Tel: 905–690–4709 dk@tfwm.com - Darryl Kirkland, Publisher

FINANCING CHURCH MEDIA PROJECTS

Christianity Today, in a revealing study of church borrowing, reported that historically over 84% of churches utilize some form of debt or borrowing for construction or technology projects and that nearly 70% of churches with annual budgets exceeding $500,000 finance media technology projects. The CT article pointed out that larger churches tend to have a higher borrowing ratio than smaller churches. Churches with larger debt apply, on average, 11% of their annual budget to debt retirement while smaller churches retire debt at a faster rate; 16% of their annual budget. The amount of money a church borrows depends on the size of its budget. The median debt for churches is equivalent to 64% of the annual budget.

Technologies for Worship’s annual survey of church plans for media technology projects reports that a high number of churches throughout the U.S., plan to add, upgrade or install new media technology including sound reinforcement, digital display technology, integrated computer and communications systems, broadcast technologies, enhanced security and fire alarm systems and music ministry equipment. At the same time contractors and systems integrators report that churches often “under-budget” media technology projects and may settle for “less than” optimal systems. One experienced contractor reports that in many cases churches repeat the process of media technology integration two or three times before finally “getting it right”. Technology budget failures are costly from a “financial stewardship” standpoint. They also undermine the true mission of media technology which is to reach the hearts and minds of the congregation and attract and sustain new worshipers.

Today we are bombarded with media messages. Most of us, especially the young, have become media “savvy”. Advertisers are adept at “capturing eyeballs”.

Sound is now digital. Television is High Definition. “Films” and video are digital and HD. Computers offer “streaming media”. Cars and SUV’s have display screens. Once static highway billboards are coming alive with electronic, digital and LCD full motion displays. Signage now moves, depicts and projects. Mega stadiums, arenas and concert venues feature huge digital displays, sound systems and integrated media technologies. Our phones now carry the news, movies, and television shows. Media is everywhere. Modern churches have fully embraced media technology in ministry , television ministry, and radio worship programming as a means to reach the congregation in new, powerful and meaningful ways.

Typically churches must make three decisions when considering media technology, be it a simple sound system or lighting package up to a multi-million dollar HD television ministry. Churches must simultaneously consider; 1) what media technologies to acquire, 2) what vendor or contractor to fully design and integrate the systems and 3) how to budget and pay for it. While some media technology projects may seem simple on the surface, the complications, coordination, and integration of today’s rapidly changing media systems require design engineering and integration by professionals with experience and knowledge of today’s vast array of technologies and systems.

Today’s media technology projects often take weeks and months to fully design, order, deliver, install, test and implement. After the original design consultation, contract administration and order process a recent $2M audio and video projection system in a well known California church took nearly 9 months to install and activate. The AV systems installation needed to coordinate with the construction timetable for the facility. Not all projects take this long yet it is not uncommon for projects to unfold over several months especially where construction and facilities are involved.

Churches of all sizes approach budgeting for media technology systems in different ways. Some churches utilize cash (self financing), contribution campaigns, regular tithing, special donor contributions or other self funding strategies. Some churches leverage traditional financing options such as bank loans, manufacturer financing or specialized lenders that focus on media technology financing. Not all churches have surplus fund balances or excess cash available to readily fund a significant or proportionally large media project costing hundreds of thousands or millions of dollars. Not all churches have luminary donors capable of carrying the full costs of a major media technology project. Some churches abstain from incurring any type of debt and grow their own media technology funding over time before embarking on a project. Other churches selectively align borrowing costs to a specific donor or contributions schedule to minimize interest expense.

One of the “best practices” of stewardship is for churches to maintain orderly records and take a professional approach to church finances and financial operations. Although churches are “non-profit” institutions that generally invest the majority of contributions into ministries and services many churches find that building and maintaining a reasonable “fund balance” provides assurance of longevity and leverage in negotiating with vendors, suppliers and even lenders.

In planning for budgeting, funding and payment for media technology projects churches might consider what their own “return on investment” is on internal use of “capital”, the church’s financial resources. In some cases it makes sense to use the capital to invest in media technology. In others the church may benefit by investing its own capital in growth, people, projects, ministries or missions. It is a unique attribute of ministry that a church measures “return on investment” congregation growth, and souls influenced.

Many churches utilize low cost borrowing to fund technology projects. Regular contributions of members often naturally align with the spread of amortized costs of the technology. This strategy allows the technology to “pay for itself”, as it is utilized, to build the ministry and church congregation using media technology as a tool.

Today’s church media technology projects can be complex and involve almost every key department in the church administration. As such it is critical that churches, big and small, new or well established, take a professional approach to evaluating, planning and implementing church media projects to insure that they fit the scope, objective and timetable respective to the particular ministry. At the same time its important that executives within the church who are charged with leading a major media project take the time to engage the most reputable and knowledgeable professionals available to consult, design, advise and implement a comprehensive media technology strategy. Prudent methodology extends to the analysis of budgeting, planning for and funding media technology projects to insure the best stewardship of church finances and a maximum return on media technology as a powerful tool within the ministry.

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