AT RISK

 

Fund Raising by Boosters & PTOs & Financial Accountability Law!

 

School Support Organization Financial Accountability Act

By: Pat Hunter

August 9, 2008

 

Last year, the Tennessee General Assembly passed the School Support Organization Financial Accountability Act. The law became effective last June 2007 with the Governor’s signature. Thousands of dollars have been raised by PTO, PTAs and booster clubs. The law was created to address certain problems and irregularities related to fundraising statewide while bringing accountability and good recordkeeping practices to govern fund raising organizations. 

 

School Boards were given ample time to adopt a policy to address requirements of the law. Why didn't the Loudon County School Board adopt a policy to coincide with the new law? The Loudon County Board of Education is a member of the (TSBA) Tennessee School Boards Association and TSBA provided information to its members with an on-line legal reference School Support Organizations and Financial Accountability Act information. Click to view

 

Fundraising organizations must be approved as a School Support Organization by the School Director. Additionally, these organizations must obtain approval from the School Director prior to fund raising activity. School organizations and clubs had one year to come into compliance within the law, which went into effect July 1, 2008. The law affects school related organizations such as PTOs, boosters, athletic, art, band clubs, etc., who help raise money annually in the name of schools. The money raised is supposed to go wherever the money was intended to go, not elsewhere.

 

The Lenoir City School System addressed this matter long before now. At a meeting held by the Lenoir City School Board, a representative from the Tennessee Comptroller’s Office spoke about the state law and accountability requirements. The Comptroller’s representative also discussed changes to School Support Organizations policy before the School Board, school administrators and non-profit organizations. But it appears, that the Loudon County Board of Education and former School Director Edward Headlee took a far different approach while opting to ignore the state mandated law. (Comptroller's representative discusses fundraising law and requirements)

 

"Under the new law, school organizations, PTO and PTA, boosters, art, clubs now have two options. The first would be to become a charter organization and file the necessary paperwork, complete with elected members. Under this option, school personnel would not be allowed to be in charge of money regarding any fundraiser; otherwise it would become school funds." "The other option would be to have the coach of a specific sport serve as that booster club’s sponsor and after any funds were raised; those funds would be placed in a school account." While this may be an option, parents would still be left out of the decision making process leaving school personnel to decide how to spend the money raised by parents.

Within the last year, one parent broached the subject of the new fund raising law, policy and required procedures with former School Director Edward Headlee but Headlee thought that the law would be repealed and no action was needed. Prior to a recent school board meeting, a school Principal asked about the fundraising policy yet nothing more was said or done in public!

 

When will the School Board and School Director Wayne Honeycutt address this matter of adopting a policy, which involves parents and brings accountability of fundraising to comply with the new state law?

 

Here's hoping that this matter will be discussed in an open manner and not behind closed doors, excluding parents from the decision making process! School is about to start as PTOs, PTAs, booster clubs start fund raising activities, what about the clubs, organizations, PTOS and boosters, which were left hanging, what about them, they deserve some answers to their concerns? 

 

Resources: Additional information about the School Support Organization Financial Accountability requirements may be obtained from the Tennessee Comptroller's Office website including SSO - Questions & Answers, SSO changes, Powerpoint presentation, Forms & wiavers and more...

http://www.comptroller.state.tn.us/ma/sso.htm

 

Questions and Answers

http://www.comptroller.state.tn.us/ma/Q_and_A_School_Support_Groups.pdf

 

 

 

School Support Organization Financial Accountability Act

 

SOURCE: tncourts.gov  Tennessee Codes

 

 

T.C.A. 49-2-602 Legislative intent.

 

"The general assembly recognizes the importance of school support organizations in providing financial support to help carry out academic, arts, athletic, and social programs to further educational opportunities for the children of this state. The general assembly also recognizes concerns that parents and other persons who support these organizations have in ensuring that money raised by these organizations is safeguarded by them and used to further the activities for which the money is raised. It is, therefore, the intent of the general assembly to ensure the continued support of academic, arts, athletic and social programs, which help to educate the children of this state, while also ensuring fiscal accountability of school support organizations.

 

 

 

49-2-604. Adoption of policy concerning fundraising. — [Effective July 1, 2008.]

 

 (a)  A school board, director of schools, school principal, or other school official or employee may not authorize a group or organization to use a school district's or school's name, mascot or logos, property or facilities for the raising of money, materials, property or securities until a policy has been adopted concerning cooperative agreements, school support organizations, and the use of school facilities for fundraising purposes.

 

(b)  The policy that a school board adopts pursuant to subsection (a) shall, at a minimum, include, in substance, the following provisions:

 

 (1)  Prior to soliciting, raising, or collecting money, materials, property or securities to support a school district, school, school club, or any academic, arts, athletic, or social activity or event related to a school, a school support organization shall submit to the director of schools or the director's designee a form that, at a minimum, documents the following:

 

 

 (A)  The organization's status as a nonprofit organization, foundation, or a chartered member of a nonprofit organization or foundation;        

 

 

 

 

(B)  The goals and objectives of the organization; and

 

 

 

 

 

 (C)  The telephone number, address, and position of each officer of the organization;

   

 

 

 (2)  A school support organization shall annually, at a time designated before the beginning of the school year, submit a form to the director of schools or the director's designee that verifies its continual recognition as a nonprofit entity or foundation and the current telephone number, address, and position of each officer of the organization;

 

 

 

 

 

 (3)  A school support organization shall annually, at a time designated after the end of the school year, provide, at a minimum, a detailed statement of receipts and disbursements to the applicable school principal;

 

 

(4)  The school support organization shall maintain a copy of its charter, bylaws, minutes, and documentation of its recognition as a nonprofit organization. Also, a school support organization shall maintain financial records for a period of at least four (4) years;

 

 

   

 

 

 (5)  A school support organization shall operate within the applicable standards and guidelines set by a related state association, if applicable, and shall not promote, encourage or acquiesce in any violation of student or team eligibility requirements, conduct codes or sportsmanship standards;

 

 

 

(6)  A school support organization's officers shall ensure that school support organization funds are safeguarded and are spent only for purposes related to the goals and objectives of the organization. The organization shall adopt and maintain a written policy that specifies reasonable procedures for accounting, controlling and safeguarding any money, materials, property or securities collected or disbursed by it;

 

 

(7)  The approval of the director of schools or the director's designee shall be required before a school support organization undertakes any fundraising activity. This subdivision (b)(7) shall also specify the extent to which approval is required. This subdivision (b)(7) is to assure that scheduling of fundraisers does not conflict with the school district's or school's fundraising efforts and that the fundraising process is consistent with the goals and mission of the school or school district. All fundraising activities shall comply with state and federal law;

 

(8)  A school support organization shall provide, upon request, to officials of the local school board, local school principal, or auditors of the office of the comptroller of the treasury access to all books, records, and bank account information for the organization; and

(9)  A school representative may not act as a treasurer or bookkeeper for a school support organization. A school representative may not be a signatory on the checks of a school support organization. A majority of the voting members of any school support organization board should not be composed of school representatives.  

 (c)  A local board of education may adopt a policy that is more restrictive than the requirements of subsection (b).

 

 (d)  As a result of this policy, the local board of education, director of schools, local school principal or any other school official shall not incur any liability for the failure of a school support organization to safeguard school support organizations funds.

 

[Acts 2007, ch. 326, § 5.]"

   

 

 

 

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08-10-2008