How to Navigate League Finances, Registration Refunds, Seasonal Operating Expenses, and Sponsors During the 2020 Delayed/Suspended Season
As the season delay causes many leagues to assess their operating expenses and determine what monies may need to be allocated to vendors, sponsors, and player refunds, the local league Board of Directors should create a detailed report of the league’s finances that can be shared with membership as needed. The transparency of the league’s finances will be paramount in explaining to the league’s membership where the league stands financially as it navigates this uncertain time.
Revenues / Savings:
Start by assessing your leagues operating revenues as part of the annual financial plan. This is simply making a list of all the money collected for the year by category (e.g. registration fees, sponsorships, donations, fundraising efforts, apparel sales, etc.).
- Identify each individual and family that has paid registration fees. Use your online registration software to review invoices and balances for players that are registered. If your league does not use registration software and/or electronic booking tools, coordinate with your Treasurer and appropriate Board Committees to reconcile the total amount of monies received from the current season’s registration fees. Account for each child in the league and note the adjustments of fees paid for families with multiple children in the league.
- Identify if any of the families have outstanding balances
- Look into any state or local laws regarding refunding registration fees
- Follow your league’s standard practices for following up with families after registration
- Little League Recommendations: When considering a refund policy for registrants, the league should use the following questions to stimulate a discussion around refund decision-making:
- How much of the season was completed or will be played this year?
- Will we issue refunds for players who choose not to play once the season is resumed?
- What expenses did we have for each player (e.g. uniform costs, equipment costs) that have been spent?
- Should we refund parents?
- Should we refund the full amount or partial?
- Should we push registration payments into a future season?
- What milestone dates should we set in assessing reimbursements?
- What will issuing refunds do to our league’s annual budget?
- Are there monies available to issue refunds to all registrants?
- Who will be responsible for developing the league’s course of action?
- How will reimbursement be managed by the league?
Local League Sponsors
- Create a list of businesses that provided you sponsorships and any costs associated with those sponsorships (for example producing a banner for the outfield)?
- Little League Recommendation: Sponsors
- Approach sponsors with the option of providing their fee as a straight donation to the league (without expecting anything in return; be prepared to share your financial assessment with them)
- Consider prorating the sponsorship fee for the timeframe of the season that was implemented
- If sponsors ask for returned fees, ask sponsors about extending their sponsorship for additional length of time (for example into the summer or into 2021)
- Donations provided to your league are typically different from sponsorships in that the donor does not expect anything in return. You should assess your total donation amounts and plan to reach out to donors once your plan to resume the local league operations are set.
- Little League Recommendations: Donations
- Once decisions are made about the season, reach out to your donors to explain the changes and outcomes. Provide an overview of where you are using their donations to support your league needs after the Coronavirus pandemic.
- If donors specified their donation of money or in-kind goods and services to a specific initiative, take some time to discuss with them where their donation is best served and ensure they are comfortable with its use.
- Many leagues undertake fundraising efforts each year in support of the expected annual budget. These range from the traditional candy or other food sales to the more complex apparel sales, discount cards for local businesses, and online fundraisers and crowdfunding.
- Little League Recommendations: Fundraising Efforts
- Whatever fundraising efforts are being employed by the league, Little League recommends that you communicate back to your donors how the funds will be used to facilitate current or future league efforts.
- If your league was just beginning fundraising or would like to in the future help offset unforeseen expenses from the delayed season, Little League recommends providing a thorough overview of your leagues expenses and how the money raised will be used to offset these expenses. We also recommend that you evaluate fundraisers that assess limited fees or surcharges to ensure the league maintains a significant portion (90%+) of the funds raised.
- Use electronic means to connect with and update your families, sponsors, and the general public of the status of the league’s fundraising efforts.
- Leagues and districts may have applied for and received grants from a variety of organizations. Grant funds are typically received with specific conditions including to support capital projects, growth initiatives, or facility improvements and typically require reports demonstrating progress and impact.
- Little League Recommendations: Grants
- Little League recommends that you carefully review grant funding requirements and contact the grantor if the league has a need to use the grant funds for other league needs or expenses.
- Leagues should discuss and summarize their unique financial situation and contact the grantor for discussion. Grantors may not permit such transferring of funds or may require further proof of such use for the intended project.
- For leagues who have been awarded funds from Little League through the Grow the Game Grants, more information will be coming to you directly about how this delay impacts your reporting and projects.
- Leagues are often looking to create opportunities for facility development and improvement and use capital fundraising over time to help sustain work towards these projects that may require a large investment. Donations raised for capital projects are typically reserved for those projects and not able to be utilized for league operating expenses.
- Little League Recommendation:
- Leagues should carefully review the circumstances in which fundraising for specific projects was conducted. Before re-allocating to assist with other league expenses, review the terms of which the donations were accepted.
