In response to an increasing number of questions from PTAs regarding fundraising and alcohol, the Illinois PTA State Board of Directors has adopted the following policy for local PTAs, PTA Councils, districts, regions, and the State Board of Directors.
Like every PTA activity, fundraising should be conducted in alignment with our mission: to make every child’s potential a reality by engaging and empowering families to advocate for all children. Likewise, National PTA policy states that PTAs should refrain from accepting funds from businesses engaged in activities inconsistent with the PTA mission and positions (e.g., alcohol, tobacco, and firearms). To help provide guidance regarding PTAs and alcohol, the Illinois PTA has adopted the following policy.
- PTAs may not directly sell alcoholic beverages under any circumstances.
- Sealed bottles of alcohol may be included in silent auction items provided that the auction is held off school property and the contents are not opened during the event or on the premises. PTAs are not to purchase alcohol for such auctions, but may auction donated bottles of alcohol.
- PTAs are strongly encouraged to refrain from serving alcoholic beverages at PTA events. If alcohol is served, the PTA may not serve it. A licensed establishment or catering company must be used to serve alcohol. PTAs may not sell alcoholic beverages through ticket sales.
- Alcohol may not be served at events where children are present.
- Under no circumstances are PTA funds to be used to purchase alcohol or to reimburse purchases of alcohol. This includes reimbursement for alcohol purchased with a meal while a person is representing PTA (e.g., while attending convention).
PTAs should also be aware that Illinois law prohibits open containers of alcohol on “public school district property on school days or at events on public school district property when children are present.” In addition, your county or municipal government may have additional restrictions regarding alcohol sales.
Theft and fraud are relatively rare in PTA, but it does happen. For PTAs that are using best practices when handling money, making deposits, and writing checks, they are even less likely to occur. By being proactive and examining your PTA’s processes and controls, your PTA can better avoid being a victim of theft or fraud. However, if you suspect your PTA has mishandled finances, here are ten steps to take.
- To protect from being accused of defamation or libel, do not make any premature accusations. Start with a discreet investigation of the facts, including an audit, documenting any funds that can’t be properly accounted for or that have been misused.
- Freeze bank accounts. Conduct no further activity until all facts can be gathered.
- Notify your insurance company of suspected theft or fraud. Provide them with the facts you have gathered.
- Do not make an offer to not report the theft or fraud if the money is paid back. Such an offer is extortion.
- Contact your police department and provide them with the information they request. Do not wait to do this, as PTAs are accountable for reporting theft or fraud. A delay on reporting could be construed as being complicit with the fraudulent activity.
- Now let the insurance company and police department do their work and report to you on their findings.
- If your PTA is currently required to file an Annual AG-990 Report to the Illinois Attorney General’s Office, you must report any theft or fraud on Item 10 of that report and file an attachment describing the details of the case. Item 10 on that report appears as follows:
10. WAS THERE OR DO YOU HAVE ANY KNOWLEDGE OF ANY KICKBACK, BRIBE, OR ANY THEFT, DEFALCATION, MISAPPROPRIATION, COMMINGLING OR MISUSE OF ORGANIZATIONAL FUNDS?
- In the case of findings of theft or fraud, your PTA must use Form 990 or 990 EZ to disclose the dollar amount involved and your corrective actions. You may not use 990N in any year your PTA is a victim of theft or fraud.
- During the time an investigation of theft or fraud is being conducted for your PTA, please be careful to manage all communications to protect your PTA image. Use positive messaging such as:
The situation is being handled in a lawful manner. Anytown PTA has already made changes in procedure to reduce the risk of anything like this happening again in the future.
- Be extremely discreet about any information naming the suspect(s) to protect any of their children from suffering any negativity or bullying from other kids at school.
Also remember that your Illinois PTA District or Region Director is there to help you through this process, so don’t hesitate to reach out to them.
Business donations can help a PTA offer programs and events and takes some of the financial burden off of your members by avoiding the need for fundraisers. But reaching out to businesses doesn’t come naturally to most people, and it can feel a little awkward when you first start. Here are eight tips to get you going.
- Remember Who You Represent.When you approach a business for a donation, you are representing your PTA and the work you do for children. PTA is a nationally-recognized brand. So when you approach a business, you have a lot to offer and are asking on behalf of a good cause. Don’t sell your PTA short by making too small a request—businesses will be interested in being associated with your brand.
