Church Executive magazine May/June 2016 by Power Trade Media

MAY / JUNE â&#x20AC;˘ 2016

H E L P I N G L E A D E R S B E C O M E B E T T E R S T E WA R D S .

A (Financial) Foundation to Grow On How fast-growing Gateway Church uses its accounting platform for better ministry p6 PLUS Preparing the church for a new pastor 10 The state of religious lending 20 Remote roundtable: demystifying data 22

FROM THE EDITOR

Oceans of information For a journalist, one of the most gratifying parts of the job is the chance to deep dive with thought leaders into a great topic — and then deliver the “pearls of wisdom” that result to your audience. It’s especially satisfying when these solutions and strategies can be mobilized for better ministry. That’s why our team at Church Executive has so enjoyed putting together this issue. As you’ll see, it’s packed full of practical, tried-and-true takeaways (and real-life stories) of how better management and leadership approaches can help you do church better. Case in point: our cover story — A (financial) foundation to grow on (page 6) — featuring the exceptional story of 36,000-member Gateway Church in Dallas / Fort Worth. Gateway has been blessed with incredible growth, spread across six different locations; but, unfortunately, their back-office accounting systems weren’t keeping up. In fact, because so many of the tools the church used were siloed, it took one team member up to 50 hours per week just to streamline the financial data church leaders needed in order to make real-time, intelligent ministry decisions. By enlisting expert guidance, Gateway now has a streamlined, accessible and accurate accounting “engine.” Best of all, the staff didn’t miss a beat during the transition. In fact, revenue transactions grew by about 25 percent! We were also privileged to collaborate with several well-regarded thought leaders in the area of generosity for the Demystifying Data roundtable (pages 22-24). The conversation — and its takeaways — focused on how church leaders can leverage the data they’re already gathering into actionable, ministry-driven insights. In this important conversation, they discuss what makes so many church leaders wary of data; why traditional report-writing tools aren’t enough to provide the actionable insights; the leading data indicators church leaders should look for; several real-life examples of how analytics and modeling have made tangible differences in ministry; and what you can do today to make the most of your data. In this issue — and in its digital component — you’ll also find two brand-new series: Pastor Coaching: On page 12, Shawn Lovejoy — founding and lead pastor of Mountain Lake Church (Cumming, GA); former directional leader of churchplanters.com and the annual Velocity Conference; accomplished author; and now founder & CEO of CourageToLead.com churchexecutive.com

in Trussville, AL — provides a compelling introduction to pastor coaching. What it is? And what does it look like in practice? “Our schedules tend to put relationship on the back burner,” Lovejoy writes. “However, when we get isolated, we become more vulnerable. When we get isolated, we stop learning from others. When we stop learning, we stop growing. When we stop growing, sooner or later the church will stop growing. For many of us, the reason our ministry isn’t growing is simple: we’re not growing.” Basic Church Finance: Only available in our May / June 2016 digital issue, series authors Darren Thompson and Richard Koon go “behind the loan application” to identify five things the bank or credit union is no doubt looking for. “Ultimately, lenders want to feel comfortable that your ministry has the planning, the processes and the protocols in place to manage the church’s financial operations,” they write. “Presenting a budget, operating at a surplus, building cash reserves, and having a detailed understanding of how the cash flow of your ministry works will go a long way to getting you the best rates and terms.” As ever, we hope these offerings — and all the management- and leadership-focused content in this issue — are beneficial to you and your ministry. All the best,

LET’S CHAT: Email: rslaybaugh@churchexecutive.com Facebook: ChurchExecutiveMagazine Twitter: @churchexecutive.com

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RaeAnn Slaybaugh Editor in Chief rslaybaugh@churchexecutive.com Steve Gamble Art Director sgamble@churchexecutive.com Judi Victor CEO & Publisher / Director of Sales jvfly@churchexecutive.com Kevin Boorse Business Manager kboorse@churchexecutive.com Blair McCarty Senior Sales & Marketing Coordinator bmccarty@churchexecutive.com

EDITORIAL ADVISORY PANEL Stephen Briggs Associate Pastor of Administration First Baptist Church | Hendersonville, NC Denise Craig Chief Financial Officer Abba’s House | Hixson, TN Mike Klockenbrink Chief of Staff Lakeside Church | Folsom, CA Dan Mikes Executive Vice President Bank of the West | San Ramon, CA John C. Mrazek III Executive Pastor Pathways Church | Denver, CO Sam S. Rainer III Senior Pastor West Bradenton Baptist Church | Bradenton, FL Mark Simmons Business Manager Christ Community Church | Milpitas, CA Eric Spacek Senior Manager GuideOne Insurance | West Des Moines, IA

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Church Executive™ Magazine is published bi-monthly by Power Trade Media, a division of The Producers, Inc., 4742 N. 24th Street, Ste. 340, Phoenix, AZ 85016. Subscription Rates: United States and Mexico $39 (USD) one year, Canada $42 (USD) one year (GST included), all other countries $75 one year, single issue United States $5 (USD), all other countries $6 (USD). All articles in Church Executive™ Magazine are copyrighted and may not be reproduced in whole or in part without the express written permission of the publisher. For reprints of 100 or more, contact Judi Victor at (602) 265-7600 ext. 125. Copyright 2016 by Power Trade Media. No advertisement or description or reference to a product or service will be deemed as an endorsement, and no warranty is made or implied by Power Trade Media Information is obtained from sources the editors believe reliable, accurate and timely, but no warranty is made or implied, and Power Trade Media is not responsible for errors or omissions.

May / June 2016 • CHURCH EXECUTIVE

May / June 2016

CONTENTS

COVER STORY MISSION: ACCOMPLISHED A (FINANCIAL) FOUNDATION TO GROW ON GATEWAY CHURCH | DALLAS / FORT WORTH, TX

The exceptional team at fast-growing Gateway Church needed an accounting platform that was as efficient, streamlined, and as “all about people” as they are. With six campuses, more than 36,000 active members, and 1,000+ full-and part-time staff, the church simply can’t function at maximum efficiency without a streamlined, accessible and accurate accounting “engine.” That was something they didn’t have … until now.

By RaeAnn Slaybaugh

SERIES INTELLIGENT CHURCH GIVING

What you don’t know about giving can kill your ministry potential By Joel Mikell & Derek Hazelet

FINANCES & ADMINISTRATION FOR CHURCH LEADERS

Succession planning: how to prepare the church for a new pastor By Rev. Dr. Perry Hopper & Vincent Schera

NEW! PASTOR COACHING

What it is — and what it looks like in practice By Shawn Lovejoy

ALTERNATIVE FACILITY OPTIONS

How the construction of a Family Life Center drove cost savings — without sacrificing aesthetics By Jim Peckham

CREATING A CULTURE OF GENEROSITY

The dreaded “summer slump” By Jayson D. Bradley

CHURCH FACILITIES: BUILDING & CONSTRUCTION

CHURCH MANAGEMENT SOFTWARE (ChMS)

On time & on budget: tried-and-true strategies for your next construction project By Rodney James

Expanding your church? 3 ways to use ChMS data to your advantage By Bill Gifford

SAVINGS IN NUMBERS

Buying through a procurement services company: your ministry and the monetary benefits, explained By Glen Witsaman

CHURCH EXECUTIVE • May / June 2016

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FINANCE & LENDING TRENDS

The state of religious lending By Dan Mikes

REMOTE ROUNDTABLE: DEMYSTIFYING DATA

A conversation on turning information into actionable insights to achieve your God-given vision Featuring Curt Swindoll, Derek Hazelet, Ben Stroup, Joel Mikell, Lance Taylor & Rod Edmondson

INSURANCE ESSENTIALS

Acts of violence: prevention and response By Eric Spacek, JD, ARM

PASTOR-FRIENDLY SOUND SYSTEMS

Beautiful sound, naturally: The Grotto (Portland, OR) By Mike Lethby

CONTINUING EDUCATION

Timothy Berry: igniting hearts through miracles & healing By Regent University’s School of Divinity

NEW! LEADERSHIP LIBRARY

A curated collection of great books for pastors

LEGAL REALITIES

How the hourly wage rules will affect churches By David O. Middlebrook

NEVER AGAIN: BEYOND INSURANCE

Don’t touch — or you might get burned! Focus on: risk avoidance By Michael J. Bemi

DEPARTMENTS From the Editor

IN OUR DIGITAL ISSUE ONLY!

churchexecutive.com/digital-edition MULTISITE & PORTABLE CHURCHES

How to accommodate — and engage — kids By Scott Cougill

STEWARDSHIP OF SPACE

How to make the best long-term investment By Rich Maas

STREAMING MADE SIMPLE

CAPITAL PLANNING FOR CHURCHES

The art behind quality church streaming By Andrew Ng

Proactive & penny-wise: examining repairs & replacements for houses of worship By Matthew C. Swain, RS

NEW! BASIC CHURCH FINANCE

Behind the loan application: What is the bank or credit union really looking for? By Darren Thompson & Richard Koon

CONTINUING EDUCATION

Online education option for busy pastors By Villanova’s Center for Church Management & Business Ethics

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May / June 2016 • CHURCH EXECUTIVE

MISSION: ACCOMPLISHED

Gateway Church / Dallas / Fort Worth, Texas

A (Financial) Foundation to Grow On

With six campuses, more than 36,000 active members, and 1,050 full-and part-time staff, Gateway Church in Dallas / Fort Worth simply can’t function at maximum efficiency without a streamlined, accessible and accurate accounting “engine” — something they didn’t have…until now.

hen Lead Director of Business Administration Monty Carpenter joined the Gateway staff in 2011, incredible growth had endured for several years. This expansion exposed the shortcomings of the church’s server-based accounting platform, which heavily relied on manual data input and Excel — inefficient and timeconsuming for a rapidly growing church. Smartly, church leaders began investigating their comprehensive, cloud-based accounting options. One of their first steps toward streamlining was to outsource the church’s payroll processing to ADP — a good start, especially with more than 1,050 full- and part-time employees. Next, they set their sights on the 10-year-old general ledger system which simply wasn’t keeping up with church growth. For one thing, it was server-based versus cloud-based. Accounts receivable was done in Excel, as was restricted / designated fund accounting. An automated expense management tool (Concur) was — and still is — used for credit card charges, expense reports and mileage reimbursements. Church management software (ChMS) was being used to store and track membership and giving. Independently, all these tools functioned OK. However, for a church growing as fast as Gateway — especially when that growth is spread across several sites — the setup was far from ideal. “The struggles were associated with having so many moving parts and trying to pull them all together,” explains Tammy Bunting, director of notfor-profit services for AcctTwo. “And really, no matter what size a church is, it has that same struggle.” Glen Strack, a senior implementation consultant at AcctTwo, says he agrees completely. “We see a common set of pain points in growing Churches,” he adds. Logistically, managing the flow of data into and out of the various campuses was one big challenge — for example, getting the funds

CHURCH EXECUTIVE • May / June 2016

collected over the weekend to the central church office, or managing the widespread accounts payable process. (At one point, the church had drivers delivering purchases orders and invoices all over DFW). The challenges quickly escalated to more difficult, overarching ones: collecting all the necessary financial data from various disparate platforms, and then using it to generate timely, transparent reports to drive real-time, intelligent ministry decisions. Weekly and monthly reports were particularly challenging for Carpenter and his team, who mostly used Excel to create them. There were many different electronic feeds and manual downloads / uploads to assemble and streamline — a 50-hour-per-week task for one (no doubt exhausted) staff member. If only all that work ensured data accuracy … but, it didn’t. As Executive Pastor of Administration Randy Bell recalls, the church’s legacy software was “giving them fits,” routinely duplicating transactions and dropping journal entries. The need for an efficient, accurate and streamlined solution became more urgent as the church added new campuses across Dallas / Fort Worth (DFW). Though welcome, of course, this growth meant additional funds to reconcile with multiple sources of revenue. “We had so many different sources of revenue inflow — the bookstore, the café, each campus, mobile app giving, online giving and more — that it stretched our reporting to the point where we had to add staff,” Carpenter recalls. With the personnel ramp-up came the need for more equipment, more office space, and so on. Leaders knew they couldn’t keep up with the growth … unless they made a big change. A better way emerges Carpenter says he started repeatedly hearing the name Intacct — a cloud-based, streamlined accounting platform for churches provided by churchexecutive.com

MISSION: ACCOMPLISHED Houston-based AcctTwo Shared Services — at conferences and events, and in conversations with other church leaders. The first connection was initiated by one of AcctTwo’s senior implementation specialists, Lynda Reich. She (along with several other executives on the team) served at a similarly sized church in the area. “She said, ‘Hey, I work for AcctTwo now, and [X] are the things I struggled with at the large church I worked at previously. Are you having similar struggles at Gateway?” recalls Tammy Bunting, Director for Not-for-Profit Services at AcctTwo — herself a former employee, too. A relationship was formed. “It’s a true peer collaboration,” Bunting says. Carpenter agrees with Bunting: “To realize the years of experience in other church environments, that speaks volumes to me,” he says. “Anybody can sell anything; we wanted somebody who would walk the road for us.” When it was time to get to work, the AcctTwo team proved to be the right fit. Strack, in particular, was pivotal in leading Gateway through the transition to a cloud-based, comprehensive accounting solution, all while helping to minimize disruption at the busy church. He was onsite every week, ensuring great communication and triggering thought leadership. “He spent a lot of time saying, ‘I know you’ve done it this way, but what about this way?’” Bunting recalls. Carpenter remembers it the same way. “From the outset, [Strack and his team] did a great job helping us understand our reporting options,” he says. “Given all the capabilities of the new software, it was like drinking from a firehose.” As such, the AcctTwo team’s focus was not just to streamline data configuration, but — even more important — to define the end results. “What are the outcomes? That’s how we were going to build it,” Bunting explains. “Putting data in was very easy; the robustness comes in getting that information out.” Strack echoes this sentiment. “We always look at the outcome,” he says. “Reporting should always be a consideration in all design discussions.” With discussion and planning, the path forward became clear. A brandnew, highly innovative accounting platform “went live” at Gateway on October 1, 2015. Church leaders say myriad benefits were immediate. Easier, faster and more accurate monthly / weekly reports. With Gateway’s legacy system, huge amounts of staff time were spent cutting and pasting data into the critical, 30-plus-page monthly report. This report comprised about 40 tabs in Excel — from attendance, to P&L statements, to cash flow projections, and much more. Likewise, the weekly report (which accounts for every dollar in and out of Gateway’s ministries for the previous seven-day period) represented a significant time investment. “Think about the need to capture every check and every expense, along with every deposit made through all those different revenue sources, every week,” Carpenter explains. “To get this [report] out in a timely manner requires that all your transactions be posted almost on a daily basis.” But that’s not all: Before the reports were shared, Carpenter and his team spent significant amounts of time reviewing the data for accuracy. Mistakes were made — and understandably so. “Because [the staff] spent a lot of time cutting and pasting, they didn’t have as much time to review it themselves,” he says. Fast-forward to today, post-Intacct implementation. More than half the monthly report is automated, with the aim of full automation in the coming months. Similar automation has been built into Intacct for generating the weekly report. Best of all, staff involved in financial reporting now has substantially more time — approximately 25 percent — to prepare and review reports.