- If donors are reachable, contact them to determine if the funds could be used for more urgent needs with each individual donor’s permission.
- It’s important to be transparent with how much money was raised for capital projects. If the league plans to transfer a portion of those funds for league expenses, the Board of Directors should inform the league membership of the decision-making process.
Savings and Reserves
- Does your league have any reserve funds in savings or other investments that could be utilized to offset any expenses that need to be paid?
Expenses (Operating Expenses): Make a list of the items your league spent money on or is committed to spending money on or those items ordered for the season. Verify such expenditures with your League Treasurer and involve the Audit Committee of the local league Board of Directors to verify expenditures, if available.
- With the timing of this delay, most leagues are in various stages of ordering and securing equipment for the season. Determine what equipment the league ordered and what the league has received.
- Equipment and supplies could include uniforms, bats, balls, helmets, tees, buckets, field-related heavy equipment (tractors, drags), lawncare (fertilizer, dirt, clay, etc.), and field-related maintenance equipment (rakes, shovels, etc.). Try to be as specific as possible with purchases and costs.
- Determine which equipment is not needed immediately.
- Determine if uniforms can be:
- Reused at a future date (note: this may impact the calculation of refunds)
- Re-ordered or order delayed when timing of the season is determined
- Given to each participate regardless of season play
- Little League Recommendation:
- Consider paying vendors first so the league does not become past due with invoices
- Plan to store equipment that can be used at a later date
- For any equipment that can’t be used at a later date, review any return/refund opportunities with your vendor
- Consider delaying printing additional graphics on uniforms including sponsors or numbers; once the season decisions are made, continue printing as needed
- Notify all vendors providing rental equipment or services about the delay to the season, make arrangement for when the season resumes
Concession Stand Expenses
- With many concessions stand volunteers preparing or actively running stands when the season delay was imposed, there are many questions on how to handle expenses associated with these facilities.
- Consider tallying expenses for food or equipment already purchased
- Did you purchase food that will spoil? Estimate the cost of these items.
- Most prepackaged food can be maintained for a period of time. Check expiration dates and determine how long food may last and the best way to store those items.
- Little League Recommendations:
- If league finances can afford it, consider donating food that may spoil to local schools, shelters, or food banks.
- Determine if the food should be stored in an alternative location during the suspension period.
Special Event Expenses (Opening Day rentals, preparations)
- For many, the Little League season is about much more than just practicing and playing games. Community and neighborhood gatherings or special events enrich the Little League experience.
- Review any contracts for vendors (rental companies, photographers, etc.) for these events. Look for a clause that states it’s able to be cancelled or postponed with limited to no penalty, and if there is any timing associated with those notices.
- Do you have any other financial commitments for these events? If so, can they be delayed or cancelled?
- Little League Recommendations:
- If your league has an attorney or legal advisor, it may be a good idea to have that individual review your contracts in the event you need to navigate changes to a contract with a third-party.
- Once both Little League and your local government restrictions have lifted, and it’s safe to gather again, consider holding a special league community day similar to opening day festivities to bring the league membership back together. Create special fundraising activities and ways for the players to engage with each other.
Additional League Operating Expenses (Municipal Fees, Township Expenses or Leases, Technology-Related Expenses, Third-Party Vendors, etc.):
- In addition to everything else, there are other regular expenses that come with operating your league, which could include facility rentals/leases, website/online scoring/online registration agreements, or third-party service agreements. Calculate these additional fees, which are tied to contracts or service agreements, and which have financial guarantees that the league is responsible.
- Have you made payments on these expenses? If so, and the services/facilities are not being used, are there any options to recover any of that money?
- Have these fields been officially “closed” by your municipality? If so, how does that impact your league financially?
- Little League Recommendations:
- Have a conversation with these third parties, whether they’re a private entity or municipality, about how the Coronavirus pandemic is impacting their business and how that influences your agreement. Start having conversations about amending any terms to account for the delay/suspended season and potentially having Little League play extend through the summer may impact your existing arrangements.
Little League International Expenses
- Little League International operating expenses for charter and affiliation fees are a minimal expense per year ($10 per team). If leagues choose to purchase their insurance through the AIG Insurance Program for Little League, these premiums need to be paid in full in order for the insurance policy to be effective.
- AIG league insurance is in effect for the calendar year basis (January 1 – December 31). if applied for and paid in full prior to or by January 1.
- At the current time, Little League is still assessing the opportunity for the season to resume and the opportunity for tournament play, and we are hopeful that we will resume play starting on May 11.
- Leagues may have ordered patches for their uniforms. Since leagues may reuse patches in future years for regular season or tournament, we recommend keeping patches on hand to be used in future years.