Best Practices for Running a Capital Campaign for your Church

Churches rely on their congregants to consistently give to ensure the bills are paid every month.  However, even the most successful churches can have financial roadblocks.  The economy goes up and down affecting congregants’ pocketbooks.  Churches can lose people due to migration trends.  Or they gain people but have a mix that involves younger givers with less means.  Most churches today offer digital giving to appeal to younger generations and accelerate the receipt of funds.

Donations

Most funding comes through regular giving from church members.  Some of that regular giving comes in the form of tithing, or the giving of 10% of one’s income.  Other funding comes through offerings.  These are usually for a special mission and can be one time or perhaps periodic.

Grants

Other funding can come from grants, usually from governments or private organizations to help cover repairs, community programs and youth activities.

Endowments

Churches can also do what other non-profits do and establish an endowment fund allowing supporters to direct gifts (usually large) for specific uses. These funds provide a church with income into perpetuity. While the original gifts grow through prudent investments, the church can use the earnings each year to enhance church ministries, outreach and care of facilities.  Establishing endowments though may involve a larger capital campaign.

Products and Services

Churches can act a bit like businesses and use their resources to make money.  For example, churches can rent their facilities and property, sell counseling services and financial planning.  They can also sell t-shirts, have bake sales, run summer camps and have movie nights for children or teens.

Capital Campaigns

All of these activities keep churches going but don’t provide major funds for large-scale projects that go beyond the scope of regular operating budgets.  Here are some of the key reasons churches launch capital campaigns:

1. Building or Renovating Facilities: Churches may need to construct new buildings, expand existing ones, or renovate facilities to accommodate growing congregations, provide better services, or create more functional spaces for worship, education, and community activities.
2. Debt Reduction: Some churches use capital campaigns to pay off existing debts, which can free up resources for other ministry activities and reduce financial strain.
3. Supporting Mission and Outreach Programs: Capital campaigns can fund new or expanded mission and outreach initiatives, allowing a church to have a greater impact on its community or support global missions.
4. Purchasing Land or Property: If a church is looking to acquire new land or property, a capital campaign can help raise the necessary funds for such a significant investment.
5. Technological Upgrades: In an increasingly digital world, churches may run campaigns to fund technology upgrades, such as new audio-visual systems, livestreaming equipment, or improved IT infrastructure.
6. Establishing Endowments: Some churches seek to create or grow endowment funds to ensure long-term financial stability and support for ongoing ministry efforts.  Endowments ensure the monthly bills in the future can more easily be covered.
7. Launching New Ministries: A capital campaign can provide the financial foundation needed to start new ministries or expand existing ones, especially those that require significant resources, such as educational programs or community centers.
8. Creating Community Spaces: Churches might raise funds to build or improve spaces that serve both the congregation and the broader community, such as fellowship halls, gymnasiums, or youth centers.  These community spaces can also be used for ongoing revenue generation as mentioned earlier in this post.
9. Energy Efficiency and Sustainability: Some churches focus on environmentally sustainable projects, such as installing solar panels, improving insulation, or making other energy-efficient upgrades to reduce long-term costs and environmental impact.
10. Strengthening Legacy and Future Growth: Capital campaigns can help churches build a lasting legacy by investing in their future, ensuring that they can continue to serve their communities for generations to come.

What to do and what NOT to do.

The Dos.  There are some best practices for running a successful capital campaign for your church.  And there are some common mistakes that should be avoided.  Below are steps to take that will help ensure a smooth and successful campaign.