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Immediate access to important data and documents. At any given time, decisions are being made at numerous levels within Gateway. One of the senior major decision-makers is Lawrence Swicegood, executive director of media. He asserts that access to real-time financial data is essential for effectively marketing and advertising the church and its offerings. And this is coming from an individual who admits he used to find all things finance … well … a little dry, to put it politely. “Information is power,” Swicegood says. “If I’ve got enough information up front, it can save me enormous amounts of time deciding how to market our Easter services or a new campus, for example.” Indeed, if he has the right data at his fingertips, he’ll know right away, for instance, if a billboard campaign is within budget. If not, he can save himself and his team a lot of time and energy researching costs and contacting ad agencies. Quick access to financial data is even more critical when the need is immediate — something Randy Bell, executive pastor of administration, can certainly attest to. Recently, at an important offsite meeting, Bell found himself in need of a supporting document. Using the church’s legacy system, it would have taken hours (if not days) to track down. Instead, he called Carpenter back at the church, who used the search feature in Intacct to find the document in minutes.

Similarly, when reviewing monthly financial statements, Bell had an inventory question. He called one of the senior staff accountants, expecting to hear back in several hours. Though the need for an answer wasn’t immediate, the response was. The accountant was in his office 20 minutes later with supporting documentation. The power to go paperless. With Intacct in place at Gateway, the ability to photograph, scan, attach and submit invoices electronically is a welcome upgrade for church leaders. Most of the payments Carpenter and his team disburse today are delivered electronically via wire transfer, ACH and so on. “It’s much quicker, much easier,” he says. “And that keeps all the ministries and events flowing smoothly at all times.” On the incoming side (accounts receivable), all pastors — whether they’re at the home church or at one of the satellites — can see financial data as soon as it’s posted to the ledger. All they need is a secure internet browser. Easy integration with other applications. For example, Carpenter recalls that — pre-implementation — making the church’s automated expense management tool “talk” to the church’s fund accounting software took weeks of consultant time, which came with a big price tag. May / June 2016 • CHURCH EXECUTIVE

MISSION: ACCOMPLISHED With Intacct (because it’s an open API, a publicly available applicationprogramming interface), this same effort took about four hours. More reliable analytics and data for budgeting. With Intacct, Carpenter and his team are able to download revenue reports, by fund, out of the church’s ChMS into Excel .csv files, and upload them into Intacct. “So, the journal entry is sitting there in [the platform], waiting for the supervisor to review and approve,” Carpenter says. “That has sped up the process by days.” Since the team at Gateway posts revenue on a daily basis, this is especially time-efficient. The same thing is enabled with outsourced payroll. From the ADP dashboard, the church can generate a general ledger download report and upload it to Intacct. This leaves more time to devote to quality control and accuracy versus number-crunching.

Good data drives good ministry As any church leader knows, when you free up staff time, they can spend it on ministry. This has certainly been the case at Gateway, now that Intacct is up and running. As of press time, the church was looking forward to the launch of a massive men’s event that evening. Over the previous few days, many checks needed to be approved and distributed. Thanks to their new accounting platform, the process — even last-minute requests — went smoothly because those funds were disbursed electronically. Executive Pastor Randy Bell was attending a conference at the time, but he was able to approve all those checks online. “Everything I can see in my office, I can see in my hotel room,” he explains. “I can be anywhere in the world, if I want to.” As a larger-scale example of the new platform’s ability to drive more effective ministry, Carpenter cites the recent launch of a new campus in Dallas. “To assimilate that campus into our accounting processes took maybe one day — definitely less than eight hours,” he says. Integrating that same campus into the legacy accounting platform would have meant hiring a consultant to come in and set up a new company, transfer all the account codes, and establish the database — a multi-day (if not multiweek) undertaking. This quick integration benefits more than the accounting team; it helps ministry staff, too. “They wanted to know right away how they were doing in that new campus,” Bell recalls. “What’s our attendance? What’s our giving? What are our expenses on capital expenditures? We were able to provide that information, fast.” Speaking of staff … Carpenter, Bell and Swicegood emphatically agree how critical the staff at Gateway has been to the Intacct implementation process. Thanks to them, operations have been “business as usual.” One part of the equation is accounting prowess. As Bell points out, the church has five CPAs on staff (including himself and Carpenter). Additionally, Gateway employs several degreed accountants and a handful of others who are pursuing accounting degrees. 8

CHURCH EXECUTIVE • May / June 2016

“One of the things people don’t understand about our church is the volume of payable and revenue cycle transactions we have compared to churches with the same attendance figures,” Bell explains. Indeed, Gateway processes twice as many giving units per household as most churches of a similar size. The number of revenue transactions grew by 93,000 — about a 25-percent increase in 2015 over 2014. Clearly, Gateway needs all the accounting and business office personnel it has ... but they’re more than that. As Swicegood points out, many of them really understand ministry because they’re church volunteers, pastors, or serve in other lay leader capacities. “Because of this, it’s not a constant battle of, I really wish accounting understood ministry because I can’t get what I really need from them,” Bell points out. According to Carpenter, another key requirement is that these staff members be in tune with the financial stewardship culture at Gateway. “And they really are,” he says. “They pay attention to their budgets and their actuals. I think every year I’ve been here, we’ve been under budget in expenses.” This sense of ownership — and buy-in to the stewardship culture — went a long way in helping to minimize disruption while Gateway transitioned to Intacct. At the outset, teams of eight to 10 employees were formed to “own” their area of responsibility. For instance, the church’s revenue manager supervised five people in the revenue department, dedicating six people to oversee with tithes and offerings alone. In accounts payable, one manager supervised five AP staff members. “Each of them knew intimately what their department needed to meet deadlines,” Carpenter says. “We had healthy conversations, adjusted, and always made it work.” Strack says he feels the same way. “Every organization has a culture,” he says. “The Gateway culture of caring and shared responsibility was obvious. The attitude was positive, and it was clear their work was more than just a job. They had a heart for this project and their Church.” Bell — who has worked at Gateway for nine years — agrees, and adds: “Gateway’s governing Elder Board and senior pastoral staff have always recognized the importance of efficient administration, especially financial. They have repeatedly provided us excellent staff and financial systems to deliver timely and accurate information. Intaact is just the most recent example of this.” “We’re all about people” While it’s easy to get preoccupied with efficient accounting processes, Bell, Carpenter and Swicegood all agree on something bigger: Intacct is, in the end, a ministry tool. “Ultimately, so is every tool we have,” Bell says. “When we go back and look at our mission statement — ‘We’re all about people’ — this is where we come out, every time.” To this end, the new platform has been more than a financial tool. It has helped the Gateway ministry team provide support to single mothers, restore marriages, and aided in seeing more than 2,850 people come to accept Christ in 2015. “From top to bottom of the organization, we keep that truth in our frontal lobe,” Bell says. “We’re always asking: Can we use this tool to help us do ministry? That’s really our heart and our vision.” — Reporting by RaeAnn Slaybaugh

QUICK FACTS ABOUT GATEWAY CHURCH Year Established: 2000 Founding Senior Pastor: Robert Morris Number of campuses: 6 across the Dallas / Fort Worth, TX area Members: 36,000 Number of staff (full- and part-time): 806 full-time / 250 part-time Combined weekend attendance: 27,000 – 29,000 (plus, 10,000+ online via video streaming) churchexecutive.com

Intelligent Church Giving

What you don’t know about giving can kill your ministry potential 3 key moves every church leader should make By Joel Mikell & Derek Hazelet

Every church leader recognizes that there are times when we must adapt the way we do ministry. While the message stays the same, the methods change. New challenges have led us to identify new approaches, such as contemporary services, small groups, multisite churches and online campuses. Unfortunately, when it comes to giving, we’re not always so quick to adapt or adjust our ways of thinking.

Believing that people are giving everything they can give is a false assumption a lot of church leaders make. The fact is, charitable giving has represented about 2 percent of an individual’s income for decades. One of the things we’ve helped church leaders discover is that there is significant discretionary income in their pews, which could lead to 50- to 75-percent budget growth in some cases. As a church leader, it’s important to challenge the assumptions we have about the people in our pews. There are ways for you to leverage data to identify how much capacity is sitting in your congregation. These insights become incredibly valuable for informing your strategy and leading your church towards greater levels of commitment and generosity.

If you’re like most church leaders, you want to lead your ministry to a place it has never been before. To lead with clarity and confidence, you need to be willing to take another look at the framework you’re using to make decisions, and the support systems needed to grow your church in the grace of giving.

#3: Develop a strategy to drive engagement with new givers AND faithful givers.

3 key giving moves every church leader should make Here are three key moves you can’t afford not to make based on insights we’ve gathered from working with churches.

When you only look at top-line metrics, it’s common to think that you’re growing if the number of new givers is greater than the number of people slipping out the back door. However, our research confirms that it can take eight new givers (if not more) to replace the impact of a single person who has given over multiple years. While possible, it is extremely difficult to do. The key, then, is to develop a strategy for driving engagement on both ends of the spectrum: from non-givers to key multi-year givers. Help them see how their faithful giving has made a difference over the years. Provide specific content that is important to them.

#1: Tell a better story about giving. Insight: Overall charitable giving increased by 4.6% in 2014, but church giving declined by 1.6%. This is according to an annual research report by the Giving USA Foundation and the Indiana University Lilly Family School of Philanthropy.

Insight: It takes, on average, eight new givers to replace one key multiyear giver.

It’s easy to assume attitudes around generosity have led to a decrease giving. But the truth is that today’s church members are just as generous as in years past. The difference is this: there are more organizations competing for the attention and resources of your church members than ever before. Research also tells us that people are beginning to split their charitable giving. How do we overcome this challenge? We must give people a compelling reason to support our ministry. We must find a way to communicate the connection between the budget and ministry impact. This takes work, but it also gives us the opportunity to identify the things that inspire people to give and ultimately generate more momentum for our ministry.

Knowledge + insight = wisdom Knowing this information is one thing — but it requires action. We can’t afford to sit on the sidelines related to emerging trends and insights that directly affect our future ministry potential. Instead, we must use this information in a way that leads to “actionable insights” that validate or challenge our assumptions and help us develop a clear strategy for moving forward. Learn how you can begin to apply the insights to your ministry efforts by downloading our free discussion guide.

#2: Validate and challenge your current baseline assumptions about giving.

Derek Hazelet is senior vice president at RSI Stewardship. Find him on Twitter [@dhazelet] or LinkedIn [www.linkedin.com/in/derekhazelet].

Joel Mikell is president at RSI Stewardship [www.rsistewardship.com]. Follow him on Twitter [@joelmikell] or find him on Facebook [www.facebook.com/ joel.mikell].

Insight: There is a significant opportunity to increase generosity when considering demographic data compared to total annual gifts. churchexecutive.com

May / June 2016 • CHURCH EXECUTIVE

Succession planning How to prepare the church for a new pastor By Rev. Dr. Perry Hopper and Vincent Schera

The pastoral search is not an easy process for church leadership. Often, they are inadequately prepared to handle pastoral transition. Pastoral searches that are rushed — or have not followed a careful discernment process — can have painful results for a congregation. Stories of church splits, poor matches between a pastor and congregation (and even clergy who have left ministry altogether as a result of an especially difficult pastoral experience) are far too prevalent. Nevertheless, pastoral and leadership change is inevitable. 10

CHURCH EXECUTIVE • May / June 2016

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hether it occurs as a result of sudden death or chronic illness, a call to another ministry or profession, an ethical indiscretion, or through retirement, it is the responsibility of the current pastor and church leaders to develop a plan for when a pastoral vacancy occurs. Just as succession planning has become standard for many businesses, it is necessary for churches to enable them to handle pastoral change with a sense of spiritual readiness and stability. A good pastor-to-church match significantly contributes to a congregation’s ability to do God’s work through ministry — work that is impactful and transforms lives. Pastoral change can provide a rich opportunity for a church to re-examine its congregational identity and deepen its faith journey together. Every congregation will approach the pastoral search differently. In the case where there is adjudicatory leadership (such as a regional or local body), it is important to reach out to them for assistance with succession planning and pastoral transition. Church culture, by-laws or other factors might also play a role, but a few tips garnered from successful searches and thoughtful resources can serve as wisdom for the journey. #1: Formulate an emergency plan. In the event of death, a serious accident or an unforeseen situation, emotions are likely to run the gamut among members — grief, anger and uncertainty about the future. Church leaders need to be proactive about preparing a plan before a crisis happens to provide for a stable transition of leadership during what is likely to be a highly emotional time for a congregation. Leaders should be guided by Paul’s reminder in 1 Corinthians: “But everything should be done in a fitting and orderly way.” (14:40) #2: Consider engaging an interim minister. This can be especially helpful when a previous ministry has ended painfully. Interim ministers are engaged for a fixed period of time, generally one or two years. A minister who is experienced in interim ministry can assist a congregation with processing the hurt, grief and anger that typically follows a pastorate that ended with ethical misconduct, or even an extremely long pastorate in which members might have difficulty moving forward. Dealing with these feelings is necessary in order to have an effective search process. #3: Build a search committee that is spiritually rooted and resilient. Ideally, the committee should be composed of a healthy balance of church leaders and lay members who reflect age, gender, ethnic and income diversity and various ministries within the church. It is essential that committee members demonstrate spiritual maturity, sensitivity, open spirits, and are consensus-builders. A healthy search process is rarely less than a year and can last up to two years, so members must be committed to a lengthy and involved process. The ability to maintain confidentiality is an absolute must. #4: Speak with other churches who have gone through a pastoral search within the last year. Much wisdom can be gleaned from interviewing members of a successful search process. • What questions helped them the most? • What might they do differently if given the chance? • What spiritual practices sustained them during the search period? • What did they observe and experience that helped them realize they had identified the candidate who was the right fit for their church? churchexecutive.com

Hearing from those who understand the responsibility that accompanies the search process can be invaluable. #5: Take the time to discover what the church is looking for. Everyone on the committee will have an opinion of what the church needs in a pastor. It is important that these preferences are stated candidly and openly so the committee can move forward in an honest discovery and discernment process together. A careful review of the church’s vision and mission statements and stated ministry objectives is key to assessing the qualities and skills that take priority and assist in drafting a job description for the pastoral search. The committee also needs to hear from church members and structure a process that helps the congregation to ask where they have been as a community of faith and where they sense God is leading them. This can happen through a series of forums, small groups, or a survey; many resources are available to help facilitate what needs to be a keen listening process. #6: Put more emphasis on character than on skills. Ideally, a committee is seeking a candidate with a healthy balance of “excellence in character and skills.” But it is important to give more attention to who the person is rather than on what they have done. This cannot be overstated because gaining a clear sense of a person’s values, mindset and character traits will tell you more than accomplishments can about how well he or she will interact with members. As you consider a candidate’s gifts in preaching / teaching, pastoral care and administrative management, recognize that no minister excels in all three areas. Your discovery process will reveal which areas are most significant for your congregation as you live into the future with a new pastor. Finding the right pastor is a process that may not happen as quickly as some would like. But, having a plan in place prior to beginning your search — and considering all your options — will make for a smoother, more manageable transition process. Perry Hopper serves as the associate executive director and director of denominational relations of MMBB Financial Services www.mmbb.org and is responsible for coordinating special programs that support MMBB’s mission. Vincent Schera serves as chief human resources officer and implements and manages all HCM policies and programs for MMBB Financial Services.

