PILLARS CAMPAIGNPositioning Ourselves For The Future

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History• CUMC before New Hope: Central Methodist Church was built in 1909 (dedicated in

1916). It is located at Third and Elm Streets in Downtown Rogers across from the old Rogers City Hall. In 1968 it officially became Central United Methodist Church. It is interesting to note that the first Methodist group to form in Rogers after the Civil War met in area around New Hope Road and Highway 71 in a community called New Hope.

• Arriving at New Hope: In the early 1990’s it was discussed whether to add onto the current building or purchase real estate to move to a new building. The congregation voted to move and 30 acres was purchased on New Hope Road. Part of the congregation purchased the downtown facility which became First United Methodist Church. So from the original church downtown two congregations were formed. Ground was broken for our new facility in August 1994 and the church congregation moved into our current location in 1997.

• Since Arriving at New Hope: The first phase of the building project started with a capital campaign in 1993 with a cost of $6,600,000.00 (including land purchase and the building). In 2000 a shell area was finished out which cost an additional $400,000.00 and in 2006 the second phase (south part of the current building) was finished with a cost of $7,600,000.00. It was necessary to keep adding onto the church as we ran out of room and needed more facility space for our current congregation of 1721.

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Journey to the Heart 2011

# Of Amount AmountYears Description Pledges Pledged Contributed93-95 Blessed to be a Blessing **est. 3,500,000$ 3,474,000$ 95-98 Offering New Hope (Cont. Phase I) 187 1,858,970$ 1,784,465$ 98-01 Debt Reduction 212 1,384,784$ 1,189,159$ 2000 Shell Area 35 315,700$ 395,831$ 01-03 Operation Pay Down 49 91,199$ 233,983$ 2004 No campaign 15,520$ 05-07 Building on the Faith (Phase II Bldg) 230 2,575,969$ 2,243,900$

08-10 Journey to the Heart 191 1,930,706$ 1,539,842$ 2011 119 295,048$ 280,599$

TOTALS 93.35% 11,952,376$ 11,157,299$

Building Campaign History

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Building Cost History

Costs1994 Phase I Building 6,600,000$ 2000 Shell Area 400,000$ 2006 Phase II Building 7,600,000$

TOTAL 14,600,000$

Interest Expense 3,556,381$

Total Bldg & Interest Expense 18,156,381$

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Summary

Contributions 11,157,299$ Building Costs (14,600,000)$ Interest Expense (3,556,381)$ Loan Balance (6,999,082)$

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Current Loan Detail

Current loans:

• Loan 1: $3 million at 6.47% interest only- Matures May 2013. Quarterly payments.

• Loan 2: $3.9 million at 4%, approximately 30 year amortization- Matures May 2013 Semi-annual payments

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Stay Current Course

2011 2012 2013 2014 2015 2016 2017

Loan Balance $ 6,900,000 $ 6,828,400 $ 6,753,600 $ 6,675,600 $ 6,594,400 $ 6,510,000 $ 6,422,400

Interest paid $ 350,000 $ 347,000 $ 344,000 $ 340,000 $ 336,000 $ 333,000 $ 330,000

Principle paid $ 71600 $ 74800 $ 78000 $ 81200 $ 84400 $ 87600 $ 92000

Total paid to Bank $ 421600 $ 421800 $ 422000 $ 421200 $ 420400 $ 420600 $ 422000

Ending Balance $ 6,828,400 $ 6,753,600 $ 6,675,600 $ 6,594,400 $ 6,510,000 $ 6,422,400 $ 6,330,400

No additional expansions, build-outs and improvements to 15 year old building

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Goal of Pillar Campaign

• Refinance Current Debt: Opportunity to refinance current debt into one loan with approximate interest rate of 4%. Would require us to put the new loan on a 20 year amortization and pay our payments on a monthly basis instead of a semiannual and quarterly basis.

• Pay down to Establish Equity: Require us to pay our current debt down by $1 million dollars to get our total building debt down to $5,900,000 which will put our debt coverage ratio (ability to service debt/interest from current income) at an acceptable level (1.25) for a bank to extend aggressive interest rate and refinance the church. We have a commitment from a local bank to refinance the debt once this happens.

• Goal: To raise $1.0 million. $1 million for principal pay down immediately.

