Statement from Tanya Cothran and Chris Lee, Co-Presidents of the Board of Directors at FirstU;
Presented at the Congregation’s Annual Fall Meeting on 27 October, 2024
Presentation of First U’s financial situation
In a few minutes we will be asked to vote on a budget for the remainder of this fiscal year. Before that I’d like to share a few updates on FirstU’s current financial situation and what it means going forward.
First, Where are we now?
We’ve heard some positive news: We’ve run a clean audit again. This speaks to the incredible work of our volunteer financial team, and about the combination of systems and trust that we’ve built together over the years. Winnie,
Michael, Judy, John, Mary Anne, Sandy, and Bill – thank you.
We’re getting closer to 473 Oakwood – 76% completed! Although we are grateful to be in the NIA Centre, every time I’m there, I can’t help but look across the street and imagine us in our own space that we can share with others. FRET team – thank you for bringing this along.
Along with this positive news, we are facing some challenges – some that are short term, and others that will require a longer view and community efforts.
Short term:
We are facing a cash flow crunch in June. At that time, we will need about $700,000 to pay our contractors and keep operations going.
What does this mean?
The simplest way I can say it is that we will not have enough cash to pay some big bills coming our way.
One reason we are in this situation is that large amounts of money we are owed have not come in yet – and we’re not sure when we will receive them. This is in the realm of $500,000. (HST rebates, and significant donations
that have been held up)
What can we do about this?
When we began the renovation project, our congregation approved a motion that we could borrow
up to $1 million if needed.
We have calculated that, to be safe, we will have to source approximately $700,000 as a bridge loan
to get us over the hump so we can move into 473 Oakwood.
The financial sustainability committee and members of the board are working on solutions and
have begun reaching out to potential lenders (including other congregations), and some creative
options (such as community bonds), to make sure we get:
- 473 Oakwood built; and
- we have a cushion to meet our 2025 financial commitments.
As I mentioned, we are fortunate that we are expecting to receive $500,000. This will help us pay off
some of any loans at a quicker rate.
What else are we facing?
We have been running a deficit operational budget for a few years now as we’ve waited to get the
renovation started. We’ve been able to offset the deficit through proceeds from the sale of our previous building and our reserves.
This has been a calculated decision – we recognized that it would be difficult to do normal fundraising, and rent out our spaces to generate income – if we had to do capital campaigns and didn’t have a building.
On Oct. 16th, the board made a motion to recommend the 2024-2025 January-June budget as presented to the congregation for approval. We thought it wise that we ensure that staff can continue in their roles as we move to our new building.
In the longer term, continuing to run a deficit is not sustainable and will get worse if we are not proactive. So as we think ahead to the 2025-2026 operational budget, we will need to gather ourselves, and whatever financial means we can offer, to ensure we can get off to a good start at 473 Oakwood.
What will we need to do together to keep moving forward?
To repeat – we’ll be looking for bridge financing in the area of $700,000 to make sure we finish the renovation on time and we can carry on operations into 2025-2026.
We have a financial sustainability committee that is assessing the situation monthly. They will be exploring ways to generate income so we make sure we can pay back the loans AND make sure we live into our mission fully, with a robust staff team and programming that are so important to our community.
In the meantime, if you are able to pay your existing capital pledge (donations that go towards the renovation) any sooner than planned, or can make a pledge if you haven’t already, please do so. If you are able to increase your operating pledge (donations for our ongoing programming, including staff salaries), we would be happy to hear from you
Every bit counts.
In the coming weeks, the board will be sharing regular updates on our fundraising plans and we will create opportunities to answer your questions.
At our last board meeting, someone shared the analogy that we have been in a boat for a few years. We have been in uncharted seas AND we have done incredibly well considering the circumstances. I’d say we make pretty good traveling buddies!
We have a destination in sight and we now need a gust of wind in our sails so we can get to land (473 Oakwood) safely.
Our work won’t be done once we get there. We will need to lean into our generosity, our collective smarts, and our passion to make this community thrive. I’m confident we can do it together.
Thank you for your time.