May / June 2016 • CHURCH EXECUTIVE

When we stop growing, sooner or later the church will stop growing. For many of us, the reason our ministry isn’t growing is simple: we’re not growing. We’ve read the books. We’ve downloaded the content. What’s still missing? Relationship. This is why I believe every leader needs a coach.

By Shawn Lovejoy

What it is — and what it looks in practice Seminary didn’t prepare us for this. Personnel issues. Hiring. Alignment. Firing. Culture. Vision. Systems. Multiple staff. Multiple campuses. Leadership development. Dealing with growth. Spurring new growth. Financial management. And that doesn’t even cover it all! The ministry world today is so complex. Good news! There are more resources available to us than ever before. The Web has made it possible to download a complete online video course on virtually any subject, in a matter of moments. At the end of the day, however, we leaders still need a place where we can talk through the things that keep us up at night. • What do we do with our worship leader? (It’s always a worship leader, right?) • Should we build a new building or start a campus? • Should we give them more time or let them go? Should we go talk to them? If so, how should the conversation start? How should it end? • How can I grow my leadership? • How can I change the way I lead? • How do we take our team to the next level? Now that we know what needs to be done, how can we ensure we do it the right way? (Because if we do the right thing the wrong way, we get the same results.) In the meantime, Sunday is always coming. Every week is relentless. We are often overextended and over-committed. There’s not a lot of time to invest in extra relationships, much less in consulting or coaching. Yet, the No. 1 mistake I see pastors make is isolation. The bottom line? We need help Our schedules tend to put relationship on the back burner. However, when we get isolated, we become more vulnerable. When we get isolated, we stop learning from others. When we stop learning, we stop growing. 12

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What is coaching? “Coaching” has become a buzzword — not only in corporate circles, but now in the ministry world. But what exactly is coaching, and why does a pastor need it? Think about it: coaching has historically been relegated to athletics. Think about what coaches do — they work to help individuals and teams win. They not only help draw a picture of success, but detail a process to help take people there. Coaches work to bring out the best in people, always pushing them to excel. They encourage, admonish, correct and consult on the right mind-set and fundamentals players need in order to win. The best coaches know how to watch a player play, and then offer constructive criticism and motivation along the way to help that player seize all his or her God-given ability. In the same way, every leader needs someone to come alongside them and watch them “play” — correcting and motivating them along the way to squeeze out all their God-given ability. Coaching is not just content; with the tips of our fingers, we can read and download content. What’s missing? Relationship.

Keep an eye on this space! Future installments in this series will focus on: • How pastors can know they’re stuck in a rut — and in need of coaching • How to select the right coach To win, I believe we all need to know and be known. We need a safe place to talk through our personal and leadership issues. Sometimes we need permission. Sometimes we have a sense of what needs to be done; we just need to hear someone say, “You’re not crazy for thinking that. Go for it!” Other times, we need to hear someone say: “Whatever you do, don’t do that.” How is a coach able to offer that kind of perspective? Simple. Guess what most coaches have in common? They were once players. They’ve been in the trenches and on the frontlines before. They’ve been there, done that, gotten the T-shirt — and often have the scars to prove it. Why wouldn’t we want to learn from someone else’s pain instead of having to learn everything the most painful way: ourselves? So, go. Get a coach! Ask them to watch you play. Being coached isn’t always easy, and the process can be grueling. The scoreboard, however, will often prove it’s been worth it. Shawn Lovejoy is founder & CEO of CourageToLead.com, where he and his team coach leaders, pastors pastors, and helps them all conquer what keeps them up at night. Previously, Lovejoy served as founding and lead pastor of Mountain Lake Church in Cumming, GA, and directional leader of churchplanters.com and the annual Velocity Conference. He has written several books, including The Measure of Our Success: An Impassioned Plea to Pastors (Baker Books, 2012) and Be Mean About the Vision: Preserving and Protecting What Matters (Thomas Nelson, 2016).

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ABOUT THE PROJECT

Building for the future How the construction of a Family Life Center drove cost savings — without sacrificing aesthetics

Owner: Alice Bell Baptist Church (Knoxville, TN) Builder: George W. Reagan (Knoxville, TN) Architect: Falconnier Design Company (Knoxville, TN) Pre-engineered metal building: Varco Pruden Buildings (Memphis, TN)

By Jim Peckham “More space, cost-effectively.” It’s by far the most common request of growing churches. Alice Bell Baptist Church in Knoxville, TN, is no exception. What is different is their unconventional choice of a metal building system for their 11,000-square-foot Family Life Center.

Construction was completed quicker, because the building system is engineered for fast, onsite assembly. Estimates show the building can be constructed 25 percent faster. The VP SSR roof — backed by an industry-leading warranty to ensure weather tightness and finish, as well as low maintenance during the life of the building — translates to long-term cost savings. These savings are achievable thanks to reduced maintenance needs during the life of building. Compared with traditional construction, the framing on this structure was less expensive. A typical comparison shows about a 20-percent savings compared with a conventional project. Steel construction makes future facility expansion simple. Cost savings include lower cost for design and detailing, and reduced cost for field cutting and welding. With a building system, there is optimal use of steel and less waste of material.

Knoxville-based Falconnier Design Company and George W. Reagan made up Alice Bell’s design-build team. George W. Reagan needed to build the Family Life Center without incurring the cost of traditional construction. A metal building system emerged as an excellent alternative. George W. Reagan is an authorized Varco Pruden builder and chose to construct the new structure with various Varco Pruden systems. This included Rigid Frame and SSR™ standing seam roof systems, which were able to be adapted and blended, aesthetically, with the existing structures on the church campus. At-a-glance: the cost savings achieved The use of this steel building system drove several cost savings: The building was erected quicker, allowing for quicker occupancy. With the architect and contractor working as a design / build team, overall construction schedules were reduced by about 20 percent. Time savings included a shorter pre-construction schedule and fewer change orders during construction. The cost of drawings and engineering was significantly less than is typical for traditional construction. With the systems approach, the costs for drawings can be reduced by half when compared to a conventional steel design and detailing drawings. churchexecutive.com

Even with all these cost savings, the Alice Bell Family Life Center beautifully accommodates the church’s main objectives: • A larger meeting space •A dditional educational space • A fellowship hall • Rough-in accommodations for a kitchen in the future • A basketball / sport court. Indoor / outdoor appeal By using brick and painted split-faced concrete masonry units, the exterior of the Family Life Center blends with the existing campus buildings. Inside, the chosen finishes are functional and attractive, yet costefficient and durable. They include a wood-look vinyl plank, vinyl tile, carpet, and painted gypsum board. Altogether, The Alice Bell Family Life Center project is award-worthy — literally. Last year, it was a winner in Varco Pruden’s Hall of Fame contest in the Church category. Buildings selected for this distinction represent the best projects among all of VP Buildings’ endeavors — true examples of the best in design and construction within the building systems industry. Jim Peckham is Manager of Marketing for Memphis-based Varco Pruden Buildings www.vp.com, a division of BlueScope Buildings North America, Inc. Varco Pruden markets its products through a network of more than 1,000 authorized builders within the United States and Canada.

May / June 2016 • CHURCH EXECUTIVE

By Jayson D. Bradley

Most of us — including pastors — like to imagine that the summer exists as a time of relaxation ... a time away from our harried schedules. Deep down, though, we know this isn’t true.

CHURCH EXECUTIVE • May / June 2016

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e’re actually just cramming recreational hobbies and barbecues into already bursting calendars. Parents with school-aged children are pulling their hair out to ensure that the kids have something to do during the day. They spend quite a bit of time taxiing them to camps, sports commitments and summer activities. On top of all that, summer is the most popular time of the year for families to take trips and vacations. Unfortunately, when families look for breathing room in their schedules, church is often the first thing they cut. Church leaders know this and respond accordingly. This back-and-forth dance is noticed and seems to encourage even more people to stay home. Enter: the summer slump. One of the most discouraging aspects of the summer slump is that lower church attendance also tends to drive others — who perhaps aren’t on vacation — to stay home, as well. Many churches are veritable ghost towns during summer months.

Getting your church set up with with a tool for recurring giving — and then training them to use it — is a game-changer. When people set up automated giving, they become more involved and interested in the life of the church. The best part is, they don’t have to think about giving. A recurring payment system is a potent weapon in the fight against summer slumps. Once members are signed up for their giving to recur naturally, you’re that much closer to being out of the woods. The best way to encourage recurring giving is with your own mobile app from a provider like eChurch [ echurchgiving.com ], the premier provider of Pushpay giving technology and custom apps to the church space [ pushpay.com ]. A mobile app has many benefits. First, it offers a secure way to give. Second, it allows your members to give from wherever they’re vacationing (including foreign countries). Third, it helps you stay

Then, as soon as school starts up again, there’s a big push to get everyone focused and back on track. With that, the fiscal year seems to start in September. Because church offerings are typically given as part of the church service, giving drops dramatically when people stop attending. The summer slump takes a huge financial toll on a church. Knowing this, churches often budget their finances according to a feast / famine calendar, enabling them to make it through the lean months by storing up resources during the busier times of the year.

engaged with them while they’re gone. Having your sermons, calendar, and congregational communications all bundled within the same app that people are using to give, is a genius way to get your church over the summer slump. While recurring giving is ideal, one-time gifts are great, too. A good app makes single donations possible with a few taps. It’s the perfect solution anytime someone is interacting with your church.

There’s no question that churches experience a summer slump… The big question is whether or not there’s anything your church can do about it — and there is. You don’t have to accept the inevitability of the summer slump. One key way to avoid this seasonal dip in giving is to set your church up with recurring giving. I’m sure that — instead of giving weekly — many of the people in your church give larger checks once or twice a month. Maybe they even mail them in. But once they’re away on vacation, it’s easy for that kind of giving to fall through the cracks. churchexecutive.com

It’s not so complicated. (Really.) You might think that an app is an accessory for megachurches, and you could never afford or maintain one. But, I assure you that’s not the case! An app is easy to manage, and completely affordable. Actually — with the increase in giving that you’re likely to see — the app can pay for itself. As you can see, the summer slump is not inevitable. You can help fortify your congregation against the low-attendance and paltry giving that normally accompanies the summer months. Jayson D. Bradley is a writer and pastor in Bellingham, WA. He’s a regular contributor to Relevant Magazine, and his blog — JaysonDBradley.com — has been voted one of the 25 Christian blogs you should be reading. May / June 2016 • CHURCH EXECUTIVE

Tried-and-true strategies for making it a reality for your next church construction project By Rodney James

Over nearly 30 years in business — and with church builds from coast to coast — our team of construction experts has learned a thing or two about how to ensure projects are completed on time, and within the financial parameters. In fact, if you do it right (and efficiently count the costs), it’s absolutely possible to complete your project under budget — something that supposedly “just never happens” in the construction world. To make it happen, there are five strategies you need to know. #1: Understand the entire process of project due diligence. After defining the vision — and before you begin to think about the details of the building itself — consider the impacts. Some people call this “doing your due diligence” on the property. Translation: If you’re doing new construction, you must first determine if the site is fully developed. One client in Alabama learned this lesson the hard way. Unexpectedly, the church had to incorporate utilities under a four-lane highway and run them quite a long distance to the property. This came with a $200,000 price tag! Obviously, this cost was immediately taken out of the overall budget, which affected the end result. The church demanded an explanation from the architect, but he couldn’t help. No architect will question the potential difficulties of bringing in the utilities; it’s just not within their scope. 16

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#2: Get your priorities straight — right from the start! A wise church once asked: “Do we determine what we want, and then figure out how much it will cost? Or, do we figure out how much we have to spend, and then decide what we can afford to build?” Most churches answer this question backwards; they start with what they want to do, and then figure out what it’s going to cost. The vast majority of the time (82 percent), projects that begin without a budget, never get completed. So, do the budget first, before you begin that first phase of due diligence. You can expect the due diligence to have associated costs which must come right out of the budget before you pay for even one square foot of the new building. #3: Before proceeding: Check twice, and complete all due diligence. Due diligence gathers data which warrants the allocation of associated costs. Only after you’ve taken the time to complete all due diligence — and accurately apply cost projections — can you know how much is left for the design and construction of your building. Due diligence takes some time, but it’s an investment that will prevent a lot of heartache (or even disaster) in the future. churchexecutive.com

The Kirk Crossing Community Church project (Jenks, OK) spans nearly 35,000 square feet and includes a 510-seat worship area, a main gathering area with a cafe, and a separate children’s worship area, nursery, and classrooms for 3-, 4- and 5-year-olds. The children’s worship area seats 100.

#4: Design your building within budget parameters. Designing a building has several phases, starting with the concept, or schematic design. During this phase, you should have great input on what you desire in your building. Your design team should have an intimate understanding of your ministry. To this end, they should first ask how you do ministry, not what you want in your building. While design is often fluid and changes many times, these changes should be held to an absolute minimum once this phase is complete. Changing features after you start the next phase of the design process costs money. #5: Get accurate pricing prior to the design. This is big! The biggest, in fact! You absolutely must make sure cost estimate are done frequently, and are detailed during design. You also need to determine project costs, not building costs. Ascertaining basic square footage estimates of what you think it’s going to cost is a dangerous game. You need someone who truly understands what the real costs of construction will be. Rodney James served as executive pastor, then senior pastor, at Sequoyah Hills Baptist Church in Tulsa, OK, for 20 years. In that time, he led and completed multiple building and renovation projects. In 2012, James joined Churches by Daniels, Inc., in Broken Arrow, OK [www.churchesbydaniels.com] as director of business and finance. The company specializes in designing and building churches nationwide. churchexecutive.com

May / June 2016 • CHURCH EXECUTIVE

Keep an eye on this space!

