den dues advice

[curious_scouter]

First post, and I apologize making it a heavy one but I'm in need of some objective advice from other scouters.  Apologize for the length, but please - read and comment.  I could use some advice from folks without a horse in the race.

 

I'm involved in a well established pack and starting this year we are transitioning the CC, CM and treasurer roles to new people to give a bit of overlap between the "old guard" and the "new guard" as the old guard is all crossing over in January. 

 

I stepped into the treasurer role.  Over the summer I worked with the former treasurer and CC to learn about processes and policies.  I learned in that time that nearly nothing was documented - 100% of our "policies" are spoken word.  It was also pretty clear that while the outgoing CC and CM seemed to share this understanding of policies, it was not something the den leaders, rest of the committee or parents understood.  But... things seemed to be clicking along and we have most of a year to transfer the knowledge with them helping to guide us so I didn't really worry about it too much.

 

Then recruiting happened.  We went from 45 boys to 90 during recruiting and our financial landscape changed pretty quickly and dramatically.  I started to feel really uncertain about the volume of money changing hands in the absence of documented controls and policies.  I addressed this with the new CC and she and I have put in place some new policies like all money in goes to the bank, all money out goes out as a check.  I'm passionate about paper trail.  This has been working well.

 

In our pack, we do not do Pack dues.  The Dens have dues and collect/manage/report out to parents on them.  How they collect, manage and spend dues is currently entirely at their discretion.  The pack also permits the Dens to keep any donations given during show and sells for popcorn.  So if you're out selling popcorn and say "Would you like to buy some" and the person says "No, but here's $1 donation" the Den gets to keep that.

 

Dens are on average collecting $75 per child annually for dues and in the last show and sell cycle for popcorn each den earned around $400 in donations.  This means we have upwards of $8000+ in dues and donation funds "floating around" out there.  Right now den leaders hold this money.  Some keep it in a literal coffee can.  Some have it in their gun safe.  Some at their work safe.  It all "feel safe" but last night I brought up my concern about "What if?"  What if someone breaks into your home and takes your gun safe?  What if your house burns down?  What if (God forbid) you fell ill and all the den funds are locked up in your work safe?  

 

Beyond this, I raised concerns like while I don't have a full accounting from every Den I know at least some dens had significant carry-over from the previous year.  If that's the case, are you giving parents dues credits since there was a previous year surplus?  If not, why are you continuining to charge dues at last year's rate when you're starting off with a significant nest egg.  Also, let's say that carry-over continues (since there is no policy that forbids it or addresses it at all)  and at crossover a den has money left in the possession of the den leader.  What happens to that money?  Nobody knows the answer to that question and my position is - that's dangerous.  It's a recipe for discord and hurt feelings, but also exposes the leaders and the pack fiscally.  Some Dens spend their money on "stuff".  Like a grate for campfire cooking, a dedicated igloo cooler for ice water, etc.  Who owns those assets?  What happens to them at crossover?  Nobody could answer that.  We recently had a den leader email us at 3pm on a Thursday simply "I quit."  Does he have a stash of den dues and money at his house?  Nobody could answer that.

 

I felt like this was a real and reasonable concern.

 

My proposal was that we deposit all Den collected funds into the Pack bank account.  I would account for them as virtual accounts in our financial statement and would cut a check on request and Den leaders could also maintain a reasonable amount as petty cash to address spur of the moment needs.  This would secure the assets and build in some transparency and safety without restricting access in unreasonable ways.  AND that we should start to establish policies about the questions I asked above.

 

This proposal did not go over well.  I was clear this was not related to any current situation and certainly wasn't about trust of our leaders.  Regardless, several people started yelling and finally stormed out swearing at me saying "You trust me with your kids, but not your money?" and while a lot of people in the room recognized this was not a personal issue, that's where it landed for a key group of individuals.

 

So in the face of conflict, everyone wants to just let things ride as-is.  I think that's a horrible idea.  I think the things I'm asking are eventualities.  They will happen.  Having agreed on policies for these eventualities will avoid hurt feelings and potential exposure for our volunteers.  My hope was the presentation and proposal would generate conversation and we could arrive at some improvement, but the final outcome was "You can do whatever you want, I'm not changing what I do."

