Cheap Shower Curtains (and church facilities)

If you have read my blogs for just about any time at all, you know that I am a big Seth Godin fan.

Recently he posted a blog entitled “Cheap Shower Curtains” that really caught my attention. Here is an excerpt:

The unskilled cost accountant might suggest you outfit your new hotel with cheap shower curtains. After all, if you save $50 a room and have 200 rooms, pretty soon, we’re talking real money.

On the other hand, experience will demonstrate that cheap shower curtains let the water out, causing a minor flood, every day, room after room. And they wear out faster. Cheap shower curtains aren’t actually cheap.

This is so in line with one of our recent blogs – “Cheap Is No Bargain”

Let’s take the analogy above a little further:

PERCEIVED SAVINGS: – $50 x 200 rooms = $10,000

AFTERMATH COSTS:

  • Damage to the floor and substrate of 200 rooms
  • Ceiling damage from water leaking from rooms above – about 75% of the 200 rooms requiring patch and repaint
  • Potential unseen issues such as mold, wet insulation, water migration to electrical fixtures, etc.
  • Increased humidity issues due to moisture causing HVAC to work “harder” to obtain comfortable levels
  • Replacement of floor covering to all 200 rooms
  • Loss of revenue due to repairs being made
  • Truncated life cycle of 200 shower curtains (this will be at least the cost of the original savings but at inflated dollars)

I am not going to venture a cost for the above…but I would say it is fair that it will be at least 10 times (and I actually believe it is 25-50 times) the perceived savings. So, unless your intent was to sell the hotel within the first few months of completion, you have just made an incredibly unwise decision. BY THE WAY: If you did plan to sell, you just sold a money pit to your buyer, damaging the one thing that really counts…your integrity and reputation. Another unwise decision.

“But Tim…we are not building hotels…we are a church.”

Right…all the more reason to not make such unwise decisions as you are utilizing Kingdom dollars entrusted to you and your church. You have been asked to steward them…not just on the “spending” of the initial costs/purchases, but of the long term value. The principle is the same whether you are building hotels, shopping centers or investing monies into the construction, renovation or sustaining your ministry facilities.

Sounds a lot like Facility Stewardship.

Church Revitalization: Boat Anchor OR Fresh Wind in the Sails?

Church Revitalization is alive and well.  This is not the “Church Growth” movement of the 1980’s or “Seeker Sensitive” or some other fad. Frankly, “CHURCH” revitalization has less to do (in my opinion) with the age or condition of a congregation as much as a revitalization of the purpose (the WHY) of the church universal.

We have seen some incredible initiatives the past 10+ years related to revitalization and church multiplication. The most obvious and most publicized are Church Planting and Multisite Church. Both are alive and well and growing in impact.

“We need to be cognizant to not burden the next generation of church leaders with facilities that will become the boat anchor around their ministry and missional impact.”

But there has been an upswell of 2 additional initiatives that need to be mentioned.  These may be subsets of the above; however, they bring an additional set of impactful elements and I believe they have significant nuances that need attention:

  1. Mergers – Our team has served several churches the past few years that have merged to not just “rescue” a declining church, but rather to form a stronger, more vibrant and impactful church. As Jim Tomberlin and Warren Bird have so well stated – BETTER TOGETHER!
  2. Revitalization/Redeveloped/Adoptive Re-Use – So many terms we could use here…but we see a trend (for the good) of revitalization and adaptive use of facilities that have either aged out or are underutilized and/or a “highest and best use” that may not be exclusive of a 1-day-a-week church facility.

A deeper dive into the above is merited, but that is for another day. Instead, I want to share a concern I am seeing with both of the above when we are not intentional. Both of the above are exciting…and they are a great way to not only grow the Kingdom/Church (capital “C”) but to breathe new life into aging church facilities.

HOWEVER…there are 4 critical considerations that both the “giver” and the receiver of such facility gifts need to consider:

1. Functional Obsolescenceis a reduction in the usefulness or desirability of an object because of an outdated design feature, usually one that cannot be easily changed. Here are some prime examples:

  • Not handicap accessible
  • Inadequate HVAC system
  • Flow feels more like a maze than an intentionally community space
  • Lots of stairs
  • “Wrong-sized” spaces
  • Limited parking

2. Incongruent/Non-contextual – In many cases, the “gift” does not communicate the story of the receiver. It may be in the wrong part of town…may feel like a monastery and not a thriving community-centric facility…or it may just be old looking, feeling, and smelling.

