By Cole Parkinson
The Horizon School Board has unanimously passed its budget for the 2018/19 school year.
While the board had approved a deficit for the past several years, there were hopes of coming out of it for this budget, but several factors played into why the next budget will see Horizon short of the mark again.
For 2018, there is a projected deficit of $895,491, with $580,300 coming from schools’ use of decentralized reserves and $315,191 coming from the board fund.
“For the upcoming fiscal year, we are presenting a deficit of $895,000. Of that budget, the schools are dipping into their reserves by $580,000, leaving the board to fund a deficit of $315,000. Of that deficit, we would like to request permission from the board to access a third year of the assessment coach as was the original plan. The transportation funding, as of now I have in the budget a deficit of $130,000, that’s very difficult to project. This one is the worst-case scenario I could come up with,” said Phil Johansen, associate superintendent of finance and operations for Horizon, at the board’s budget meeting on May 23.
The assessment coach was a three-year plan with 2018/19 being the last, and the total going towards the budget is at $110,000.
Starting in the 2016 school year, staffing changes were made within the division which was a reason for the start of deficits for the school board, though their reserves were able to carry most of the extra costs.
“In September 2016, Horizon School Division had an accumulated operating surplus of $10,828,000. That year, we ran a significant deficit of just over $1 million. One of the driving factors behind that deficit was we had changed our staffing approach and on top of that we had around 100 kids that didn’t show up in the fall that had been projected to come. Because the board had reserves in place, we were able to carry the staffing commitments that had been made. The other issue is, of course, in the current climate the province has been questioning the level of savings school divisions have,” said Johansen.
The deficit saw a total of $1,172,450 in 2016 and climbed to $2,303,329 the following year.
Meanwhile board reserves were at $7,430,930 and $4,504,600 for 2016 and 2017 respectively.
“The Auditor General recommends that we carry one to five per cent of our annual operating budget in savings. At the start of the year (2016), we were closer to around 24 per cent of our annual operating budget in savings. There has been pressure from the government asking what the plans are for the money,” said Johansen. “One of the plans was we figured we should put some money into maintaining our facilities and addressing any outstanding maintenance issues so we could get long-term benefit from that money.”
While one to five per cent was recommended, Johansen sees some issues with only carrying that much.
“The danger of bringing the savings down that low is there is always two things that happen. If your savings are low and we get an event like in 2016 where 100 students don’t show up and that funding for those students is just short of $1 million, you have no ability to cushion.”
“The other thing is, not all of the funding is received in equal installments throughout the year. We get our funding on the 15th of every month but sometimes it’s a little higher or lower,” he said.
In 2017, most of the money was put into school modernizations which included D.A. Ferguson and Barnwell School.
Schools have also seen a dip in their reserves as they were at $1,686,448 in 2016 and $1,634,677 in 2017.
“One of the unique things about this board is you allow schools to carry over large amounts of money year to year. One of the nice things about that system is it doesn’t create this end of year panic that you see in organizations where they start spending every penny they’ve got because they will lose it. It allowed schools to accumulate, at the end of 2016, just about $1.7 million of funds that were controlled at a school level,” added Johansen. “We’ve given principals that discretion. We trust in their professional judgement.”
The amount of money spent out of reserves is a big concern for Horizon staff.
With another deficit for the coming school year, they stressed the need to correct their current path.
“Over the course of three years, the board has spent about $6 million in savings. At that rate, we will be out of money completely in two years,” said Johansen.
A lack of past grants has also hurt Horizon as $1.72 million has ceased due to the grants not being available anymore.
Several schools within the division have seen declines in the number of students in their traditional english speaking schools.
Based on full-time equivalent (FTE), their regular schools excluding Taber Christian School are down 511.5 FTE over the past 10 years while their mennonite schools have seen steady growth.
“Our mainstream English schools are down in the last 10 years by about 500 kids. Our outreach programs, especially our Mennonite outreach programs and our colony schools, our enrolment is growing. Taber Christian School is growing,” explained Johansen.
Changes in regard to teaching staff has seen the FTE for certificated staff projected to shrink slightly after it was at 217.79 in 2016/17, 216.01 in 2017/18 and it is projected to be at 209.26 for 2018/19.
Last year saw a lot more staff absences than expected and they had to correct it for the newest budget.
“Another item that is a significant impact on this budget is absenteeism. Historically, teachers in Horizon miss about five days of work due to illness in a year. This year it spiked, it looks like it will average out to about 7.5 to eight,” said Johansen. “Maternity leaves were quite high this year as well.”
With schools expected to use some of their savings for the 2018/19 school season, Johansen expects most of the money to go towards added support staff time.
“Schools are planning on dipping into their savings by an amount of $580,000 this year. That will leave them savings around $700,000 or $800,000 at the end of this year. One of the big things schools use to purchase with their money is to buy extra support staff time and so this current year, with their reduced allocations, schools purchased 32,306 hours of support staff time,” he said.
Assistants for students with complex needs are also being supplemented with more hours for 2018/19.
After 54,361.66 hours and 49.24 FTE in 2016/17, 53, 147.58 hours and 48.14 in 2017/18, Horizon is projecting a total of 55,895.7 hours and 50.22 FTE for 2018/19.
While the board had hoped to see the budgets return to the positive side for the coming school year, they realize they can’t cut essential services in order to do so.
“We started down this road three years ago, we told administrators that in three years we’d like to be there as a balanced budget without us having to supplement with reserves. We aren’t there, however I think it’s as harsh as we could possibly go. What the future holds, I don’t know where that’s going to go,” said vice-chair Bruce Francis.
A motion was made to approve the 2018/19 budget and was passed unanimously by the board.
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