Crowdfunding: Some Districts Ban It, Others Embrace It

  • by admin
  • April 4, 2019
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  • Fundraising
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    Sarah Schwartz’s Education Week blog follows the recent Crowdfunding Research Report published by EdSurge, and outlines many reasons why a multitude of school districts like Metro Nashville Public Schools are banning the use of crowdfunding sites like DonorsChoose.org. With the recent boom in education crowdfunding, Schwartz finds that “leaders are starting to voice concerns” because “they have no way of knowing whether the instructional materials and technology flowing into their schools through individual teacher requests are aligned to district standards” and they worry that “the decentralized process will make it hard to monitor how money is distributed among schools.” Others echoed these concerns, stating that “such sites are problematic for school districts because of lack of adequate controls.”

    However, even with these concerns, Schwartz indicates in her research “that banning crowdfunding isn’t the way to go.” Instead, she points out that many leaders aren’t giving up on the “potential benefits” of crowdfunding because of the additional funding, supplies and experiences it provides for students. As the EdSurge crowdfunding report points out, “instead of banning educators’ use of these platforms altogether, administrators should manage teachers’ projects and create a unifying policy for crowdfunding in the school district.”

    What Other Publications Have Said

    Many recent publications are supportive of the latter idea, allowing crowdfunding with the right policies and platforms in place. A special report published in July of last year by the Ohio Auditor of State made a similar statement on its cover, that “with sound policies in place, school districts can ensure that online fundraising enhances student learning.” In this report, Auditor Dave Yost provides an informative overview of crowdfunding, surveys of Ohio school districts, specific liabilities of crowdfunding (including student confidentiality, financial controls and accounting, and reputational risks), and best practices for districts.

    A few months after it’s publication, the California School Boards Association published guidance recommending that districts “be aware of all such campaigns conducted in the name of the district, a district school or a district employee.” The CSBA recommended that districts adopt policy to govern crowdfunding campaigns, and in it districts should “require prior approval,” list out the “criteria to be considered,” address “mechanisms for financial transparency,” and “identify the crowdfunding platforms that may be used.” Even the National School Board’s Association is currently in the process of revising their “best practices” around crowdfunding for K-12 school districts, and is another resource to watch for in the coming months.

    Filling the Holes of a Deeper Problem

    The problem, as many will agree, is the funding gap in America’s Educational system. State and federal funding for public schools dipped sharply during the Recession that began in 2008. Although the numbers have recovered somewhat, many districts are still not being funded at the same level. Today, reports indicate that about 94% of America’s public school teachers are spending their own money on classroom supplies, with the average annual expenditure totaling $480. Some teachers on social media even reported spending thousands of their own dollars to fund projects they find crucial to their students’ education.

    While crowdfunding may never completely fill the gap, it has become a saving grace for many teachers, boosters, and parent organizations who otherwise can’t secure funding from their school or district. It has also become a reflection of the changing culture in schools and parents: turning away from the traditional methods of fundraising that require large sums of time and effort with high overall costs, and toward the easier methods of online donations that have lower costs and more transparency.

    Overcoming the Challenges of K-12 Crowdfunding

    At Livingtree, we consistently refer to Austin Independent School District, who was one of the two school districts featured in EdSurge’s full crowdfunding report, and Chandler Unified School District as examples of districts who have successfully overcome the challenges of crowdfunding. Leaders from both districts recently participated in a panel at SXSW EDU, and talked about the importance of realizing that fundraising has changed and is now a part of our reality. As Michelle Wallis, Executive Director of Innovation at Austin ISD stated, they chose to implement their current system and platform three years ago because they needed ways to safeguard everybody, including, teachers.

    Austin embraced the reality that people want to, and expect to, give online and to have an easy experience doing so. Without a system in place, it becomes the “wild wild west.” Thus, they put together a set of guidelines and set up a system that the district endorsed, supported, and rolled out district-wide. Their system integrates with principal and district approval, so when a teacher posts a campaign, it is automatically sent to the principal and district for review. On the backside, their finances are linked with their bookkeeping system, and then it is all loaded into their donor database where they have tracking, reporting and receipting for every campaign.