Church Management Software (ChMS)

Expanding your church? Here are 3 ways to use the data in your ChMS to your advantage. By Bill Gifford Let’s be honest: church growth isn’t about the numbers. It’s not about how many people attend each week, or how many people are baptized, or the size of your budget. The driving force behind why you want to expand your church has deep spiritual roots that aren’t quantifiable. But, numbers play a key role in expanding the church — and are a great tool for enabling church growth. To get where you’re going, you have to know where you are now — and where you’d like to go. You need to create a map for planning your church expansion. This is where your church management software (ChMS) comes in. #1: Determine whether or not your church is growing. Pull your general attendance numbers for the last two to three years. To make it simpler, you can lump it into monthly totals or averages. Are the numbers increasing or decreasing? By how much? Calculate the percentage. Graph it so you can actually see the comparison from year to year. You’ll want to create these same graphs on a regular basis so you can track your progress over time.

#2: What kind of growth is it? Know your demographics. If your church is indeed growing, figure out where the growth is coming from. In general, there are three different types of church growth: biological, transfer, and conversion. Biological growth happens when existing church members have babies or adopt children. But just because a lot of babies were born this year, doesn’t mean your church is growing! Your membership also declines when members of the church pass away, so pull the appropriate reports from your church management software. If the birth rate is higher than the death rate, then your church is experiencing biological growth. 18

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Future installments in this series will help you mobilize ChMS data to identify and engage less-than-active volunteers and lapsed visitors — and foster reconnection with those key individuals. Transfer growth happens when people leave another church for various reasons and join your church. Transfer growth can happen quickly. For example, I was recently talking to the treasurer of a church where membership doubled almost overnight when a neighboring church split. Make sure you have a solid administrative team in place, as well as ChMS that can expand with you so you can handle a sudden influx of people. Conversion growth is when people who are “unchurched” join your church. Typically, this is the type of growth churches focus on when they’re setting goals. Once you understand your demographics, you can target your highest areas of growth and offerings. Here are a few different ways to accommodate the growth: • Add worship times to your schedule • Expand your current space, or move to a larger facility • Plant a church or add a second location • Offer live video streaming #3: How do you determine which option is best? Map your members!

Export the addresses in your database and map them so you can see where everyone lives. If the population is heavily saturated in one area, then adding worship times could be the solution. If your worship service schedule is already at capacity, then you could look at expanding your existing facilities, or having a second location where the service is streamed live. If the population is more spread out, maybe it makes sense to have a second location or church plant with its own worship services. Bill Gifford is the president of Icon Systems in Moorhead, MN. For more than 20 years, Icon Systems has been developing software that will meet the needs of any religious organization — from church plants to denominational offices. www.iconcmo.com

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Buying through a procurement services company Your ministry and monetary benefits, explained By Glen Witsaman A procurement services company provides a volume-based system of buying products and services through relationships with large, multi-facility clients, as well as with hundreds of manufacturer and distribution partners. With a sufficient base of customers, procurement services companies are able to leverage this collective volume and offer discounts and value to a variety of smaller clients — including, for example, church ministries, which might not buy quite as much on their own. Cost savings benefits for your organization For a church organization, the main benefit of purchasing this way is to simply save money for your ministry on quality products and services that often come with the support of manufacturer and distributor partners. The pure cost savings can be seen from the moment you sign on, with discounted prices on thousands of products for your foodservice, facility and sanctuary. For example, entegra has a negotiated contract for a popular brand of flatware (stainless steel forks, knives, spoons) in a Windsor pattern. This exact set of flatware would cost 14 percent more if purchased directly from a wholesale restaurant distributor at their list price. With price reductions like this across your church’s budget, the savings will be significant. That savings can be redirected to support the important outreach of your ministry. In addition to products, a variety of services — such as facilities management and cleaning services — are also offered through many purchasing organizations. Using these services frees up your staff and volunteers to devote their time to ministry tasks, instead of obtaining supplies or fulfilling janitorial responsibilities. Logistical benefits for staff and clergy Through the use of a procurement services company, a church can reap the benefits of a tested process that provides local and national purchasing options, as well as the ease of consolidated delivery through an established supply chain. There is a large industry distribution network throughout the country and having a company that can use that network provides you with reliable and safe delivery to your door. The process should also include responsive customer services to help the church customize its buying and maximize savings, with a live call center and client account representatives. This should include active procurement-based websites, such as entegra’s informative internet churchexecutive.com

presence at entegraPS.com. Online tracking tools will help you to seek out more savings opportunities within a program. A website can also deliver expertise from dietitians and chefs, educational webinars, recipes and menu guides — all resources that help you optimize your ministry. Intangible benefits for parishioners Flexibility to choose from hundreds of suppliers for your individual needs helps you to create a unique atmosphere in your church. Through a full-service procurement company, you will gain the ability to provide on-trend foodservice with healthy menus, sustainable foods, recipes and Grab ‘n Go options. You have opportunities to update every part of your facilities with new, affordable products. This can range from finding affordable warming ovens for your kitchens, to absorbent hand towels in the bathrooms, to the most beautiful flowers for your worship space.

“[E]ntegra has a negotiated contract for a popular brand of flatware (stainless steel forks, knives, spoons) in a Windsor pattern. This exact set of flatware would cost 14 percent more if purchased directly from a wholesale restaurant distributor at their list price. With price reductions like this across your church’s budget, the savings will be significant.” The advantage of working with a procurement services company like entegra Procurement Services depends on the use that your church organization makes of the purchasing opportunities, and the ongoing support available. One church will save money. A larger organization that can spread the savings across many facilities — such as an area conference of churches or a network of outreach centers — will likely realize the most value and savings when purchasing this way. Regardless of the volume, your ministry can use the savings it gets toward its mission, no matter how large or how small. Glen Witsaman is National Director of Business Development, Leisure & Faith-Based segments at entegra Procurement Services www.entegraPS.com, a non-fee-based purchasing company that provides customized procurement and distribution services for food and related supplies to many industries — including hospitals, schools, restaurants and church groups — in the United States and Canada. May / June 2016 • CHURCH EXECUTIVE

Finance & Lending Trends

The state of religious lending By Dan Mikes Religious institution expansion appears to be on the rebound, and the willingness of financial institutions to support this growth remains strong. At the same time, the religious institution segment as a whole seems to have learned from some of the challenges it faced through the downturn. In this post-meltdown era, physical expansion plans were less aggressive, and required a lower debt-to-income ratio. I should begin by stating that data to support these comments is not easy to come by. In fact, for this publication, the editor requested that the author provide observations supported by the experience of a single lender to religious institutions — albeit one which has loaned nearly $4 billion to houses of worship over 20 years of uninterrupted service to the segment — and one who reviews hundreds of loan applications annually. The loan applications alone provide insight into the expansion plans of these institutions, regardless of whether the loan amount was or was not approved. First, some historical perspective As we all know, the early 2000s were marked by strong growth. While home ownership was expanding at a rapid pace — due, in part, to lax credit standards — per the market observations of the aforementioned lender, so too were houses of worship. Many applicants reported receiving loan commitments for amounts in excess of the limit which the contributing lender was willing to approve. Prior to the downturn, the words “religious institution” and “foreclosure” were rarely spoken in the same sentence. Unfortunately, that changed when the economy took a turn for the worse, and many congregations struggled. Immediately following the downturn — between 2009 and 2013 — congregations kept their finger on the expansion “pause” button, perhaps 20

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due to higher unemployment rates and a general reluctance to go to their donors with a capital-pledge fundraising request, as typically coincides with religious institution physical expansion. For example, between 2003 and 2009, the hundreds of millions of dollars which were loaned to new customers was split 54 percent for refinancing, and 46 percent for new construction. (It should be remembered that bank loans typically term-out, and must be renewed or refinanced, at five- or 10year intervals.) By contrast, of the hundreds of millions of dollars loaned to new customers between 2010 and 2014, only 22 percent of those funds were for construction. However, in 2014 and 2015, construction within the religious institution segment increased — seemingly taking its cue from a declining unemployment rate. During those two years, 44 percent of the hundreds of millions which the referenced lender advanced to new customers were for construction. Based on the above, one might wonder if attendance at religious institutions drove the variability in construction activity. After all, why would an institution need (or want) to expand if adult attendance was in decline? Data provided by the same lender seems to imply an answer. Between 2005 and 2015, the average adult worship attendance across this lender’s total pool of customers increased every year except one. This seems to support the assumption that the apparent down-tick in construction activity was related to a reluctance to undertake capital expansion fundraising. While any correlation to fundraising and the unemployment rate is (from a purely statistical perspective) anecdotal, it is worth mentioning that this lender further supports its market observations based on continuing dialogue with its hundreds of religious institution customers. Expansion plans seem to be more moderate, with debt requests requiring lower debt-to-income ratios. This observation is based on the lender’s observation of an increase in its own “approval ratio,” or the percentage of loan applications which were approved for the requested amount of debt. It should be noted that financing offers typically carry contingencies like a loan-to-value limitation. However, the “approval ratio” is calculated without consideration of the eventual collateral appraisal valuations and, therefore, does not reflect the impact of fluctuations in the real-estate market. Also, this up-tick is not a function of any change in credit policy, as this lender’s credit policy remained static through the timeframes referenced in this writing. One final bit of good news for the borrower… The referenced lender reports a relatively stable “acceptance-ratio” (offers extended versus new customers won) through the periods referenced in the writing. This might imply that in spite of the problems which some religious institutions faced during the downturn, there appears to be no shortage of lenders willing to link arms with houses of worship — and march forward with them in support of their visions! Dan Mikes is Executive Vice President and National Manager of the Religious Institution Division, Bank of the West, San Ramon, CA. www.bankofthewest.com The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of Bank of the West.

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Intelligent Church Giving

Demystifying

DATA

A conversation on turning information into actionable insights to achieve your God-given vision

Our Panelists:

Curt Swindoll, Executive Vice President, Pursuant

Derek Hazelet, Senior Vice President, RSI Stewardship

H E L P I N G L E A D E R S B E C O M E B E T T E R S T E WA R D S .

Intelligent Church Giving Presented by: RSI Stewardship

Get the WHOLE conversation! Download the Intelligent Church Giving eBook [churchexecutive. com/ebooks#generosity] for a full-length transcription of the conversation, including several insightful “bonus” questions. And be sure to share this valuable resource with your staff ! 22

CHURCH EXECUTIVE • May / June 2016

Ben Stroup, Senior Vice President, Fundraising Communications, Pursuant

Joel Mikell, President, RSI Stewardship

Lance Taylor, Executive Pastor, Long Hollow Baptist Church (Hendersonville, TN)

Ron Edmondson, Senior Pastor, Immanuel Baptist Church (Lexington, KY)

For church leaders, analytics and modeling can sound cold. Impersonal. Nothing could be further from the truth. When thoughtfully collected and mobilized, they can be a hugely powerful ministry tool for any pastor. The key, of course, is to know which metrics matter most to ministry — and what to do with that data once it’s in hand. For that, we’ve called on an esteemed panel of ministry leaders and church giving specialists to discuss how data can help church leaders gain greater clarity and confidence to lead. Why do you think this idea (i.e., — using data to make ministry decisions) is an increasingly important conversation for church leaders to have? Ron Edmondson: Obviously, as churches, we’re competing with different things — time, resources and dollars. We have to be more efficient with our resources, just like the business world has had to do for years. We’re required to be good stewards of what God has given us. Ben Stroup: I think there’s so much in ministry that’s intuitive. It can be very easy to carry over that mind-set into other aspects of church leadership. The problem is when we’re ‘off’ — if there are myths to our intuition, or if our intuition is incorrect—we need the ability to re-center to something that we can know. That’s where analytics and modeling can help. Joel Mikell: I also believe there’s a growing expectation of the church to look at — and analyze — data. I’m on the budget finance team at my church, along with a few members who are young executives. One is a CPA. As we were working through the planning process this past fall at the church, they were asking, ‘Why don’t we utilize here at the church some of the tools and practices that are used in the business world?’ ‘Why don’t we start looking at some key metrics and analytics?’ So, there’s a generation coming into leadership that’s going to expect the church to tap into analytics and modeling.

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Derek Hazelet: The data the church has at its disposal is remarkable. What the church tracks in its church member management database is absolutely amazing. What’s fascinating about business intelligence is the ability to peek into the information and get ‘actionable insights.’ So, when we sit here and wonder if we can measure discipleship, there’s a good chance that there are some indications in our data that can offer clarity about what’s happening.

modeling can hurt you, because you’ll spend your time in reaction mode. As a church leader, if I’m simply analyzing data based on lagging indicators, then I’m going to be like a pinball every Monday when we pull the report. Oh, we’re down in children’s ministry? We’ve got to do something! Then, we wait for the next report to see if we’ve made progress. I’ve found that simply using descriptive data from report writing tools is like trying to drive by looking in the rearview mirror.

Why are some church leaders still hesitant about using objective information to make ministry decisions?

Curt Swindoll: It is. Knowledge is understanding; wisdom is knowing what to do with that understanding. Data is the same way as it relates to information; in effect, it’s meaningless points of content. Analytics is the process of turning that data into information in a form that [benefits ministry]. Modeling is a further extension, which gives us some kind of indication about what might happen in the future based on what’s happened in the past, or based on characteristics about people.

