Chapter 5: ICC Finance & Scholarships

From ICC Policy Wiki

Budget

Process

  1. Consult with the Board: The Finance Committee will present a draft budget for the coming fiscal year to the ICC Board no later than the last board meeting in December. Board members will discuss the budget with their houses and supply the Committee with input and suggested changes.
  2. Deadlines: By January 31 of each year the ICC Vice President for Finance shall submit to the Board a proposal for a budget for the coming fiscal year as recommended by the Finance Committee, together with a statement of the budget and actual expenses for the preceding year as a reference. The Board must approve a budget by February 28.
  3. Administration: After approval of the Board of Directors, the budget becomes official. The staff shall administer the budget as finally adopted by the Board.
  4. In Lieu of Board Approved Budget: If at the end of the fiscal year the ICC does not have a new budget, the ICC shall continue to operate under the old budget until a new budget is adopted. When adopted, the new budget shall be retroactive to the beginning of the fiscal year.
  5. Provision for Adjustment: If the number of actual vacancies varies from the number of estimated vacancies in any term, the Board may vote to increase ICC charges or reduce the charges so that the total revenue will equal the budgeted revenue.
  6. In October or November of each year, the Finance Committee may bring a proposal to the Board for revisions in the current year’s budget, to increase its accuracy.

Expenses 

The ICC expense budget for each fiscal year shall include the following items:

  1. House Operations: including but not limited to, debt service, note repayment, insurance and maintenance, phone, internet, and utilities. Utilities shall include water, gas, and electricity.
  2. Administrative payroll and benefits
  3. Administrative services, including audit and legal fees, postage, staff bonding, telephone, supplies, printing and duplicating and office machine leases, service and/or purchases
  4. Committees and activities, including dues and subscriptions, recruitment, training and education, publications and social activities.
  5. Alumni Program:  Funding for the Alumni Program shall be generated by:
    • 10% of all ICC Membership Fees
    • A designated line item in the operating budget
    • Alumni Association membership fees and contributions
    • Any unused funds designated for the Alumni Program at the end of each fiscal year shall be retained in the Alumni Program Account and remain available for use by the Alumni Team.
  6. Bad Debt: A line item to account for potential bad debt in the ICC. Money paid by former members on accounts which have already been expensed as bad debts shall go toward offsetting the bad debt line item of the current fiscal year.

Income

  1. The income budget shall assess members, based on the estimated occupancy levels for each term of the Fiscal Year.  The Finance Committee shall set estimated occupancy rates for each term.
  2. Houses shall be assessed ICC Charges for the number of contracted members with exception of apartment co-ops, which will be assessed for the number of contracted apartments.
    • Fall/Winter: Charges for Fall/Winter shall be assessed for each term but shall be due in four payments for each term.
      • 25% of Fall term charges shall be charged on the 1st of each full month included in the contract (September, October, November, and December.
      • 25% of Winter term charges shall be charged on the 1st of each full month included in the contract (January, February, March, and April).
    • Spring/Summer: Charges for Spring/Summer shall be assessed for each term but shall be due in two payments for each term.  
      • 50% of spring term charges shall be due on the first day of the contract period and the remainder shall be due on June 1st.
      • 50% of summer term charges shall be due on July 1st and the remainder shall be due August 1st.
    • If a person occupies a space in a house without a contract and is not a guest the house shall be assessed the ICC Charges for time that person lived in the house as if that person had a contract, plus any other applicable contract fees. If a house knowingly allows a person to live in the house without a contract, the house shall also be assessed a charge equal to 10% of the ICC Charges due under this Standing Rule as liquidated damages.
  3. ICC House Density and Budgeting Capacities:
    • For the purposes of the ICC budget proration only. These official rooming capacities may be changed by action of the Board.
  4. The amount of revenue Campus residents supply, and the amount that Central Campus residents supply shall be adjusted by the Finance Committee each year based on the relative proximity of the cooperatives rates to market rates of comparable space in that area and on a comparison of the vacancy rates on Central and North Campuses.  In addition, these adjustment mechanisms should be constantly examined for relative accuracy and relevance in judging the fairness of the ICC charges. 
Central Campus Capacity
Black Elk 22
Debs 23
Gregory 29
Johsnon-Rivera 9
Linder 20
Luther 49
MichMinnies
  • Michigan (19)
  • Minnies (24)
43
Nakamura 29
Osterweil 12
Owen 22
Ruths' 12
Truth 52
Vail 23
Total Central Campus 345
Campus Capacity
Escher
  • Large (51)
  • Small (84)
  • Double (30)
165
Baker
  • Large (16)
  • Small (11)
  • Double (6)
33
King Apts 6
Total Campus 204
Overall Total 549
  • For the purposes of density and building capacity as defined by city housing code as of 10/1/93, these are the capacities:
House Capacity
Baker 56
Black Elk 31
Debs 29
Escher 216
Gregory 30
Johnson-Rivera 15
King 10
Linder 20
Luther 50
Michigan 21
Minnie's 39
Nakamura 32
Osterweil 15
Owen 27
Ruths' 12
Truth 63
Vail 24
Total 690

