Collecting funds for Singles Conference via Paypal

My stake will be hosting a singles conference soon with members from multiple wards in the stake and others outside the stake participating.

There are registration fees required to cover the costs of the conference.

We want to handle the funds correctly and are thinking of setting up a sub category under Other:AMFA.

We'd like to direct everybody to register online and pay via paypal (or some other service, but I think Paypal would work best) and then cut one large check from paypal to the ward, depostiting it in that category and then reimbursing costs (or paying for the conference) from that Other sub category account.

Is it legitimate to use paypal for this purpose? Members of the ward can of course pay directly via a donation envelope and donation slip, but it would be much easier for the conference if we directed everybody to register and pay via the web. Surely this has come up before. Any issues using paypal for this?

We plan to see if we can set up an organizational account on paypal (a charitable one if allowed) so it's not just going into somebody's personal paypal account.

Thanks

kylehart wrote:We want to handle the funds correctly and are thinking of setting up a sub category under Other:AMFA.

That would be the correct procedure for handling such pass-through funds.

kylehart wrote:We'd like to direct everybody to register online and pay via paypal (or some other service, but I think Paypal would work best) and then cut one large check from paypal to the ward, depostiting it in that category and then reimbursing costs (or paying for the conference) from that Other sub category account.

Is it legitimate to use paypal for this purpose? Members of the ward can of course pay directly via a donation envelope and donation slip, but it would be much easier for the conference if we directed everybody to register and pay via the web. Surely this has come up before. Any issues using paypal for this?

I don't see how a PayPal account could be appropriate. Note that the audit instructions say: "Bank accounts: The only authorized checking account is the unit checking account. ... Savings accounts are not authorized." I know that PayPal sound like it would be efficient, but I think you need to stick with payments made in the normal way to priesthood leaders.

Another issue with using PayPal is that PayPal takes a fee with each transaction. So while it may be convenient, it would be redirecting funds away from their intended purpose. I would think that to properly account for that you would need to track that fee in the MLS system, which would be rather complicated.

I believe that the person who benefits most from the convenience should pay for it.
In this case it would probably be the clerk. So in this case, if the charge for the
conference is $20 per person, and the paypal takes $1 per transaction, then the
clerk would make up the difference with personal funds.

Of course, it is up to local priesthood direction. The funds for the paypal "take"
could be paid via a check to the unit out of the budget and deposited with the
paypal check.

Example: 20 people register with paypal for $20 each; Paypal takes $1 per transaction
and deposits $19. The check from paypal would be $19 x 20 = $380 and
the unit (or the clerk from his own funds) would have to write a check to the unit
for $20 for "Paypal transaction fees". When Depositing these checks, it is important
that you do not use a donor called "Donor", "Collected Funds", or "Anonymous",
but rather enter the checks on the right side, and enter each donor on the
left with their $20 fee under the "Other" category for the conference. You hit
New Slip after each donor's record of payment is recorded until everyone is recorded. This
way you have multiple slips attributed to the two checks, and you have a list
of all the people who paid the conference fee in MLS.

It can be done, but I believe that Alan is probably right that PayPal would be an unauthorized
bank account, or at the least could be seen as a misuse of Budget funds to pay unnecessary
convience fees. Of course, the benefits of higher turnout might outweigh these concerns.
I would encourage some serious prayerfull consideration by the proper priesthood leadership
prior to implementing it. It is, however, not as complicated as it would appear at first glance.

- Atticus

atticusewig wrote:I believe that the person who benefits most from the convenience should pay for it.
In this case it would probably be the clerk. So in this case, if the charge for the
conference is $20 per person, and the paypal takes $1 per transaction, then the
clerk would make up the difference with personal funds.

I'm sure we could debate that . In this case, people from all over the country would be attending the conference. Paypal would be highly convenient for them.

It can be done, but I believe that Alan is probably right that PayPal would be an unauthorized
bank account, or at the least could be seen as a misuse of Budget funds to pay unnecessary
convience fees. Of course, the benefits of higher turnout might outweigh these concerns.
I would encourage some serious prayerfull consideration by the proper priesthood leadership
prior to implementing it. It is, however, not as complicated as it would appear at first glance.

- Atticus

I'm more concerned about the "unauthorized bank account" aspect. If it's indeed an authorized method of accepting funds for a ward sponsored activity, then the paypal fees would be necessary vendor fees just like any other aspect of the conference (caterers, venue rentals etc). The paypal fee would be built into the conference budget and not a cost the ward would pay out of other funds.