 

 

I mean, so far nothing horrible has happened under this model. That's true.  But historically our dens were very poor, scrapping for funds and cutting a lot of corners.  Suddenly they are carrying sizable balances forward year to year and hundreds, possibly thousands of dollars of cash and assets are stashed in private homes.  The landscape has changed and I don't think we can carry on by the seat of our pants.  It's a recipe for trouble.

 

Do I have valid concerns here or over reacting?  As Pack treasurer, is this any of my business?  Should I just butt out, leave the den finances alone?  Are Den monies "den monies" or are they pack assets held in trust by the den leaders?

 

Inviting your frank feedback and if you have experience with this kind of thing, please share.  I searched and googled and found very little from BSA on this kind of thing.  I was hoping there was some BSA policy that clearly addressed den dues, but I did not see anything like that.

 

[qwazse]

Welcome to the forums!

Some trust issues going on here.

If you're getting this much push-back, apologize to your people and move on.

It will spare you a lot of extra work.

If someone eventually walks away with den dollars, you just say "sorry about that. nothing I can do. Ask some other den to float you something from their tin."

 

Thanks for your service to the boys.

[Stosh]

Welcome to the forum!

 

I haven't been in Cubs, but what you do sounds pretty close to a part of what we do with patrols.  If patrols want money for events, equipment, etc. they can get out and raise money.  We do ask that the patrols contribute half of what they make for the troop to purchase troop equipment, which is very little, but that money goes to registrations, camperships, gasoline for drivers, etc. and expenses that might affect a boy who's situation requires more than what a patrol can do for him.  It is our policy that all the boys only have to pay $50 for summer camp and that's a large portion of the troop's half of the funds.

[fred johnson]

Hmmm.....  I've been involved with Cub Scouts for 15+ years and multiple packs.  I've never seen funds managed like you describe.  Usually, all funds are held at the pack level and rarely float down toward the den.  

 

BUT ... Just because it's different does not mean it's bad.

• Suggestions
  • View the den money as den family money, not unit money.  It's just money parents share with each other in advance.  Let the den's be and manage their own internals.
  • Respect the pack traditions.  If you are not comfortable with it, then don't become the treasurer of the pack leader.  
• Potentially good
  • Often, den leaders spend lots of their own money ... OR need more money to run a good program.  I know I myself often bought and paid for things out of pocket ... significantly ... without being reimbursed.  So having some funds would be nice.
  • Keeping the funds closer to the scouts who will benefit from the money.
  • Reducing the amount that is managed by the larger pack.   A 90 member pack could easily have $6000 to $10000 in dues.  $30000 to $40000 in gross fundraising.  And $15000 to $20,000 in fundraising fundraising.  And another $10000 in camping fees.  Large amounts of money are hard to manage and even harder to spend efficiently.  
• Potentially bad
  • Packs need money to operate.  Pack meetings.  Events.  Banquets.  Rechartering the membership.  
  • Loss of accountability
  • Loss of control
  • Fundraising in the name of a non-profit should be managed by the non-profit.
  • Fundraising in the name of a non-profit should benefit the whole membership of the non-profit, not just the subset that managed it.  You can target a significant portion to those who raised the funds, but significant is definitely less than half of the profit, probably more like 20% to 30%.

My comment is don't reject the idea out of hand.  Don't try to fix things that may not necessarily broke.  Wait for the right time or the right reason.  

Edited December 1, 2016 by fred johnson

[curious_scouter]

@all, thanks for your feedback.

 

@@qwazse, "If you're getting this much push-back, apologize to your people and move on."  Frankly, this concerns me more than anything.  If everything were above board, why be so outraged at the mere conversation?  If I have a concern and I voice it - should it not be discussed?  

 

@@Fred in particular, As the pack permits the den to keep donations earned during fundraisers and it is not just den dues from parents (and some would say "from the boys") in play.  Beyond that, if a den is accumulating money at a profit year to year and still asking parents for dues - that seems counter to our purpose.  RE: Pack traditions, I also do not subscribe to the idea that just because this is how it's always been done that it's right and ought to be that way forever.  Times change.  Needs change.  I'm not saying what's going on is "wrong" but but the idea of "if you are not comfortable with the status quo, butt out" is not in line with my personal convictions.  Also recall in my preface, we do not have any pack level dues.  ALL dues are managed at the den level.  Which is why this is coming up.

