DIB Fee-Based Revenue Funds

FEE BASED REVENUE FUNDS

A special revenue fund is a separate, segregated fund on the general ledger of a municipality to record all of the activity related to a special and distinct purpose or program. These monies have legal restrictions and require close monitoring of annual activity. One of these types of special revenue funds is a fee-based fund. Fee-based funds are intended to record all fee revenue and all of the corresponding expenses related to the specific fee-based program for the relevant population served.

For the Wayland Public Schools, there are two types of fee-based funds:

1. Fee-based funds where a fee is paid by students/families to defray a portion of the cost of service provided by the Wayland Public Schools. Examples include, but not limited to, transportation, instrumental music, athletics and building use.

2. Free-standing fee-based funds are intended to recover the full (or vast majority) of the cost of the program, specifically staff, benefits and expenses of the program. Examples include, but not limited to, Before and After School Enrichment (BASE), The Children’s Way (TCW) Pre School, Full-Day Kindergarten and the Food Service program.

For both types of fee-based funds, these guidelines should be followed:

1. The School Committee will vote to establish a new fee-based fund, pursuant to the appropriate Massachusetts General Law.

2. Annually, the School Committee will vote the fees/tuitions based on a cost recovery policy (full cost, partial cost) and documentation that details the specific costs to be recovered (e.g. salaries, benefits, utilities, custodial services etc.). A record of the vote shall include the vote, the cost recovery objective, and the costing documentation to justify the fee/tuition.

3. By April 1 of each year, the School Committee will conduct a fee/tuition review process, whereby refunds and/or adjustments in the fees/tuitions may be administered by a vote of the School Committee.

For fee-based funds where a fee is paid by students/families to defray a portion of the cost of service provided by the Wayland Public Schools, such as transportation, instrumental music, and athletics among others, expenditures should be charged directly against the fund such that the balance at the end of the fiscal year shall be zero, or as close to zero as possible.

For free standing fee-based funds, there may be times when a balance accumulates. Except for the Food Service program, whose balance shall not exceed three months of operating expenses per Massachusetts General Law, the goal of the School Committee is that balances may not exceed ten percent (10%) of a free standing fee-based fund’s annual operating expenses. Refer to “Fee-Based Revenue Fund Guidelines” for information related to the calculation of the Fee-Based Revenue Fund balance.

Should free standing fee-based fund balances exceed this threshold, the surplus funds may be used for the following purposes, not in order of priority, subject to the approval of the School Committee and based on the recommendation of the Superintendent:

• To mitigate current or recent fees/tuitions or

• To refund current fees/tuitions or

• For capital improvements to the facility where the program is located or

• For start-up investments to enhance the program offerings

Should free standing fee-based fund balances (taking into account any surplus funds and all revenue collected related to the operation of the program underlying the fee-based fund in the current fiscal year, minus any prepayments) not be sufficient to cover all expenses related to the operation of the program underlying the fee-based fund in the current fiscal year, such expenses may be deferred or paid from other available sources, such as the school’s operating budget, current year transfer, Finance Committee reserve funds among others, subject to the approval of the School Committee and based on the recommendation of the Superintendent.

LEGAL REFERENCE: Mass. General Law Chapter 71, sections 71E, 26A, 26B and 26C and Chapter 71, section 47.

School Committee Approval: December 12, 2016