Open Board Meeting Preliminary 200809 Operating Budget Update

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Open Board MeetingPreliminary 2008/09 Operating
Budget Up-date

• Dec. 9/08
• City Hall

2
Agenda

• Summary of 2007/08 Financial Results
• Projected Budget Shortfall for 2008/09
• Review of Guiding Principles for Making Decisions
  about Fiscal Restraint
• Proposed Action Plan for balance of 2008/09
• Proposed Action Plan for 2009/10 beyond

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Summary of 07/08 Financial Results

• Total Appropriated Surplus 765,552
• Unspent department and school funds from 2007/08
• Net Operating Deficit lt632,292gt
• Overspent department and school budgets in
  2007/08
• Net Surplus of 133,260 as at Jun.30/08
• As per Statement 1 of our 2007/08 Final Financial
  Statements

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Analysis of 2007/08 Operating Deficit

• This Operating Deficit resulted from
• One time surpluses totaling 14,000
• On-going costs totaling lt646,000gt
• For a total operating deficit of lt632,000gt in
  2007/08

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Sept.30/08 Enrollment

• Regular school K-12 enrollment down by 6.3125
  FTE
• Alternative Learning Centre school-aged
  enrollment down by 12.0635 FTE
• AccessNW (a new Distributed Learning program)
  enrollment up by 36.875 FTE
• Overall K-12 enrollment up by 18.499 FTE
• Adult ALC up by 4.985 FTE
• Overall, enrollment is strong and increasing
  slightly.
• FTE Full Time Equivalent

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Unique Student Needs

• ESL up by 1.0 FTE
• Aboriginal up by 7.5 FTE
• Level 1 Sp Ed down by 1.0 FTE
• Level 2 Sp Ed up by 1.0 FTE
• Level 3 Sp Ed down by 2.0 FTE
• FTE Full Time Equivalent

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Unique Geographic Factor Funding

• The Unique Geographic Factor (UGF) is a grant
  provided for by the Ministry of Education. There
  are 6 types of UGF grants.
• Effective for 2008/09, we are no longer receiving
  the Enrollment Capacity UGF totaling 1,012,000
  that we received in 07/08.
• Therefore, our school district is receiving over
  a million dollars less each year than it used to
  from this one particular grant.

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One Time versus On-Going Costs

• One Time costs are those costs that only impact
  a single year (e.g., the purchase of a new
  maintenance vehicle).
• On-going costs are those costs which occur each
  and every year (e.g., staffing, or leasing costs).

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Projected 2008/09 Shortfall

• Made up of the following
• 2007/08 Operating Deficit 632,000
• 2008/09 On-going structural deficits brought
  forward from 2007/08 646,000
• Projected Prior Year Surplus (not available to
  us) 315,000
• Sub-Total 1,593,000

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Projected 2008/09 Shortfall

• In addition, some new/emergent items were not
  included in the 2008/09 Preliminary Operating
  Budget (approved June, 2008)
• 176,000 in one time costs (e.g. Student
  Information System)
• 254,000 in on-going costs (e.g., additional
  substitute costs, school fees, Bill 33 teachers,
  etc.)
• 430,000 in Total
• Total Estimated Shortfall
• 1,593,000 430,000 2,023,000

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Projected 2008/09 Shortfall

• Therefore, the district is currently projecting a
  total shortfall of about 2,023,000 for the
  2008/09 school year due to a current operating
  deficit and a structural deficit.

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2007/08 Operating Budget

• Total Salaries Fringe Benefits 87

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2007/08 Services Supplies

• Total Variable Costs 4.75 million (68)
• Total Fixed Costs 2.2 million (32)

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Guiding Principles for Making Decisions about
Fiscal Restraint

• Attend to Needs before Wants
• Attend to Students before Staff
• Preserve Staff before additional supplies (i.e.,
  Staff before Stuff)
• Equity Across the District
• Balance between educationally sound fiscally
  responsible
• Set up a district contingency, if possible

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Budget Theme for 2008/09

• One time measures for balancing the budget in
  2008/09
• Structural changes for 2009/10 beyond
• New Reality
• Continued funding pressures (eg Bill 33, Carbon
  Tax, inflation, etc.)
• World/Canada/BC facing a potential recession
• Increased utility costs (gas, electricity, water)

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Proposed Action Plan for 2008/09

• Reduce district budgets 1,145,000
• Reduce school budgets 838,000
• Recovery of costs from non-school district
  entities 40,000
• Total Targeted Savings 2,023,000

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Structural Review

• A process will begin in January, 2009 to
  undertake a detailed structural review of the
  district.
• The process will involve consultation with the
  major stakeholders (e.g., DPAC, PACs, unions,
  NWPVPA, students, etc.).
• This process is intended to deal with our
  structural deficit for 2009/10 beyond.

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Timeline

• Dec. 9/08 Board Inaugural Meeting
• Dec. 9/08 Special Open Board Meeting to discuss
  Preliminary 2008/09 Operating Budget and the
  proposed action plan
• Dec. 16/08 Regularly Scheduled Open Board Meeting
  to accept the proposed action plan