3. Deferred Maintenance – “Here is your FREE Building.” – Oh Goodie…but what about the $3-4M in deferred maintenance. Don’t miss this. I have seen too many well intended churches and church planting organizations hand over an older facility to a church plant or even a multisite campus that appears to be “free” only to find they had been give the MONEY PIT. Free is rarely ever free.

4. Uninsurable – Directly related to the above, make sure the facility being gifted is actually insurable. Put yourself in this scenario…you are the pastor of a church plant…you are gifted a facility only to learn that the facility in not insurable or the insurance cost, due to its condition, has massive deductibles and/or unsustainable premiums. OUCH!

We need to be cognizant to not burden the next generation of church leaders with facilities that will become the boat anchor around their ministry and missional impact.


4 Steps to Conquering Deferred Maintenance

Deferred maintenance is a term that gets thrown around a lot and yet I find many people have no real idea what it means. Let’s start with a definition:

Deferred maintenance is the practice of postponing maintenance activities such as repairs on both real property and personal property (i.e. machinery) in order to save costs, meet budget funding levels, or realign available budget monies. The failure to perform needed repairs could lead to asset deterioration and ultimately asset impairment. Generally, a policy of continued deferred maintenance may result in higher costs, asset failure, and in some cases, health and safety implications. (Wikipedia.com)

In a previous blog entitled “The “4 X” Reality of Deferred Maintenance” we provided some very sobering realities from national research projects…here they are again:

“Every $1 in deferred maintenance costs $4 of capital renewal needs in the future.”

“If a necessary repair is deferred and allowed to remain in service until the next level of failure, the resultant expense will be 30-times the early intervention cost.”

If those 2 statements do not shake you up a little, then you may need to see a doctor or psychiatrist. If you believe EVERYTHING belongs to God…and that HE has ENTRUSTED His ministry facilities to us to STEWARD…then you cannot take this lightly.

Let’s explore what the keys are to conquering deferred maintenance.

1. Identify YOUR deferred maintenance – The first step in nearly any issue in life is to first recognize there is an issue. If we do not acknowledge there is an issue, how can we resolve it? In most churches, there is a lack of understanding of what their deferred maintenance issue are. We get so busy with budgets, “doing church”, break/fix items, etc that we do not stop to take time to see the trees for the forest. In many cases, even if you took the time, you may not know what you are looking for. This is where a set of “FRESH EYES” can be beneficial.

2. Provide adequate general maintenance budgets – Over the past couple years, we have done facility assessments for several million square feet of church facilities. The aggregate amount of deferred maintenance has been in the tens of millions of dollars. That is sad!  The “church” claims to be an organization focused on being “good stewards” and yet we allow our buildings to deteriorate right under our feet. In every single case, the General Maintenance budget was under-funded. There was not enough money in the budget to keep up with the natural rate of physical deterioration. Check out this quote from Kevin Folsom, former Facilities Director at Dallas Theological Seminary:

“There are numerous levels that can be used to go about this, but to start we have to remember our early Physics lessons in high school about the 2nd Law of Thermal Dynamics. Everything we build will decay, but it may last longer if properly maintained. So, here’s a puzzling question…If we build facilities that the natural law causes them to decay at fairly predictable rates throughout its birth to burial, why do we not plan for it?”

The best way to conquer deferred maintenance is to have a budget that addresses the natural decay and deterioration of your facility.

3. Properly “staff” your facility team – In every instance referenced above, not only was the budget under-funded, but they were under-staffed…and not by just a little! If you only have enough staff to address the break/fix emergencies of the urgent, then how do you expect to stay on top of the natural decay and deterioration? Quick answer…YOU CAN’T! Based on national surveys by our firm and IFMA, we believe the number of facility staff for a well-run organization is one Full Time Facility Staff Employee for every 25,000 – 35,000 SF. This is not for cleaning…that is another story…this is for general maintenance.

