I agree with Marvin. Developing a course takes a lot of time,
expertise and energy - $500 is dirt cheap.
I've developed several online courses for our school district and
they must pay me my hourly rate, which is somewhere in the vicinity
of $50 an hour. I never tell them how many hours it will take
because I don't know. The first course you develop takes the longest
because you're learning how to write an online course. Subsequent
courses that you may develop will take a shorter development time.
If you can, negotiate an acceptable hourly rate and go from there.
Don't sell yourself short. If they are seeking your help in
developing the class, then they know you do quality work.