Each member type will have its own set of dues rules that may or may not apply to the dues-paying members assigned. These are the rules that are used to create dues invoices for your members and properly account for the revenue.
AE Tip™: It's important to consider a member type's settings when creating or reviewing your dues rules.
Sections in this article:
Novi Note: If you are thinking about a major re-structuring of your dues rules, please consider setting up a workshop with our team to discuss your possible changes. This will help ensure that the proposed changes work efficiently with your site.
Accessing Your Dues Rules
The Dues Rules live under your Member Type settings. From the backend navigation:
Click Members > Member Types
Next, from the list displayed, open the membership type you would like to edit. You can click the Name of the Member Type, or the Edit link to the right.
Once viewing the member type, click the Dues Rules tab.
To create a new dues rule, click the + sign at the top right of the list, or use the New drop-down.
To view/edit an existing dues rule, select the dues rule by clicking directly on the Dues Rule Name, or the Edit link to the right.
A pop-up window will appear with the Rule Conditions and Dues Equation.
Rule conditions are used to determine whether a specific dues rule applies to a specific member. If a dues-paying member meets the conditions established, the dues rule will apply to that member during the signup or renewal. If a dues rule has no conditions, it will apply to all members in the member type.
Common Rule Conditions
New Member - equal - yes
New Member - equal - no
New Member - equal - yes
Membership Expired - Days ago - less or equal - 365
Membership Expired - Days ago - greater or equal - 90
New Member Dues Rule Condition
Completely new members and prior members whose expiration date is beyond the "Treat late renewals as a new member" timeframe set on the Member Type are considered "new members."
The dues equation is how Novi determines what to charge the member for that particular dues rule.
The default dues equation asks for a "Number Value." If the dues for that rule are a flat fee (ie: $50), then just enter the amount.
One of Novi's strengths is the way that the system handles complex calculations. You'll notice that in addition to the "number value" field, you also have access to custom fields that you have enabled for dues rules. Instead of "no additional steps," simply choose the math function you'd like to perform. To check your work, take a look at the "Dues Formula" shown below the equation.
More Complicated Calculations
If you charge $5 for each of the first 5 employees and $4 for each employee thereafter, you can use Novi's "Min/Max" feature to help make the math simple.
If your dues equation has a number of steps to it, you'll want to use the parenthesis to enforce all of those math rules we learned back in 6th grade.
You're also able to provide discounts on dues rules, by setting the dues equation value to a negative number.
This way, that amount will be subtracted from the total dues amount.
Don't forget to set up your dues rule conditions! This way, the discount will only apply to those members who should receive it. If you use New vs. Renewal dues rules, you'll want to consider if this discount applies to both of those scenarios as well.
For calendar year organizations (those that renew on a certain date each year - i.e. 12/31), specific dues rules can be set to prorate or not prorate.
This per-dues-rule level allows you to prorate general dues, but not an application fee, for example.
Proration settings are completely up to your organization - whatever you feel is fair for new members joining to pay once the membership term has started. You may want to check your bylaws if unsure of your organization's proration policy.
Dues can be set to prorate in the first or second membership term. This determines if they receive the discounted rate when joining, AKA this year (first term) - OR - with their first renewal, AKA next year (second term).
Important Note: If you split your dues rules out for "new" vs "renewal" and you are prorating in the second membership term, make sure both dues rules have proration turned on. Otherwise, proration will not apply in the second term and they will be charged the full rate on both invoices.
Admins determine when proration begins based on the number of days, months, or years prior to the expiration date.
This usually happens a bit after the new membership term has started. So if your members expire 12/31, you might want to start prorating around Q2. If that's the case, you'd start prorating nine months prior to the expiration date.
Proration can be based on the remaining days, partial months, full months, partial quarters, or full quarters.
Prorating based on days is the fairest option for both members and the association.
Prorating based on partial months or partial quarters will favor the association.
Prorating based on full months or full quarters will favor the member.
Proration Calculation Example
As an example, if members expire on 12/31, let's say that a new member joins on 7/1. Their dues are $200.
If you prorate based on remaining...
...days, the member pays: ($200/365 days) * 183 number of days left in year = $100.27
Don't forget about leap years!
...partial months, the member pays: ($200/12 months) * 6 months left in year including July = $100
...full months, the member pays: ($200/12 months) * 5 months left in year excluding July = $83.33
...partial quarters, the member pays: ($200/4 quarters) * 2 quarters left in year including Q3 = $100
...full quarters, the member pays: ($200/4 quarters) * 1 quarter months left in year excluding Q3 = $50
Q&A - Will the member be billed for both years upfront?
Depending on the date the member joins and the member type's Multi-Year Initial Term setting, there are two possibilities:
If proration applies on the date they join, but the multi-year initial term is not in effect yet, only the dues amount for the first membership term will be billed at the time they join. The second term will be billed separately when renewal invoices are run.
If proration applies on the date they join and the multi-year initial term has already started, the dues amounts for the first and second term will be charged on one invoice at the time they join.
If you have specific dues rules for new members (and other dues rules for renewals), please note the following:
When the multi-year initial term is in effect, the system will only look at the dues rule(s) for "new members" when calculating the first and second year.
The second year is not considered to be a renewal since it's included in the multi-year initial term. The system will only look at the dues rule(s) for "new members" and will then charge for that rule twice.
Additionally, the charges for both years will be mapped to the same line item in QuickBooks Online (the item tied to the "new member" dues rule).
Q&A - What happens to current members' renewal invoices if I make changes to the proration settings?
As soon as a change is made to the proration setting on a dues rule, it will be applied to all applicable dues invoices moving forward. In other words, the system only looks at the current dues rules and settings when creating dues invoices. Keep this in mind if you decide to change proration from first membership term to second term (or vice versa) since this would mean members who joined in the last term will receive prorated dues for both terms (or neither term).
If your dues rules include a minimum or maximum amount (for the entire dues rule - no matter the conditions), be sure to set your limits in the Limits section of each dues rule.
Do you have "highly suggested but not 100% required" dues like contributions to the foundation or your PAC? You're going to love Novi's Optional Dues. Just enable the toggle.
During signup, a member can choose not to pay for the optional dues rule without having to call your accounting department - or without sending a partial payment and leaving your team to figure it out. Admins also have the ability to remove optional dues during the manual renewal process.
Each Dues Rule, if it applies to a particular member, will create a single line item on that member's dues invoice. In addition to adding transparency for your members, this allows your organization to code dues differently than other fees (e.g. unit fees or application fees).
Each dues rule will have the following fields that directly relate to accounting:
Item - This is the QuickBooks Item that will map to your dues rule. Multiple dues rules can map to the same item.
Class - If you use classes, you can apply them to your individual dues rules.
Invoice Item Description - In addition to what you place into this field, Novi will append any custom field values that were used in the dues calculation.
If it makes sense for your Dues Rules to be listed in a certain order (for example, base dues first and optional donations last), you can drag and drop the dues rules to change the display order. This will affect all areas, including the checkout cart on the frontend website and the invoice/sales receipt.
(click, hold, drag, and drop)
If a member type also has Product Add-ons, they will be displayed below the dues rules. To arrange the order of these products, go to the Product Add-ons tab of the member type and drag/drop to change the display order.
Example Checkout Cart for New Member Signup:
Learn how to automate a Reinstatement Fee for members who want to re-join your organization.
Learn what Draft Dues Rules are and how they affect new member signup.
Use merge fields to add membership dates to dues invoices in the Message Displayed on Invoice field of each member type.