Maintenance Budgets

  • The funds used to preserve, enhance, and replace structures, building systems, and equipment, as appropriated by the Board and managed by the Director of Maintenance. Changes to this policy should be done with the consultation of maintenance staff.
  • Capital Investments Budget (Major Maintenance): The cost of projects that increase the value of property and will become depreciated, including large-scale renovations & improvements. A comprehensive list of such items and projects as well as the 5-year plan, shall be kept in the Maintenance Office.
  • General Maintenance Budget (Annual Maintenance): The cost of projects which are expensed and not capitalized, including the day-to-day care, preservation, and enhancement of facilities.

Spending Policy

No funds may be spent for other than their intended purpose without Board approval.

  • General: The Finance Committee shall supervise the administration of the ICC Budget; ensuring that no more than 10% over any budget line item less than $5,000 and no more than 5% over any budget line items greater or equal to $5,000 is spent without the board’s approval.  Individual line committee budgets shall be treated as one line item.   A “budget line” shall consist of a medium level budget line.  Examples are Debt Service, Maintenance, Property Taxes, Insurance, Property Expenses, Payroll, Office Expenses, Computer Expense, Professional Services, Advertising and Promotion.    
  • Debt Service, Property Taxes, Insurance, and Property Expenses: The GM or Central Accounting Lead as delegated by the GM shall be responsible for administering these budget lines.
    • Payment of minor medical insurance deductible and other costs related to House Labor:  The ICC shall pay the deductible amount for house labor related accidents, or up to $1,000 for amounts that are too small for an insurance claim.
  • Office Expenses: The staff shall be responsible for administering “Office Expenses” funds as they see fit.  
  • Professional Service: The GM shall be responsible for administering these funds.  
  • Advertising and Promotion: Staff members, as delegated by the GM shall be responsible for administering these funds.
  • Committees: Committees shall be responsible for administering their budgets as they see fit, unless otherwise specifically directed by the Board of Directors.
  • Unbudgeted Discretionary Items: The Finance Committee shall be authorized to spend up to $1,000 per fiscal year on discretionary items as requested by houses or staff members, up to $500 per item. Larger discretionary items must be approved by the Board.
  • Donations / Sponsorships: Items which fall into the following two categories may be approved as noted.  Other donations may not be approved.
    • Sponsorships: Members who wish to be sponsored to participate in an activity may be approved by the Education Committee. The activity must be related to the ICC or to co-ops.  Funds shall be taken from the Education Committee budget as approved by the Education Committee.
    • Donations to other Co-ops: The ICC may make one-time donations to other co-ops. The Coordinating Committee may, depending on the size and/or nature of the request, either send a proposal to the Board of Directors or refer the request to the appropriate ICC Committee.  

