of loan sources, including banks, credit unions, denominational lenders and bond companies. Huskins recommends that churches ask potential partners about the following:

  • Experience with nonprofit lending
    •    Volume of church loans closed during the past few years
    •    Underwriting guidelines critical to the decision-making process

The cheapest deal is not always the best deal. In fact, a quality relationship with the bank is as important as the loan itself. A good way to gauge the bank, Huskins says, is by evaluating if the bank is more concerned about their policies or your vision.

How Potential Borrowers Prepare

In order to prepare to move forward with financing or refinancing, churches should:
•    Know how much money you will need
•    Focus on telling a compelling story
•    Professionalize financial statements
•    Model debt impact on operations to avoid debt bondage

The most important element of preparation is the loan package. It should include:
•    Loan purpose and desired loan structure
•    Church history and governance information
•    Organizational documents
•    Financials for the prior 3 years (Banks prefer CPA-prepared statements.)
•    Existing debt schedule
•    Attendance trends for prior 3 years
•    Current operating budget
•    Capital campaign information and results

Additionally, if you’re seeking a construction loan, include the following:
•    Description of build team
•    Background information for builder and architect
•    Copy of the construction contract
•    Plans and specifications
•    Construction schedule It takes time to pull together a comprehensive loan package.

Churches should use available expertise—both internal and external—to prepare.

How Banks Analyze Loan Packages

Just as churches are evaluating lending partners, they, too, are being evaluated and, specifically, their loan packages. Lending partners evaluate the viability of a loan request based on the strength of church leadership, governance processes and the quality of financial statements.

“Documents are judged on whether they are internally or CPA-prepared, as well as whether they are compiled, reviewed or audited,” says Huskins.

Additionally, key bank underwriting guidelines are applied to the evaluation. Specifically, banks assess:
•    Deposits and loans
•    Debt coverage ratio – 1:1 or higher
•    Debt as a multiple of the operating budget – 3 times
•    Debt service as a percentage of the operating budget – <33%
•    Loan to value ratio – 75% to 80%

In addition, lenders analyze church loan packages by other financial considerations, including the number of giving units, attendance trends, prior capital campaign experience, and the dollar amount that the top 15 givers contribute to total operating budget.

Upon Loan Approval

Once the loan is approved, the church will receive a commitment letter that outlines the loan approval. The letter will outline:
•    Debt coverage requirements and frequency of testing
•    Bank approval of additional borrowing
•    Prepayment penalties
•    Financial statement quality and reporting requirements Huskins says to look for key loan covenants that may restrict certain areas of operations.

Lender Selection

In order to avoid the potential hazards incumbent in the lender selection process it is imperative to focus on the following critical steps.

7 Tips for Preparing for Financing

1.    Research banks that serve the nonprofit market.
2.   Don’t approach banks too soon—take the necessary time to prepare.
3.   Model the impact of debt on operations and ministry.
4.   Know the desired loan amount and structure.
5.   Understand the difference between commitment and terms letters.
6.   Avoid prepayment penalties.
7.   Avoid excessive fees and understand closing costs.

The selection of the right banking partner will have implications far beyond the completion of a building project or loan refinance.  The bank selected will not just be the church’s lender but a partner that potentially defines the ministry the church ultimately pursues.

Jon J. Huskins is the President of Crossbridge Funding Group, LLC. He can be reached at 317-514-0262 or

This Article has been supplied to you by T&W Church Solutions as part of our effort to provide growing Churches in our region with relevant information to enhance their ministries and to reach out more effectively to those who do not know the Lord.

Kurt Williams, NACDB CCC, LEED AP, is a Design/Build veteran at T&W Church Solutions with over 25 years in the industry, 20 of those years guiding over 100 churches through the various stages of Planning, Designing and Building their new facilities.  T&W Church Solutions is a Design/Build firm who partners with ministry-focused architects to serve the churches of Central Indiana as well as the only NACDB (National Association of Church Design Builders) Certified Firm in Central Indiana.

The Top 3 Things That Building Committees Wish They Would Have Done Better Before They Built

Evaluating and contracting design and construction services has never been an easy task for the church. In today’s economic climate, the challenge has become exponentially harder as struggling builders are becoming increasingly “creative” in how they represent themselves. Discussions with hundreds of churches that have built has boiled down to a very simple “Top Three” list of advice and wisdom that will help your church make the most important decision, with the most financial risk, that it may ever make. Without further ado, let’s take in the wisdom of those who have already survived the adventure of designing and building a new facility.

The Top Three things that building committees wish they would have done better before they built are:

1.  Check the References of Your Team – Really, Check the References.
2.  Fully Understand the Fees for the Work.
3.  Fully Understand How the Project Will Be Delivered.

