Hiring out your school’s facilities: What you need to know
Many Principals will have the benefit of hosting facilities at their school that provide great opportunity and value to the local community. Whether it is your oval, hall, music facilities, pool or other facilities, schools have the power to enter into agreements with third parties for the use of school facilities when they are not required for ordinary school purposes. Indeed, hiring them out to local sporting clubs, business and community groups can provide great benefit to your school.
Whilst the increased revenue, good will and opportunity to show off your school are all positives, you should ensure that the appropriate steps are taken to protect your school’s interests so that the benefits aren’t outweighed by the negatives.
Types of Agreements
When offering your school’s facilities to third parties, you should consider the type of agreement that is appropriate to put in place. Typically, the agreement will take the form of:
– A hire agreement
– A licence agreement
– A community joint use agreement
Hire agreements are suitable for occasional or one-off hire of school facilities.
For example, this agreement would be appropriate when a local community group seeks to hire your school hall for a weekend, or a theatre group wanting to stage a play over four nights.
Licence agreements should be used for ongoing community use of your school facilities by third parties.
For example, a local drama group using a school performing arts centre every Wednesday evening for a year, or a local football club hiring the school oval for a season.
Community Joint Use Agreement
Community Joint Use agreements are suitable when you are looking to build a jointly-used community facility with another party, such as stadiums, sporting grounds and theatres.
Obviously, these types of agreements are less common than a hire or licence agreement, but it is good to be aware of them.
What should your agreement include?
- the price payable (must be market rates), including any applicable deposit;
- what facilities are being provided (and importantly, what is not). Eg. Does the hire of the school hall include the sports equipment?
- the term/duration of the agreement;
- payment terms – how much must be paid and by when;
- who is responsible for certain risks;
- obligations on the third party to comply with applicable school policies and procedures regarding the use of the facilities.
VRQA Guidelines, which took effect from 1 July 2019, can impact on a school hiring out its facilities.
The Guidelines require that the arrangements made for the hiring of school facilities be put in writing and subject to usual commercial terms. The agreements and any day-to-day processes regarding the hiring of those facilities must also comply with the VRQA Guidelines.
You also need to consider the risk management aspects of the agreement. Hiring school facilities to third parties carries with it a level of risk. Accordingly, it is important to be clear on who bears the risk and what insurances and other contingencies need to be put in place to safeguard against that risk. Schools should ensure that every hirer provides evidence of appropriate insurance prior to the hire event.
How can Brennan Law Partners assist?