4. Have a Properly funded Capital Reserve PlanGentlemen…this is a football! Church leader…capital replacement is not an “IF” consideration but rather a “WHEN” and “HOW MUCH”.  You WILL replace every HVAC unit.  You WILL replace all your carpet.  You WILL replace your roof. You WILL have to re-surface your parking lot. To turn a blind eye to the need of a capital reserve fund is kin to telling God that the laws of science and natural resources…that HE created…don’t apply to your church. You are above the laws of God. REALLY?!?! Do you have a 401K or similar account for the future or do you assume retirement or old age is not part of your future…that it does not apply to you?

If we were proactive with our operational budgets and capital reserves, there would not be any deferred maintenance. In a perfect world, we would properly fund our general maintenance budget to keep the building in the best physical condition as possible…AND…we would have adequate capital reserves when we approach “end of life” of our facility component.

That is how you conquer Deferred Maintenance. To quote Sean Connery in The Untouchables“What are you prepared to do?”


CAPITAL RESERVE PLANNINGAlmost every component of your facilities will have to be replaced at some point. Do you have an action plan? INTENTIONAL organizations plan today for tomorrow’s costs. That’s why it’s critical you establish a capital reserve account now.

Download our FREE guide to learn more. 

 

Facility Stewardship – What Is It?

For over 10 years, you have seen me refer to facility stewardship. For some of you this may be still be a new concept. You know what a facility is and you are familiar with stewardship…but how do the 2 go together? I am glad you asked…

Let’s first look at the definition of each:

FACILITY (ies) – something designed, built, installed, etc., to serve a specific function affording a convenience or service.

STEWARDSHIP – (act of being a STEWARD) – a person who manages another’s property or financial affairs; one who administers anything as the agent of another or others.

If you have grown up in the church or been involved in church for any period of time, you have heard the term “stewardship”…and I am sure that in almost every case, it revolved around money or raising money. In these cases, we are generally talking about financial stewardship which is critical to our spiritual life as well as the life of our ministries.

The word “money” is used over 140 times and if you add terms such as “gold” and “silver” the number is huge. For example, financial matters are mentioned more often in the Bible than prayer, healing, and mercy.

But stewardship is not just about money and finances…but refers to (as its definition above indicates) the caring for or oversight of something of someone else’s. The EPA has a section on their website that explains “Environmental Stewardship”. They define it as:

Environmental stewardship is the responsibility for environmental quality shared by all those whose actions affect the environment.

So, how do we apply this to our ministry facilities? Do we really believe that God has entrusted these to us, thus making us stewards of their care and oversight? As I have shared before, I have witnessed churches and ministries spending millions of dollars in the construction and renovation of their facilities…but then fail to maintain them (i.e. steward them). They wave the banner of “stewardship” when raising money to build them…but then neglect their care, management and maintenance. So, the following is a list of attributes that I believe are part of “Facility Stewardship”:

  • Proper cleaning
  • Systematic and proactive Preventive Maintenance
  • Proactive Capital Reserve Account planning
  • Life Cycle analysis and planning
  • Development of a systematic painting plan
  • Proper facility scheduling – this is a key element of stewarding the facility…they were meant to be used
  • Sustainability implementation
  • Vigilant monitoring of operational costs
  • Implementation of energy saving processes (i.e. HVAC interface with a Building Automation System or WiFi thermostats of better yet)
  • Proactive cataloging of facility components and tracking of work orders and service requests

With the above as a backdrop, how are you doing with your Facility Stewardship? What can you implement immediately that would make you a better steward?


The “Real” Cost of Facility Ownership: What They Didn’t Teach You in Seminary

As many of you know, I come from a background of planning and building ministry facilities. I have been blessed to invest over 30 years of my life in serving churches to develop new and renovated ministry facilities. That phase of my life brought me great joy and fulfillment. But now I am very burdened by the millions…and billions of dollars that are spent each year on religious construction without a clear understanding of the “real” cost of ownership. I also think that most ministry leaders do not understand that the ongoing costs eclipse the initial costs and do so in a much bigger way than you would imagine.