“Plans fail for lack of counsel, but with many advisors they succeed”
– Proverbs 15:22

“Blessed is the man who finds wisdom, the man who gains understanding”
– Proverbs 3:13

Check the References of Your Team

Really, check the references! The attitude of “they wouldn’t give us the reference if it wasn’t good” needs to change. Any design and build firm that claims to build problem free, either has not built, or is less than honest. The issue is not “if” you are going to run into a problem, but “when”. That is why you owe it to yourself and the church to check, extensively, the firm’s references. There is a saying that companies have resumes, and people have references. Without a doubt, the people that you will work with will make your project a success, or something less. When speaking with the firm’s references, ask six simple questions:
1. Who were the people that you worked with on your project?
2. What were the problems that took place on your project?
3. How were the problems resolved?
4. Who paid for the problems?
5. How is your relationship with the people that worked on your project?
6. Would you hire them for your next phase?

Fully Understand the Fees for the Work

The primary cost items for a construction project are design and engineering, general condition costs, building construction costs, reimbursable costs, fixture and furnishing costs, and builder overhead and profit.

Faced with the daunting task of choosing the right builder for their project, building committees have resorted to shopping building firms based on their overhead and profit percentage. They believe that overhead and profit are the only variables between builders with the remaining project costs (Design & Engineering, Construction Costs and Fixtures & Furnishings) being somewhat fixed. That assumption is far from accurate. Choosing a builder based solely on their “low” overhead and profit percentage has sometimes become a rude awakening for churches around the country when they finally stumble upon the “hidden costs” of the project.

Many times, attention is gained with a low overhead & profit figure from a builder, only to find later that there are other “costs” the builder has moved into general conditions that have subsequently created a higher actual project cost to the church. When evaluating your design and build team, make sure that the general conditions, costs, and the overhead & profit are identified and carefully compared.

Fully Understand How the Project Will Be Delivered

Church building committees spend countless hours wrestling with the approach they will take to design and build their new facilities, and with good reason. Construction still remains the number two most litigated industries in America today – second only to medical. Almost $.20 of every construction dollar goes towards claims and litigation. So how does a church protect themselves from becoming a statistic, while building positive relationships with their designers and builders? Often the approach taken to design and build is a reflection of the building committee, their comfort with risk, and their personal past experiences with similar projects. Today’s church building committees face a harder task of selecting an approach than their predecessors, due primarily to the “hybridization” of the traditional three delivery systems: Design-Bid-Build, Construction Management and Design-Build. There are distinct Pro’s and Con’s to each approach. Make sure that you understand the pro’s and con’s of the various delivery systems and have identified who (you, the architect or the builder) will be responsible for the different situations that will occur on your building project.

A good Design and Build Team, with a heart to serve the Lord, can make what could be a time of ministry distraction into a time of ministry focus. Selecting a team to serve your ministry should be based on the relationship with the team members that you would be interacting with regularly through the course of the process, the past experience of each team member, and the ability of each team member to synergize with the others to develop cost effective solutions for your project. Every project, first and foremost, is all about God. The next thing a project is all about is people. Great people can steer your church through the landmines of the construction process and protect you and your congregation from the risks that are commonplace in the construction industry.

Kurt Williams is a Design/Build veteran at T&W Church Solutions ( with over 25 years in the industry, 20 of those years guiding over 100 churches through the various stages of Discovering, Designing and Building their new facilities. T&W Corporation is a Design/Build firm dedicated to serving the churches of Central Indiana and is an active contributing member of the NACDB ( Kurt can be reached at

Article as Published in Church Solutions Magazine, Virgo Publishing, January 2009

NACDB Annual Member’s Meeting

Why is the NACDB Annual Member’s Meeting so important?

Waldon Studio Architects | Bay Area Community Church | Annapolis, MD

Waldon Studio Architects | Bay Area Community Church | Annapolis, MD

We are holding our Annual Member’s Meeting on September 29th, 2015! This is a chance for the NACDB members to fellowship, network, and keep up with the ever changing design and construction industry as well as other best business practices.

One of the Presenters at the meeting this year is Leroy Hamm of IHD Corporation. IHD Corporation is an industry leader in pre-screening and personnel development and has been around for 27 years. The firm focuses on human resources services, management, and team development.

While preparing for the Annual Meeting, we ran across this article about conflict resolution and immediately thought about you – the church. Not just businesses can use the tips in this article – your relationships with staff, committees and your congregation can all benefit.

Conflict Resolution By Leroy Hamm

Understanding Human Behavior to Resolve Conflict in Your Workplace

The hope of every relationship is to keep conflict to a minimum; but once you find yourself in a polarized “us vs. them” or “me vs. you” mind set, the challenge is stepping out of the conflict and looking at conflict in terms of interests versus position.