Ben Stroup: In my experience, there’s nothing in church leaders’ training or backgrounds that would suggest that they have a vocabulary or a sense of intuition to reach for this kind of data. They’ve certainly gone to college, and in a lot of cases have spent 90 credit hours in a graduate degree program. But, they haven’t been exposed to these ideas in even one of those classes. So, in a lot of ways, church leaders don’t know that they don’t know. Curt Swindoll: I also think there’s a perception that it’s cold; that it’s not spiritual. Ron Edmondson: Along with that, as a business-minded pastor, the pushback I get is, ‘God is in charge of the numbers.’ Curt Swindoll: I’ve heard [criticisms] of [equating] business with ministry for a long time, too. Years ago, I looked up the definition of business, and it’s this: a group of people committed to a common cause. I thought that was fascinating. By this definition, our ministries are more like businesses than a lot of businesses. You could say it’s a matter of semantics, but ministries do have financial responsibilities, and many aspects of what they do look very much like a business — payroll, income, expenses, financial departments, staff and so on. There’s an accountability that comes when measurement happens. I’ve looked at a lot of reports that didn’t tell me what I wanted to hear. But, in every case, now I was accountable to that information, because I knew about it. I had a responsibility for it. Typically, how far / deep are churches digging when it comes to evaluating their data? What areas are they most often tracking and analyzing? Joel Mikell: Unfortunately, most churches only look at what came in over the previous weekend. They are are not looking at trending, movement up and down, lost givers or new givers. Many church leaders just want to know if their church is in the black or in the red. Curt Swindoll: I agree; a lot of data analysis in churches is surface-level. Can you define what we mean when we say “analytics and modeling”? How is this different than the way church leaders currently analyze data? Ben Stroup: Many church leaders assume that a report writer is the same thing as analytics. However, a report writer aggregates and simply tells you what has happened — helpful, but not necessarily insightful when you’re trying to decide what to do next. Analytics and modeling allow you to identify the direction your church is headed based on those historical trends. Then, beyond that, it gives you the ability to identify what key moves need to be made to ensure the church will arrive at the outcomes it wants to create. Knowing what has happened isn’t enough to focus your efforts on the long-term impact of current ministry decisions. Derek Hazelet: That’s true. Not maximizing data with true analytics and churchexecutive.com

Lance Taylor: Some analytics we can do in-house. With regards to attendance, for example, we often measure whether or not a person was here. But, if we took attendance by how well people came, that would take our metrics to a whole new level. Similarly, when we look at generosity, it’s not just a question of whether or not a person gave — how well did they give? That additional factor alone pushes the analysis into a category we can’t do on our own. That’s why we’ve had to go to [RSI Stewardship] for help. Are traditional report-writing tools enough to provide the actionable insights churches need from objective information? Curt Swindoll: I don’t believe so. As Derek said, aggregating and reporting on information about what has already happened keeps you in ‘pinball mode,’ constantly reacting instead of strategically making decisions that are driving the church forward. Derek Hazelet: Right. You’re moving the numbers; the numbers aren’t moving you. Ron Edmondson: As church leaders, we have a lot more information than we use. Our software will do things we don’t even know it will do. So, if you really want to help churches, creating better tools is important. However, you also have to help churches understand how to use the data at their fingertips — how to convert it to simple, transferable items. Lance Taylor: It’s true that our software can do more than we use it for, but a lot of churches are limited by the people, in-house, who know how to maximize that tool. Even if we did have a bunch of those individuals on staff, we’d also need people who know what to do with the information that’s been generated. In this area, working with RSI, Derek [Hazelet] is our guy; he tells us each step of the way, ‘Here’s what we’re going to do.’ Then, he works with us — developing the plan, pulling information — and then walks with us through the whole thing. You know, our team is made up of pastors. We’re not always thinking in these kinds of ways. This partnership has taken us to a whole new level. We didn’t know we didn’t know these things. We didn’t know we could even find that information, much less that there was something we could do with it. What are some leading indicatorsthat church leaders might want to pay attention to? Derek Hazelet: Actually, all indicators can be leading or laggard, depending on how you leverage the information. Giving tends to be a lagging indicator if you only look at it when it’s gone or when it’s May / June 2016 • CHURCH EXECUTIVE

Attend the “Demystifying Data” Webinar! On Thursday, June 30 at 11 a.m. ET, join all these panelists — and the Church Executive staff — for a FREE webinar. In this 60-minute event, we’ll “deep-dive” on how to turn data into better, more effective ministry at your own church. Register now at http://tinyurl.com/ demystifyingdata

there. It becomes a leading indicator when you’re catching it earlier in the process — when you’re intentional about what’s happening along the lifecycle. If you are, you can make better decisions and communicate differently. You can change outcomes instead of responding to what’s already happened.

their giving capacity. In actuality, if we provide relevant, timely and specific messaging, we can challenge people to give beyond their current levels. That leads us to another common assumption — that people give at their capacity, and that a pastor is likely to cause frustration if he keeps asking them to give more. This particular analysis revolves around capacity versus interest. In one church, members clearly had interest in giving because they did so, and had a history of doing so. However, analysis determined a delta existed between members’ capacity to give, based on household income, and their willingness to give at those levels.

Curt Swindoll: We need to think about the steps in relationshipbuilding as a process. Activities, for example, are a common leading indicator. What’s the attendance in small groups? For volunteer participation? Are those numbers going up or down? How many weddings are we hosting? How about involvement in missions trips?

The case for analytics and modeling is clear. But, how can church leaders begin applying these concepts in their ministry today?

Ron Edmondson: As church leaders, we need real information, immediately. If somebody stops attending two or three weeks in a row — or stops giving for two or three months in a row — there’s a problem, somewhere. It’s an indication. At that point, it becomes a discipleship issue for me. Ben Stroup: Right. Let’s say, for example, the metric you’re looking at is active attendance. That’s something you can measure. A leading indicator is something that’s happening earlier on in the process. Had we been looking at that other information, we would have noticed that a member stopped going to her small group three months ago. And three months before that, she stopped giving. In so many churches, the congregation grows beyond its leaders’ ability to just kind of ‘know’ everybody. That’s why, as church leaders, you’ve got to be looking at the data — a relational, discipling, responsibility kind of standpoint. Joel Mikell: That’s important. Last week, I was looking at a church’s financial data with the pastor. He noticed that someone in the church’s top 10% of givers had fallen into the top 20%, and then into the top 50%, and then dropped out completely. It pointed out an opportunity for the pastor to touch base with that person — not about the giving, but more as a wellness check on him and his family. He found out there were some serious issues between the husband and wife, which was affecting the children. So, the data pinpointed a ministry opportunity. Ben Stroup: That’s why we talk about the idea that data doesn’t dehumanize the ministry process; it enhances it. How have analytics and modeling-driven solutions made a tangible difference in how church leaders approach ministry? Ben Stroup: A few examples come to mind. In one instance, a church only had active, valid email addresses for about 30% of its congregants. Yet, the church was using email as a way to communicate with members throughout the week. So, the general assumption was that just because an email was going out, everyone was getting the message. Of course, when we pulled the raw data, the reality was rather startling for church leaders. In another scenario, church leaders assumed the greatest majority of major gifts were coming from known financial leaders in the congregation. That’s a natural assumption. But, we discovered that the largest gifts actually originated in the general giving category; certain people started to give at smaller levels, and something drove them to give at significant levels. The implications of this assumption are huge. We sometimes limit what we’re willing to ask of certain groups because we think there’s a limit to 24

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Curt Swindoll: Obviously, we believe so strongly in analytics and modeling in the church. It’s not just about the ability to identify individual trends; it’s the ability to link those trends to larger relationships between members and the church. Analytics and modeling provide so much immediate clarity in areas where we struggle. And it’s not just about giving; there can be any number of communicative elements or qualities we can employ that have nothing to do with receiving and securing a gift. But, if we don’t have clarity — at a level that’s actionable — then we’re really shooting in the dark and working purely on intuition. I believe it’s important for church leaders to ask about some of the assumptions they could be making about their ministry: Are we communicating often enough? Are we asking often enough? Are we providing opportunities for engagement early on in the relationship process? Are we encouraging people — and thanking them for the giving they’ve done? Are we making the need known? These are the questions that some of the solutions we’re providing can help answer. Joel Mikell: In my own church, one of the questions I posed to our budget and finance team was: “Are the activities we are currently doing producing the results we want to see? And if not, then what do we need to do to change the results we desire? What do we need to do to grow people to the grace of giving? What do we need to do to engage first-time givers, and then turn those first-time givers into second-time givers? So, basically, one of the starting points is to determine what we’re currently doing that isn’t producing the results. Then, what do we need to change? Then we can start to make the changes that will deliver the results we want. Derek Hazelet: Analytics and modeling help church leaders identify the first steps they can take. Almost every church leader I speak with is wondering, What do I really know? Do I really have the confidence that if I put together this ministry plan, or budget, the money is going to come in to fully fund this vision? So, I think the first question is: Do you have a handle on it? Do you have a good feel for what’s likely to happen? Not what will happen (unless things are altered), but what’s likely to happen. To this end, are you maximizing your systems? Are you leveraging those systems? Are you tracking the right things? Those are the types of questions we’re beginning to help church leaders answer. — Reporting by RaeAnn Slaybaugh

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ACTS OF VIOLENCE: PREVENTION AND RESPONSE By Eric Spacek, JD, ARM

As church leaders, staff, volunteers or even members of the church, it is hard to imagine a religious facility being a prime target for criminals. Churches are seen as sacred and safe places; however, violent incidents of varying natures happen several times each year across the country. Because these places of worship are open to the public, churches have become more vulnerable to senseless acts of violence. As a church leader, you will be looked at as a symbol of hope when disaster strikes. While rare, violent acts do occur at churches. No religious organization, big or small, is immune to the risk of a violent episode. These acts may include robbery, assault, rape and even murder. The most common violent act is a shooting. Typically, these vicious attacks are carried out by people who have some connection to the congregation, and have oftentimes given a warning sign, such as threats, outbursts, disputes or other confrontations. There is no assurance that a violent episode can be avoided; however, your church can be prepared for the possibility of an incident occurring. Make your church less vulnerable • Working with your church’s safety and security team, designate a person to take the lead on security issues, and define responsibilities of that position. • Conduct a security assessment to identify your church’s vulnerabilities. This should be conducted in conjunction with your local law enforcement agency or other security professional. • Develop a church security plan and guidelines with defined roles for all members of your staff, including greeters, ushers and other frontline workers and volunteers. Use your local law enforcement agency to help form the church’s security plan. • In your security plan, include a seating location for ushers and / or security personnel — strategically stationing them in both the front and rear of the sanctuary. Be sure to also include lockdown procedures for all areas of the facility, crisis communications, and an evacuation plan for the building. • Establish a method for quickly communicating issues of concern, such as a weapon, to appropriate church personnel and authorities. Walkietalkies, two-way radios and cell phones might be appropriate to have on hand. • Establish a no-tolerance policy for fights, altercations and other disruptions. • Work with local law enforcement to provide training for staff and volunteers on topics such as dealing with disruptive individuals and identifying and diffusing potentially violent situations. 26

CHURCH EXECUTIVE • May / June 2016

• The use of professional or volunteer security guards at church has become more commonplace in recent years. Churches generally have three options when it comes to the use of security guards to help keep your ministry safe: - Hire off-duty law enforcement personnel; - Hire a professional security guard service; or - Maintain a security guard force at your church. What to do in the event of a violent incident If a violent incident occurs at your facility, the first priority is to protect the people in your congregation. To ensure everyone’s safety, follow these steps: • Call 911 as soon as it is safe to do so. • If there is an opportunity to keep the invader out by locking doors and / or closing off areas of the church, do so. • If there is an opportunity to remove all members and guests from the premises, do so as quickly and safely as possible. • Quickly control panic situations. Ideally, this will likely lead to a sequenced evacuation. • A church leader must take charge and provide orders to be followed. • All orders must be clear and direct, such as: - “Ushers, secure the building.” - “(Name), call the police.” - “(Name), secure the nursery.” - “Everyone, take cover on the floor.” While not every violent incident can be prevented, taking the steps outlined above can help your religious organization become better prepared for responding to criminal acts and for communicating to your congregation during a crisis. Eric Spacek, JD, ARM is the Director of Risk Management and Loss Control at GuideOne Insurance www.guideone.com in West Des Moines, IA. Before joining GuideOne, he served as Minister of Operations for a large Methodist church in Raleigh, NC, and was a liability litigation trial attorney in Washington, D.C. churchexecutive.com

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BEHIND the loan application What is the bank or credit union really looking for? By Darren Thompson & Richard Koon Developing a strong and trusted relationship with your lender can provide your ministry with competitive financing options, access to capital, and a reliable source of advice on financial matters. As your ministry looks to begin a relationship with a lender — or maybe improve an existing one — having insight into the mind of a lender will help you develop this vital partnership. Here are five strategies your potential lender is sure to appreciate. #1: Prepare an annual budget. Your budget should be a realistic and conservative roadmap for the year ahead. Although your ministry might have plans for growth, we recommend establishing a budget that reflects previous years’ financial performance. Rather than being based solely on last year’s numbers — or on projected growth for the year ahead — your budget should demonstrate a clear understanding of the financial trends of the church based on a three-year history. The budget process allows the church to make strategic decisions about goals, objectives and issues affecting various ministries that might need financial support. Knowing that you have a plan for the good days and the rainy days provides your lender an understanding of the financial abilities of the church and those who manage the finances. #2: Operate at break-even or better. Creating a budget with a 10- to 15-percent margin allows the ministry to operate at break-even (or better) and keep expenses lower than income. When your ministry produces positive cash flow, you create a sustainable operation that can handle the fluctuations that nonprofits typically experience. #3: Build liquidity. Cash is easy to spend, but tough to accumulate. When you create a budget and stick to it, the ministry will generate cash by keeping expenses below revenues. Building cash reserves is not just a sound financial management principle; it also provides the ministry with a safety net. Cash reserves allow the ministry to continue regular operations, even when unexpected events happen or as monthly cash flows fluctuate beyond the normal ranges. #4: Understand fixed expenses. Knowing your fixed expenses is important because it helps facilitate the conversation around what is discretionary. Mortgage payments, insurance and staff are a few examples of fixed expenses that the ministry must meet every month. However, it’s important to understand which expenses are able to be quickly eliminated or reduced should the ministry encounter lean 28

CHURCH EXECUTIVE • May / June 2016

times. During the Great Recession, ministries were scrambling to reduce expenses as income dropped. Developing a plan demonstrates sound financial management to your lender, the Board and your congregation. #5: Exhibit leadership and oversight. Although most churches are started (and sustained) on the spiritual vision and leadership of the senior pastor, a lack of leadership and oversight in the financial office can be very costly. It’s important for churches to establish a structure that supports transparency and shared leadership when it comes to money matters. Church boards should include non-related members with the skills and experience needed to provide guidance and oversight to the pastoral staff. This could also include additional checks and balances provided by independent committees who help develop operational budgets and periodically review the church’s financial statements. A proper leadership and oversight structure will provide protection for the pastor, adequate oversight, shared authority, and a commitment to transparency. Ultimately, lenders want to feel comfortable that your ministry has the planning, the processes and the protocols in place to manage the church’s financial operations. Presenting a budget, operating at a surplus, building cash reserves, and having a detailed understanding of how the cash flow of your ministry works will go a long way to getting you the best rates and terms. And if you find the right lender, you will have a trusted partner who is aligned with your values and can be relied upon as you reach for your ministry goals. Darren Thompson is Vice President of Credit Services for America’s Christian Credit Union in Glendora, CA www.americaschristiancu.com. Richard Koon is Vice President of Ministry Lending for America’s Christian Credit Union in Glendora, CA.