Let’s look at the REAL cost of ownership of our ministry facility:

  1. INITIAL COST: For this exercise, let’s assume that our new ministry facility is 30,000 SF for $4,777,550
  2. COST OF “MONEY”: Let’s assume that we borrowed $3,000,000 to pay for the project and we did so based on a 15 year loan at 6%…but paid it off in 7 years. In this scenario, you will have paid approximately $1.1M in interest.
  3. COST OF OPERATION: Based on our research and bench-marking provided by IFMA (International Facility Managers Association), the average church in America will spend $4.50 to $7.00 per square foot annually for janitorial services, utilities and general maintenance. In addition, a church will spend an additional amount in capital improvements that will be in the $1.00 to $2.00/SF range (if the capital reserve account is started at the time construction is complete…this number grows significantly higher if you neglect the capital reserve account during the early years of the building’s life cycle). For the sake of this exercise, let’s assume that we will spend $6.00/SF for operational and capital reserve items. This may be low…but I want the calculations to be realistic.

Assume a 40 year life cycle (which is not that long)…at 1.5% per year of inflation. Remember that operational costs are perpetual and paid for with inflated dollars…so this is going to increase, and 1.5% is probably TOO LOW. $210,000/ yr x 40 years at 1.5% per year inflation for 40 years…without compounding = $13,440,000.00

So let’s look at what this means:

  1. Initial costs including design – $4,777,550
  2. Cost of Money – $1,100,000
  3. Cost of life cycle operations and capital reserve – $13,440,000 (that is $448/SF…OUCH)
    TOTAL COST OF OWNERSHIP = $19,317,550

WOW…that is a BIG number…now…here is the shocking part:

  1. The combined cost of the construction partner and the design professionals is only 3% of the total cost of ownership.
  2. The construction cost…including the design…is only about 22% of the total cost of ownership.
  3. The interest paid is only about 6% of the total cost of ownership.
  4. Leaving…71% of the total cost of ownership in operation costs and capital expenditures.

As I indicated prior, State Farm Insurance found that they spend about 80% of the total cost of ownership of commercial buildings on operational costs over 40 year. Further, a book was published in 1969 by THE AMERICAN INSTITUTE OF ARCHITECTS entitled – LIFE CYCLE COST ANALYSIS 2: USING IT IN PRACTICE by David S. Haviland. In this book, Mr. Haviland states:

“The INITIAL DESIGN and CONSTRUCTION of a facility comprises about 15% of the total cost of a building over its 40 year lifespan. The remaining 85% is made up of the building’s OPERATIONS and MAINTENANCE COSTS.”

So…what costs more…the initial cost…or the cost after you occupy? I think the numbers speak for themselves. So…do we invest the same amount of time and energy in planning our operational costs as we did when we developed our master plans and floor plans? Why do we get all in a tiff about an architect charging 7% instead of 5%…or the construction partner charging 6% instead of 3%? The fees that encompass only 3% of the total cost of ownership feel so important at the time we hire them…but the decisions, direction, means and methods that this team suggests and implements will be with you for the life of your buildings. Do we have our eyes on the REAL cost of facility ownership?

If Facility Stewardship is really about being wise stewards of all God has entrusted, then I think it is fair to say that most of us have our priorities upside down. Facility Stewardship must include:

  1. Purposeful Facility Planning – Taking the time to really evaluate the “genetic code” of the church, reviewing the vision, determining IF facilities are needed to accomplish the vision and mission of the church in addition to evaluating the potential financial implications.
  2. Proper Facility Development – This is not just about construction…but also encompasses the financial stewarding of the resources God has entrusted to us by planning facilities that meet the ministry objectives…AND…that do not bankrupt the church in the future with operational costs. As seen above…most of your long term cost of facility ownership WILL BE established based on the planning during this phase of any project.
  3. Proactive Facility Management and Long Term Care – This is where we too often fall grossly short in our Facility Stewardship Initiative.
    Think about it…then do something about it.

Do you need some help getting started? Don’t forget to order your copy of our manual –   Facility Stewardship: Managing What God Has Entrusted To You. It is a must have for every church that has a facility!


 

4 Reasons Why Every Church Budget Should Include a Capital Reserve Line Item

I am a big fan of the men in the Rainer Family…you know…Thom, Sam, Jess and Art. These men have been a great encouragement to me and their support of our work has been incredible. We have posted blogs in the past from Thom and Sam…but not Art…until now. We are excited to have a blog by Art Rainer. Art’s passion for Biblical Financial Stewardship is infectious and it so mirrors our passion for Facility Stewardship (aren’t they really one in the same???).

