Can excess supply fees be used to pay other expenses?

Our homeschool co-op charges families a registration fee to cover administrative costs and a per-class supply fees to cover supplies/materials for individual classes. This past year we have a pretty good surplus on supply fee income.  Teachers ended up not needing to purchase the supplies they anticipated.  But we are running a little short on the administrative side.  Are we able to use some of the supply fee income to cover those outstanding administrative costs?  Or should we leave that alone and dip into our contingency fund for those admin costs?  Any advice is greatly appreciated.

Thank you for being such a valuable resource to homeschoolers!
Regards, Julie

Julie,

Your homeschool nonprofit organization can certainly use excess supply fees to cover administrative costs. Your leadership has a fiduciary duty to manage the program and part of that is managing the finances to shift expenses around if needed.

The only time that shifting expenses is not permitted is if a donor specifically designates their gift be spent on a specific program or event. Then the nonprofit must honor the donor’s request. Many nonprofits do not accept designated gifts because it ties the hands of the leadership in using the funds where most needed.

In general, I advise homeschool groups to avoid multi-part fee structures, where every fee is tied to an expense. For example, some homeschool groups charge several fees: a facility fee, insurance fee, supply fee, etc. Instead of all these fees, I recommend homeschool groups do what private schools and colleges do: charge one large fee.

Your treasurer and board will know what needs to be paid from that fee (rent, insurance, supplies, etc), but then it is easier to pat all the expenses and not feel guilty!

Creating a budget

Need help creating a budget so that your fees cover all your expenses?

Money Management in a Homeschool Organization explains how to create a budget, monitor it, and inform your board of the financial health of your organization with clear, easy-to-understand financial reports. Specifically written for treasurers of homeschool organizations.



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