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TAKE THE LONG–TERM

By Rich Maas Portable room dividers are essential equipment for any church – especially growing churches. They’re forever useful as a church’s ministry offerings — and physical campus — expand. So, they should last a long, long time. That kind of longevity doesn’t come cheap … or without careful, considered selection. Many church leaders have never purchased portable room dividers. To that end, they’re not always sure what kind of investment these valuable ministry tools represent. To provide a framework, we’ll use our company’s three different room dividers lines — all made in America — as examples: light-duty, allpurpose, and heavy-duty. While heavy-duty dividers are beyond what churches require, allpurpose dividers are extremely popular among church clients. We offer 36 sizes in this line, from 4 feet high and almost 6 feet long up to 8 feet high and just over 24 feet long. After customary discounts are applied, investments begin at roughly $500 for our smallest all-purpose divider. Our most popular sizes are 6 feet high and approximately 17 feet and 20 feet in length. After discounts, these range from $1,200 to $1,400 apiece. Light-duty dividers (as their name implies) have fewer bells and whistles, and not as many fabric choices. These start at $400 each after discounts at 6-feet-5-inches high x approximately 6 feet long. So, as you can see, portable room dividers aren’t a small investment — but, a properly built divider is intended to last a lifetime. To this end — and in the interest of the best possible stewardship — longevity should be No. 1 on the list of selection criteria. To ensure you are getting not only the quality, but also the correct dividers you need, we offer a complete — and free —planning service. Simply tell us the size of the room you will be using the dividers in most of the time, and what you want to accomplish. We will send you a plan in both 2-D and 3-D which you can review with your committee members. OK — but, what does a long-lasting portable room divider look like? To answer that, let’s start with what they don’t look like. Many years ago — when my brother was in the church design and construction business — he was visiting a client in Wisconsin. They invested in T-leg panels (common in offices) because “the price was right.” He noticed that four or five were leaning up against the wall after their “feet” broke off; they were awaiting repair by a local welder. Suddenly, the price looked a lot less … “right.” And really, this is the most common mistake church leaders make when investing in portable room dividers: buying cheap. It’s no different than buying a car or a house. To make the best long-term investment, you do your homework, you check out the products, and you — ultimately — realize that quality will cost you a few more bucks. In return, you will get more value for your church’s dollars. Interesting … but I still need to know what to look for Good point. When vetting divider options, pay special attention to a handful of critical structural components: churchexecutive.com

Connections, connections, connections. The longer a divider’s hinges between the panels, and the more screws used to connect that hinge to each panel, the stronger it will be in the long term. For our most popular-height divider — 6 feet — we use 34 screws and a full-length hinge to connect two panels together. (Yes: 34!) In contrast, cheaper dividers feature only one geared connection at the top and bottom of each panel pair. Position controller. As depicted (right), this rounded device helps keep the divider in place at any angle. It also “locks” in place at common 90- and 180-degree settings. You’ll see we use four screws to keep that position controller firmly affixed to the panels. The full-length hinges mentioned above and the position controllers work in conjunction with each other. We make these components ridiculously strong because it’s this spot where dividers most commonly wear out. (People aren’t always gentle with things.) End frame connectors. In the image (left), you’ll see the black, sleekly curved end frame which not only gives the divider much of its stability but also is used as a very convenient handle to move the divider. The means by which the end frame is connected to the panel set is critical, since this connection must absorb the twisting, turning, grabbing and pulling as the divider is moved within the church, over thresholds and so on. Accordingly, a well-built, long-lasting divider will have all three of these connections: 1) The panel will actually be inserted into the end frame; 2) This panel / end frame combination will be screwed together from both sides for superior strength; and 3) A gusset plate will be added at the bottom, connecting the two members yet a third way. These important connections can be seen in this short video. Do you want your new dividers to serve you for years and years? Make sure any portable dividers you invest in are connected in this fashion. Self-leveling casters. For enhanced stability, our dividers feature self-leveling casters. Have you ever sat at a wobbly table because one leg wasn’t touching the ground? This happens on room dividers that have fixed-height casters. Our dividers are never wobbly or unstable, because every wheel makes full contact with the floor. These ‘What to look for’ features can be seen in this short video. The proof is in the purchase order We believe that repeat business is the biggest indicator that our quality design approach is working, long-term. Many church and school clients — or, as is often the case, a combination of both — order additional room dividers from us as their ministries and facilities expand. Taking Phoenix as an example, we have many customers that fit this description. Several have bought twice. Another customer bought in 2007, 2010 and 2015. Another church has re-ordered five times. In the same city, one school district has bought from us on eight different occasions since 1999, and another has bought on 10 different occasions. If you’d like the list — or a list for your local area — let me know. We are proud of our loyal customer base. To us, this is the biggest testament to our products’ longevity. After all, would you order more of something that didn’t work the first time? Rich Maas is vice president at Screenflex Portable Room Dividers [ www.screenflex.com ] in Lake Zurich, IL. May / June 2016 • CHURCH EXECUTIVE

SOUND SYSTEMS

Beautiful sound,

naturally

The Grotto — a stunning outdoor sanctuary in Portland — is a truly challenging audio environment. First and foremost, church leaders needed awe-inspiring audio to match the sanctuary’s surroundings. But, the system also had to be flexible, reliable, durable … and discrete. Here’s how they got everything on their wish list. By Mike Lethby

Known as “The Grotto” since its founding in 1924, The National Sanctuary of Our Sorrowful Mother in Portland, OR, is a rare “place of solitude, peach and prayer” in a bustling city. For nearly 100 years, this beloved Catholic Shrine and botanical garden — spanning an amazing 62 acres — has served as a source of spiritual respite for worshipers and visitors alike. What makes it so unique is its conception and design as an outdoor cathedral; it marries religious significance with natural scenic beauty — dramatic rock formations, towering fir trees and lush gardens. Our Lady’s Grotto, the central attraction, was carved from solid basalt in the cliff wall in 1925. Above its natural rock altar is a white marble replica of Michelangelo’s Pieta. With more than 100 religious sculptures and two glorious chapels, it’s no wonder that The Grotto draws more than 200,000 visitors per year, representing all faiths and countries. It’s one of the most beautiful Marian sanctuaries in North America, and perhaps the world. A place of light and sound, The Grotto is home to the annual Festival of Lights during the Christmas season, and more than 140 choirs throughout the year. Wait … doesn’t it rain a lot there? It does. In this sense, the Pacific Northwest’s reputation is well warranted. However, the months of May through October bring very little precipitation — and, not surprisingly, this is when The Grotto (for which the entire property is named) “comes into its own. It’s difficult to envision a lovelier site for Sunday Mass, a wedding or other religious celebration … and there are many, here, during those months. But, it’s not all sunshine and roses; although gorgeous, The Grotto is a challenging environment in which to run a live sound system. The winter brings heavy rain and occasional freezing temperatures. And, the seating area slopes down and away from the actual grotto and the altar in front of it, making it difficult to ensure sound coverage. And of course, the Friars are not experts in modern audio technology. Even so, their audio requirements can range from simple background music to elaborate services combining singers, musicians and the spoken word. Fortunately, they and the staff can call upon the expertise of Design Sound Northwest (DSN), a local AV systems design and integration firm

CHURCH EXECUTIVE • May / June 2016

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headed up by Craig Leppert, principal. Leppert was instrumental during The Grotto’s most recent construction phase, an endeavor which included a remodel of the outdoor worship space. For this unique — and unusually challenging — audio environment, Leppert had the foresight to install extra conduits under the concrete and asphalt. These conduits run from the altar area in front of The Grotto to a small building that houses much of the electrical and audio infrastructure. By design, smartly, these elements are protected from the elements. Ease of use was another priority for Leppert and the client. To create a simple, yet flexible, interface — one that’s easy to understand — he linked a wireless AMX NetLinx control panel with a Biamp AudiaFlex digital signal processor. Hailing back to the need for flexibility, Leppert was able to set up three operating modes: Daily (read: low-level background music), Small Group, and Large Events. Each is selected, as needed, from the AMX panel. Normally, it sits on a desk inside the control room; however, Leppert and his team also installed a high-gain directional antenna so that musicians can take the panel outdoors to control input levels. “We gave the end users a very basic, limited set of options,” he explains. “We programmed presets into the Audia with individual level and EQ settings for every channel, for quick and easy setup. The wireless AMX panel allows simple adjustments to be made on the fly, from any location, so the musicians are in control of their performance.” For small services, the “Small Group” preset gives users access to four wireless microphones and allows them to control the CD player. For the Large Events preset, DSN pulled a multicore snake through one of those spare conduits: it is terminated with a 60-pin LK disconnect in a waterproof box near the musician’s staging area. To set up for a large service, the staff simply picks the right preset and connects the remote mic snake, instantly giving them 16 wired mic channels, foldback monitors, four wireless mics and CD / Tape playback. By design, the celebrants are well served by this system … But what about the worshippers? With thoughtful design, Leppert has them covered, too. One of DSN’s key objectives was to provide quality sound to an extremely wide, downward-sloping seating area (with the added challenge of residential neighbors across the street from the rear), all without compromising The Grotto’s unique fusion of natural and manmade beauty. “We tried lots of different ideas,” he recalls. “My first thought was to hide some big directional speakers up in the trees, but there were too many practical issues.” Indeed: Though portable speakers could do the job, as Leppert explains, there is no way to (a) fill the hole in the middle of the seating area, or (b) keep the sound from shooting over listeners’ heads. Not to mention portable speakers require a labor-intensive setup. Plan B wasn’t a great fit, either: hanging compact loudspeakers from the arms of The Grotto’s light poles — as Leppert calls it, “the Disneyland approach.” The problem with this scenario was the large visual footprint. Avoiding this was very important to the client, particularly Executive Director Father Jack Topper. So, Leppert and his team considered a third option. A digitally steered column could mount flush to the light pole, becoming almost invisible — or could it? Not so much, as Leppert and his team found out. Even though the speakers could be removed and stored inside during the winter, they still needed protection from the unpredictable Portland weather in the other months. “The first major manufacturer we considered told us we would need a separate fiberglass enclosure around the loudspeaker,” Leppert recalls. “That would have been too bulky and clumsy-looking.” Neither of those distractions would pass muster with Father Jack and the other leaders at The Grotto, who prioritize aesthetics.

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Even so, DSN built a fullsize mockup in the shop so The Grotto staff could assess the visual impact. “After having it mounted on the light pole only one day, Father Jack and the staff rejected it,” Leppert recalls. “They said it would be too intrusive.” Another year passes without the perfect solution During that time, the Grotto made do with a portable system. Then, Renkus-Heinz announced its Iconyx series of digitally steered arrays. Importantly for the aestheticsfocused church staff, the modular Iconyx arrays could be made weather-resistant without expanding the aluminum enclosures. So, they weren’t bulky. What’s more, each Iconyx module had an eight-channel, DSP-driven amplifier inside to accomplish the array steering. For reliability, AC power was supplied via Furman power conditioners, with ground fault interruptors in line, just in case excessive moisture does appear in the electronics compartment. Renkus-Heinz also brought years of color-matching experience to the table. As such, they were able to exactly match the existing light pole color. Still, a dummy installation was still a pre-requisite for final approval. “We mounted a dummy enclosure on the pole for over a week,” Leppert says. “Father Jack told me that he walked right past that pole numerous times without noticing it.” Although the client was satisfied, Leppert and his team spent a few more months researching and developing specialized stainless steel mounts with built-in security features and UDP inserts that fit the light poles tightly without marring the paint. The mounts are tamper-proof, but also so simple that grounds staff can remove the Iconyx enclosures in only 15 minutes for winter storage, and then re-install them just as easily once the rains take a break. Next up: troubling acoustics With the visual and mounting hurdles surmounted (beautifully), DSN turned to the acoustic problem at The Grotto. To optimize the coverage, Leppert and his team conducted a basic Enhanced Acoustic Simulator for Engineers (EASE) model. “The wide, 140-degree horizontal pattern works well in this application, even though the two light poles are very far apart,” he explains. “With the digital steering, we can mount the arrays flush on the poles, yet aim the sound downward so it covers the seating area well without annoying the neighbors.” Clearly, attention to detail is a guiding principle for Leppert and his team at DSN. Their thoughtful approach to delivering naturally beautiful sound at The Grotto — including the incorporation of aesthetically pleasing, yet durable and effective loudspeakers — is one of the main reasons he and his crew enjoy a long-standing relationship with leaders at this iconic outdoor sanctuary, as well as many other corporations, religious and educational institutions in the Northwest & Alaska. Naturally beautiful sound: achieved. Mike Lethby is director of ML Media Ltd. This article was prepared on behalf of Renkus-Heinz, Inc. [ www.renkus-heinz.com ]. Located in Southern California for more than 35 years, Renkus-Heinz is a manufacturer of high-end professional loudspeaker systems. May / June 2016 • CHURCH EXECUTIVE

PROACTIVE & PENNY WISE

As time passes, the RUL of each component naturally decreases. Since outside factors (such as the quality of materials, workmanship, weather conditions and preventative maintenance) can all have mitigating effects on RUL, the rate of the decrease might or might not correspond to the number of passing years. However, we can clearly define an item with a Remaining Useful Life of “zero” years as having reached the end of its Useful Life. The Capital Plan also serves as the church’s cash flow management plan, crafted to provide funding that allows for “timely” repairs and replacements. “Timeliness” in a Capital Plan means making a repair or replacement within the year when a component’s RUL reaches “zero” years.

By Matthew C. Swain, RS

The end of a component’s Useful Life (UL): 3 failure categories There are three general ways components reach the end of their Useful Life (UL). Understanding these differences will help you make a wise and appropriate decision about executing the project in a “timely” manner, per the Capital Plan schedule, or — wisely — deciding to wait.

Examining repairs and replacements for houses of worship We know a few things about the future: 1) that it will come, and 2) it probably won’t be exactly what we expect. In this spirit, we counsel our house-of-worship clients to be proactive by preparing for the repair and replacement expenses that are both inevitable and predictable. But, we also counsel them to be wise. When your capital plan shows a component has reached the end of its “useful life,” it should simply be replaced — right? Not necessarily. A “leaking” roof has clearly failed and requires immediate attention. But, what about those outdated restrooms which are still quite functional? Should we postpone repairs to a cracking parking lot, or should we schedule to resurface it right away? Let’s begin by reviewing some basic concepts A church needs to know the condition of its major capital assets to wisely and cost-effectively budget for their eventual replacement. This foundational information is communicated in the Capital Plan’s Component List. The “scope” of a project is communicated by the project’s Description and Replacement Cost ($). In the example below, it’s easy to see that the scope of work for sealing the asphalt ($8,000) is significantly less than resurfacing ($150,000).

The “schedule” of repairs is communicated by a combination of Useful Life (UL) and Remaining Useful Life (RUL). The UL is an estimate — measured in years — of how long the component was designed to fulfill its intended function. The RUL is an estimate — also measured in years — of how much longer the component will perform its intended function.

