Jump to content



Photo
- - - - -

How much money in the Troop Treasury?


  • Please log in to reply
77 replies to this topic

#1 bluecat

bluecat

    Junior Member

  • Members
  • 7 posts

Posted 09 November 2014 - 12:03 AM

I've not seen this problem addressed before. If anyone has some pointers to good policies on this matter, please forward that (in addition to your opinions, of course!)... We're a well-established troop but in an area with declining scout enrollment. Our troop has dwindled down in size to about 10 boys and, with the current crop of boys about to age out, there is some danger of folding. (We are working on improving the numbers so this does not happen, but it is possible that it will.) We have a substantial treasury that has been passed down to us today over the past decades. My question is: how much is too much? What guidelines do you use to understand how much money should be kept for capital expenditures (tents, etc.) and for annual expenses? Any "rules of thumb"? If we decide that we have too much, what's the fairest way to spend this money down?
  • 0

#2 Stosh

Stosh

    Senior Member

  • Members
  • 12459 posts

Posted 09 November 2014 - 08:13 AM

Money in the bank is of no use to the boys. Stosh
  • 1

#3 KenDavis500

KenDavis500

    SM

  • Members
  • 94 posts

Posted 09 November 2014 - 08:20 AM

What does the Troop budget say? You should have enough for equipment maintenance/replacement, awards, etc., plus some reserve. After that, subsidize the camp outs, give to local charities, or ask the Scouts what should be done with the "extra" money.
  • 1

#4 bluecat

bluecat

    Junior Member

  • Members
  • 7 posts

Posted 09 November 2014 - 12:44 PM

We are loath to spend the "extra money" because, first off, we want to be good stewards of the money and, second, we don't have any clue about what should be the "reserve". (The amount of the reserve is what I'm looking for guidance on...)
  • 0

#5 SeattlePioneer

SeattlePioneer

    Senior Member

  • Members
  • 4170 posts

Posted 09 November 2014 - 05:37 PM

You can always donate leftover money to your chartered organization or council. But in general my aim is to spend money on the boys who earned it. Sounds like that might not be easy top do with your legacy funding. Sounds like your aim is to find new boys --- certainly the best option. Do you have a Cub Pack or two that you get boys from? What other recruiting methods do you use, and why are you having this problem? I targeted a Scout Troop I was interested in helping build more membership 7+ years ago. I've done that by rebuilding the Cub Pack that can feed boys to the troop. The pack was down to one boy, and today we have 23, and are sending boys to two troops. Not easy though!
  • 0

#6 bluecat

bluecat

    Junior Member

  • Members
  • 7 posts

Posted 09 November 2014 - 06:02 PM

Thanks, SeattlePioneer. Yes, we are trying to up our numbers but, frankly, our troop has done a minimal job on this for quite a few years now. And now we are at that point where our small size is an obvious issue for webelos as well. The SM has his hands full already. Do you think the DE is (or should be) working on this issue with us? It's almost FOS season, so I imagine we will see him again in the near future. ;-)
  • 0

#7 fred johnson

fred johnson

    Junior Member

  • Members
  • 1619 posts

Posted 09 November 2014 - 11:49 PM

... Do you think the DE is (or should be) working on this issue with us? ...


Yeah ... NO. I'd avoid getting too many people involved. Especially professional scouters. IMHO, if they did not care enough as this built up over the years or help build it up, then they should not be involved. If you want to make a substantial FOS donation, fine. Just make the decision as a troop.

If you want to involve anyone, involve the charter org rep or the charter org executive. "Officially", it's the charter organization's funds anyway. The money was collected under their non-profit umbrella and it should be argued if anyone has a right, they have the right.

For me though, I'd keep the decision within the troop. On the other hand, if you only have three adult leaders deciding how to spend $20,000, you want to involve the charter org. You did not say the amount, but I'm just asserting an example.

