We wish you a holy Lenten season and look forward to celebrating the Resurrection of our Lord with you this Easter. No doubt you have seen the construction activity on our campus. We are writing to update you on the progress of our Honor the Past, Embrace the Present and Secure the Future Capital Campaign.
It is truly a blessing that our Campaign has exceeded its goal with $3,290,000 currently pledged! We are also pleased to announce that we have the means to complete all projects by the fall of 2018! To understand how we did the math, read on!
The steps below were set out in the Fall Campaign Update and have been completed by the parish:
- Formed a Building Advisory Committee (BAC)
- Retained a professional project manager via competitive process–Falkin and Associates
- Retained a general contractor via competitive process—Chinn Construction
- Received cost estimates from sub-contractors
- Taken steps to complete the permitting process
As these steps were completed, we learned the following:
- Construction costs have increased significantly. The market for construction services and materials nationwide, and in Seattle in particular, is extremely competitive and prices are increasing rapidly as a result.
- The original construction budget was prepared by our architects and subject to review by a construction contractor. As work progressed, it became clear that assumptions regarding code requirements and change in use were too optimistic.
Despite increases in cost and scope, the best time to complete these projects is NOW:
- Our portable classrooms will soon need to be replaced.
- A delay in this project will only increase the cost; renovating and repurposing the school, rectory, and Quigley will only become more expensive and difficult.
- New construction is not an option due to cost and limited opportunity for expansion.
- We cannot be certain that further changes in code requirements will not place further limits on plans if we delay.
- In addition, fire and seismic updates to Quigley and the rectory will be necessary regardless of any renovations.
The Executive Committee and BAC carefully evaluated the revised budget, the results of our campaign, our ongoing operating budgets, and the needs of our parish and school and recommended the following to Fr. Crispin:
- The entire capital project should move forward without delay. Spreading the project over a period of years will only increase costs.
- The Parish will continue to ask new families to participate in the campaign.
- The Parish should defer purchase of the Rectory house on 80th street and instead continue to rent it. Eventually, the Parish should purchase it for the agreed upon price of $650,000.
- John will fund the additional costs of the project as follows:
- The Parish has available reserves for working capital. The original plan was to leave these reserves intact. Staff and the Executive Committee have carefully evaluated these accounts and have concluded that $714,000 of these balances can be utilized to fund project costs and leave adequate reserves to fund ongoing operations. Some of these balances can be replenished through ongoing operations of the parish and school over time.
- In order to fund constructions, we will borrow amounts from the Parish Revolving fund. Amounts borrowed will be partially repaid from pledges. In 2022, the remaining balance of $890,000 along with existing parish borrowings of $575,000 will be combined into one, 30-year loan from the Parish Revolving Fund. The resulting annual payment on this loan will be approximately $15,000 higher than the present payments required on the existing loan. This amount can be managed within our existing budgets.
- We will continue to work with Chinn and Falkin to identify cost savings as the projects proceed.
The Executive Committee has recommended the approach described above to Fr. Crispin and he has accepted the recommendation.
As we write this letter there are two remaining estimates to be completed. First, the impact of the clay tile construction on the structural work in the rectory must be finalized. Second, more shear walls may be required in the school. We will provide further information as these estimates become available. As changes occur, we will provide updates with current estimates of costs. The attachment to this letter expands on these points as well as other background information. This letter and the attachment will be available on the campaign web site which can be accessed from www.stjohnsea.org
Fr. Crispin Okoth, Pastor Frank Feeman, Chair, Executive Committee