PACT Charter School

Original Creation Date: October 11, 1994
Last Approved By: PACT Charter School Board of Directors
Last Approved Date: June 3, 2021
Year Reviewed: 2020-2021

PURPOSE

 The purpose of this policy is to set limits on how funds are authorized to be spent.

POLICY STATEMENT

This policy is in place to set limits on how much spending our ED, BFC, and Board of Directors are authorized to spend.

DEFINITIONS 

Abbreviations 

The following PACT committee abbreviations apply:

1. BFC refers to Budget and Finance 
2. EPCC refers to the Elementary Programming and Curriculum Committee
3. SPCC refers to the Secondary Programming and Curriculum Committee 
4. JPCC refers to the Joint Programming and Curriculum Committee
5. FUN refers to the Fundraising Committee

1. BAS refers to the Business Accounts Specialist 
2. BDT refers to the Board Treasurer 
3. CE and CEs refers to Capital Expenditure(s) (over $1000) 
4. FA refers to a designated Funds Account 
5. DFT refers to the Designated Funds Treasurer 
6. EXC refers to the Extracurricular Administrative Team 
7. LIBS refers to Line Item Budget Supervisors. For this document, LIBS includes Treasurers.
8. PCT refers to the Program Coordination Team (EPCC chair, SPCC chair, and Administration) 

11. UFARS refers to the Minnesota Uniform Financial Accounting and Reporting Standards 
12. Other definitions and references 
13. “Purchase” shall be understood to include individual items, groupings of related items, and contracts requiring BFC approval. 
14. The budgeting process is found in 314 - Annual Budget Process Policy
15. Detailed information about budget departments is contained in a separate document with filename prefix Policy-BudgetDepartments-20yymmdd-.

GUIDELINES 

Authorizing expenditures – basic guidelines 

1. Each department (see 320 - Budget Departments Policy) will have a Board-approved budget at the start of each fiscal year. Each department may spend up to its budgeted allocation (see additional guidelines below). Board approval is required to spend funds more than the approved department budget. 
2. Each department shall have a LIBS or Treasurer who authorizes and/or monitors the department's expenditures. Different individuals may act as LIBS on separate line items. The BAS will maintain a list of LIBS and make a list available to the Executive Director and BFC members. Departments must report changes in LIBS promptly before new signatures will be accepted. 
3. For operational efficiency, the BAS may authorize expenditures that are within budget and requested in writing or other traceable form and that do not require additional approvals as described below. 
4. Verbal approval is permissible under extenuating circumstances. All persons involved should be noted on the signature approval line. However, written approval by the appropriate LIBS is preferred. 

Additional Required Authorizations 

1. BFC must separately approve budgeted, non-re-occurring expenditures over $7,500 and contracts longer than six months (excluding staff contracts). 
2. School Board of Director's approval is required for purchases over $40,000 and/or any contractual obligations that exceed one year. 
3. Designated individuals shall present such requests to BFC through the chair and shall use the approved request form with filename prefix Document_BidSummary_20yymmdd-. 
4. PACT requires three price comparisons for any expenditure over $7,500 or an acceptable explanation of why three bids were not obtained. The rationale for selection (or explanation) must be included with the request for approval. Repeat contract renewals may be exempted at the discretion of BFC. 
5. Submitted requests shall include disclosure of the existence of any potential conflict of interest involving the vendor and any PACT personnel engaged in the purchase. 
6. Submitted requests must include a reference to the appropriate committee, administrative team, or task force minutes at which said purchase was discussed and approved.
7. Submitted requests shall include documentation that all intermediate reviews and approvals have been accomplished, in particular regarding technology purchases. 
8. Vendors may be required to submit documentation affirming that they comply with specific statutory requirements, including immigration laws. 
9. Where possible, requests should include the proposed UFARS code that applies to the purchase. 
10. BFC members may consider any or all of the following when approving such requests: the needs of the school, knowledge of competing or alternative products or services, adequacy of submitted documentation, financial impact, potential liability, unforeseen consequences, or any factors which, in the sole discretion of the individual members, impact the well being of PACT. 
11. Purchasers are will to inform BFC and Administration early in the process of developing major purchasing decisions. 
12. Purchasers are not to attempt to circumvent the intent of this policy. BFC members continually monitor all expenditures, and BFC is authorized to ensure compliance with this policy's intent. 

Reallocations 

1. Departments have the authority to reallocate amounts from one line item to another within the same department. 
2. Reallocations must be reported to the Contracted Financial Manager, the BDT, and the BAS as soon as possible so that the budget may be updated in the school’s accounting software. 

Designated Funds 

1. The DFT (see Designated Funds Treasurer) shall be responsible for monitoring compliance with this section. 
2. Expenditures from FAs are subject to the same level of fiscal responsibility as other PACT expenditures, including the requirements of Governmental Accounting Standards Board Statement 54 (GASB 54). 
3. Each FA, as tracked by course code, should have a non-negative balance as of June 30 (end of the fiscal year). If any FA has a negative balance at that time, the sponsoring committee shall transfer funds from other accounts under its control to remove the negative balance. In exceptional circumstances, the sponsoring committee may appeal to BFC through the DFT for permission to carry the negative balance into the new fiscal year. In no cases shall an activity be permitted to carry a negative balance forward for more than one year. 
4. When approval of a Programming and Curriculum Committee is required, the PCT shall determine the appropriate committee to provide such approval (EPCC, SPCC, or JPCC). 
5. When requests exceed available funds, approved requests should be given to the PCT, which will determine which requests will be funded in conjunction with FUN. Preference will be given to expenditures that directly enhance the learning experience of PACT students. 
6. Fundraising events to raise more than $500 need approval from both the FUN and a Programming and Curriculum Committee. This approval covers all expenditures of these funds, provided they are for the initially designated purpose. 
7. Reallocation of designated funds needs approval by both the FUN team and a Programming and Curriculum Committee. Committees should not attempt to circumvent the intent of this policy. 
8. Unused funds in a graduating class account will be transferred to the "Unspent Class Funds" account for use by a graduating class if there are overages in spending during a school year. 

Building Rental Designated Fund Account 

1. The Executive Directors have authority and discretion to spend funds accumulated in the Building Rental Designated Fund account (after expenses have been paid for building use).
2. All funds will be spent in accordance with state guidelines and in accordance with this policy. 
3. These funds should be used to cover expenses outside of what has been included within the general budget.