— Students at Athens State University may play a small role in how the Athens City Council appropriates funds during the 2012-2013 fiscal year.

ASU Professor Laura Lynn Kerner’s marketing research class took a close look at the criteria the city uses to fund local agencies, and submitted several suggestions to consider when granting those funds.

“We felt the citizens should be educated on what the sources of revenues are for the city, and there should be some transparencies in how the money is used,” Kerner said. “We felt residents didn’t understand how the City Council gets its money and how sales tax generates revenue for the city.”

A preliminary appropriations budget projects the city could divvy out more than $4.46 million in appropriations this year, though $3.4 million of that represents the annual sales-tax allotment to Athens City Schools. About $380,000 covers the cost to power and maintain the city’s streetlights.

Both of those items were passed at the last City Council meeting on Sept. 24, as was the city’s annual $30,000 appropriation to Pryor Field. The council will approve the remaining appropriations before month’s end.

Councilwoman Dr. Milly Caudle said the council has had discussions about the required guidelines for nonprofit agencies seeking money from the city. She added that the ASU report was “well done, thorough” and that it will help the council examine how funds are allocated.

“More and more agencies apply (for funding) every year, and we really have to look at those closely as we deal with our own budget,” she said. “(Kerner) does a good job with that kind of hands-on teaching and experience, and we’re really impressed with what (the report) will do for us.”

One of the suggestions Kerner’s students had for city leaders is that they should evaluate nonprofit groups objectively prior to funding, and even perhaps use a scorecard method. Other considerations included:

• Nonprofits should not be funded if they cannot provide a 990 and/or a 990-EZ tax form showing the sources of their funding;

• Agencies should not be funded if they cannot maintain their nonprofit status;

• Each organization should submit a budget and financial statements to the council;

• Each agency should provide details on how the city’s money will be spent and then show an itemized breakdown at the end of the budget cycle showing how the funds were used;

• There should be no conflicts of interest between the city and the agencies, meaning no family members of council members should serve on an agency board seeking funding; and

• Directors of nonprofit organizations should be offered training on how to manage operations.

Kerner’s class also broke down the importance of each agency into six categories, with first being agencies that contribute to economic development or revenue growth. Second on the list would be agencies that contribute to the health of citizens, followed by education, quality of life, beautification and historical preservation.

City Finance Director Annette Barnes said the ASU report would be read and considered, but added many of the students’ suggestions were ones the city enacted for the first time this year.

“We’ve always requested budgets, but for the first time, we asked for more detailed information like financial statements, budgets, who’s on the board, how much of the money will stay in Athens and the types of programs they want to use city dollars for,” she said.

She said there were some portions of the report the council has no leeway on, including its contractual commitment to Pryor Field and to the school system.

“We’re trying to do a better job because there are so many agencies that are very worthy causes and need more money each year,” she said.

Kerner said she’d like to think her students’ hard work offered some new insights to the council, but added the project was worth it to broaden their perspectives on city government.

“This is the biggest project we’ve ever been given, and it was an eye opener for me and the students,” she said. “What they learned is tremendous, and they’re now more civic-minded. They did a really good job and learned a lot about how their money is spent and that they should be diligent about the people they elect.”