Designated Cash and Funds

The General Manager shall maintain reserve funds that secure ICC’s short-and long-term future and fairly distributes costs among future generations of members. The General Manager will report annually on reserve policy, funds accrued, and fund balances. Any changes in the Reserve Funds Policy will be reported to the board at the next board meeting after the change was made.

Audit

  • Each year the ICC shall have its records audited by a Certified Public Accountant.  The Auditor shall be chosen by the Board on recommendation of the Finance Committee.
  • The audit shall be completed as soon as possible after April 30 but no later than October 31 of each year.
  • The auditor shall be required to report to the Board. Sufficient copies of the Audit shall be reproduced to supply a copy to each director during the coming year.

Cash Assets

All payments shall be reviewed and authorized by the General Manager. Payments over $3,000 shall be authorized by the ICC President or ICC Vice President for Finance, unless they have been pre-approved by the board or one of the committees on the board.  Authorization is not required for payments to ICC houses or transfers between ICC accounts.

Borrowing and Investment Policies

  1. ICC Borrowing: The ICC shall pay prime rate interest on money loaned to it by friends or former members.  Interest will be paid only at the time of repayment of the loan.
  2. ICC Investment Guidelines
    • Investment management of the ICC's funds shall ensure preservation of principal, high profitability, defined as 10% Return on Investment (ROI) or above annually, optimum liquidity depending on market conditions to provide for scholarships when needed, and social responsibility.
      1. Socially responsible companies are defined as those that are deemed not to be engaging in unsustainable business practices.
      2. ICC commitment to social responsibility (outlined below.)
    • The Finance Committee shall maintain an Investment Policy as part of the Finance Committee policy that:
      • 1. sets policy related to investment choices,
      • 2. Establishes limits on investment types,
      • 3. recommends specific types of investments, and
      • 4. sets forth policies regarding the risk level of such investments. The Board shall make final decisions on all investment recommendations.
    • The Finance Committee shall conduct an annual review of the ICC investment portfolios to evaluate appropriate divestment(s). Any permanent divestment will be noted in the Investment Policy.
    • The General Manager will have full responsibility for the implementation of the investment policy dictated by the Board.
    • Investment in any one company or institution, except direct obligations of the U.S., is limited to the amounts dictated by the Investment Policy. The Finance Committee must review the caps on investments each year.
    • The Board shall be informed of all investments made and the Finance Committee shall present a performance update of the Endowment Fund and any other ICC investments to the board on a semi-annual basis.
    • When approached for a loan for a student housing cooperative, the ICC shall consider investing through the Kagawa Fund first.
    • Commitment to Social Responsibility: The ICC understands that its financial actions have repercussions on local, national, and transnational institutions. A concerted effort will be made to support those institutions that:
      • 1. aid the local economy by providing local residents with competitive wages and benefits;
      • 2. support the local community through direct giving or other activities;
      • 3. engage in activities that have minimal impact on the environment;
      • 4. treat their workers in a fair manner; and
      • 5. are governed in a cooperative manner.
        • The ICC shall measure the social, environmental, and corporate governance impacts of its investments in individual stocks. through ESG (environment, social, governance) investing metrics as provided by verified rating agencies.
        • If any company in the portfolio has an ESG rating below the industry mean, FinCom shall review any investments into said company and divest if deemed necessary.
  3. Loans to ICC Houses: The Board of Directors may make a loan to member houses for special purposes.  No interest shall be charged upon such loans.  No loan may extend for a period of more than three years and a schedule of prompt and full repayment must be agreed to by the house before any loan monies are disbursed.  The total amount of outstanding loans to houses (including all other loans to houses) may not exceed 1% of the ICC Budget.

