As announced for the last two Sundays in worship, there will be a special congregational meeting on June 12, 2011 to consider the replacement of the cooling tower that is the air-conditioning unit for the Sanctuary building.
The Admin SLG held a meeting on June 6, 2011 to discuss the cooling tower. After reviewing Mark’s detailed report on the condition of the cooling tower, we concluded that the unit should be replaced and a draft plan was developed to finance the replacement.
Specifically, Admin. determined that:
1) The Cooling Tower Needs to be Replaced — The cooling tower is made of metal and has suffered severe rust due to a water treatment system not being added when the unit was installed approximately 10 years ago. The cooling tower is leaking severely, although successive temporary patching over the past few years has kept the system moderately operational.
2) The Cooling Tower Should be Replaced this Season — To plug leaks, Mark has applied roofing cement to stop the most severe holes. Although predicting system failure is difficult, the team expressed significant concern that a major hole could erupt at some point this cooling season–the metal is severely rusted in spots continues to leak. Given the recent heat wave, system failure could lead to unbearable heat in the sanctuary.
3) Replacement Cost is $23,000 — Mark received two quotes for replacing the Cooling Tower. Today, we have refreshed the lowest of the prior quotes. Two other potential vendors did not respond. The proposed solution features PVC construction and the manufacturer, a large, reputable company, guarantees the performance of the unit for 15 years. Rust should not be a problem. The quote is fixed-price, and there is a four week lead time on delivery. The replacement unit may result in a savings of $500 to $1000 per year in maintenance and utility savings.
4) The New Unit Can be Financed With Available Funds — The Admin SLG proposes to finance the new cooling tower as follows:
~ $4,000 from the current 2011 budget
~ $3,000 additional draw from the Endowment in the current fiscal year
~$16,000 borrowed from the Endowment; ($17,000 to be repaid to the endowment by June 30th, 2013).
As the Admin SLG is currently moving through a planned accounting review, the exact treatment of the capital improvement in Old First’s financial statements will be determined. An immediate down payment of $12,000 is required to order the new cooling tower, and can be funded immediately from existing cash balances.
Draws of interest and dividends from the endowment are used to support the annual budget. To pay back the loan, the Admin SLG will reduce the draw down by $8,500. for both FY 2012 and FY 2013.