I apprecaite the responses to this. I was also originally leaning against paypal for this but that's the preference of the conference committee (and paypal seems to be the standard nationwide for these church singles conferences). I'll escalate this to our local priesthood leadership to get their thoughts. Thanks everybody.

I thought adding and withdrawing funds from a PayPal account could only be done through a checking of savings account. I wasn't aware that PayPal could cut checks. I though that ability essentially disappeared when they discontinued their bill pay service several years ago. If all that is correct, then that means that the funds collected via PayPal are, at some point, going to have to be deposited electronically into someone's bank account so that a check or other withdrawal can be made and given to the ward/stake that is processing the funds for the activity.

This whole process sounds rather complex and difficult to audit.

Why not have each ward collect the funds and then each ward (or stake for the other stakes) can make one check out to the hosting stake along with a list of those that have paid?

I'm not sure how our last one was handled, but in the past the singles have snail-mailed the check to the stake putting on the activity.

For those with no checkbook, but a bill pay service, I suppose they could have a check cut and snail mailed to the stake president, although I'm not sure how the payment would be matched to the registration form.

Here is the process as explained on PayPal's website (using the Send Money Now option):

1.All you need to send money is the recipient's email address or mobile number.
2.The recipient gets an email or text notification. To withdraw the money, they log in to PayPal or sign up in minutes.
3.Recipients in the US can withdraw the money by:
Spending it online
Transferring it to a bank
Requesting a check
Using a PayPal Debit Card

The cost of sending $100 via PayPal's send now to "Friend and Family" is:
Fee if you pay with:
PayPal Balance: FREE
Bank Account: FREE
Credit/Debit Card: 3.20 USD

To me, the convenience here is solely for the conference registrant. Accepting payment by any means other than a check and donation slip complicates the process for the clerk; it doesn't make it easier for them. I'd rather process the donation as a matter of course during a weekly donation than have to worry about accounting for a third-party system. If I'm the clerk I push strongly to have the gathering of the donations performed by the conference committee and turned in to me as a set of donations/slips.

nbflint wrote:If I'm the clerk I push strongly to have the gathering of the donations performed by the conference committee and turned in to me as a set of donations/slips.

Although I agree with much of what you said, I don't agree with this last sentence. I see no reason why this conference would change the standard rules for handling funds: money is given to priesthood leaders. I liked the earlier suggestion to have wards (meaning bishoprics) collect funds, and then pass them on to the stake. Or funds can be given directly to a member of the stake presidency. But it's not a good idea to have anyone else collect funds. That would be an obvious audit problem, for the good reason that it would create unnecessary risks for donors and those handling funds.

nbflint wrote:Here is the process as explained on PayPal's website (using the Send Money Now option):
...
3.Recipients in the US can withdraw the money by:
Spending it online
Transferring it to a bank
Requesting a check
Using a PayPal Debit Card

Under the "Request a check" option, PayPal just told me:

A fee of $1.50 USD will be applied to each check withdrawal.

There also does not appear to be a way to have the check made out to anyone other than the PayPal account owner/registrant. While it may be convenient for the participants, it still feels like an auditing/accountability nightmare waiting to happen.

nbflint wrote:The cost of sending $100 via PayPal's send now to "Friend and Family" is:
Fee if you pay with:
PayPal Balance: FREE
Bank Account: FREE
Credit/Debit Card: 3.20 USD

In addition to what the others have said, I might point out that technically the stake is offering a service for the funds (the conference), so as I see it, it would be against the PayPal User Agreement to collect funds for an event like this using the free "Personal Payment" method. (I'm not anything close to being a lawyer, just a long-time PayPal account holder.)

aebrown wrote:I liked the earlier suggestion to have wards (meaning bishoprics) collect funds, and then pass them on to the stake. Or funds can be given directly to a member of the stake presidency.

I think that would be fine for a smaller local or regional event, but in this case, the conference gets a few hundred attendees from all over the country. Having their local bishops in their home state (not stake) collect funds is not practical.

There are definitely some varied responses here. I'm a bit surprised it hasn't been asked before. Certainly makes for an interesting discussion.