Insurance Coverage and Bonding

  • Insurance and Bond Coverage: The ICC is not responsible for damage or theft of personal property or personal injury on ICC property or injuries suffered by members during activities connected with the ICC arising out of the member's own negligence. The ICC has no liability for member's cars parked on ICC property.
  • Fire and Extended Coverage Insurance: The board must approve any changes of the insurance carrier and furthermore we endorse the "rent insurance" concept which would return rental income to the ICC for a year in case of fire. The ICC shall insure each house to at least its assessed value.
  • Personal Effects Coverage: It is ICC policy to carry an average of $500 fire and extended coverage insurance for each rooming member on their personal effects.
  • Public Liability Insurance: Public liability insurance in amounts of $5,000,000 total and $1,000,000 per occurrence will be carried on all ICC property.
  • Persons Bonded: All house treasures shall be bonded.  The ICC President, Vice President for Finance, Director of Financial Services, General Manager and any other full-time administrative employees shall also be bonded.

Standard Fines

For the purposes of fines the variable $X shall be $15

Scholarship Program

The board delegates its power to control and administer the ICC  Scholarship Endowment Fund and the ICC Scholarship Programs to the Finance Committee.

  1. Purpose: The Purpose of the ICC Scholarship Fund is to provide scholarships for students who need financial aid to continue school and to members experiencing unexpected financial difficulties.
  2. Funding: The funding for the ICC Scholarship Programs shall come from two sources:  The Operating Budget and the Scholarship Endowment Fund.
    • Operating Budget: The scholarship program shall be given a minimum $35,000 award each year. This appropriation shall not be deposited in the scholarship fund. For accounting purposes, the cost of each scholarship accrues in the fiscal year when the award, not in the fiscal year which it’s set aside. Any surplus remaining at the end of the fiscal year shall be reinvested in the endowment fund.
    • Scholarship Endowment Fund: Each fiscal year, 6% of the value of the Scholarship Endowment shall be withdrawn to fund scholarship disbursements, with 20% of the total value being reserved for distribution during the Spring/Summer terms and 80% of the total value being reserved for distribution during the Fall/Winter terms. Any money not disbursed by the end of the S/S term will be added to the F/W reserve.
    • Additional Funding: Scholarship funding may also come from specified gifts, proceeds from fundraising events, other monies specifically designated to the fund by the Board of Directors, and fundraising efforts of the Committee.
  3. Administration. No loans shall be made from the Fund, nor shall any aid be disbursed in the form of cash. The Finance Committee shall be responsible for:
    • Developing standardized metrics to determine eligibility and scholarship amounts for an applicant.
    • Publishing the metrics in a FinCom Policy Manual.
    • Sending scholarship amounts to the Finance Office to be subtracted from the applicant’s monthly charges.
    • Publicizing all scholarship programs including but not limited to the MLK scholarship, Bridge scholarship, Solidarity Scholarship, and COVID scholarship to current and prospective members.

Documents Retention and Destruction Policy

The Document Retention and Destruction Policy identifies the record retention responsibilities of staff, volunteers, members of the board of directors, and outsiders for maintaining and documenting the storage and destruction of the organization’s documents and records. The organization’s staff, volunteers, members of the board of directors, committee members and outsiders (independent contractors via agreements with them) are required to honor the following rules:

  • Paper or electronic documents indicated under the terms for retention in the following section will be transferred and maintained by ICC Administrative Staff as a collective.
  • All other paper documents will be destroyed after three years;
  • All other electronic documents will be deleted from all individual computers, databases, networks, and backup storage after one year;
  • No paper or electronic documents will be destroyed or deleted if pertinent to any ongoing or anticipated government investigation or proceeding or private litigation (check with legal counsel or the human resources department for any current or foreseen litigation if employees have not been notified); and
  • No paper or electronic documents will be destroyed or deleted as required to comply with government auditing standards (Single Audit Act).
  • The table indicating the minimum requirements for document retention and destruction are located in the Finance Committee Policies.