#1: Catastrophic failures This category includes components whose intended function is essential to the health, safety or comfort of people. Boilers, fire alarms and AC systems might — based on observed age and deterioration — have reached the end of their Useful Lives, but could still be serving their intended functions. However, they could fail “at any time” and cause significant expense, disruption or liability exposure. As such, it is wise to make repairs and replacements in a “timely” manner, as opposed to waiting for a catastrophic failure to occur. #2: Slow, gradual failures Asphalt, paint, fencing and roofs fall into this category. The component might be at the end of its Useful Life but still be serving its intended function due to mild weather, low use, enhanced maintenance, or simply good fortune. There might be an opportunity to delay this repair project, on the condition of annual inspections and re-evaluation. However, in the case of wood painting and asphalt seal coating — where the repairs or replacements protect the underlying construction material — “timely” repairs are essential! Delays in these cases might void a warranty or cause significantly increased future repair or replacement expenses. #3: Obsolescence Components facing technological or aesthetic obsolescence have Useful Lives that outlast their “value.” The shag carpet in the fellowship hall, the dated appearance of the elevator interior, and the ancient message board with press-on lettering are good examples. Even though the RUL might have reached zero, waiting for the component to actually fail has little consequence. People can survive a week, months or years until the item is repaired or replaced. However, while the church can generally postpone these types of repairs after the RUL has reached zero, deferring indefinitely is usually not in the best interests of any organization that wants to remain relevant in the eyes of its members, and wants to be appealing to visitors. Everyone loves saving money, cutting back, and reducing expenses. However, sometimes there is a tendency to focus on the wrong things, which makes it easy to neglect the larger picture. Understanding the different ways a component serves the mission of the church — and the implications of its eventual failure — helps church staff make wise decisions. It is crucial for a church to be aware of all the components in its Capital Plan that have reached the end of their Remaining Useful Lives and make wise, informed decisions about when (or when not) to embark on the repair or replacement project. Matthew Swain, RS, is Worship Facilities Specialist at Calabasas, CA-based Association Reserves. [ www.ARCapitalPlans.com ] He is a certified Reserve Specialist and has been preparing capital plans for non-profit organizations across the country for more than a decade. Swain currently serves as the national representative for AR Capital Plan’s worship facility clients.

CHURCH EXECUTIVE • May / June 2016

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Multisite & Portable Churches

How to accommodate — and engage — kids in a multisite or portable church venue By Scott Cougill Creating an irresistible, welcoming environment for young families and their children is important for any church.

that equipment is stored and transported in heavy cases built in the back garage that scratch floors, the church appears anything but professional to the school. I have witnessed over and over that when the church invests in a professional portability solution, the school / theater / community center treats them better, more professionally, and with more grace. Theater best practices Can you do children’s ministry well in a movie theater venue? Yes. It can be done well and is being done well by hundreds (maybe thousands) of churches across the country weekly. Valley Christian Church in Poughkeepsie, NY, is one of those churches that does children’s ministry well. They partnered with Regal Entertainment Group and Portable Church to design an excellent and inviting church environment for young families. You can learn more about their story here.

However, when you are a church that meets in a rented facility, what additional things should be considered? What are the best practices? A great first experience When I was an executive pastor of a multisite portable church, we had a saying that went something like this: “The gospel is offensive enough (Gal 5:1, Rom 9:33); we don’t want to add to the offense by our poor planning, systems, or a visitor’s negative first experience with our church.” The children’s environment sends a message. Think about the message I received from the church I visited with my children when I arrived 10 minutes before service time and found many adults milling around and inside the classrooms. People were still organizing the room, and a back door to the classroom was open. I got the message that this church was disorganized — and maybe didn’t think any visitors would show up today. Contrast this with Action Church’s new campus launch in Oviedo, FL. Church leaders engaged Portable Church Industries to design their children’s area at the high school they rent so that new families would have a curbside personal welcome, easy check-in experience, a volunteer escort to the classroom (past a security guard) which was separate from the main worship area, and special treatments in the classrooms that were bright, colorful and engaging for children. Visiting Action Church, you get the message that Action Church expected visitors and was prepared for them. Visitors will likely conclude that Action Church is this organized and intentional with all aspects of their church. Launching a new church or campus in a rented facility offers many benefits that permanent locations don’t — lower cost, speed, flexibility, community partnership, and volunteer engagement. That said, creating an excellent and inviting children’s ministry in a rented venue requires different planning and preparation than a permanent campus. From our 20+ years assisting churches launch in rented spaces, here are some best practices of churches that launch children’s ministry well. Overall best practices Finding enough volunteers for children’s ministry is challenging in all churches. When you add the extra volunteers needed for setup and teardown, it is critical to take the extra time and expense to design setup / teardown solutions that are volunteer-centric — designed to maximize both the volunteer and participant experience. Churches that plan ahead and engage portability experts when designing their portable children’s ministry have better success and don’t wear out the volunteers as quickly as churches that do it on their own. As a church that will interface with the landlord and community, you will want to be treated professionally and have a professional relationship. But, if Sunday setup requires extreme early arrivals — because you have hundreds of totes and equipment not designed for quick setup — and if churchexecutive.com

School best practices Two (of many) best practices for schools are using treatments and partnering with the staff of the local school directly. Many school rentals are organized by the district office. But, it is the local teachers and custodians who are most impacted. Churches that serve the local school without strings attached create the most favor and best partnership experiences. A number of churches get teacher classroom supplies wish lists and make sure they are filled. Others flood the school with willing volunteers to read and serve. An interesting story about one church (Faithbridge Church) that launched strong in an elementary school is here. Here are some photos of school treatments that create welcoming environments for children:

Scott Cougill is CEO of Portable Church Industries in Troy, MI, a company that has partnered with more than 2,000 churches to launch strong and thrive in rented spaces. Find Cougill on Twitter @ScottCougill. For more information, download a free eBook that goes into many more specifics about volunteer structure, training, setup strategies and staffing. May / June 2016 • CHURCH EXECUTIVE

CONTINUING EDUCATION

Igniting hearts through miracles & healing Raised in a traditional Baptist home, Timothy Berry thought his path in life was to become an engineer. That all changed at age 19, when a calling from God radically altered his course. Berry began to intensely pursue a deeper experience and understanding of God’s love, presence and power. He moved to California to study under Minister Randy Clark — known for his gift of healing and miracles. Clark became Berry’s mentor, and together they traveled to conferences, renewal meetings and crusades throughout the United States and the world. A humble, spiritually hungry Berry says he began to “see miracles happening in my life on a regular basis.” Clark recommended Berry pursue a religious studies degree at Regent University, due to the school’s “renewal” perspective that embraced the renewing work of the Holy Spirit. “My undergrad experience was great!” Berry recalls. “I loved the feel of Regent and the professors.” During that season of his life, he adds, “The Lord spoke to me to get serious about my personal ministry — to ‘ignite hearts for Christ in every nation’ — which would become my ministry’s slogan.” A solid foundation for spiritual, professional growth Shortly after marrying in 2010, Berry and his wife, Elizabeth, founded Hearts Ignited Ministries International. He then worked as an itinerant pastor, traveling up to 180 days of the year. While fulfilling this call, he pursued his Master of Divinity degree at Regent. The program’s flexibility enabled him to learn from anywhere — whether Berry was at his home in California or on the streets of Mozambique. This approach meant he could accomplish varying goals, together with Regent faculty. “The professors understand people who are multiministry and have families,” he explains. “I would email a professor about a pastoral emergency, and [that professor] would give me grace and grant an extension.” Berry says he was especially impressed that the professors — who have decades of experience — treated their students as peers; as people whom they wanted to raise up to their same level. “To realize you have a voice, and have a chance to become like them — it changes the whole dynamic of the program,” Berry shares. “It’s so uplifting. Regent is cutting-edge on the best ways to empower and equip future leaders.” Today, Berry says, about 50 percent of what he does in pastoral ministry comes directly from Regent’s divinity program — from preparing sermon notes, to creating personal boundaries that protect his family from being constantly driven by his work. 34

CHURCH EXECUTIVE • May / June 2016

“To realize you have a voice, and have a chance to become like [your professors] — it changes the whole dynamic of the program. It’s so uplifting.” “At a different seminary, I would not have had the same partnerships and freedom to express my charismatic background,” he points out. “Regent really placed me at a higher level, and I am different because of it.” About the education Regent’s School of Divinity is a multidenominational seminary located in Virginia Beach, Virginia. The school offers a spectrum of course-delivery options — completely on-campus, completely online, online with minimal residency, and blended structures — to put students in the driver’s seat as they earn their degree. Recently, their Master of Divinity and Master of Arts in Practical Theology was approved by the Association of Theological Schools (ATS) to be offered completely online, with no residency. Other Regent programs include the Master of Theological Studies, M.A. in Christian Spirituality & Formation; Master of Theology; Doctor of Ministry; and Ph.D. in Theological Studies. “At Regent, no matter which format you choose, you will receive an affordable, streamlined, high-quality education,” says the school’s dean, Dr. Corné Bekker. “More than that, you’ll receive a biblically based education that emphasizes the vital role of the Holy Spirit in transforming lives. “The Regent University School of Divinity will prepare you for a multi-ethnic, multicultural and multigenerational ministry,” Bekker adds. “You will experience academic excellence that reflects the mind of Christ and empowers you to serve with the heart of the Father.” This article is provided by Regent University’s School of Divinity in Virginia Beach, VA. Explore your program options by contacting an advisor at 800.723.6162, or visit regent.edu/divinity. churchexecutive.com

Pursue Your Ministry Degree. Live a Lifetime of Calling. Creating ministers with longevity. That’s one of Regent University’s core strengths, says traveling pastor Timothy Berry (‘15). While earning his Master of Divinity online, Timothy continued working around the world to expand his Hearts Ignited ministry. Even from the depths of Mozambique, he could count on Regent’s flexible, committed faculty: “The professors are supportive, and they treat you like peers.” On campus or online, you’ll gain scholarship and practical tools to live out your calling. We’re ready to lead you. M.A., M.Div., MTS, Th.M. Ph.D., D.Min. ON CAMPUS & ONLINE

APPLY TODAY.

success.regent.edu | 800.723.6162 The School of Divinity is accredited by the Association of Theological Schools (ATS), with approval for a Comprehensive Distance Education Program. DIV150592

CONTINUING EDUCATION

Online education for busy pastors How Villanova’s Center for Church Management & Business Ethics is making it easy for busy pastors and church leaders to continue their education. Continuing education might seem like an impractical proposition for many busy pastors. During a typical day, pastors are engaged in the daily lives of their congregations. They spend their time offering counseling, consoling the bereaved, visiting the sick, and reaching out to the disenfranchised of their church communities. When they are not directly interacting with their flock, pastors spend significant time preparing for services, writing their sermons, and planning for the future of their congregations. For more than a decade, Villanova University’s Center for Church Management & Business Ethics has offered an extensive array of online and satellite educational programs for busy pastors and church leaders. In addition to a Master of Science in Church Management (MSCM) that can be completed online, Villanova also offers online webinars that can be taken individually or together for a certificate in Church Management. “These programs offer busy professionals the opportunity to learn church management concepts in a flexible and user-friendly environment,” says Michael Castrilli, an adjunct professor in the MSCM program, and instructor in the webinar series. Master of Science in Church Management The online Master of Science in Church Management is an innovative, two-year graduate business program that provides busy pastors and church leaders with a high-level skill set in church management. It is ideal for professionals who cannot take leave of their positions to relocate and pursue full-time study. With the exception of a one-week residency on the beautiful Villanova campus, the program can be completed online in only two years of part-time study. The program aims to provide the practical skills necessary for successful stewardship of a church. “Participants are able to join a live online classroom and actively participate through polling questions and opportunities during the session to engage in Q&A with the faculty,” says Castrilli. “Flexibility is a key component of the program. For those days / times when participants can’t join due to a schedule conflict, they can go online and view the recorded session.” Examples of courses offered: • Civil Law and Church Law for Church Administrators • Stewardship and Development • Financial Reporting and Controls • Human Resource Management in a Ministry Setting • Information Technology for Churches Church Management Certificate Webinar Series The Center for Church Management & Business Ethics, in partnership with Our Sunday Visitor and AmericanChurch, Inc., also offers the Church Management Certificate Program webinar series. The series of 12 web seminars is designed to allow busy pastors, priests, business managers and other church administrators to continue their education without having to leave the privacy of their home or office. 36

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The webinar series is designed to help church leaders of all denominations deal with common temporal problems. Webinar participants will learn how to use those resources as effectively as possible to meet their ministry goals. This innovative series of 90-minute webinars can be taken as a whole program for a Certificate in Church Management from Villanova University, or individually, depending on the interests and needs of the pastor or church administrator. Examples of webinar topics: • Church Security and Loss Prevention • Leadership Development • External Communications / Church Marketing • Church Websites • Social Media for Churches • Church Budgeting According to Castrilli, “The webinars attract a wide variety of church professionals with diverse roles and responsibilities. This provides opportunities for participants to not only learn from the instructor, but also from other students in the program.” This article is provided by the Center for Church Management & Business Ethics at the Villanova School of Business in Villanova, PA. churchexecutive.com

Streaming Made Simple

3 key qualities Mastering the art of effective church streaming By Andrew Ng Based on feedback from our church clients, we know three qualities are absolutely essential to a quality live stream. #1: An online campus This is one of the best things a ministry can have — somewhere social media followers, members and prospective members alike can go to find all the church’s news, content and media (including the live stream). Generally, this online campus “lives” on the church website; however, a Facebook page is a great place to house it if your website isn’t up to the task. When streaming to Facebook, you can stream content to your own timeline or to someone else’s — if, for example, a new member wants to share his or her baptism with their network of friends. You can also stream that content to a Facebook group or page. This is particularly effective because: • Most people and organizations already have a Facebook page and following — including your church. • Facebook just opened itself up to live streaming with its Facebook Live platform. • All our company’s streaming solutions are equipped to broadcast to Facebook. So, it’s really easy to do. • Facebook offers immediate, built-in interactivity. By design, viewers can chat with each other — and ask questions about what’s being presented — in real time. So, there are a few different, compelling options for streaming to Facebook. And all this brings us to the next key quality of effective live streaming … #2: Interactivity & engagement One thing every quality live stream has in common is audience engagement, whether it’s in real-time or post-broadcast. If you build engagement, people will come back. They’ll want to “talk.” In fact, some churches have found the online campus experience is even more interactive than the live event. When people physically attend a worship service, they don’t necessarily feel free to talk with each other until afterward. Online, no such stigma applies. Take, for example, online gaming — another space in which our products offer solutions. More often than not, the “Comments” box is overflowing. That’s why a company such as Twitch — a major online platform for video game broadcasting — continues to thrive: community. To me, this kind of engagement has resonated within houses of worship, as well. It really makes the stream worthwhile. #3: Reliability The concept of being engaged is kind of like going to a movie. You go to a theater. It’s big — big enough to occupy your whole field of vision. It’s dark. churchexecutive.com