1. Set a Clear “Why” for the Campaign: Identify why you need the money and the goals (amount of funds) you have in mind. And then ensure that these goals are realistic and aligned with the church’s mission and needs.
2. Develop a Compelling Vision: Craft a compelling narrative that communicates why the campaign is necessary and how it aligns with the church’s mission. This vision should inspire and motivate the congregation to participate.
3. Engage Leadership Early: Involve church leadership, including pastors, elders, deacons and key volunteers, early in the planning process. Their support and commitment are crucial for the campaign’s success.
4. Conduct a Feasibility Study: Before launching the campaign, conduct a feasibility study to gauge the congregation’s willingness and ability to contribute. This can help set realistic financial goals and identify potential challenges.
5. Create a Detailed Campaign Plan: Develop a comprehensive plan that outlines the campaign phases, including the pre-campaign planning, silent phase, public phase, and follow-up. Assign roles and responsibilities to ensure smooth execution.
6. Communicate Transparently: Maintain open and transparent communication throughout the campaign. Regularly update the congregation on progress, celebrate milestones, and address any concerns or questions.
7. Involve Everyone: Encourage participation from all members of the congregation, regardless of their financial capacity. Emphasize that every contribution, whether large or small, is valuable and contributes to the collective goal.
8. Provide Multiple Giving Options: Offer various ways to give, such as one-time donations, pledges over time, online giving, and in-kind contributions. Make the process easy and accessible for everyone.  Faith Teams and other modern church management software applications offer online and text based giving for small and even large amounts.
9. Acknowledge and Thank Donors: Recognize and thank donors at every level of giving. Personal thank-you notes, public acknowledgments, and donor recognition events can help build goodwill and encourage continued support.
10. Follow Up and Report Back: After the campaign concludes, follow up with the congregation to report on how the funds were used and the impact of their contributions. These builds trust and set the stage for future campaigns.
11. Celebrate Successes: Celebrate the completion of the campaign and the achievements made possible by the funds raised. This could include a special service, a dedication ceremony, or a community event.
12. Plan for the Long Term: Consider how the campaign fits into the church’s long-term financial and ministry goals. Ensure that the campaign contributes to sustainable growth and doesn’t strain the church’s resources.
13. Leverage Technology: Use digital tools for communication, tracking progress, and managing donations. Social media, email newsletters, and a dedicated campaign website can help keep the congregation informed and engaged.
14. Prepare for Challenges: Anticipate potential obstacles, such as economic downturns or unforeseen expenses, and develop contingency plans to address them.

The Don’t Dos. There are also pitfalls that should be avoided.  Here are a few of the common mistakes made when running church capital campaigns.

1. It’s Not Just About the Money: Avoid focusing solely on the financial aspect of the campaign. Remember to emphasize the spiritual and communal importance of the project, aligning it with the church’s mission and values.
2. Lack of Clear Vision and Purpose: Avoid launching a campaign without a well-defined purpose and clear goals. Ambiguity can lead to confusion and lack of enthusiasm among the congregation.
3. Rushed and Inadequate Planning: Avoid rushing into the campaign without thorough planning. Skipping important steps like a feasibility study or not having a detailed timeline can lead to unrealistic expectations and unmet goals.
4. Short-Term Focus: Avoid planning the campaign with only immediate goals in mind. Consider the long-term impact and sustainability of the project to ensure that it aligns with the church’s future needs.
5. Leaving out Key Stakeholders: Avoid excluding church leadership or influential members from the planning process. Their support is crucial, and lack of involvement can lead to a lack of buy-in from the broader congregation.
6. Ignoring the Feasibility Study: Avoid ignoring the results of a feasibility study or not conducting one at all. This study is essential for understanding the congregation’s capacity to give and identifying potential challenges.
7. Overemphasizing Large Donations: Avoid focusing only on large donors. This can alienate members who can only contribute smaller amounts, making them feel undervalued or unimportant.
8. Pressure Tactics: Avoid using guilt or pressure to solicit donations. This can create resentment and damage relationships within the church community. Instead, emphasize voluntary giving and the spiritual rewards of generosity.
9. Underestimating Costs: Avoid underestimating the costs of the project or campaign. This can lead to financial shortfalls and may require additional fundraising efforts, which can frustrate donors.
10. Failing to Acknowledge Contributions: Avoid neglecting to recognize and thank donors. Failing to acknowledge contributions can make donors feel unappreciated and discourage future giving.
11. Lack of Transparency: Avoid being vague about how funds will be used or not reporting back on how money was spent. Transparency builds trust and confidence in the campaign’s leadership.
12. Disregarding Congregational Input: Avoid dismissing feedback or concerns from the congregation. Engaging with members and addressing their questions is vital for maintaining unity and support.
13. Overextending Resources: Avoid launching a campaign that overextends the church’s financial or volunteer resources. This can lead to burnout and financial strain, impacting other ministries and operations.
14. Failing to Celebrate Milestones: Avoid ignoring key milestones or not celebrating progress. Celebrating successes keeps momentum and enthusiasm high throughout the campaign.

By following these best practices and avoiding common pitfalls, churches can run effective capital campaigns that not only meet financial goals but also strengthen community bonds and advance their mission.