- Coordinate Your Requests.PTAs run several events and programs over the course of the year, so make sure you’re not asking the same businesses for donations for each one. Have your leaders for the various programs work together at the beginning of the year to divide up the businesses you’ll be approaching for each event. Try and match potential donors with relevant programs, like asking an art supply store to help sponsor your Reflections program.
- Find Out Who Your PTA Already Knows.Check past years’ records to see which businesses have donated before. Look at your membership and school population—are any of the families at your school business owners. Don’t just look at parents, but also grandparents, aunts, and uncles as well. They all have a stake in the success of the students at your school.
- Know What You Want.Decide in advance what you would like from a potential business donor. Is it a simple financial donation, door prizes to hand out, or materials to help you put on your event. Be specific in what you are asking for.
- Offer Them Something in Return.Be sure to offer your business donors a publicly visible recognition of their support. That can be a window cling or certificate citing them as a “Proud Supporter of Lincoln PTA,” signage at your event thanking the sponsors, mentions in your newsletter thanking them for their support, or a small banner spot on your PTA website or newsletter for a certain period of time. Note that when doing the latter, PTA is not endorsing the business, the business is supporting the PTA. Think PBS-style sponsor (This PTA event was brought to you in part by ABC Business, provider of fine art supplies.), not traditional advertisement.
- Don’t Burn Your Bridges.A business may say no for a variety of reasons—they may have already filled their planned quota of non-profit donations for the quarter or the year, they may feel that the event doesn’t fit their business, or they may not currently have the resources to spare at that time. Thank them for their time, and ask if they’d be willing to sponsor a different PTA event sometime in the future.
- Follow Up After Your Event.Be sure to send a thank you note to every donor with a handwritten signature. Include a receipt if the donation was strictly financial, and note the amount of the donation either directly or as the value of the in-kind donation so they have a record for their tax filing. Consider sharing photos of your event or thank you notes from the kids who participated.
- Keep Records of Who Donated.By keeping track of the businesses who have donated in the past, your PTA will know who to approach first in the future. You can also then thank a donor for their past support when asking them to donate again.
The budget and finance committee develops a budget to meet the needs of the PTA’s programs and activities. After the PTA has adopted the budget, the budget and finance chairman (usually the treasurer) is responsible for assuring that PTA money is disbursed in accordance with the budget, presenting necessary amendments to the budget at executive board and general meetings, and keeping all expenditures within the line item amounts of the budget. Remember that any changes to the budget must be approved (voted on) by the general membership.
Composition of the Committee
Refer to the bylaws to determine whether the budget and finance committee should be elected or appointed. The committee usually consists of members knowledgeable about the PTA’s needs, proficient in bookkeeping and accounting, and experienced in planning a budget. The treasurer, past treasurer, and standing chairmen should be members of this committee. The president is an ex-officio member.
Budget and Finance Committee Procedures
- The budget committee should meet and plan the budget prior to the close of the current fiscal year. If this was not done, do so as soon as possible at the beginning of the school year.
- Treasurer’s records and copies of last year’s budget should be available for guidance in planning the new budget. However, do not let past practice limit your planning for the new year’s budget.
- The committee should take into consideration the funds needed for approved programs and projects, leadership development, and committee and officers’ expenses.
Adopting the Budget
- Present the proposed budget to the executive board meeting for input and approval for presentation to the general membership.
- Present the proposed budget at the first general membership meeting (after adoption of audit report) for consideration and adoption by the PTA members. This presentation must be made at a meeting where a quorum is present. A majority vote of the members present and voting is required for adoption. The budget and finance committee chairman says, “I move the adoption of the proposed budget for the _____fiscal year.” [Note: The fiscal year is identified by the calendar year in which it ends, so the budget your PTA adopts this fall is for the 2019 fiscal year.] The chairman then presents the budget line by line for explanation, discussion, and possible amendments. A vote is then taken to adopt the final version of the budget.
Remember, the executive board (officers and chairmen) approve the budget for presentation, but the general membership is the group that adopts and amends the budget. Illinois PTA has created a Local Unit Sample Budget.
Photo by Nick Youngsonvia Alpha Stock Imagesunder Creative Commons license.