You feel like you’re in the movie. But, any distraction (even a piece of dust on the projector) reminds you where you are. It takes you out of the moment. Engagement in a live streaming event works the same way. If viewers experience a drop-out, or if the image quality is poor, it’s disengaging. Because reliability matters — a lot — we’ve designed our products with professional TV broadcast requirements. By its nature, this keeps reliability at the forefront. Get the right tools for the job The first decision to make is what kind of content you want to live stream. Then, you’ll need to decide how to capture the live video / content. Typically, this is done a few different ways. First, there’s the traditional camcorder. If this is your chosen method, we offer devices — the Teradek VidiU product family, for example — that attach to the camcorder and stream the content to the internet. (As a more advanced approach, you could use a multiple-camera setup.) If you prefer something more mobile, our Live:Air app lets you use your iPad to capture the video and stream it online. Once content is online, you must decide how you will present it. If you want to offer a chat feature, quite a few content delivery networks / platforms can deliver. A few popular platforms are Wowza and Ustream; another is Churchstreaming.tv. Ultimately, however, you can use platforms that are available at no charge, including YouTube Live and Facebook Live. Finally, a few words of advice before you go too far down the live streaming path: get a moderator. This individual is the most important element in driving effective interaction between the online community and itself, and between that virtual community and the church. Here’s why. A good moderator keeps the pace going. This person can review questions as they’re asked during the live stream, and pose them to the speaker — or to another person at the church who can intelligently respond to the queries — at the appropriate time. If you’ve run a live event in the past, you know that expecting one person to respond to questions — as well as moderate the conversation — is a tall, potentially chaotic order. Such multitaskers do exist, however; so, if your church is blessed enough to have such a person on hand, definitely enlist his or her gifts for your live stream. For church members, the ability to actually talk to someone from the ministry when they can’t attend in person is huge. It lets these important individuals continue to be active in the church. And that’s what ministries are always hoping to cultivate: active members. Andrew Ng is Director of Marketing at Teradek in Irvine, CA. [ www.teradek.com ]

May / June 2016 • CHURCH EXECUTIVE

A curated collection of great books for pastors All the Places to Go… By John Ortberg In All the Places to Go… , John Ortberg reveals the countless doors God gives us, teaches us to recognize them, and encourages us to step out and lead with faith — embracing the extraordinary opportunities that await. Be aware. “Go ahead — walk through that door”. [tyndale.com]

The Changeover Zone: Successful Pastoral Transitions By Jim Ozier and Jim Griffith The Changeover Zone addresses a critical and perennial need in the church: the process of handing the baton of pastoral leadership from one person to the next. Authors Jim Ozier and Jim Griffith offer practical, clear instructions and guidance for both clergy and congregations. [abingdonpress.com]

CHURCH EXECUTIVE • May / June 2016

Fear of the Other: No Fear in Love By William H. Willimon There is a distinctively Christian way to engage the so-called “outsider” and “stranger.” “This gutsy, biblically rich, theologically searing book … gigs everybody’s sacred cow. Not only is the one whom Christ loves Other, but God is Other. The ground beneath us shakes the walls that divide us.” — Tex Sample [abingdonpress.com]

Lead... for God’s Sake! By Todd G. Congwer An unusual leadership book! Lead… for God’s Sake! is a parable for discovering who you are as a leader, how you measure success, and why you lead. The lives of a basketball coach, a CEO and a janitor intersect, revealing truths about leadership, relationships and success. An insightful read. [tyndale.com]

Conviction to Lead By Albert Mohler

Mission Drift By Peter Greer and Chris Horst

Hailed as the reigning evangelical mind by Time, in Conviction to Lead, Albert Mohler reveals his leadership secrets and shows how to become a leader people want to follow. [bakerpublishinggroup.com]

In Mission Drift, two nonprofit leaders show organizations how to stay true to their Christian mission, and offer tools for getting back on track if drifting. [bakerpublishinggroup.com]

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The Most Excellent Way to Lead By Perry Noble

The Necessary Nine: Things Effective Pastors Do Differently By Bob Farr and Kay Kotan

The BEST leaders strive for excellence, inspire their teams, and provide strong leadership. But, there’s a way of excellence that motivates teams to exceed their goals. Discover Biblical teaching that reveals the heart of great leadership in The Most Excellent Way to Lead by Perry Noble. Get your copy today! [tyndale.com]

Reaching Millennials By David Stark In Reaching Millennials, successful church consultant David Stark shares proven, practical methods for churches to attract and engage young people. Based on principles that built the early church, Stark’s strategies help leaders utilize their church’s strengths and show how churches can reach out to their communities in ways that align with the positive interests of Millennials. [bakerpublishinggroup.com]

The Necessary Nine contains nine simple axioms for effective pastoral and lay leadership for the church. It will help the reader with the simple leadership strategies that — if practiced over and over and over — will change the effectiveness of their leadership, impacting the church and the world. [abingdonpress.com]

You want the freedom to … reach out … minister to people … create fellowship

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3/1/16EXECUTIVE 5:36 PM May / June 2016 • CHURCH

How the hourly wage rules will affect churches

By David O. Middlebrook

For church leaders, finances are often a stressful topic — usually not an issue pastors enjoy talking about. Add to that stress numerous Department of Labor (“DOL”) and IRS regulations that drive up the cost and hassle of employment, and sometimes conducting formal ministry seems all but financially impossible.

ecause of the tedious nature of ever-evolving employment laws, ministries and churches often adopt a far too simplistic approach: pay everyone a stagnate salary the organization can afford, regardless of time worked. Thoughts about clocking in and out — and paying overtime — are overlooked or disregarded because they are burdensome and not seen in the spirit of “doing what it takes.” The Department of Labor’s Wage and Hour regulations affect almost every employer, regardless of finances. The Fair Labor Standards Act (the “Act”) is the main legislation that effects wage and hour rules and gives authority to the DOL to enact and enforce regulations regarding wage and hour rules (such as the payment of minimum wage) and requires overtime pay for nonexempt employees working more than 40 hours in a set week. All employers — even churches — must be aware that the DOL takes the default position that all employees are nonexempt. This means they are eligible for minimum wage and overtime pay unless the employer can demonstrate that an exemption outlined by the DOL and the Act applies.

CHURCH EXECUTIVE • May / June 2016

So, when does the Act apply? The Act applies only in cases of employment and does not apply to independent contractors. To understand whether the person you are paying is an employee, the DOL looks at the following factors: 1) “The extent to which the work performed is an integral part of the employer’s business.” The more important the worker’s value, skill and work are to the employer, the more likely the position will be considered an employed position rather than a contracted one. 2) “Whether the worker’s managerial skills affect his or her opportunity for profit and loss.” The managerial duties and skills of a worker indicate an employment relationship. Rarely, if ever, would there be a scenario where an independent contractor would exercise managerial control of the organization, employees or capital.

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SERVING AT SIXTY The Church Network • 60th National Conference • Dallas-Fort Worth, Texas • July 6–9, 2016 Learn. Education through up-to-date, relevant training is the heart of TCN’s conference. Seventy plus workshops wil be presented by experts in accounting, auditing, risk management, tax and legal issues, staff development, and more. Trade Show provides information on innovations and developments products and services. Four keynote speakers will share their wisdom and expertise. FastTrack preconference intensives will focus on church communicators, facilities leaders and executive pastors. Network. Connect with other church professionals. Imagine the knowledge to be gained from the insights and experience of more than six hundred leaders just like you. Whether in the corridors, in the trade show, or in the minutes before or after the sessions, treasured insights are gained in informal conversations. Recharge. A break from the rigors of ministry. Recharging begins with a beautiful location and a significant change of routine. Explore the Gaylord Texan. Each day will bring opportunities to relax with your colleagues and family, and many say they return year after year because of the friendships made at conference. Celebrate. As we celebrate sixty years of service through our association, we will recharge and network to equip for serving congregations. Be at the party while you learn new skills and sharpen your leadership.

Mark Your Calendar Now! Go to http://theChurchNetwork.com/2016. The Church Network. Don’t Go It Alone. The Church Network is your resource for every aspect of your work. Stay connected to professionals just like you through local chapters and national conferences. Enhance your professional growth and knowledge through education and our professional certification. Research products and services for the church through our comprehensive guide and access a wide range of resources such as MinistryPay.com, the most comprehensive and current church salary source available. The list goes on and on. Details are available online at www.TheChurchNetwork.com. Come examine all that TCN offers.

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Administrative: “Performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and the employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.” Executive: “The employee’s primary duty must be managing the enterprise, or managing a customarily recognized department or subdivision of the enterprise; the employee must customarily and regularly direct the work of at least two or more other full-time employees or their equivalent; and the employee must have the authority to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees must be given particular weight.” Professional: “The employee’s primary duty must be the performance of work requiring advanced knowledge, defined as work which is predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgment; the advanced knowledge must be in a field of science or learning; and the advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.”

3) “The relative investments in facilities and equipment by the worker and the employer.” Under this factor, the DOL looks at whether the worker owns their equipment and facilities in which the work is performed. While an independent contractor may use the facilities of the employer, often the contractor will bring their own equipment, and maintain it themselves. 4) “The worker’s skill and initiative.” While employees might have specialized skills, independent contractors possess skills that allow them to operate separate businesses and command market value for their services from other customers. 5) “The permanency of the worker’s relationship with the employer.” Typically, employees have either a long employment term or no term. 6) “The nature and degree of control by the employer.” This factor focuses on the control of the employee’s schedule and their method of work. None of these factors alone can tip the scale in favor of an employee or independent contractor. However, the DOL analyzes each factor individually, and in each given case determines whether employee benefits or overtime should be extended to those the employer improperly classified as independent contractors. Remember: the DOL’s default position is all workers are employees, and the burden is on the employer to demonstrate the individual worker is actually an independent contractor. If you determine that an employment relationship exists, you can now ask whether your employee qualifies for a FLSA exemption, meaning they are not entitled to minimum wage, nor are they eligible for overtime, regardless the number of hours they work. Once the worker is determined to be an employee, they must meet the following threepoint test to be exempt: • Paid at least $455 per week — subject to change to $951 with possible upcoming regulations • Paid on a salary basis; and … • The job duties must fall into one of the following exemptions: 42

CHURCH EXECUTIVE • May / June 2016

Computer Employee: “The employee must be employed as a computer systems analyst, computer programmer, software engineer or other similarly skilled worker in the computer field performing the duties described below; the employee’s primary duty must consist of: 1) The application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software or system functional specifications; 2) The design, development, documentation, analysis, creation, testing or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications; 3) The design, documentation, testing, creation or modification of computer programs related to machine operating systems; or 4) A combination of the aforementioned duties, the performance of which requires the same level of skills.” Highly Compensated: “Highly compensated employees performing office or non-manual work and paid total annual compensation of $100,000.” Many ministerial positions are exempt from the Act; but, if you have questions about the Act and ministerial positions, contact legal counsel as several appellate courts have laid out specific requirements for the ministerial exception to apply to the Act. Regardless of an organization’s size, the Act affects almost every employer. Failing to comply with the Act can result in stiff monetary penalties. Organizations should take heed of the rules affecting their employees, conduct an internal review to determine if the organization has any trouble spots — such as the misclassification of workers and failing to properly keep time records for non-exempt employees; and consult experienced legal counsel to resolve questions or issues regarding these employment issues. The materials in this article are provided for informational purposes only and do not constitute legal advice. This article is intended, but not promised or guaranteed to be current, complete or up-to-date and should in no way be taken as an indication of future results. Transmission of the information in this article is not intended to create — and the receipt does not constitute — an attorney-client relationship between sender and receiver.

David O. Middlebrook is a founding shareholder of Anthony & Middlebrook and the Church Law Group [ www.amlawteam.com ] in Grapevine, TX. His clients include high-profile charitable and religious organizations, both domestic and international.

churchexecutive.com

NEVER AGAIN: BEYOND INSURANCE

Don’t touch — or you might get burned! By Michael J. Bemi

In our last article, we together began our journey to move “beyond insurance.” We then examined the ﬁrst step in that process: risk identiﬁcation, analysis and evaluation. Now, we undertake the next step in our journey: risk avoidance. To properly consider this step in the process, we have to acknowledge a very important reality: namely, that — as people of faith and followers of the Lord, we believe that we are called (indeed, compelled) to do ministry. This ministerial phenomenon would be nothing other than wonderful in a perfect world where justice, fairness, righteousness, compassion and consideration for your fellow humans prevailed. We all know that this world is not that and will never be, until the Lord returns and sets it right. In this world, you need to understand that the performance of ministry creates risk for the Church. You next need to understand and recognize that risk entails various costs. These costs are multifarious, but certainly include: emotional anguish and distress; potential bodily injury (and perhaps even death); significant liability with its attendant substantial defense costs; destruction of personal property, vehicles or buildings; damage to the Church’s reputation; and disruption or destruction of certain Church operations and activities. Finally, now that we recognize that ministry entails risk, and that risk can be extremely costly in a negative sense, we must confront and accept the fact that we are called to be the best stewards of the resources we have been blessed with — and that means we must make choices to undertake (or not) specific ministries. Some examples will demonstrate the point. Scenario #1: Your charitable outreach division is contacted by the state. It would like to pay your church to convert one of your unused buildings for use as a halfway house for paroled convicts. The contract would include the costs of renovation, provisions for the men, and the salary expenses for three church representatives to manage the facility. So far, it sounds like a great ministerial opportunity to help rehabilitate some men and restore them to society. Then, you learn the rest. These are all “hard-timers” and very serious felons whose crimes include murder, rape and pedophilia. There will be an average of eight to 10 residents at any time. Your three employees will be just enough to staff revolving eight-hour shifts, one person at a time — supervising up to 10 men, alone. Your unused building is less than two blocks from a local 44

CHURCH EXECUTIVE • May / June 2016

public grade school. The state wants your church to assume all liability for anything that might “go wrong.” Remember those risk costs? Unless you can get the state to contractually share responsibility, to increase the contract value so that you can be assured of two church staff representatives on each shift, and to negotiate at least some limited right of placement refusal, this is a risk you should avoid. You’ve got it: risk avoidance! Scenario #2: Your church carnival — a local community summer favorite and opportunity for outreach, plus a successful revenue generator for your church — is coming up. The church council suggests something new: a “bounce house” for the enjoyment of your littlest congregants and guests. Aware of some recent issues with these, you contact the most highly regarded amusement operator in the city. Here’s their deal: they will complete all set-up — done with only the finest equipment and to the highest standards — but you must then appoint a “maintenance supervisor” who they will instruct on how to check the rigging over the four-day duration of your carnival. And, by the way, your church is completely responsible for the rigging throughout this time period. Here is yet another risk (the “bounce house,” not the carnival) you are likely best served to simply avoid. Being the best stewards we can be demands some tough decisions. One of these is to avoid pursuing a ministry simply because of the risks involved. Michael J. Bemi is president & CEO of The National Catholic Risk Retention Group, Inc. (Lisle, IL) — a recognized leader in risk management. To learn more about available coverage — and to get valuable tools, facts and statistics — visit www.tncrrg.org. churchexecutive.com

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We hear it all the time. “We’re a ministry, not a business. We just don’t have the money to offer financial benefits.” But the truth is, affordable financial benefits are not out of reach. MMBB Financial Services thoroughly understands the needs of faith-based organizations. And as benefits consultants, we will tailor an affordable plan so that everyone in your organization will enjoy retirement, disability and life insurance benefits that are sensible and secure. To find out more, visit us at MMBB.org/affordablebenefits. Or call 1-800-986-6222. We may just have some very good news for you and your employees.

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