Mutual Interests vs. Position

Keeping mutual interests in focus is paramount to a mutually agreeable resolution of conflict. A domestic conflict which focuses on mutual interests, such as the children’s needs being met, is more productive than a positional perspective where demands come from who gets what on…

To download the rest of this article, click here. More information on IHD Corporation can be found here.

Check back later for updates on the 2015 Annual Member’s Meeting!

You can receive receive updates by checking out our Facebook and our Twitter pages!

Open Letter to The Church Building Committee – Part II

Dear Building Committee,

Parkway Baptist Church | Smyrna, TN

Parkway Baptist Church | Smyrna, TN

There is a lot to consider when you’re launching on the journey toward a new building, addition or renovation for your church. Here is more food for thought as you continue the process.

  • Get your banker on board early.

So often, churches advance the project design and procure construction estimates without knowing the exact amount they can borrow. Only late in the process do they discover that what they thought they could borrow is less than the amount they can qualify for.

The bank needs to be on board right after the capital campaign is complete and when the design is in the very early stages. While interest rates are important, good service from your banker is even more important.

  • If your church is going to embark on a capital campaign, secure an outside consultant to assist and guide the process.

Well-run capital campaigns usually raise 1.5 times the annual church budget. Outside consultant fees may not be small, but the expertise and counsel pays great dividends. I have watched many churches try to create and manage their own campaigns, and then fall way short of their goals.

Trying to run your own campaign is also a huge disruption to the staff and your ongoing ministries. Church staff and volunteers are already shorthanded anyway; let the experts do what they do.

  • Your staff and your ministries are more important than the church building. This goes back to designing to a budget. Is your church adequately staffed? Is the staff paid appropriately? The building program should not block action and forward progress in these areas.
  • The facility must be balanced.

Seats in the sanctuary drive everything else.

Once the appropriate number of seats is established, you can then determine the right amount of parking, education space, children’s space, etc. to support that number. As the church grows, all of these areas must grow with it.

  • Parking is critical. Please do not try to save money by reducing parking spaces. The amount of parking you need to attract and keep visitors is much greater than the minimum numbers your area’s Codes department will require. Work to meet the needs of visitors, not to meet code requirements.
  • Location is critical.

A church might be able to open its doors in a hidden or neighborhood location, but survival and healthy growth cannot be sustained “off the beaten path”. Buying cheap real estate will kill a church.

Jesus moved on the busy roads. Vibrant churches are located on the busy roads.

Employing best practices from the very beginning will pay tremendous dividends throughout the construction process. With a well-defined process, you, your congregation and outside experts can accomplish your goals on time, with a quality result and on budget.

Dow Smith, DowSmith, Certified Church Consultant and NACDB Member

DowSmith is an NACDB member and over the past 10 years, they have designed and constructed dozens of churches, functioning as a key partner and extension of each church’s Building Committee. They also bring to their work ongoing and extensive experience in other industry sectors, applying that knowledge to further improve their church-building process.

Copy used with permission from Dow Smith. The original PDF can be found at their website:

Open Letter to The Church Building Committee

Church-building doesn’t have to be a grueling process. Using key principles, you and your congregation can work together effectively with outside experts to accomplish your goals, on time, with a quality result and on budget.

Murfreesboro, TN Dow Smith Fellowship Bible Church

Murfreesboro, TN | Dow Smith | Fellowship Bible Church

Dear Building Committee,

As you begin this journey toward a new building, addition or renovation for your church, we’d like to offer some possibly helpful thoughts and experiences.

    • First, consider the makeup of your church-member planning and construction team. Make sure your team is made up of people who match the diversity of your congregation. We do not need “construction people” right now. Nor do we need “developers” or “businesspeople.” We need a 5-to-7-person team of your church members who are involved in all aspects of your church’s ministry. This group should have a genuine love and understanding of your staff, your children’s ministry, your youth ministry, your adult ministry and your community outreach programs.
    • Then, develop a good master plan. Yes, you know you need a _____________(insert bigger sanctuary, larger auditorium, bigger fellowship hall, more children’s ministry space, etc.). Decide early on where these key programs can be placed in this addition or in future additions. A good master plan is more than just different blocks of color on a design schematic; it is a guiding document that outlines complete pedestrian and vehicle flow, from one end of the property to the other, both today, with this project, and tomorrow, with possible future projects. A good master plan can also tell us a church is at its maximum capacity at its current location.
    • Design to a budget. Set the budget first. Don’t begin with the design. You can’t allow the design to determine the budget—that is backward planning. You may need to borrow money, but your mortgage payments should not exceed 25% of the church’s operating budget. You may need to mount a capital campaign, but there is only so much you can raise within the church family. Yes, God’s provision is much bigger that any of us can imagine, but we still need to operate in current reality. Well-run capital campaigns that employ outside consultants usually raise 1.5 times a church’s operating budget.
  • Hire your architect and your contractor at the same time or very soon thereafter. Architects have many skills and gifts, including how to design space and structures. However, when you’re able to have a cohesive team from the very beginning, you get more communication and are able to mitigate issues. That’s why you need a construction firm on your team very early in the process so you can develop accurate cost estimates as the design develops.