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New Course for a Better Future Proposed: 4% rate, 20 year amortization, $5.9 million loan 2012 2013 2014 2015 2016 2017 2018

Loan Balance $ 5,900,000 $ 5,703,387 $ 5,498,764 $ 5,285,804 $ 5,064,169 $ 4,833,503 $ 4,593,440

Interest paid $ 232,421 $ 224,411 $ 216,074 $ 207,398 $ 198,368 $ 188,971 $ 179,189

Principle paid $ 196,613 $ 204,623 $ 212,960 $ 221,635 $ 230,666 $ 240,063 $ 249,845

Total paid to Bank $ 429,034 $ 429,034 $ 429,034 $ 429,033 $ 429,034 $ 429034 $ 429,034

Ending Balance $ 5,703,387 $ 5,498,764 $ 5,285,804 $ 5,064,169 $ 4,833,503 $ 4,593,440 $ 4,343,595

Stay Course Ending Balance $ 6,828,400 $ 6,753,600 $ 6,675,600 $ 6,594,400 $ 6,510,000 $ 6,422,400 $ 6,330,400

Savings $1,125,013 $1,254.836 $1,389,796 $1,530,231 $1,676,497 $1,828,960 $1,986,805

CUMC BUILDING LOAN & OPERATING FINANCIAL CONDITION

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Overview of 2012 Financial Operations

• 2012 Budget Annual Operating Income Budget - $1,361,143

• 2012 YTD Operating Income (6/30/12) - $600,206.21• 2012 YTD Operating Expense (6/30/12) – ($570,692.22)

• 2012 YTD Operating Income (6/30/12) - $29,513.99

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2012 Operations vs. 2011 Operations(YTD – 6/30)

2012• Operating Income –

$600,206.21

• Operating Expense – ($570,692.22)

• Operating Income – $29,513.99

2011• Operating Income –

$606,336.31

• Operating Expense – ($619,039.99)

• Operating Income – ($12,703.68)

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Overview of 2012 Financial Operations

Contributions & Income:

- Pledged Giving - $427,683.16

- Non-Pledged Giving - $161,455.57

- Other Income - $11,067.48

- Total YTD (6/30/12) - $600,206.21

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Overview of 2012 Financial OperationsOperating Expenses:

- Apportionments - $ 0.00

- Building Admn. - $ 158,863.59

- Office & Tech Support - $18,099.64

- Program Ministries - $31,477.44

- SPR - $362,251.55

- Total YTD Operating Expense - $570,692.22 (6/30/12)

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Historical Apportionment Expense

Apportionment Due

• 2008 - $185,700

• 2009 - $188,635

• 2010- $179,899

• 2011 - $191,609

Apportionment Paid

• 2008 - $64,476 (35%)

• 2009 - $152,582 (81%)

• 2010 - $179,899 (100%)

• 2011 - $191,609 (100%)

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CUMC Building Income

2011

• Building Income - $337,377

• Building Expense – ($406,397)

• Building Grand Total – ($69,020)

2012

• Building Income- $104,416

• Building Expense – ($196,254)

• Building Grand Total –($91,838)

• Building Income - $485,483

• Building Expense – ($506,608)

• Building Grand Total – ($21,125)

2008-2010Average yearly

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Benefits of Loan Pay Down• Ministry- By reducing our debt burden and obtaining a lower interest rate we will be

able to devote a larger share of our revenue to the ministries that further our mission of Connecting People to Christ.

• Principle Reduction- With our current loans we see very little principal reduction. Most of our payment is going to interest. After 7 years we could see our loan balance shrink by approximately $1.6 million ($2.6 million if you include the $1 million pay down) which would greatly relieve our debt burden on our facility.

• Cash Flow- Since we would be paying down the existing debt by $1 million our cash flow would stay approximately the same but a much greater reduction in principal will be made on the loan.

• Reduced Interest- Average interest per year on current loan is $340,000 while average interest on proposed new loan would be $207,000 per year. Amounts to a savings of over $900,000 over 7 years.

• Build outs- We are committed to only use the funds raised in this campaign to pay down principal. The only other item we will spend the funds on is a build out of a small room (room 107) by the choir rooms which should be less than $50,000 to finish this room.

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How Do YOU Help Make This Happen?• Goal - $1 million in funds raised now not pledged.

• Timing - Now. With interest rates at historic lows we can’t afford to pass up this opportunity.

• Giving Options - Cash, Stock, Life Insurance and other Investments.

• Next Step - Commit to help the church pay down the building debt and help refinance our loans. Continue with or join in our Journey to the Heart campaign with a yearly pledge to continue paying our current loan obligations.

• Prepare for a formal building campaign in 2013.

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