Navigating funding for capital building projects

10 August 2023

Capital building projects can be transformative endeavours, providing a dedicated space for worship, fellowship, and community engagement.

A blueprint for a building project with a pencil and a set square resting on the plan.

Building projects often require substantial funding, and the planning and development process can be quite complicated. This means it is crucial for churches to understand the various avenues available to secure financial support and the steps that must be taken to gain planning permission. In this article, we will explore the key considerations and strategies for funding capital building projects and look at what you need to do to ensure your building project gets the green light.

Laying firm foundations

  1. Developing the plan properly: From the outset, it may be worth commissioning a feasibility study for larger projects to thoroughly explore your options. This could include building condition, asbestos and carrying out level surveys, or a full measured survey and plans if no architectural drawings exist. Many trustees are reluctant to spend valuable funds on these professional fees rather than actual construction work, but they are essential to establish whether the project is safe to undertake.
  2. Planning sensibly: Think long-term when you can but be sure to plan from a place of evidencing need. Undertake research, such as surveys and questionnaires, which clearly support the project you are proposing. This will better enable potential funders to understand what you’re planning and donate accordingly. 
  3. Being conservation conscious: Check all conservation area/listed building questions and factors at an early stage. If your denomination has its own process or Conservation Officer, engage with them as soon as possible.
  4. Checking legal documents: At an early stage, ensure title deeds and boundaries are properly understood. Many church sites have historic restrictions, easements or rights of way that cannot be ignored.
  5. Requesting planning permission and consent: Find out what Local Authority planning consent is required – for large projects making a pre-application helps to start the conversation and will save time and expense later. The same may apply to Church/denominational consent. Check which decision-making body has the ultimate say and if your plans are in line with its stated policies, mission, and ministry priorities. 

Building Sustainable Funding

  1. Establishing a vision: Before delving into funding options, it is vital to develop a clear vision and comprehensive fundraising plan and case for support for the capital building project. Focus on evidencing the need for the project, and the impact it will have on church life and the community, showing how people will benefit from the project, which will help to engage the congregation and relevant stakeholders to ensure shared commitment and enthusiasm. Identify the objectives and outputs of the project, and what difference the project will make.
  2. Understanding the costs: Throughout the planning process, it is important to determine the scope, purpose, and estimated costs of the project to understand how much you will need to raise. Once further along the planning process, obtaining a total budget from a Quantity Surveyor is essential, which will include all likely fees, and estimates cost increases throughout the project’s duration, such as the increase in price of building materials. If your building is listed, ensure your surveyor is experienced in this area and knows the additional costs associated. Professional VAT advice may also be beneficial if a listed building is involved, or significant disability access measures are planned. 
  3. Congregational giving: One of the primary sources of funding for capital building projects comes from the congregation itself. Encouraging regular donations and promoting a culture of giving can create a solid financial foundation. 
  4. Traditional financing: For larger-scale projects, securing a loan from a financial institution could, for some specific cases, be a viable option. Building a strong case for the loan, demonstrating the ability to repay, and presenting a comprehensive business plan are key steps in this process. It is crucial to explore different lenders, compare interest rates, and assess repayment terms to make an informed decision.
  5. Grants and foundations: Many foundations and organisations offer grants specifically designed to support religious and community projects. Researching and identifying grant opportunities relevant to church building projects can be a fruitful endeavour. Some foundations focus on providing financial assistance for construction, renovation, or preservation of religious facilities. Baptist Insurane’s List of Funders and Grant Guide resource shows some of the grants currently available to churches. When filling in applications, it’s important to emphasise the difference your project will make on your communities.
  6. Partnerships and sponsorships: Collaborating with local businesses, corporations, or community organisations can provide additional funding avenues. Seek partnerships for sponsorship, fundraising events, or in-kind donations of materials and services. Engaging with the wider community not only fosters financial support but also enhances the church's visibility and impact.
  7. Fundraising events: Organising fundraising events can be an effective means to gather financial resources while fostering community spirit. Events such as auctions, dinners, concerts, or special services can generate excitement and attract donors. Leverage social media platforms and traditional media channels to promote these events and reach a broader audience.
  8. Planned giving and endowments: Encouraging planned giving, including legacy donations through wills or estates, can provide long-term financial stability. Developing an endowment fund helps secure future funding for ongoing maintenance and operational expenses of the church building. Educating the congregation about the benefits and impact of planned giving is essential.
  9. Crowdfunding and online Platforms: Harnessing the power of digital giving, crowdfunding platforms and online fundraising campaigns enable churches to reach a wider network of potential donors. Creating compelling campaigns, utilising social media, and sharing personal stories can inspire individuals to contribute to the project. Websites and online platforms also provide transparency and convenience for donors.

Successfully completing capital building projects requires careful planning, effective communication, and a proactive approach to engage the congregation and wider community. By combining these planning steps and a range of fundraising methods, such as exploring grants and foundations and leveraging technology, churches can navigate the path to financial success. Remember, transparency, gratitude , and effective stewardship play a vital role in building long-lasting relationships with donors and creating a thriving place of worship.

Church fundraising PC screen