=========================

​How much money should you keep on-hand? After subtracting targeted funds (rechartering, "paid" camp fees, scout account balances, etc), have enough on-hand so that you don't have cash flow problems and so that you don't go broke in the next year or two.

Before you figure out how much you should have, figure out your annual budget. Income: Dues. Camp fees. Expenses: Rechartering scouts and leaders. Equipment replacement. Site reservations. Special events. Awards. etc. etc.

In our troop, we charge $75 a year dues and $30 on average per camp out. Some more. Some less. We figure our cost per camp out and add $2 to $4 for troop extra expenses. Goal is to not lose money on a camp out, but to not profit more than $1 or $2 per scout. The annual $75 dues are to cover rechartering scouts and adults, awards and any non-camping expenses.

So I'd be upset if we had more than $1000 to $2000 extra unallocated each year.

IMHO, troops don't need a large legacy fund. If anything that can cause trouble.

==========================

One great use ... cut all camp fees for EVERYONE in half until the extra is smaller. That's the best use. Reduce camp fees.

It's hard to help a pack because they do not necessarily join your troop. But it could be a great recruiting incentive too. "Oh, they helped our pack ..."

==========================

I've heard of troops with tens of thousands in their checking accounts as extra. That's just dangerous and asking for trouble. It's amazing how people get bent out of shape and infer the worse of each other when large amounts of money is involved.

Good luck.
  • 0

#8 Stosh

Stosh

    Senior Member

  • Members
  • 12459 posts

Posted 10 November 2014 - 07:57 AM

This issue leaves a lot of open ended questions. Does the money belong to the troop or the CO and by what authority does the troop have to give away the CO's money. If the organization is touting itself as non-profit, what's it doing raking in a profit every year? If the funds are accumulating more than needed, quit the fundraising. A bank account does the program no good unless spent on maintaining and improving the program. The money was a designated gift and assumed that when the donation was made it would be used in accordance to the wishes of the donor. "Hi, I'm Johnny and I'm selling popcorn so I can go to camp next summer." and then spend the popcorn money on adult training at Philmont? or gives it away to another program? That constitutes fraud. If an organization has an EIN with tens of thousands of dollars in the bank, it will show up on the radar that taxes haven't been paid under that EIN and a check for tax-exempt status doesn't show on the system.... That should show up on IRS radar. Saving up a bit for a rainy day doesn't mean one has to be prepared for a hurricane of the century. Stosh
  • 0

#9 meschen

meschen

    Member

  • Members
  • 133 posts

Posted 10 November 2014 - 06:11 PM

My take: Assume the Troop will not fold. Continue being thrifty with the money so when you grow you won't feel a pinch. Curtail, but don't completely stop fundraising efforts so it won't be as painful to restart. Have a discussion with your CO to decide if it is appropriate to plan a Philmont type trek, but don't go out of completely out of proportion with what you've done in the past. If you do fold, unless things are set up in a way that goes against BSA policy, the funds go back to the CO. They should probably look to giving it to another Scout unit, but are not obligated to do so.
  • 0

#10 meschen

meschen

    Member

  • Members
  • 133 posts

Posted 10 November 2014 - 06:14 PM

If an organization has an EIN with tens of thousands of dollars in the bank, it will show up on the radar that taxes haven't been paid under that EIN and a check for tax-exempt status doesn't show on the system.... That should show up on IRS radar.


Banks don't report holdings (balances) only interest income and large dollar cash transactions.

  • 0

#11 Stosh

Stosh

    Senior Member

  • Members
  • 12459 posts

Posted 11 November 2014 - 08:46 AM


Banks don't report holdings (balances) only interest income and large dollar cash transactions.


This must be why one of our members who happens to be our city's tax lawyer told our group to keep the amount of funds in the bank low because of our tax-exempt status.

