Project 2020 Congregational Meeting on May 31
Project 2020: Congregational Meeting on May 31
On Sunday May 31, we will hold a very important congregational meeting and vote. Due to a lot of work by many in our congregation and others, we are now ready to start construction and bring our Project 2020 vision and dreams to reality!
At the virtual congregational meeting we will (1) provide an update on Project 2020; (2) provide information and answer questions on the construction bridge loan; and (3) ask for a vote to approve proceeding with the loan.
***This meeting will be held on Sunday May 31 following the 10 AM virtual service on Zoom. Please contact admin@eternalhills.org to receive an invitation. Attendance will require registration!***
Please plan to join this Zoom meeting!
Background
We have been approved and are ready to close on a flexible construction bridge loan of up to $600,000 from the Presbytery Investment Loan Program (PILP). These funds will cover costs during the construction phase of Project 2020. It allows us to pay construction costs while we accumulate pledges and other funding through December 2022. This is a typical approach to funding a construction project. We will start drawing on this loan as construction begins. The 3.6% interest rate is calculated based on only the amount we need to borrow, and there is no penalty for prepayment.
- Our intention is to pay the bridge loan back as pledges and other donations are received and convert only a manageable amount to a regular loan. Any remaining loan balance (i.e., residual debt) will convert to a 20-year loan at 3.4% interest. We consider debt service in the range of 5% of our annual budget to be manageable.
- This bridge loan would encumber our church property (that is, use church property as collateral to secure the loan) and requires a vote of the congregation. We are confident in our ability to use this loan during construction while incurring manageable residual debt. Our goal remains to manage the project to zero debt.
- There are a number of factors that will impact the residual debt, if any, including the accuracy of the initial cost estimate; actual cost of the project; pledge fulfillment rate; decisions to defer scope; and additional gifts and grants that may be received.
- Taken together, our pre-campaign gifts, pledges, and grant amount to more than 80% of our original Phase 1 construction estimate.
- Note also that the Denver Presbytery has given us a grant of $121,500 toward Project 2020 with the possibility of additional grant funding.
Action
At the congregational meeting, you will be asked to vote to approve securing a construction bridge loan in the amount of up to $600,000 from the Presbytery Investment Loan Program (PILP).
Please feel free to contact Pastor Paula, Matt Nixon, Meryl Eddy or Bob Gaskins with questions.