In my mind it boils down to this:
1. There are costs involved in running the conference
2 Those costs are passed on to the parcitipants
3. We want as many people from the entire country to participate as possible
4. We want to make it easy for them to do so
5. Nobody is making any money on this
6. Funds have to be collected somehow
A. A check can be mailed to my Stake/Ward for this and funds entered into MLS and the participant added as an out-of-unit donor to the "Other" category
B. People can use Paypal, put this on their credit cards, get airline points, and not have to look for an envelope (and of course, using Paypal drives conference costs up a few dollars per user)
B1: the conference organizers have an always-up-tp-date list of participants that have registered

Option 6B is what every other conference in the company seems to do but apparently it may bump up against some policy/accountability issues.

I appreciate everybody's thoughts on this.

kylehart wrote: 6A. A check can be mailed to my Stake/Ward for this and funds entered into MLS and the participant added as an out-of-unit donor to the "Other" category

I was thinking that individuals would make the donation in their home ward (no out-of-unit donors) then these funds could be send as a group from each ward (or stake) to your Stake. You would probably want some kind of notification that a person's registration had been paid from that ward/stake so that you could keep your registration list up to date. It would also reduce the number of individual checks/other unit donors you would have to process on your side.

I am surprised this hasn't been asked before too. I have been involved in numerous conferences and we have always wanted to be able to collect funds electronically. To me the most obvious answer would be to have the church collect the money centrally. The church can take cards at distribution, why not to pay for events?

A problem the tech team could solve is being able to register for events including events that cost.

aebrown wrote: I see no reason why this conference would change the standard rules for handling funds: money is given to priesthood leaders.

I don't know that this is a general rule. I agree that the handbook is clear on the collection of tithes and offerings(these are sacred funds); but conference fees is neither of these.

From a propriety standpoint I agree that having the funds deposited and managed by the clerk ultimately is the best route. I just don't know that someone(e.g. An auxiliary president) other than a priesthood leader is aloud to gather payment and submit to the clerk. This is how we handle fund raiders. The organization president collects the funds and then gives the entire amount to the clerk.

Edit: The option is also given to make payment via a donation slip/envelope (which then is only collected by the Bishopric) for anyone that would like it individually recorded.

nbflint wrote:This is how we handle fund raiders.

Love the Freudian
I assume you mean "raisers".

Yes, who put the d next to the s anyway?

nbflint wrote:I don't know that this is a general rule. I agree that the handbook is clear on the collection of tithes and offerings(these are sacred funds); but conference fees is neither of these.

It is indeed a general rule. The term "Tithing and Other Offerings" on the donation slip is much broader than you might assume from the words themselves. If you review the online training course Understanding and Using the “Other” Category, you will see that we are directed to use the "Tithing and Other Offerings" slip for any payments made to the "Other" category. That would cover the YSA conference that is the topic of this thread, as well as any other funds received by a unit of the Church. The only exception mentioned is for Aaronic Priesthood holders who collect fast offerings.

Furthermore, please remember that the safeguards that are built into the official procedures for handling funds are there to protect both the person making the payment and everyone who handles the funds. Ignoring those procedures because you think a particular situation is an exception exposes everyone involved to unnecessary risks.

In addition to what aebrown has pointed out there is also the issue of the Church protecting and maintaining its tax exempt status.

Without appropriate chain of custody measures using the companion principle for any funds collected and used for any Church sponsored event then all kinds of challenges can be made against those collecting, holding and transferring those funds. Following Church policies and procedures will protect those handling those funds.

aebrown wrote:Like many things in life, if everything always goes well, you can get away with being a bit relaxed on procedures. But what happens if a payment gets lost? What if someone handling those funds gets accused of doing something dishonest with the money? What accounting and accountability is there?

I know it's a difficult cultural battle to fight because of entrenched traditions, and when you ask people to follow the proper procedures, many people would say "That's a big hassle -- don't you trust us? It's not that much money." I wish the policy were more clearly stated in this regard, but as I mentioned earlier, I really do think that the policy applies to all funds handled by the unit, for the protection of all.

I want to stay in policy, but accountability/audibility with Paypal are not a big concern with me.

The payer has a receipt for payment.
Papal keeps good logs.

We know how much money goes into Paypal, we know what Paypal's fees are, and we can track expenses for the event via reciepts. There may not be two Priesthood holders handling funds with the companion principle, but there's an electronic record. Perhaps just as good for a "protection" purpose.

If maintaining the companion principle is important here, one could set up the Paypal account with a very long password, and two people each only knowing half of the password. Then all disbursements sent from paypal as well as reviewing of logs are done with two people.

This model may work for our large event but probably wouldn't work for the sister collecting small amoutns for arts and crafts.

Moderator note: A question about funding RS Enrichment Night via PayPal as been spun off as a new thread.