 

Things are happening that we don't have answers to.  A den leader quit with only an email notice.  He was the tiger leader for an entire year.  This predates my tenure as treasurer.  Nobody knows if he has den money in hand that he needs to return.  Noone knows if we can even get it from him if he does.  This will not be an isolated incident.  What about the other questions - if a den buys "stuff".. where does it go at crossover?  To the troop?  Not all boys go to the same troop.  To the pack?  It was bought with den money from parents.  Sold off and the proceeds split between then-active parents?  Noone knows.

 

Beyond this, BSA has this to say relative to the pack treasurer role:

• Collect dues from den leaders at the pack leaders’ meeting, preferably in sealed den dues envelopes. Open envelopes in the presence of den leaders. Give receipts for these funds, and deposit the money in the bank account.

Am I naive?  Is this not actual common practice?

 

Sorry for the pushback if it's perceived that way and appreciate the feedback.  I'm new to being a treasurer of a pack but I've been in scouting for 33 years now.  As an adult only 3 years of that in Cub Leadership.  Obviously I have some experience ("baggage"?) that is coloring this for me.

[fred johnson]

You're push back is reasonable. 

 

I've never seen a pack work like this.  It is not the best practice.  But you are also stepping into leadership in an existing pack that has 90 members.  I'm taking that as a pack that is relatively successful.  Pushing for significant change while being the new leader will not go well.  You'll get resentment and push back.  Pushing for change because it's not the ideal solution in a pack that is viewed as running okay will not go well.  

 

My comments were just trying to find a way to accept how the pack is running now.  Perhaps over time you can drive change.  Either find a way to accept how the pack works or step back and just enjoy the pack with your scout.  

[qwazse]

...

@@qwazse, "If you're getting this much push-back, apologize to your people and move on."  Frankly, this concerns me more than anything.  If everything were above board, why be so outraged at the mere conversation?  If I have a concern and I voice it - should it not be discussed?  ...

Well, if people have been "above board" among themselves, and someone says, "We need to change because sooner or later your $s are gonna walk away." They will take it as a false accusation or at best a vote of no confidence.

 

How do you react when falsely accused or declared good for nothing?

[Stosh]

Well, if people have been "above board" among themselves, and someone says, "We need to change because sooner or later your $s are gonna walk away." They will take it as a false accusation or at best a vote of no confidence.

 

How do you react when falsely accused or declared good for nothing?

 

I always figure that if they think something is wrong with the way I do things, they are more than welcome to take over for me.  I've never had anyone take me up on it though, so I don't know how that works other than they quit complaining.

[pchadbo]

Welcome to the Forum!

 

A couple of points of clarification from the Unit Commissioner in me (and former Pack Committe Chair).  First the pack DOES NOT OWN ANYTHING (caps for empahsis). Any money that the Pack or Den collects belongs to your Chartered Organization.  They should have an interest in making sure that the funds are handled in an open and trackable manner, as they bear the financial responsibility for THIER money.

Second, I agree that putting controls in place is a great thing, and am curious as to why anyone would object to covering thier own behind by making sure they were not solely responsible for large amounts of money.

Third, if the fight is too contentious, and those leaders are unwilling to change, in your position, I would say Thank You, but please find another treasurer, as I will not be held responsible for funds I have no control over.

[fred johnson]

First the pack DOES NOT OWN ANYTHING (caps for emphasis). Any money that the Pack or Den collects belongs to your Chartered Organization.  They should have an interest in making sure that the funds are handled in an open and track-able manner, as they bear the financial responsibility for THEIR money.

 

Yes and no.  

• Fundraisers are more clear cut, but even then there are complexities and arguments that can be made.

As for den "dues", the term dues would need to be clarified.   

• If I told parents that we are having a den pizza party and the cost would be about $10 per kid, people would not argue that's den money and/or den family money.  
• If I told parents the kids were going to a science museum and the admittance charge was $12 per person and parking was about $3 per person, it would be reasonable for the den to collect and hold $15 per person.
• If I don't know how many pizza parties I'll have or how many projects I'll need to purchase materials for, I could just say I'll target $75 per year and I'd like each family to kick in that much to cover den expenses for the year.  I think it would be hard to argue that money does not belong to the den parents.  
• If not spent, it should revert back to the parents or the troop their scout joins.  I personally would not care for an accounting of the $75 as I'm sure every den leader for my kids spent at least that much on my scout.  

