Financial updates

A task force will be formed to generate ideas for the future use of all or a portion of the steeple and cross. If you are interested in participating on this task force, please contact Todd Ballen (taballen@comcast.net).

An engineering analysis has shown that the building design is not compatible with the weight and height of the steeple. As a result, the steeple and cross will not be placed back on the roof.

No, the roof is not done. The damaged portion was covered with plywood and shingles to provide a temporary roof. This will protect the church better than the several tarps that have been used over the past months. 

It is expected that the design of the repair solution and the fabrication of custom parts will not be completed before the weather changes. So, the plan is to rely on the temporary roof to keep the church dry over the winter and complete the repairs as early as possible in the spring. 

CUMC continues to be in litigation with our former insurance company over the roof claim with negotiation ongoing. 

We are hopeful that negotiations will be completed to allow work to proceed this fall.

Roof projects at both campuses are included in insurance storm damage claims. We are in the middle of the design phase for the Roseville project, so don’t yet know the total cost. The SAP roof project is farther along, so we have a better idea of the cost. In both cases the negotiation with the insurance company is ongoing, so we don’t yet know how much will be covered by insurance.

When both roof projects are finished we will be able to switch to lower-cost insurance.

The past couple of months have been spent assembling repair cost estimates valid at the date of the storm damage (2020) to match the requirements of our insurance policy.  After receiving those estimates, the insurance company has recently agreed to use an appraisal process to determine the amount of coverage to repair the damage.  Scheduling of the appraisal panel will happen soon. 

The steeple and cross structure were removed from the roof on Aug. 19 and a temporary roof applied that will remain until the project is completed.  Effort since that time has focused on assembling all the components of the cost estimate to submit to insurance.   
A detailed analysis has determined that due to the nature of the roof construction it is not possible to replace just the damaged area; instead, the entire north side of the sanctuary roof must be replaced.  This will require removal of the entire roof and ceiling down to the supporting beams and the construction of scaffolding that will fill most of the sanctuary.  Once the custom ceiling/roof boards are installed the rest of the new roof will be installed. 
We have considered other options – including whether a lower-cost/simpler roof construction could be used instead of the custom tongue-and-groove boards.  However, these other solutions would be heavier or otherwise incompatible with the spacing of the supporting beams.  Furthermore, limitations to the load-bearing capacity of the existing wall and beam structure don’t allow the substitution of other roof types without expensive reinforcement. 
As you can imagine, this project will be a major disruption since the sanctuary will be unusable for at least a month.  Timing of the work is still unknown, but more details will be communicated as they become known.  

The total cost estimate for both projects is very large.  We believe that we will receive additional insurance payments, but it is unclear exactly how much insurance will pay.  Furthermore, we believe that we cannot wait until the insurance situation is completely resolved before starting work on the roof projects.  So, after careful consideration, at its Oct. 22 meeting the Leadership Board authorized taking out a bridge loan for up to $1,500,000 before the end of 2024.  This loan will enable the projects to be started while waiting for the insurance process to continue.  The Leadership Board has also authorized a capital campaign for early 2025 to fund as much as possible of the roof repairs not covered by insurance.  Once the insurance payments and early contributions to the capital campaign have been received the bridge loan will be converted into a standard loan to be repaid over a period of years.  Your prayerful consideration and planning for how you can participate in the capital campaign will be appreciated.  

 Please contact Todd Ballen (taballen@comcast.net), Steve Torgrimson (sltorgrimson@gmail.com), Bob Milligan (milligandanes@gmail.com) 

We continue to negotiate with our insurance company over the roof claims at both campuses as we work with the contractors to plan the repair work. We hope we can come to an agreement and perform work at the SAP campus before the end of this year. For the Roseville campus, an important milestone this summer was the completion of an engineering study to evaluate the impact of the additional damage discovered on the sanctuary roof during the November 2023 re-shingling project. This study determined:

• The multi-layer tongue-and-groove boards (ceiling on one side/structural roof support on the other) need to be replaced in a large portion of the north side due to water damage from leaks in the roof. 
• Building code changes require reinforcement of repaired areas to meet current ice and snow load requirements. 
• The steeple and cross structure on the roof shift due to wind and temperature changes, and this is a primary cause of the water leaks in the roof. 

These issues are being addressed with the repair plan. To guarantee the future integrity of the roof we need to permanently remove the steeple and cross structure from the roof. This is a difficult decision. We recognize that many people have an attachment to the steeple and cross as part of Centennial’s identity for many years. We are considering how we might reuse part of this structure to honor that history while still positioning the CUMC Roseville building for long-term soundness. soundness. A task force will be created to gather and explore ideas from the congregation. If you’re interested in serving on this task force, please contact Todd Ballen.

The steeple and cross structure will be removed from the roof on Monday, August 19. A temporary roof will be applied over the damaged area on the north side of the sanctuary roof. This will seal the roof over the winter while the custom roof boards are built – with final repair to occur in Spring 2025.

Due to your generous contributions and careful control of expenses, Centennial’s budget was generally in good shape prior to the insurance cost increase. Both Expenses and Revenue have been generally in line with their year-to-date portion of the budget through mid-year. Leadership Board actions earlier in the year successfully reduced staff costs to meet budget objectives. The ongoing Fill-the-Gap campaign has raised pledges and contributions of approximately $42,000 to date – which goes a long way toward meeting the needs of the planned 2024 budget. (Further contributions to the Fill-the-Gap campaign will be gratefully received to help offset these significant increases in insurance costs!)  In addition, the lease by another faith community of the SAP building will generate an additional $27,000 of annual revenue starting this August.

The Finance team has been working hard to develop a plan to pay these increased insurance premiums. We will likely not pay our apportionments for 2024 aside from giving that is specifically designated for that purpose. A line of credit for $100,000 from the bank has been secured – but not used yet – to provide a cash flow cushion as needed. This line of credit is a new debt obligation that also impacts the budget going forward when it is repaid. Other ways to address this expense are being pursued. Your continued financial gifts and prayers are important and appreciated as we navigate through this new insurance impact on our operating budget!

In April 2024, Church Mutual notified Centennial that they would not renew our property insurance when the current policy expired in July. When attempting to locate new insurance, we discovered that the two open roof claims meant that we could not get conventional insurance. Instead, we were forced to buy insurance on the secondary market with a dramatic increase in cost. The total insurance costs increased from approximately $51,000 (2023-2024 policy year) to $260,000 (2024-2025 policy year). This obviously has a huge impact on Centennial’s budget – particularly because the insurance premiums are heavily front-loaded by significant down payments. The impact is $165,000 over what was budgeted for insurance for 2024. This new insurance increase will also impact our 2025 budget.  (Note: once the roof claims are closed, then we can return to the conventional insurance market with more reasonable premiums.) 

Please contact Todd Ballen (taballen@comcast.net), Steve torgimson (sltorgrimson@gmail.com), Bob Milligan (milligandanes@gmail.com)