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Running a Capital Campaign

Running a Capital Campaign

Fundraising with a Focus

Capital campaigns come in all sizes and are conducted for a variety of projects.

But what successful ones have in common is that they are carried out by church leaders who, making use of knowledgeable consultants, put forth a compelling case to their congregations about the solid link between their churches' missions and the projects being funded.

Use a Consultant
Securing the services of a professional consultant enables a church to make the most of its capital campaign efforts, according to a number of participants in the process.

"Hiring a professional consulting firm helps you maximize your results," says Allen Walworth, Ph.D., president and principal of Generis Partners LLC, an Atlanta, Georgia-based church fundraising/capital campaign consultancy.

"On average, a church will usually raise two to three times the amount of money using someone like us, as opposed to doing it on their own," Walworth says. "And the fee usually adds up to just about three months worth of interest they would have paid on a bank loan for the money they weren't able to raise on their own."

Indeed, church leadership typically has enough on its plate without adding the challenges of running a capital campaign to the mix, according to George Mason, senior pastor of Wilshire Baptist Church in Dallas, Texas, who states that he has been through "five or six campaigns" and has used a consultant for each.

Wilshire Baptist, utilizing Walworth as its consultant, has recently completed a $6.5-million "Measure by Measure" capital campaign that raised funds to rebuild its fellowship hall, add parking, and renovate and expand its choral hall and music wing.

"The regular warp and woof' of church leadership tends to gobble up time, making it difficult for a staff member to focus enough attention on the capital campaign," says Mason. "Having someone else who takes care of the organization, lays things out, calls you to account, and keeps your eye on the ball is very important."

"Professional counsel brings a timeline and drives the campaign towards completion," says Doug Turner, president of Dallas, Texas-based RSI Church Stewardship Group, a capital stewardship campaign group. 

"Commitments are sought, received, and invested in the mission of your church in a timely fashion," Turner explains.  All the while, "The focused attention on the campaign excites and encourages people, resulting in larger gifts; and gifts received can then be invested in the mission, enabling the church to move forward instead of dwelling in a campaign."

Most projects make some use of debt financing to augment the equity they raisewhich means that their lenders are going to want to take a look at how well the church handled its capital campaign.

"A lender is going to ask a number of questions about the success of your campaign, including how much you raised in pledges vs. actual receipts, in order to ascertain if there was more than the normal shrinkage a church experiences between the two," says Dan Mikes, executive vice president of Bank of the West in Walnut Creek, California.

"Without question, the professionally orchestrated capital campaigns are much more predictable," Mikes says. Based on his experience, "A professional consultant will definitely be able to generate higher pledge totals as opposed to lay people, or a church staff that is both untrained and inexperienced.

"Additionally, with professionals running a campaign," he adds, "the shrinkage on gross pledges will be more predictabletypically, you can expect somewhere between 5% -10% difference between amounts pledged and those finally received."

Select the Right One
When interviewing potential consultants, "It is extremely important that the church interview the working consultant assigned to the church, not the company's salesperson," says Rev. Robert S. Hallett, founder and president of TLC Ministries Inc. This New Castle, Indiana-based church fundraising/capital campaign consultant recently assisted First Covenant Church of Salina, Kansas in raising more than $4 millionnearly seven times their annual budgetfor a total relocation project.

"The working consultant will have a major impact upon the success of the church's capital campaign, both because of the relationship that develops between the consultant, the senior pastor, and church leadership, as well as the personal and professional qualities the consultant brings to the campaign," Hallett says.

Meet the actual consultant in person, agrees Walworth. And ask a lot of questions during the interview process.

"Ask about their track recorddo they have experience with your kind of church, your kind of project, in your part of the country?" Walworth says. "Find out if they work with churches of the same size as yours. Especially when it comes to capital campaigns, small churches are completely different [than] larger ones. And ask if they have experience with churches in your regiona consultant that works only in the Midwest, for example, may not be as effective in running a campaign in southern California."

Look for consistency, experience, and resources on the part of the consulting firm, Walworth says, "and make sure their core values line up with yours." Check references thoroughly, he says, "and check to see if they have a history in court."

Fees should be set at a flat rate, adds Walworth, "and are normally based on the size of the client church not a percentage of the total funds raised."

Campaign Ingredients
In addition to a consultant, a successful capital campaign requires that the church have several elements in place before fundraising efforts for a project actually begin, according to Hallett.

"Proper preparation includes having a well-supported and urgent-worthy cause, along with a credible plan," Hallett explains.

"That credible plan will need to include sufficient details of the project in order for people to believe that this project will be done, that its budget and costs have been worked out, and that all the financial details have been developed," Hallett says, adding, "The people of the church must have full confidence that the project is do-able."

Church leadership has the responsibility of instilling "a sense of the church's mission being fulfilled through the project," Hallett notes, "as well as developing a feeling of ownership by the peopleby involving them in the planning and decision-making process and not just asking for their final approval." And he adds, "[A successful campaign] also requires the personal, passionate commitment of the church leaders, which will give them the credibility and the moral authority to lead the church in this endeavor."

Wilshire Baptist's "Measure by Measure" capital campaign built upon the church's "wonderful trust in their clergy and lay leadership," according to Walworth. At the same time, "The project tied into and resonated with the church's mission and values; the members of the congregation accepted that their facilities didn't match up with these in terms of providing common gathering space."

At that point, an improved fellowship hall, new parking, and an expanded choral hall "became real needs that the whole church recognized as necessary to its missionas opposed to being just renovation projects that would be nice to do," Walworth continues.

The campaign included creation of a Community Tapestry, where members were asked to contribute pieces of fabric from a baby blanket, wedding dress, military uniform, or other sources, that symbolized their faith journey and connection to Wilshire as a community of faith. The pieces are (as of this writing) still being woven together into "one great church tapestry" according to Walworth.

"The imagery of being woven together' resonated with the congregation," Walworth says. The imagery was complemented by the church's weekly newsletter, dubbed "The Tapestry."

"[The tapestry motif] helped us connect with a wider proportion of [the church's] members," Walworth says, adding, "there were a lot of people who had never contributed to a campaign before. But once they had a piece of cloth to be woven into the tapestry in their name, they gave."

Don't Worry about the Economy
Contrary to what you may think, the credit-crunch and related problems currently plaguing the global economy really don't impact the ability of church capital campaigns to raise funds.

Indeed, "The biggest difference in today's economic climate is the tendency of some consulting companies to cut back on services, either by resorting to telephone conference calls and/or reducing the number of on-site visits to the church," Hallett says. This, in turn, reduces the number of consulting sessions and training experiences led by the consultant, "and may save the consulting company some money, but it costs the church much more in reduced donations, which ultimately results in higher interest expenses [i.e., loan interest] for the church," he adds.

The state of the economy does make a difference in major donations, though, particularly those involving appreciated asset giving, "where real estate and/or a given number of shares of stock gifted out of a portfolio are less valuable than they would be in a more robust economy," says Walworth.

But the huge majority of donations come out of the income of people who are giving up eating out once a week, or doing something else in order to be able to give $30 a week for a project they see as part of being faithful to their church and its mission.

"Historically, most people give out of income stream, and that has not changed in this economy," Walworth notes.

"We follow the Scriptural teachings by encouraging people to be sacrificial in their giving," adds Hallett. "We encourage people to change their lifestyles, to rearrange their priorities, and to identify something specific they already have in their budget that they are willing to give up, reduce, or delay in order to give at that sacrificial level." People's spare money is being squeezed these days, he notes, "but the sacrificial giving comes from what is already built into their budgets."

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