Sometimes we get so so stuck with terms that we lose site of something that can be viewed as not a big deal.   

 

Now, I've never seen a pack work as you describe, but I don't think it's unreasonable.  In fact the more I think about it, I like it.  Dens need funds to operate.  Packs should be able to run unit programs and even the recharter wholly on the profit from fundraisers.  Or, dens could kick dollars up to the unit to pay the recharter.  

 

I really don't think I have that big of an issue with it.  In fact, I'm growing to like the idea more and more.

Edited December 1, 2016 by fred johnson

[pchadbo]

Fred, I am not arguing that the dens cannot and should not have their own "budget" I am just saying by law and right, any monies that the den or pack has in it's trust, is legally the property of the Chartered Organization as they own the pack and all it's assets and liabilities.  As treasurer in this situation, or Unit Commissioner, or Committee Chair or Chartered Org representative, the best practice would be for all funds to be placed in the Pack bank account and individual den ledgers or "accounts" be created to readily track all expenditures. 

 

A  not unreasonable scenario involves  the Chartered Org being audited, by It's parent organization or the IRS and they want an accounting of all the funds that have been handled by their organization.  At $75 dues per Scout times 90 scouts that is $6750 per year plus other expenses is quickly going to be $10 - 15,000.  This could be a significant portion of the CO's budget. If you are not able to account for that money, in detail, they may face repercussions and the Pack could be harmed and/or need to find a new Chartering Organization.

 

The thing to remember is that NONE of this money that gets passed to the Den or Pack belongs to the Den or Pack in a legal sense it is the CO's.  So we must be Thrifty and be good stewards of money that does not belong to us.

 

I personally, as a Pack Leader, would not be comfortable with 3 - 5K "floating around" with no one other than the Den Leader having knowledge or responsibility for these monies. 

That is my opinion and it is worth what was paid for it   ;-)

[blw2]

.....

 

@@qwazse, "If you're getting this much push-back, apologize to your people and move on."  Frankly, this concerns me more than anything.  If everything were above board, why be so outraged at the mere conversation?  If I have a concern and I voice it - should it not be discussed?  

 

.....

I'll comment on this one quickly, but don't have time at the moment to really dive into the treasurer stuff.

I had some real concerns early on, similar to yours but in my case it wasn't about financials.....and was given the advice to practice cooperative volunteerism.  Remember, you're the new guy.  Trust has to be earned.  If a person charges in and tries to change stuff up front that can be very upsetting.  Sometimes a person needs to just stay the course that was set before they took the helm for a while, before they go turning the ship....

 

I do agree with you though, it is alarming.  In fact I personally would really question the whole thing.  I can't really imagine anyone wanting the money.  There is just too much chance for people to misunderstand, misinterpret, accuse....  I stayed as far away from the money when i was with the pack as I could.  I only took the treasurer job with the troop because that's where the need was.  I personally would never ask for the money or control over it, and would not fight to keep it either.... so that's why that DL's reaction would make me question his motives.  As treasurer, if someone pays me $20 cash, that same $20 bill goes straight into the bank as fast as I can get it there... and I post proof of it along with the transaction record on the troop's web site for anyone on the committee to see.  I never let it blend with my personal cash, and I want 100% transparency.

 

I'll come back to this thread later....

initial questions though

am I correct in understanding you do not current have a pack bank account?

Is your charter Org a non-profit?

what tools do you currently have available or use for unit accounting (software, online service, etc..)?

[Stosh]

If money is raised from the public through a charitable donation to the unit, it belongs to the CO because they hold the legal right to charitable fundraising. 

 

However, if parents provide money for their child to attend an activity, this pays the cost of that child's participation and is not recorded as a charitable donation to the CO and is not, therefore, their money.

 

I do believe this is the distinction that @@fred johnson is trying to make.

 

On the other hand, monies raised under the assumption of a charitable donation, should not be going to individual scouts' benefit.  Charitable donations are for the organization holding the tax exemption rights.  A scout who "earns" money/monetary benefit through his own efforts should be reporting this as personal income.  People can not make a charitable donation to an individual who does not hold a legal tax-exempt status/permit to do so.