    Chandler Unified School District was in the same situation about a year and a half ago. As Chandler USD’s Chief Financial Officer Lana Berry stated in the SXSW EDU panel, “we found that we needed a crowdfunding platform because…this is the new method to raise the most amount of money with the best safeguards put in place,” however they “needed to standardize that and approve it.” Berry continued, that “we needed to have a system in place that we were proud of so that when people donated to a Chandler Unified District fundraiser, they knew exactly where their money was going.” So, they started by looking at their policies to make sure they had board policy to back what they were doing. They then looked at their procedures to determine what they allowed. Finally, they looked at what tools were currently being used, and found they had just about every tool out there – GoFundMe, SnapRaise, DonorsChoose. They knew how important it was to have the right processes and procedures in place to help guide their principals and their schools, so they went on a nation-wide search for a platform that would help with guidance, the approval process, account for the dollars that came back in, and that would meet all of the district’s needs.

    After finding a platform that met their strict criteria, the district is now in control of their online fundraising and sending their online campaigns through the correct processes and procedures. As Berry says, “It’s important to take the first step and move to implement something because this area is going to continue to grow, it’s the new form of raising money. Parents love it and don’t like the old ways. There are still a lot of mechanisms in the old forms of fundraising, but more and more people are utilizing this new way of giving.”

    Review and Approve Your District’s Campaigns

    An important practice to note when it comes to crowdfunding is that districts need an internal review/approval process for every online campaign because only those with a vested interest in the district can properly assess that a campaign meets all district policies, as well as state and federal laws. Even crowdfunding sites that claim to “vet” campaigns before they are launched won’t catch everything pertinent to a particular district, let alone all state and federal laws. DonorsChoose, for instance, has been cited to have campaigns that posed some potentially significant legal and reputational issues for the associated schools and districts, even after going through their screening process.

    As Erin Duryea Gilsbach, the Director of Professional and Policy Development for King, Spry, Herman, Freund & Faul, LLC, wrote in an article for the NSBA Council of School Attourneys: “a review of some of the posts from educators on DonorsChoose.org revealed some significant legal issues within the teacher posts themselves, including potential FERPA violations and liability under the Individuals with Disabilities Education Act (IDEA).” She later explains that these posts “included a number of potential FERPA issues related to teacher posted photographs, which were combined with specific written information in the posts about the classes. These descriptions could also legally be considered to be potential IDEA violations, and/or violations of specific district policies. Other posts, while they did not pose any particular threat of liability, painted the schools and/or districts in a very negative light when asking for funds.” Further in the article, Gilsback describes a number of real examples that pose serious risks to the organizers and associated districts.

    The point is that even sites that are seemingly more protective can still miss major liabilities or even specific policies from within your district, thus making it imperative (regardless of whether you have a manual process or an automated process built-in to your chosen platform) that your district have some sort of internal review process of all online campaigns. At the end of the day, you have a mix of educators, parent organizations, boosters, teams and clubs who are launching campaigns in the best interest of their students but aren’t always aware of the legal liabilities or the political activities of the school district, which is why districts must safeguard everyone. This type of internal review process ensures that every publicly posted campaign is in the best interest of the district, is in compliance with policies and laws, and is in line with what a district is doing politically.  

    Creating a Supportive Environment for Crowdfunding

    So, while some districts may go with their first instinct and take the easy route of banning crowdfunding sites, it’s important to realize that this option forgoes the many benefits that crowdfunding has to offer for school districts. With the right platform, school districts can support, and even encourage members to raise funds for additional materials and experiences that they can provide their students. In order to do this, districts must take the first step to be aware of their current crowdfunding situation, and look into their current policies, procedures, and guidelines, as well as what campaigns are out there with a school or the district’s name on it.

    It’s also important to be extremely selective of the crowdfunding platform that your district decides to support and endorse. Consider adopting a platform that has everything you need to truly oversee the crowdfunding process in your district – with an automated multi-level campaign approval process, tracking of donations, centralized fund routing, donor management, detailed reporting, and built-in tools for all of your parent organizations, boosters, clubs, teams, and teachers. These features are many of the reasons why Austin ISD, Chandler USD, and districts from all around the country are choosing to partner with Livingtree.

    To hear Michelle Wallis of Austin ISD and Lana Berry of Chandler USD talk more about their journeys of successfully overcoming crowdfunding, you can watch their recent 30-minute session at SXSW EDU here:

    If you need assistance locating crowdfunding campaigns from within your district, contact Livingtree Sales at sales@livingtree.com, and we’ll help provide a detailed report of all campaigns, as well as amounts raised and revenue lost.

    For additional resources, Chandler USD and Austin ISD have shared their procedures and guidelines, which can be accessed at learn.livingtree.com/givetogether.

     

    To request more information about how Livingtree Give can help your school district support online fundraising without the complexities, click below:

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