Faith-based buildings and properties are more than just physical structures. They are sacred spaces that serve as places of worship, community, connection, and spirituality for many people. However, maintaining and managing these spaces also requires financial planning and stewardship. In this blog post, we will explore some of the financial aspects of faith-based buildings and properties, including budgeting for repairs, renovations, and community spaces.
Budgeting for Repairs and Renovations
One of the main challenges of faith-based buildings and properties is keeping them in good condition and up to date. This requires regular maintenance, cleaning, and repairs, as well as occasional renovations and upgrades. Depending on the size, age, and style of the building, these costs can vary significantly.
According to a study by the Lilly Family School of Philanthropy, the median annual spending on building maintenance and utilities for congregations in the US was $28,000 in 2018. However, this amount ranged from $3,000 to $1,200,000 among different congregations. The study also found that 40% of congregations had major repairs or renovations in the past five years, with a median cost of $50,000.
To budget for these expenses, faith-based leaders need to assess the current condition and needs of their buildings and properties, as well as anticipate future projects and improvements. Some of the factors to consider include:
- The age and history of the building
- The architectural style and design of the building
- The materials and systems used in the building
- The climate and weather conditions in the area
- The usage and occupancy of the building
- The codes and regulations that apply to the building
- The availability and cost of contractors and suppliers
Based on these factors, faith-based leaders can estimate the frequency and cost of maintenance and repairs, as well as prioritize the most urgent and important projects. They can also plan for contingencies and emergencies by setting aside a reserve fund or an emergency fund.
One way to create a budget for repairs and renovations is to use a line-item or incremental budgeting method. This method takes the previous year’s budget and makes adjustments based on inflation, changes in income or expenses, or new projects or goals. This method is simple and easy to follow, but it may not account for significant changes or opportunities.
Another way to create a budget for repairs and renovations is to use a zero-based or base budgeting method. This method starts every year with a zero-dollar balance and requires every expense to be justified based on its value and impact. This method is more comprehensive and flexible, but it may also be more time-consuming and complex.
Budgeting for Community Spaces
Another financial aspect of faith-based buildings and properties is creating and maintaining community spaces. These are spaces that serve as venues for social, educational, cultural, or recreational activities for members or guests of the congregation. Examples of community spaces include:
- Fellowship halls
- Classrooms
- Libraries
- Gyms
- Cafeterias
- Gardens
- Playgrounds
Community spaces can enhance the mission and vision of a faith-based organization by providing opportunities for outreach, engagement, learning, service, and fellowship. However, they also require financial resources to build, operate, maintain, and improve.
According to the same study by the Lilly Family School of Philanthropy, the median annual spending on program expenses for congregations in the US was $18,000 in 2018. However, this amount ranged from $1,000 to $2,000,000 among different congregations. The study also found that 29% of congregations had major additions or expansions in the past five years, with a median cost of $150,000.
To budget for these expenses, faith-based leaders need to assess the current demand and supply of community spaces in their area, as well as evaluate the benefits and costs of creating or expanding them. Some of the factors to consider include:
- The size and demographics of the congregation
- The needs and interests of the congregation
- The availability and accessibility of existing community spaces
- The compatibility and alignment of community spaces with the faith-based values and goals
- The potential revenue or savings from community spaces
- The legal and ethical implications of community spaces
Based on these factors, faith-based leaders can estimate the feasibility and viability of community spaces, as well as allocate resources accordingly. They can also seek alternative sources of funding or support for community spaces, such as grants, donations, partnerships, or rentals.
To help you with creating a tracking worksheet, we have included a template that you can use or modify as you wish.
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Faith-based buildings and properties are sacred spaces that require financial places. By budgeting wisely for repairs, renovations, and community spaces, faith-based leaders can ensure that their buildings and properties serve their congregations well and faithfully reflect their missions.
Chazin & Company
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