 

However, if a parent makes installment payments to the unit to cover the cost of an activity, it is still the parent's money being held in trust so that such payments can be made at a more convenient time for the troop and should not be counted as a CO donation.

[pchadbo]

 

On the other hand, monies raised under the assumption of a charitable donation, should not be going to individual scouts' benefit.  Charitable donations are for the organization holding the tax exemption rights.  A scout who "earns" money/monetary benefit through his own efforts should be reporting this as personal income.  People can not make a charitable donation to an individual who does not hold a legal tax-exempt status/permit to do so.

 

However, if a parent makes installment payments to the unit to cover the cost of an activity, it is still the parent's money being held in trust so that such payments can be made at a more conon-profits (nvenient time for the troop and should not be counted as a CO donation.

 

Yes, I see this distinction, and we could go on about the individual accounts, charitable donations and IRS regs on non-profits (please, lets not), however that does not change the fact that if a Unit has a checking account, the account should be using the CO's Federal Tax ID Number, and therefore, any monies in that account "belongs" to the CO, now they also own any liabilities as well, owing individual parents refunds for pre-paid expenses, outings or events comes to mind, and that is something addressed if and when it ever comes up.  But as a general CYA position, everything should be run through a single account, with at minimum dual controls and transparency to all.

[fred johnson]

If money is raised from the public through a charitable donation to the unit, it belongs to the CO because they hold the legal right to charitable fundraising. 

 

However, if parents provide money for their child to attend an activity, this pays the cost of that child's participation and is not recorded as a charitable donation to the CO and is not, therefore, their money.

 

I do believe this is the distinction that @@fred johnson is trying to make.

 

On the other hand, monies raised under the assumption of a charitable donation, should not be going to individual scouts' benefit.  Charitable donations are for the organization holding the tax exemption rights.  A scout who "earns" money/monetary benefit through his own efforts should be reporting this as personal income.  People can not make a charitable donation to an individual who does not hold a legal tax-exempt status/permit to do so.

 

However, if a parent makes installment payments to the unit to cover the cost of an activity, it is still the parent's money being held in trust so that such payments can be made at a more convenient time for the troop and should not be counted as a CO donation.

 

 

Yes.  That is the distinction.  Raised funds versus money kicked in by parents to help cover the costs of another parent who's also volunteering to run their son's den.  

 

As a den leader of multiple dens, I paid for a lot out of my own pocket and never asked for reimbursement.  And, I would not comment as other den leaders would try to be reimbursed for minor expenses.  Their choice versus my choice.    IMHO, it would have been nice as a den leader if the parents in the den would have each voluntarily kicked in a few bucks to cover the year of activities we did.  Food.  Snacks.  Materials.  etc.  

 

Most dens are 6 to 10 kids.  Minus the den leaders kid.  So if dues are $75, you are talking about $375 to $675 per den.  IMHO, that's petty cash.  

 

IMHO, it's also nice because ...

• risk of losing a large amount is less because it's spread and it's between a close knit set of people in the same den.  
• all den leaders are financially supported at the same level.  Shy or nice den leaders are not penalized because they won't ask for reimbursement.
• too often dens are not given money by the pack to operate.  As such, it reduces the quality of the den experience.  

Raised funds is a different issue though a shared portion could be allocated to the den who raised it.  That's an IRS accepted practice as long as it's within boundaries.  

 

Personally, I would not have setup the pack this way.  I also would never recommend this.  But, it's what you joined.  I would not have that hard of a time living with what you describe.  

 

Now if they were doing fundraising of $10,000+ ... I could imagine many different ways I could be ill-at-ease.  Den leaders only giving pack cost of product.  Dens allocated more than 30% of profit of their sale.  Den leaders holding large amounts of cash from the fundraiser.  

 

But to be honest, these days $600 is not that much in the long run.  It's a lot to ask a volunteer to submit a reimbursement sheet for when they buy two boxes of Oreos and drinks one month.  Or another month go the scout shop and buy eight Bear faced coin pursue craft kits.  Or collecting $10 for pizza, giving it to the pack and then getting a check from the pack for $80 to pay for pizza, drinks and desert (parents fed too).  

Edited December 1, 2016 by fred johnson