By Cole Parkinson
Horizon School Division has further closed the gap in their budget as the board has approved a $424,915 deficit for the 2019-2020 school year compared to last year’s shortfall of $895,491.
“There is an overall deficit of $424,915. All of that comes from a decision that schools have made with there cumulative savings over the years to spend for next year and you have allowed them to make that decision. As far as the board side of reserves go, the budget is balanced,” said Phil Johansen, associate superintendent of finance and operations at the Horizon board’s regular meeting on June 26.
“People may ask why the board doesn’t contribute more from its reserves and the reality is that the board has contributed heavily over the last five years. You can see that the board’s operating reserves have reduced to about $1.3 million by the end of this year. You simply don’t have the operating reserves as a luxury anymore.”
A big challenge this year for Horizon staff was centered around the fact the new UCP government has not released their provincial budget, and it is not expected until fall.
With that, a fair amount of estimation had to be made based upon unofficial discussions with the provincial government.
“It’s been a bit of an interesting budget cycle. We briefly discussed the budget last month to give you an idea where we were at and where things were headed. So today we have the finished product,” said Johansen. “There were a lot of challenges surrounding the budget this year, most of them came from the fact we had an election and we have a new government that has a new mandate to try and balance the books and reinvigorate the economy. The economy has been sluggish for a number of years and the province has been running deficits. We don’t know exactly what direction the province will be headed and we haven’t received a budget from them. We expect we won’t be getting a budget until October. Things they have talked about is they intend people’s right to choose where they get their education. They also intend to enhance accountability within the system and they have made a commitment to maintain or enhance funding, although there isn’t any specifics around that.”
From this, the budget had staff using more projections compared to years past.
“I have made an assumption of about $100,000 in savings from staff turnover. Most years that would be a conservative estimate but we will see. The other thing we made an assumption about was the Classroom Improvement Fund and the Nutrition Grant. Those were individual grants the NDP government brought into place. We haven’t really had any communication from the government as to whether they will be cancelled or continued. We have built those into the budget this year. However, we haven’t hired those positions yet. We will look to hire those position in the fall when we get a clearer picture of the budget the government will bring forward,” continued Johansen.
One of the biggest factors when looking at school division budgets is student enrollments.
“The key thing that drives the budget is enrollment. I wanted to highlight some of the shifts we are having in enrollment within Horizon,” said Johansen.
When looking at Horizon’s 2019-2020 enrollment, a decline is expected.
“We are projecting a decline of 159.5 full-time equivalent students,” stated Johansen, and it was pointed out Kindergarten students were classified as 0.5. “Every year we try to project how many kids are coming in but you don’t really know how many kindergarten kids are going to show up that aren’t already in the system. Typically, our kindergarten enrollments are a little low in our budget and in the fall they are a little better than that.”
With another deficit coming for the division, it wasn’t all bad news as it had been significantly decreased compared to the previous years which saw multiple school modernizations.
Also, the fact the board reserves have been balanced is a positive sight moving forward.
“Overall, you can see over the past few years we have run some significant deficits. We have talked about that at length about how it is not sustainable and how we need to try to correct that,” said Johansen. “The board did give us a directive to try and balance the budget this year. The board kind of carved up its savings or surpluses into two main categories. One is allocating money to schools over the years that they have not necessarily utilized and you have allowed them to save that money. And then you have other money that the board has saved. Legally, you have a responsibility for all that money.”
Total revenues for the year are $45,811,663 with Alberta Education providing the largest share of that at $42,851,399 and total deficits at $46,236,577.
Almost half of the $46,236,577 comes from certificated salaries which is at $20,372,572.
“Over the last four years we have had a steady increase in average cost of a teacher in the jurisdiction,” explained Johansen.
Total certificated staff full-time equivalents for the 2019-2020 school year are projected at 205.8 compared to the actual 213 last year.
A motion was to approve the 2019-2020 budget and was approved unanimously by the board.