The design-build delivery method is an option that will accomplish this goal. Select your contractor the same way you selected your architect. The “low bid” approach isn’t a best practice approach, and ends up damaging the process and the result every time. Church-building doesn’t have to be a grueling process. Using key principles, you and your congregation can work together effectively with outside experts to accomplish your goals, on time, with a quality result and on budget.

Dow Smith, DowSmith, Certified Church Consultant and NACDB Member

DowSmith is an NACDB member and over the past 10 years, they have designed and constructed dozens of churches, functioning as a key partner and extension of each church’s Building Committee. They also bring to their work ongoing and extensive experience in other industry sectors, applying that knowledge to further improve their church-building process.

Copy used with permission from Dow Smith. The original PDF can be found at their website:

What is Gossip?

How do we keep gossip from going ‘unchecked’ in the church?

By: Leroy Hamm, IHD Corporation, NACDB Member

Gossip is the most poisonous kind of speech one can have. It has the power to destroy a church, a relationship, a family, a company, etc. How do we control such a powerful force? How do we, as church body, stop this force from tearing apart our lives? We can control such a force with determination, discipline, and dedication.

The eighteenth century English author, Robert Burns, is quoted as saying, “The best laid schemes of mice and men oft go astray.” Many a man’s or woman’s best laid schemes, fondest dreams and greatest hopes have been dashed by the insidious poison of gossip. Organizations have been torn asunder by gossip.

Gossip, in its most malicious form is attacking a person in a forum in which he is not present to defend himself. In its more subtle form, gossip can be defined as “casually sharing detrimental information with others who are neither part of the problem nor part of the solution.” Gossip creates rumors that, if left unchecked, take on a life of their own.

During World War II the U.S. Armed Forces printed posters warning that “Loose lips sink ships.” Many an organization’s ship has been sunk by idle (or not so idle) gossip.

There are two kinds of gossip: innocent and malicious. One can be just as destructive as the other. The following are possible reasons people gossip:

1. An individual has been hurt and retaliates in anger.

2. An individual is afraid to confront directly.

3. He or she has a need for attention and approval from certain others to feel accepted.

4. An individual has the desire to build his or her own position artificially by tearing down others.

5. They want to even the score and get their power back. They do not feel free to act out their aggressions overtly.

6. Habit. We get used to relating through gossip.

The only conditions under which we should talk about someone are:

1. It must be the truth.

2. It could be said with that person present.

3. If for whatever reason it would not be appropriate to have that person present, then the person you’re sharing your comments or concerns with must be part of the solution.

While shopping in a local discount store, I overheard a young man say to a fellow cashier, “Do you think Sara Ann (not real name) is two faced?” If you have gossiped about a person, take a fearless moral inventory of your motives for doing so. Ask yourself, “Have I been hurt and feel the need to retaliate in an indirect way? Am I afraid to confront directly? Do I need approval and am I attempting to get acceptance from the individuals to whom I am gossiping? Am I attempting to elevate my own position formally or informally by tearing the other person down with gossip? Have I gotten used to a damaging habit?

Someone once asked me, “What if I am just sharing my opinion?” If the motive of sharing your opinion is to discredit someone else or build yourself or your position up, then you need to keep that opinion to yourself and assess your motive because your opinion has become gossip.

If someone begins gossiping to you, ask them, “Have you talked to (the person) about this?” or “I don’t see that person that way at all,” or “What does that have to do with what we’re talking about?” Remember, gossip is an unhealthy foundation for a relationship. If someone gossips about another around you, then they will gossip about you around another. Your “real” influence of those around you diminishes the more you gossip.

The practice of gossip in many organizations goes unchecked and unchallenged but its damage is far reaching in time and space. I recently heard an ousted leader of an organization return to reconcile himself to the group that had ostracized him eight years earlier. He said to them, “If I had done half of the things I later heard I had supposedly done, I would not be worthy of standing before you.” Ihara Saikaku, a seventeenth century Japanese author said, “There is always something to upset the most careful of human calculations.” That something all too often is gossip.


Leroy Hamm is a member of the National Association of Church Design Builders and also the President of IHD Corporation, a leader in pre-employment assessments and seminars on interviewing and communication skills. In 1987, Mr. Hamm founded IHD Corporation to train companies in the use of the DISC II and Achiever assessments.

To learn more about IHD Corporation, visit their website at