Legal Brief

Protecting Districts From Booster Club Missteps
By JIM WALSH/School Administrator, June 2017

Do the band boosters in your school district have to register as a terrorist organization?

A superintendent once asked me that actual question. It was an attempt at humor, but the question revealed the frustration school leaders experience when dealing with the good-hearted parents who want to support the marching band or the volleyball team or the chess club.

As many high school administrators have observed, the job would be a lot easier if you didn’t have to deal with the A-B-Cs — Athletics, Band and Cheerleaders.

Five Concerns
In an era when school funding never covers all needs, the support of booster clubs can be essential. But the best of booster clubs can become a nightmare for the school if the proper foundation for the organization is not established. Five areas of concern should be addressed.

First, each booster club should establish its own distinct identity. For financial, governance and liability reasons, it’s important to establish that the booster club is not part of the district. Boosters will make a better contribution when they establish their own legal identity with a set of documents such as articles of incorporation or bylaws. Most booster clubs will engage in fundraising and want to assure donors that contributions will be tax deductible — something that cannot be provided until boosters have approval from the IRS as a 501(c)(3) organization.

To determine the entities are properly separated, the principal should annually review the group’s bylaws, list of officers and financial reports, in part to ensure no school employees are listed as club officers.

Second, ensure boosters have their own bank account and procedures for handling money, separate from district funds. If district funds end up in the booster accounts, questions will arise over proper oversight of expenditures, leading to news coverage of a major or minor scandal. No booster funds may be spent by coaches. Again, the idea is to keep those entities separate. Booster club funds should be spent by booster club officers.

Third, monitor financial contributions to athletic teams that may tip the balance in favor of one gender. Under Title IX, schools are expected to take booster club funding into account when assessing whether the boys and girls teams are supported equally. So if the boosters of boys varsity basketball regularly bring in megabucks, while the girls’ boosters struggle with an annual car wash, you may have a problem.

Watch out, in particular, for football. Boosters love to support football, but it’s mostly boys out there. If the athletic boosters create an NFL-quality locker room for the football team, while the girls on the soccer team are squeezed into cold, cramped quarters illuminated by a single naked light bulb, your district may have a problem.

Fourth, make sure the boosters get independent legal advice about the liability standards for booster clubs. While they support the public school, they are not the public school. In most states, the school district and its employees will enjoy some degree of immunity from tort liability, but this may not be the case for the boosters. Don’t let the leaders of the boosters think they are covered by the same laws or protected by your district’s insurance policies. 

This advice should come from the lawyer for the boosters, not the school district lawyer. If the school district pays its lawyer to advise the boosters, you may be improperly expending district money.

Separate Identities
Finally, take a look at any restrictions in your state laws about the use of public funds for private purposes. This is the overriding reason it is so important to separate the boosters from the school in terms of governance and finance. If a school employee is devoting significant time to the work of the boosters or if school facilities are made available at no cost, you may be violating your state’s laws.

And, no, the band boosters are not required to register as a terrorist organization. We think they will not act like one if you take a few simple steps to make sure your working relationship with these important organizations is on a solid foundation.

Jim Walsh is an education attorney with Walsh, Gallegos, Treviño, Russo & Kyle in Austin, Texas. E-mail: Twitter: @jwalshtxlawdawg