Managing Expenses for School Based Teams

How do all of the school based teams deal with expenses? Our school requires us to go through their admin and create a PO for every purchase. There is no ability for me to pay for something and get reimbursed. I’m doing my best right now to raise money for swerve, and even if I get the money I likely can’t order quickly enough to purchase before they are sold out. Very frustrating.

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We’ve worked out an open PO system with our district to pre-authorize spending up to a certain $ amount. I estimate/budget our our robot funding across the multiple FRC vendors, and then leave a bucket for (slower) specific purchases of other one-off items. Typically we open PO’s for AM, REV, McMaster, Digikey, and occasionally WCP.

Metals/sheet stock gets acquired in the fall to have on hand for build.

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Any way to handle small local purchases quickly? (e.g. a role of tape from the hardware store)

This topic pops up occasionally. Unfortunately, if you can’t secure an open PO to common vendors (REV, Andymark, etc.) you’ll just need to do your best to pre-order what you think you’ll need.

My school has a independent foundation that acts as a common booster account for a lot of sports, activities, and even our science department. This foundation is a 501c3 non profit and we do our best to get donations made to the foundation. The foundation allows me to be reimbursed from our funds after I make purchases.

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Our school district tech teachers have p-cards for Home Depot for their normal classes, so we don’t run into issues there usually.

No petty cash type of option. Usually one of the parents just purchases. Currently that tends to be me.

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I was thinking something like a booster club that runs in parallel. How difficult is the 501c3 paperwork and process to handle each year?

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The foundation is its own entity, separate from us. They’re an umbrella organization for all of our campus. From what I’ve heard from other teams who have their own dedicated 501c3, it’s not too much work once it get started. But consulting with legal/tax experts is the best way to start.

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Once you set up your 501c3 it’s easy to maintain. 5 min a year for the online postcard to the IRS. if you get bigger it gets more complicated.

Setting it up takes a solid weekend and $500.
https://www.irs.gov/charities-non-profits/application-process

Once you file all your paperwork, it will take a few months to get your determination letter. you can then use that to open a bank account

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In my experience on an old team of mine, try and press as hard as you can to have control over the finances, try and explain that a FRC team moves quickly, needing to order parts right then (like motors or any other part coming back in stock) and needing to make a PO or having to pass up an order through a chain doesn’t cut it, from part shortages, to people who don’t know what they’re doing ordering. My last season with my previous team, many things got misordered, didn’t get ordered, ordered too little or too many, supply chain issues. This lead to many of our mentors having to purchase items with their own money, and never got reimbursed for the many items ordered.

TL;DR: try and get the finances in your and the team’s hands, sometimes it can work out with a PO system, but in my experience no.

Definitely worth doing your own 501.3c. You can do it so you can have all the large purchases through the district and then raies your own funds and do the ‘omg we need this yesterday’ stuff.

FIRST also has partner up with Hackclub (Fiscal Sponsorship — HCB) on helping ppl to do that (we’ve gone 501.3c back in 2018 so I dont have any real experience with them).

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6328 has been run as an independent 501(c)3 from the beginning, I’ve been on the Board of Directors since 2017. If you have someone organized to manage the finances and annual filings, it’s really not that hard though obviously I’m only familiar with Massachusetts regulations.

I’ve recently been chatting with a few other teams also looking at starting their own 501(c)3 “booster” style organizations specifically because of the financial issues you described. I’m happy to chat about our experience if that would be helpful, feel free to send a message! We’re in the middle of updating our team’s guide to 501(c)3s for FRC teams, I’ll post that once it’s done.

(edited to add: apologies for replying to the wrong post! Meant for @madisonDad)

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This is very much a possibility, but be careful in how you do it.

Setting up a 501(c)3 is easy enough and can certainly help with finances, both in spending and in fundraising. Our team had problems with getting some grants in the past because schools in NC are not technically non-profits, so some donors wouldn’t deal with us. We also had the problem with purchasing, especially since district regulations required large purchases to go through a convoluted process. So we eventually set up a 501(c)3 booster club to support the team. It’s worked out really well and the team’s finances are much more flexible and responsive, since we can just charge what we need to the booster club’s debit card.

However, there is a catch that you might need to watch out for. In our district, a district employee cannot have any direct involvement with a 501(c)3 organization that supports school activities. This is to keep financial dealings clean and the district not involved in them. That means that we had to have parents organize and run the booster club and the officers shift as students join and graduate. It works, but it does take some involved parents to make it happen.

Part of our budget is an allocation from the school. For those funds, the lead teacher sends orders to a specific admin who will place and receive the orders. This works pretty well, but can be too slow for an item that may only stay in stock for maybe a day or two. No PO is required for these orders. I assume that running the orders through the admin is considered sufficient control.

The funds raised by the team through sponsorships or other means are held in a school account that is controlled by the lead teacher of the team. The lead teacher has a p-card that can be used to access those funds. There are several admins who can place orders with those funds as well if directed by the lead teacher. The p-card can be used at local stores, but it has to be a teacher associated with the team who makes the purchase. Mentors cannot use the p-card. Purchasing with team funds is fast enough for all but the most urgent needs.

If there is an item that might go out of stock in an hour or two, or a local item is needed for the upcoming work session, even a p-card in the teacher’s hand might not be fast enough if they are in the middle of a class, can’t leave school to visit a store, or something like that. Mentors will often make this kind of purchase although this type of purchase is rarely needed. If mentors keep their receipts, they can submit them all in one transaction toward the end of the season (and school year) and get reimbursed. There is no option for mentor reimbursement following each purchase.

We have at times used open POs with various vendors, as well as used a school credit card only authorized for certain vendors (which included AndyMark, Vex, Rev, etc. as well as Amazon, Lowe’s, and Walmart). We also have money in a community 501(c)3, Rochester Community Robotics, which issues us a debit card every year–before you set up your own, check to see if there’s one in your area you can piggy back on.

Petty cash is a terrible idea (and often illegal), so I wouldn’t suggest doing that.

I was referring to petty cash as a mechanism to make small purchases with something like a debit card. I was just using the term incorrectly. I don’t want to have to handle actual cash.

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I’ll toss my hat into the “handle your finances separately” ring. We got a little bit from the school that we used for non-time-sensitive things, but most of our funding and purchases went through our 501c3 booster club. There’s plenty of work involved but you’ll find you’re much better off.

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Some people do use actual petty cash in extracurricular activities (especially when there’s cash fund raisers involved), and it’s the number one source of fraud arrests in schools (at least in New York.)

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Can confirm, RCR is an amazing resource for a couple dozen of us western NY area teams. They provide 501(c)3 nonprofit status to teams as an umbrella organization, and help manage finances as @pfreivald mentioned. Best yet, nobody on the board for this organization takes a salary from the org, so overhead is minimal (and covered from the interest earnings of the team money (anything over a reasonable working balance of 2-3k) pooled into a common moneymarket account).

Our teachers have a purchase card tied to our team’s account at school. Most purchases are otherwise ordered by mentors and submitted for reimbursement in a very easy process. Our school is pretty fantastic and reimburses quickly. Our booster club account can also make purchases on our behalf pretty easily, especially if checks need to be written for anything.

We’re pretty fortunate our mentors are able to operate without much issue at all.