CONTINGENCY 2 – includes
cutting $10,000 in “luxury”
and “useful but optional”
items and $15,000 in 2%
across-the-board salary cuts.
Income
Tuition and Fees ......................................$230,000
Fundraising Income ...................................$45,000
Total Income ...........................................$275,000
Expenses
Administration ..........................................$XXXXX
Building & Grounds ...................................$XXXXX
Fundraising Expenses ................................$XXXXX
Marketing.................................................$XXXXX
Mortgage Interest .....................................$XXXXX
Mortgage Principal ...................................$XXXXX
Personnel .................................................$XXXXX
Student Expenses .....................................$XXXXX
Total Expenses ....................................... $275,000
Net Income / Loss ............................................. $0
VOLUME 22 ISSUE 4 • 2020 | WWW.MONTESSORI.ORG/IMC | ©MONTESSORI LEADERSHIP
thinking through options like these can be
a helpful way of identifying potential tradeoffs
and enabling you to see what will
happen if you can’t bring in enough tuition
and/or fundraising income.
SHARE SUMMARIES
OF YOUR BUDGETS
WITH YOUR STAFF
AND PARENTS
After you have created your contin-
gency budgets, it can be very helpful to
share them with your staff and parents, so
both groups know what’s going on and can
understand more easily what will happen
at different levels of income and expenses.
If you haven’t done this before, it may
make you nervous, because it may feel like
you’re revealing private information. But,
especially in uncertain times like these, it
can provide an important element of clarity
for everyone involved. Your staff and parents
may have questions about the choices
you’ve made, but if you’re clear about
what you’re doing and why that shouldn’t
be a problem; and if the questions raise
issues that you hadn’t considered, this can
actually be helpful feedback that you can
incorporate into your planning.
You shouldn’t share all the specific
items in your budget, such as how much
each staff person is paid. Instead, you
should share broad categories of income
and expenses, such as the following,
which are based on Contingency 1 and
Contingency 2 above: (Fill in numbers in the
chart below for the actual expense lines.)
You can prepare summaries like these
for each contingency budget that you develop.
The point is not to frighten your
parents and staff, but to help prepare them
for the steps you will take depending on
your income. That way any cuts you have to
make won’t come out of the blue.
When I was Director at the Knoxville
Montessori School, I found it was helpful
to actually write staff contracts with different
salary levels contingent on the school
meeting certain levels of enrollment and
income. If we met or exceeded our enrollment
and income targets, we could give
raises. If we were slightly under our targets,
we could keep everyone at the same salary
they had received the previous year. If
we were substantially under our targets,
we would have to cut salaries. We also included
language in each contract that gave
us the flexibility to make additional cuts as
CONTINGENCY 1 – No cuts
Income
Tuition and Fees ......................................$240,000
Fundraising Income ...................................$60,000
Total Income ......................................... $300,000
Expenses
Administration ..........................................$XXXXX
Building & Grounds .................................. $XXXXX
Fundraising Expenses ................................$XXXXX
Marketing.................................................$XXXXX
Mortgage Interest .....................................$XXXXX
Mortgage Principal ...................................$XXXXX
Personnel .................................................$XXXXX
Student Expenses .....................................$XXXXX
Total Expenses ........................................$300,000
Net Income / Loss ............................................. $0
needed. Fortunately, we always met or exceeded
our targets, so we never had to cut
salaries, and we were usually able to give
raises each year. But, writing the contracts
this way gave everyone on staff a clear understanding
of what to expect at each step
in the process.
Sharing your budget summaries like
this can also help motivate your parents
and your staff to help with fundraising,
because it will show them very clearly how
much money you need to raise and what
will happen if you can’t.
CONCLUSION
As I said at the outset, each of the topics
I touch on here could easily be the topic
of an entire article – or several articles.
I hope this has given you some things to
think about and some ideas you can use as
you and your school deal with the financial
problems posed by the pandemic.
One thing I know for sure: Montessori
teachers and administrators are among
the most dedicated and creative people I
have ever had the pleasure of working with.
So, whether you use some or all of these
ideas, or chart your own path entirely, I am
confident that you will find a way.
/IMC