There are many steps your church should take when preparing to construct a new church building or undertake a church renovation project. One is getting a church funding plan. Without it, your project isn’t going to get very far.
Chances are you’d think—in the beginning, anyway—that the cost is equivalent to the amount of money needed to construct the building.
However, there is a good deal more to any church building budget, and if you want to optimize your church financing, you need to know what comprehensive budgets entail.
4 Elements of a Comprehensive Budget
Essentially there are four elements to a comprehensive church building budget. The largest piece—the third element, if you’re looking at this chronologically—we’ve already mentioned: The cost to construct the building.
The first part, however, involves what we call “site work.” This is preparing the ground where the church will be built. It must be level and solid enough to handle the weight of the building, plus water, sewer, gas, and electric lines all need to be laid before the building goes in. Furthermore, site work must also be done for the parking lots and sidewalks including their actual installation.
Next, the second element, which involves the various fees that must be paid for drawings, approvals, and permits prior to the building being constructed. There will be architectural drawings to be drafted and approved, along with structural, plumbing, HVAC, and electrical engineering components that must be individually planned and integrated into the overall design. There are also building permits to be issued and soil samples to be taken and analyzed.
The final, fourth, element is everything that goes inside the church building once it has been constructed. We call it “FF&E,” or Furnishings, Fixtures, and Equipment. This includes the furniture, appliances, all your audio/visual equipment and technology such as servers, WIFI, and alike.
If you walk through your current church building and pay attention to everything that’s been installed in every room, you will discover there’s quite a bit of FF&E that must be either brought over from the old building or purchased for the new.
Taking it all into account
For example, let’s imagine a roughly $750,000 church building construction project. We need to budget approximately $61,000 in fees, another $18,500 for inflation (because no church building is built in an instant, and costs will go up the longer it takes), and another $101,500 or so for FF&E.
This means the total budget for the construction project is over $930,000.
Why a Comprehensive Budget Boosts Church Financing?
When you, as church leaders, approach a lending institution for church financing, that institution wants to know you’ve done your homework. A comprehensive budget, covering all four areas, shows you’re well-prepared and improves your chances of getting whatever financing is needed to complete the project.
Find Out More
We have more resources available for you regarding church design, building, and renovation. To learn more about better budgeting, see this post. To learn more about church financing and a whole lot more, visit our website, and sign up for our free i3 webinars.