Thanks Art for sharing your wisdom, passion and heart!


In personal finances, we all know how important it is to have an emergency fund. Unforeseen, costly events happen. Sometimes they are relatively small—a tire goes flat or a washing machine stops working. Sometimes they are big—a job is lost. Having money set aside for these purposes is key to financial health.

But what about churches?

Churches face a similar predicament. The inevitable unforeseen cost is just around the corner.

Capital reserves are funds set aside, specifically for facility improvements or repairs. And sufficient funds set aside for these improvements or repairs are the result of very intentional planning.

“To start setting aside funds for future capital needs, church budgets must include a line item dedicated to accomplishing this goal.”

To start setting aside funds for future capital needs, church budgets must include a line item dedicated to accomplishing this goal.

Here are a few reasons why every church budget should include a capital reserve line item:

  1. Church facilities tend to get older, not younger. This may surprise you, but your church facilities will not improve on their own. Unfortunately, many churches budget as if their facilities will never deteriorate, that the air conditioning unit will work forever. Having a capital reserve line item acknowledges reality—facilities get worse over time, not better.
  2. You never know when a major capital expense will hit. Our best plans fail, even for capital repairs. Many church facility problems come as a complete surprise. You didn’t anticipate the roof leaking that day. You thought you had, at least, another year on your air conditioning unit. But here you sit, in a hot, leaking church building. A capital reserve line item helps ensure you have money set aside for unfortunate surprises.
  3. Capital reserves will increase confidence and decrease stress. Capital reserves increase you and your church members’ confidence that the budget will not be derailed by a major facility expense. Capital reserves also decrease the stress that comes from knowing you are not prepared to withstand an unforeseen capital expense.
  4. The absence of capital reserves will cannibalize ministry funds. When expenses must be reduced because of an  unforeseen capital expense, it is the ministry budgets that typically take the largest hit. This happens because ministry budgets are typically not seen as a fixed cost. Variable expenses, like ministry dollars, are almost always reduced before a church’s fixed costs.

Churches need funds set aside for capital expenses. Some of these expenses are anticipated, while others come as a complete surprise. To start saving money for inevitable repairs and improvements, make sure to include a capital reserve line item in your budget.

Envelope3.com is a website dedicated to helping churches better understand their budget. A church budget is a vital, but often overlooked, tool for church leaders. A church budget is a blueprint for mission. Church leaders can get their church budget analysis and comparison for only $19.97! Be sure to check it out.


Living in Wake Forest, NC, Art’s curiosities center on faith-infused leadership, marketing, and life observations. Such interests fueled his authoring of several articles and two books, Simple Life and Raising Dad.

Art earned his Master of Business Administration at the University of Kentucky and is currently a doctoral candidate in business administration. Art serves as the Vice President for Institutional Advancement at Southeastern Baptist Theological Seminary and is co-owner of Rainer Publishing.

WOW – You Offer THAT?!

The other day I was contacted by a man from a church who was working with a committee he had established to help his church understand the importance of taking care of and planning for the inevitable future costs related to their church facilities. He had downloaded one of our eBooks (Church Facility Stewardship) and was interested in other resources to make his case.

As I started to compile a response, I paused and stared at the screen…WOW – THAT IS INCREDIBLE! As the email developed and the list grew, I was frankly humbled and blown away with the resources that we have been able to make available to churches across the country.

If you have not checked out what we have developed (many resources are free) and what services we provide…just take a look at the list below.

  1. 5 Intentional Steps to Establish a Capital Reserve Account –  Free eBook – This was written as a primer for churches that are starting from Square 1 with a capital reserve.
  2. Church Facility Evaluator – Free tool to evaluate some of the key operational metrics/costs of a church related to national averages.
  3. Church Facility Stewardship Manual – Almost 300 pages of information for any church to use to establish and further their facility management initiatives.
  4. Other Resources – We have written a number of books and other material.
  5. Assessments/Training – We also provide a number of assessments and training.
  6. Life Cycle Calculator – This is a free software that will help ANY organization establish their capital reserve plan and project funds needs and when.
  7. eSPACE – Facility Management Software – We originally developed this software suite for churches, but since 2008,  we now have private and public schools, colleges, YMCAs, municipalities and other facility/property managers. In addition to the free Life Cycle Calculator from above, we have subscription offerings for:
    1. Event Management 
    2. Work Order Management
    3. HVAC Integration 
  8. Church Facility Management  Solutions – This is a new membership website that we recently released…VERY excited about this!

