If it's time to update the dues rules for the upcoming membership term (for example, it may be time to increase the dues amount), this article will explain how to update dues rule(s) and also when the update should be made.
It's important to take each member type's settings into consideration like multi-year initial term and proration when making updates.
When to Update Dues Rules
Plan in advance what updates will need to be made when the time is right. Based on the settings and scenarios described below, determine a specific date to edit dues rules.
NOTE: If you want to test the new dues rules prior to when they should be active for members, you can log in to your staging site (from when you were onboarding into Novi) and create a test setup there. If you need help accessing your staging site, please reach out to us via Intercom.
If Auto-Renew is turned OFF
Anniversary: If a member type's settings has Auto-Renewal disabled and Anniversary-based expirations, update the dues rules on the day the update should take effect. Skip ahead to the section below that shows how to update dues rules.
Calendar: If Auto-Renewal is disabled and expirations are Calendar-based, check the section below for "Calendar Renewal Cycles" to determine if there are any other settings to take into consideration. If multi-year initial term and proration are not turned on, update the dues rules on the day the update should take effect.
If Auto-Renew is turned ON
If a member type's settings are set to Auto-Renew, update your dues rules before the system automatically creates the renewal invoices.
To figure out this deadline, go to the Renewal tab of the member type and scroll down to the Auto Renewal section. Look at the number in the "Run auto-renewals ____ day(s) before expiration date" setting.
Example: If a member expires on 12/31 and invoices are going to be created 60 days before expiration, update the dues rule(s) before 11/1.
If there is only one dues rule that triggers for both new and renewal members, edit the dues rules on 10/31 (and not earlier) because they will take effect immediately.
If there are separate dues rules for new members vs renewing members, the renewal dues rule can be set before 11/1 (and potentially earlier if needed).
If updated were missed and renewal invoices have been created, check out this article to learn more about how to recalculate dues invoices. Please note that this process does take time and can be avoided by updating the dues settings prior to renewals running if possible.
For Anniversary Renewal Cycles
Anniversary renewals will not have prorations or multi-year initial terms since all terms will be the same length. Therefore, refer to the section above to determine when dues rules should be updated, then go to the section below to learn how to update the dues rules.
For Calendar Renewal Cycles
Note: The settings for proration and multi-year initial term are separate but impact each other, so be sure to read about both of these below.
If Proration is turned ON
For calendar year organizations (those whose members renew on a specific date like 12/31), dues rules can be set to prorate in the first or second membership term. This can be done by going to the Dues Rules tab and opening each dues rule to review/edit the proration settings.
Admins determine when proration begins (based on the number of days, months, or years prior to the expiration date) and the proration calculation (based on date or percentage).
Example #1: If prorated dues begin on 6/1 (for a 12/31 expiration) and the multi-year initial term setting is not turned on (see below), choose the date that new members joining the association should start paying the new dues rate (e.g. 12/1) and edit the dues rules the day before (e.g. 11/30).
If someone joins on 12/1 or after, the new dues rate will apply but they will only be charged for the first year's prorated amount at the time of signup. Their expiration date will be in the current year. If auto-renewal is turned on, they will be billed for the second year at full price when the renewal invoices are created.
Example #2: If prorated dues begin on 6/1 (for a 12/31 expiration), and the multi-year initial term setting is turned on, choose the date that new members joining the association should start paying the new dues rate (e.g. 12/1) and edit the dues rules the day before (e.g. 11/30).
The new dues rate will apply to the first and second year, but the actual amount charged for each year depends on your proration setting (first or second membership term). Their expiration date will be in the next year.
NOTE: When you're deciding which date to edit your dues rules based on your proration settings, be sure to also check your auto-renewal settings (as described in the section above) and make sure you're choosing the best date based on all of your settings.
If Multi-Year Initial Term is turned ON
For calendar-year organizations, admins can set up a multi-year initial term after a certain date and charge dues for both years or the second year only.
Example: For a multi-year initial term that's set to 2 months before expiration (see screenshot above) it will apply to new signups starting on 10/31. In this case, edit your dues rule(s) on 10/30. This way members signing up on 10/31 and after will pay the new dues rate when they join and have an expiration date in the following year.
The amount new members are charged depends on the setting for "both years" or "second year only."
If set to "second year only" the member will only be charged for the upcoming dues year and the remainder of the current year will be free.
When "both years" is selected, proration will apply. To check your proration settings, go to the applicable dues rule(s).
Important Notes:
When a proration setup is edited, new invoices that are created will be based on the updated settings.
If there are specific dues rules for new members (and other dues rules for renewals), please note the following:
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).
Important Note About Draft Dues Rules
Please read carefully before starting to make changes to dues rules
Set dues rules to "Draft" (i.e. inactive or deactivated) while making changes, but they should only be in this status for a short period of time. Do not keep dues rules in Draft mode for an extended period of time.
Having a dues rule in Draft mode prevents new members of that member type from joining your association and prevents renewals from running for that member type as well.
To see if any member types have dues rules in Draft mode, go to the Dues Rules tab on a member type and look at the Status column. There will also be a warning message (see screenshot below).
NOTE: If you want to test the new dues rules prior to when they should be active for members, you can log in to your staging site (from when you were onboarding into Novi) and set them up there. If you need help accessing your staging site, please contact us.
How to Update Dues Rules
When the time comes to edit dues rules, follow these steps:
Go to Members > Member Types
Select the member type.
Go to the Dues Rules tab and click the Edit link for the dues rule you want to update (you may also click the dues rule name to edit it).
Now that the dues rule is in draft mode, click the Edit link again to reopen the modal.
Update the dues rule as needed, which may include the condition(s), the amount, proration settings, accounting item, etc. More info on setting up dues rules.
Once all of the updates have been made and reviewed, toggle the dues rule(s) back to Active and Save. The update(s) will take effect immediately.
NOTE: When changing the "Item" that a dues rule is linked to, do not delete the old item in QuickBooks Online or you will lose the ability to report on those past items in QuickBooks Online. More info on connecting dues rules to QuickBooks items.
Additional Info
Don't forget to review the Message Displayed on Invoice field of each member type. If the message includes any dates or timely information, you'll want to get this updated before the auto-renewals run.
If renewals run and you find an error, you can update the settings and then recalculate the open dues invoices in that member type.