Question:  Are the ASB and parent/teacher/student organizations different?

Response:  The relationship among booster clubs, foundations, parent–teacher associations, and student organizations is often confusing. Student organizations are legally considered a part of the school district. For this reason, they are included in the annual audit of the district and have the benefit of the district’s tax-exempt status under the Internal Revenue Code.

Booster clubs, foundations and parent–teacher associations (PTAs) are organizations established to provide support to the school district and its students. These groups may raise funds and donate these funds to the district or purchase items with their funds for donation or assistance to the district, but they are not legally considered a part of the school district and are not included in the annual audit. Some organizations such as the PTA are established as nonprofit corporations with a separate tax-exempt status. However, many of the organizations in place have not applied for or received nonprofit status and do not have their own tax identification number, so it should not be assumed that they are all official groups in the eyes of the Internal Revenue Service (IRS).

Because student organizations are operating under the tax-exempt status of the school district, the funds deposited in bank accounts are not subject to state or federal taxes. For this reason, the funds raised by booster clubs, foundations or parent groups should not be deposited into or commingled with the funds or bank accounts of the student organization or the district; rather, they should be deposited into the group’s own bank account. These groups may donate funds to the student organization(s); however, once they do so only the student organizations can control how the funds will be used. These non-student groups also may not use the district’s tax exempt status or open bank accounts using the district’s tax identification number; non-student groups are responsible for their own tax status and accounting. It is best if school staff members do not act as officers of non-student or non-district-sponsored clubs to avoid the appearance of district sponsorship.

Organizations formed by teachers and/or other employees of a school district, such as "sunshine" clubs, also are not a part of the ASB or the district and may not use the district’s tax identification number or deposit funds into the school’s ASB account or district bank accounts.

Because booster clubs, foundations and other types of parent organizations are separate from the school district, they are not under the control or the responsibility of the school principal, superintendent or governing board, and their funds are not controlled by the district or students. However, governing boards are able to approve guidelines for these groups to follow, and the fund-raising activities of these groups are supposed to be approved by the governing board. Education Code section 51521 states that all organizations that conduct fund-raisers to benefit students, schools or the district as a whole must be approved by the school district’s governing board or the governing board’s assigned designee.

9/19/07