If your church has a facility…you need to familiarize yourself with the above items and take advantage of the best set of tools to help you be a GREAT steward!


Keys to Success in Uncertain Times

A few years ago, I attended a conference sponsored by Shelby Systems. On this particular day, the guest speaker for the session was Mr. Dan Busby, President of ECFA  (Evangelical Council for Financial Accountability). This was one of the best plenary teaching times I have heard in some time. Dan is one smart guy…and has tremendous insight regarding financial issues. But what stuck with me, was his passion for the Lord and His people. This was so refreshing to me…so…I asked Dan if I could share the outline that he taught from…for which he graciously consented…thanks Dan.

KEYS TO SUCCESS IN UNCERTAIN TIMES (I would add…for all times)

  1. Practice Integrity – Integrity has no need for rules. (This really struck me…how many of us try to legislate integrity?)
  2. Talk Straight – Let your yes be yes…and your no be no
  3. Listen Aggressively – “When was the last time you were criticized for listening too much?” (Norm Augustine – Lockheed Martin)
  4. Ignite Trust – Low trust exposes everything (this concept is further explained in the best selling book “The Speed of Trust” by Stephen MR Covey)
  5. Create Margin – In all you do…including but not limited to time, personal finances, business finances, commitments, etc. (A great resource for this is Margin: Restoring Emotional, Physical, Financial, and Time Reserves to Overloaded Lives by Richard A. Swenson)
  6. Require Simplicity – “If you cannot explain something simply, you don’t know enough about it.”  ~Albert Einstein
  7. Insist on Flexibility – While we can learn from history, history has never been here before.

Dan finished the session by saying, “Success is having clearly defined goals consistent with God’s plan and faithfully meeting them with integrity.”

These are great lessons for all of us…whether in business, church leadership, or our families.


Why Use Facility Management Software for Your Church: Part 3

Welcome to Part 3 of our series on Why Use Facility Management Software for Our Church.  You can see the first 2 segments on our BLOG page.

In summary, we have established common language for this discussion and explored the first 2 most obvious reasons for using facility management software (Be intentional and Central Database/Repository).

Now, let’s expand that list and look at a number of other factors in making the right decision for your church/ministry:

  1. Hit by a truck: What would happen to all of your data, plans, procedures, systems, process, etc if the key facility person at the church was (heaven forbid) hit by a truck? Would you lose all of the data that is squirreled away in their head? Would you find yourself starting from scratch? What things might go undone or undetected until something major broke-down? Would you know where all of the files were stored and what vendors had contracts with the church or what promises had been made? I have met dozens of great facility managers. They know their facilities like the back of their hands and they are invaluable to their church. But…what if suddenly they were gone? Would you be prepared?
  2. Long Term Capital Improvement Planning: We have been pretty surprised by how many churches do not have an active “sinking fund” or some form of capital reserve process. When we ask them about their planning process for major capital expenses (i.e. replacing flooring, replacing HVAC equipment, resurfacing parking, etc), the oh too common answer is…”we wait until it breaks and then replace it.”  OUCH…that does not sound like planning! It is funny that we generally do a tremendous job when we plan for a building expansion or new construction project. We set aside money in a building fund…evaluate the costs…and plan accordingly. However, we find it more common than not that this level of proactive planning dies when a church moves into the building. Having a proactive means to project and plan for future capital expenditures is a key factor in using facility management software.

    “Trying to keep all of this in your head or on a legal pad will only increase the stock value for Advil.”