One always hears dialog both ways on these kinds of issues, and I just like to err on the side that will result in the least amount of damage. :)

Stosh
  • 0

#12 Sidney Porter

Sidney Porter

    Junior Member

  • Members
  • 232 posts

Posted 11 November 2014 - 09:20 AM

Not legal advice but this article seems to explain it.
http://www.nolo.com/...ings-30284.html

I have heard that non profits must spend all the money they bring in. That doesn't make sense, I assume that NFP hospitals and churches routinely save money for future expenses. In theory a a scout unit would be the same.

In order to jepordize the tax status the group would need to start having excessive unrelated business activities. Say a scout group decides to have a car wash for a fund raiser it would not be a problem. But it was successful, so they have another one the next weekend and the next. Then they decide that because of demand they need to be open on the weekdays. They they need to start hiring people to work at the car wash. It has gone from a fund raiser to a business.
  • 0

#13 JoeBob

JoeBob

    Ashes

  • Members
  • 1275 posts

Posted 11 November 2014 - 09:24 AM

Since a portion of your funds is credited to your legacy members, how should you spend it to honor them? I'd recommend keeping the troop alive. Host some outrageous recruiting events. Take the Weebs go-carting, miniature golf, rock-walling, bouncey house, etc. Whatever works for your area. Get a snake or animal expert to visit the Packs, and have your scouts go. Money puts you in position to recruit in unusual ways.
  • 0

#14 Stosh

Stosh

    Senior Member

  • Members
  • 12459 posts

Posted 11 November 2014 - 10:30 AM

Not legal advice but this article seems to explain it.
http://www.nolo.com/...ings-30284.html

I have heard that non profits must spend all the money they bring in. That doesn't make sense, I assume that NFP hospitals and churches routinely save money for future expenses. In theory a a scout unit would be the same.

In order to jepordize the tax status the group would need to start having excessive unrelated business activities. Say a scout group decides to have a car wash for a fund raiser it would not be a problem. But it was successful, so they have another one the next weekend and the next. Then they decide that because of demand they need to be open on the weekdays. They they need to start hiring people to work at the car wash. It has gone from a fund raiser to a business.


There's nothing wrong with a tax-exempt organization running a business. It's not the activity one does, it's the way the organization is structured with the government that makes it a tax-exempt organization. In our case we are chartered by a church, so we can run any kind of fundraiser as many times as we wish because a church can do that. If our boys want to do a car wash every Sunday morning in the church parking lot after church, so be it, not a problem and not a business because the church is structured as a not for-profit business for tax purposes.

If a unit is using it's own tax-exempt structure and EIN number, they fall into the rules pertaining to a not for-profit business for tax purposes as well.

It all boils down to the combination of EIN and tax-exemption status the unit holds.

Stosh
  • 0

#15 qwazse

qwazse

    Senior Member

  • Members
  • 6836 posts

Posted 11 November 2014 - 10:33 AM

Get the boys and the COR around the same campfire and talk about the best way to handle this. Generally you want a one-year cushion. But, you may want to plan for some whiz-bang recruiting opportunities. Even letting it be known that you have $200 camper-ships for any boy who joins your troop this year may help bring in some families who were feeling scouting's "sticker shock."
  • 0

#16 bluecat

bluecat

    Junior Member

  • Members
  • 7 posts

Posted 11 November 2014 - 07:51 PM

Thanks, everyone. Some very good ideas there. Although I feel a little guilty about spending down the inheritance, I will have to now convince the rest of the Committee that I think it's the best for all of us. I'm not really inclined to see it go to the CO (who haven't been involved at all) and I always worry about a treasurer who goes AWOL with the funds. (It has happened!) I especially like the idea of spending on recruiting events and offering a discount for Webelos signing up with us. It serves the purpose of growing the ranks too.
  • 0

