Event:2016/08/01 Fundraising Call w/ Stephaney

Call w/ Stephaney - 1 August 2016

Attendees

• Jose, Laura, Stephaney, Jenny

Discussion

• Identifying debt capacity and financial risk using the 5 c's of credit, and a mitigation plan around those risks
• Starting a financial model based on the LOIs (subleases & fiscal sponsorship agreements)
• Event Rental income reflects set amounts in contract; donations received are separately categorized
  • We should look more at event rentals $13000 so far for events in 2016. Aiming for $23000 this year. Understand this year will be lower becasue of ballroom renovations. Next year anticipating $31,000. WOUld like to have more information about how that figure was arrived at. It woul be prudent to have supporting numbers behind the rental projections.
  • Jenny will work on that.
• On cost side there are a lot of repairs and maintenance expenses - %27,000 projected. We need to think more about a capital plan, reserves. on top of that you will have to get together a capital needs assessment, including major systems, roof, etc. HOw much life is left and how much to replace, leading to plan to save for these costs.
  • This report costs $2200-5000, can be part of the underwriting process.
  • Rough construction estimate, Stephaney can forward some contacts
• Based solely on revenue, or also equity/assets? They look at all of that; equity getting you in the door. Still a startup, awaiting 501c3 status. Also looking at capacity to refinance in ~10 years. Lending market - 10 year deals w/ 20 year amortization, interest at 5-6%. May likely be a need for a guarantor
• Laura has a contact to a person who will give us a deal on an appraisal:
• Phase I or II Environmental Report - has owner done any of these?
• Stephaney has questions about some expense line items - she will talk to Jenny individually about
• One estimate: Debt service - $35K/yr - would have to make $44K/yr after costs for a 20yr amortizing loan at 6%, could borrow up to roughly $580,000
• Nonprofit lenders will be more comfortable with our diversity of income streams
• Current assets and current liabilities
• Should have 60-90 days of savings as part of cash reserve, operating expenses over 365 days / 90
• Fundraising: No specific plan; need a more robust plan. Currently working on a crowdfunding campaign for the commercial kitchen; increasing occupancy & listing venue in directories.
• Need to factor in that we'll be extracting rent expense in our loan application financials
• Stephaney on vacation from Aug 12-22nd

Fiscal Sponsorships

• Compatability with Omni's nonprofit activities and mission; consensed on by the Board
• Contingent on organizational status of the collective (whether it becomes a project or a sublease) - 501c3s or for-profits have subleases
• All agreements are currently one-year terms, though Omni is open to short-term sponsorships
• Fee determined on fit, internal process of space & resource allocation
• GCS / YES: "We propose to pay $100 a month in rent plus utilities for the first three-months until we receive grants to support our program. After the first three months we will pay $200 for rent plus utilities."
• Let Steph know if we need any resources. Need to specify roles and functions, best practices.

Improvements

• Commercial kitchen renovation - $50K
• ADA Bathroom
• Plumbing
• Roof repair
• HVAC

Action Items

• Create a worksheet for Event Rental income [Jenny]
• Talk about if we want to meet in person with Stephaney, and where and when
• Stephaney will send examples of supporting numbers worksheet
• Stephaney will send some contacts re: construction estimate
• See if there are any recent reports (environmental, appraisal) of the building [Jenny/DK]
• More robust fundraising plan [Fundraising WG]
• Operating expenses worksheet - granular [Jenny/Stephaney]

Next Meeting

• Timeline working back from our option
• Going over report w/ updated numbers
• Training etc; on fiscal management?

Reference Links

• LOIs (subleases & fiscal sponsorship agreements): https://drive.google.com/drive/u/0/folders/0B4_Q7DQvNFT-M0FnWmdzLWh1Yzg
• New Rent Roll (Jenny, simplified): https://drive.google.com/open?id=1jf_uGStPFhTnj-xqkcAUOg9i_MAb6d-FDH8OX5HxtSQ
• Old Rent Roll (Matt): https://drive.google.com/open?id=1O8nDyJsiMzCanXFyllUUrjG5ergodGnJVkWljew6-eA
• Pro Forma: https://drive.google.com/open?id=1DCFMb5KomLhrfz1nD5QFvuEkV-LDTCsYgmfyKu-yUkU
• Pro Forma folder w/ updated financials: https://drive.google.com/open?id=0B4_Q7DQvNFT-VGhfbFdfa0M1QW8
• New Market Tax Credit Map: https://www.cohnreznick.com/NMTC-Mapping-Tool