  3. Prioritize work: Does the “urgent” take precedence over the important? Does that last e-mail or call take you off task? Ever walk into the office and know you have a  million things to to…but don’t know where to start? Do you feel like you have a mountain of work…e-mail or projects or emergencies?  Well…you are not alone. Frankly, I feel exactly like that as I am typing this. I have a fence to repair, bills to pay, accounting to update, and so much more.  Well…the use of a software solution can be a tremendous asset to staying on point and keep work prioritized. If it was not for Outlook, I would forget where I am to be, everyone’s phone numbers and even when to take certain meds (I know…I am a mess). If it was not for my PipeDrive account, I would not be able to stay on task with the people I need to follow up with or to get a proposal. Facility management software can do the same thing for your facility team. It can set the priority of the work, set an ETA for the work to be complete and send e-mail alerts and reminders. Trying to keep all of this in your head or on a legal pad will only increase the stock value for Advil.
  4. Manage Vendors: Who is approved to work on your site? How do you track their names, addresses, e-mails, phone numbers, etc? How do you dispatch work to the vendors? Fax? Phone? Smoke signals? Most good facility management software solutions will, at the very least, provide a section to list all of the pertinent data about your vendors and subs. This is a necessity. The better systems will also provide a means for assigning work orders to vendors and dispatch the work orders via an automated system through e-mail, text messages or some similar method. We believe that these tools are vital to the success of your work flow and will save you a great deal of time and frustration in the future.

Well…that is it for this time…there are several more factors that need to be discussed…but they will have to wait until our next post.

By the way…if you have not already downloaded your free copy of our HVAC eBook…you can do so HERE.


The Four Buckets of Church Facility Budgeting

“Hey Tim…how do we get started with Facility Budgeting?” I hear that a lot from Pastors, XP’s, Business Admins, Facility Managers and lay people.  It is a universal concern.  Let’s take a 30,000 foot level view of the most effective means by which we have seen work.

When you are budgeting for your facilities, there are 4 primary buckets that need to be accounted for:

We fully believe that being intentional about all 4 buckets will keep you out of the dog house related to your facilities

  1. Operational – This includes utilities, janitorial, general maintenance and staffing. Budgeting these area will be critical to get RIGHT. What does that mean? It means that you are not spending too much on utilities and making sure you are spending enough in the other areas to keep up with the natural rate of deterioration. Here are some rules of thumb that we find to represent “best-practices” for churches:
    1. Utilities – $1.00-1.50/SF annually. If you are over $1.25/SF, you may want to consider an energy audit or a review of your HVAC controls, as 50% or more of your energy consumption is attributed to HVAC and the best way to reduce that is through proper “behavior” which can be assisted with proper controls. We also just released a free eBook on HVAC Solutions…get your free copy HERE.
    2. Janitorial (labor, material, paper products, major cleaning like carpet extractions, window cleaning, etc.) should be in the $1.50-$2.50 range annually.
    3. General Maintenance – If you are budgeting below the national average of $2.25 – $3.00/SF this should be re-looked at. We have found that if a lack of general maintenance is present, the likelihood of deferred maintenance increases.  In most cases $1 not spent on general maintenance will cost 3-4 times in the future.
    4. Staff – Based on national surveys by our firm and IFMA, we believe the number of facility staff for a well-run organization is one Full Time Facility Staff Employee for every 25,000 – 35,000 SF.
  2. Deferred Maintenance – These are the items that should have been addressed prior but for whatever reason, have not been accounted for. We have found that when insufficient general maintenance is budgeted, the likelihood of deferred maintenance increases…same for staffing. As stated above, the cost of deferred maintenance can be 3-4 times the cost of the initial general maintenance. Sounds like good stewardship to avoid deferred maintenance.
  3. Capital Reserve – We have found that a church needs $1-3/SF annually in order to keep up with the real cost life cycle planning. Capital replacement is not an “IF” consideration but rather a “WHEN” and “HOW MUCH”. While the $1-3/SF is a reasonable way to start planning, the best way is to do “line-item” projections for each asset that has a life cycle. If you have not already done so, check out our FREE Life Cycle Calculator to help you get started.  We also have a free eBook on this topic.
  4. Capital Projects – These would be the type projects like adding space or major renovations, expansions and the like. It would be “easy” to see the need for some added space and be tempted to take the money from one of the above buckets. Be VERY careful with that thinking…that is a slippery slope. In addition, small projects like painting, replacing a few light fixtures, etc could…and should…be part of your General Maintenance budget.

We fully believe that being intentional about all 4 buckets will keep you out of the dog house related to your facilities. If you need help evaluating these, do not hesitate to reach out and we will help you get started.