#17 jpstodwftexas

jpstodwftexas

    Senior Member

  • Members
  • 809 posts

Posted 11 November 2014 - 10:30 PM

One way to use it.. In My Youth Troop we had Honor Scouts.. Scouts earned points for...Attending Meetings...Wearing Proper Uniform..Attending Events (Campouts, Camporees)..Advancement...Earning Awards, Merit Badges..etc..and Community Awards such as Attending Church..School Participation.. At the The end of The Year...Points were Tallied... 1st Place Honor Scout got Philmont and Summer Camp Paid for.. 2nd Place Got 1/2 Philmont and All Summer Camp paid for 3rd Place Got All Summer Camp Paid for 4th got 1/2 Summer Camp Paid for plus each won a Medal to wear on Ceremonial Uniforms You could do "High Adventure BAse of your Choice" depending on where you live. Spend it on Members of the Unit...don't waste it on Possible Members..Use it wisely
  • 0

#18 Basementdweller

Basementdweller

    Junior Member

  • Members
  • 5173 posts

Posted 17 November 2014 - 02:05 PM

Does anyone remember the news story of the Los Angeles troop that had their treasurer steal $40,000 dollars and another in vermont for $30k. If anyone has any spare laying around my guys could use it. I promise with won't be spent on adult registrations, or troop trailers.....But more tents and cooking gear.
  • 1

#19 CherokeeScouter

CherokeeScouter

    Junior Member

  • Members
  • 74 posts

Posted 18 November 2014 - 11:44 AM

What a great problem. And what an easy solution. Get the Scouts together, pull out of a the map of the U.S. and pick a place to go camping. My suggestions would be Philmont, Sea Base in the keys or the Grand Canyon. Then book some flights, go there and camp. What about the World Jamboree next year? We found ourselves in a similar situation with several thousand in the bank. Soooo, we decided to give every kid in the troop a scholarship to one summer expedition. We had groups going to Summer Camp and Northern Tier. We usually also do a group to Philmont and/or Sea Base, but not this past summer. It worked out really well. I think we granted every Scout a $150 scholarship. All this money comes courtesy of a poinsettia fundraiser that I"ve posted about before. We prolly make about $5,000 a year out of that thing (although I'm not exactly sure because I'm not on the finance committee).
  • 0

#20 Pack18Alex

Pack18Alex

    Junior Member

  • Members
  • 237 posts

Posted 18 November 2014 - 12:53 PM

1. If the money is a legacy that you are a steward of, continue protecting it. You should keep a reserve that is the amount you need for 4-6 months of the program (i.e. time between fundraisers). 2. Invest in the future of the troop, spend some on recruiting. We have done custom signs, custom flyers, etc. Some are pitching our brand, some are pitching our specific scouts (instead of generic pictures). 3. Invest in your Pack. Does your CO have a pack? If not, start one right now. That's the best source of new recruits, and it's a no brainer use of money bequeathed to you. 4. Invest in a Satellite Pack. See if you can get a second Pack chartered to your CO. Find a location that is within a 15 minute drive of your CO. Recruit a Pack there. If you have a Pack there, those boys should be encouraged to float over to the Troop each year, where 15 minutes is less of a big deal (Cub Scouts are tired at night). 5. Shiny Webelos Recruiting? Advertise a free, Webelos Only PWD or other event with a fancy new track. But if you have two new NSPs coming from two packs/year, your longevity is safe. Now, funds are part of the issue, an adult to champion each of these things is another story. This will be super unpopular with the core group here, but if you have money in the bank, but not enough Scouts in the Troop, to me the most obvious use of the money in the bank is to convert it to Scouts. You can't exactly buy Scouts, but you can invest in marketing. I am super against the idea of "we have this big legacy supply of money, and we're shrinking, so we'll spend our endowment today on a big hedonistic bang." If you don't want to invest it growing the troop, go purchase zero-coupon bonds for the Troop, with various maturities, so the Unit can fold but when it's time to restart it you have a legacy. Good luck. But you didn't earn the money, the scouts of today didn't earn the money. It's robbing the past to spend it on today's Scouts. It's a tribute to the past to spend it on recruiting tomorrow's Scouts.
  • 0




0 user(s) are reading this topic

0 members, 0 guests, 0 anonymous users