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Prairie South forced to use reserve money to cover almost $6M deficit next year

During their recent May board of education meeting, trustees unanimously approved the 2022-23 budget, with revenues of $98.2 million, expenses of $94.7 million and capital purchases of $11.6 million.

The province increased educational funding by 8.3 per cent for 2022-23, but that isn’t enough for Prairie South School Division, which faces a nearly $6-million deficit next year due to higher operating and inflationary expenses.

During their recent May board of education meeting, trustees unanimously approved the 2022-23 budget, with revenues of $98.2 million, expenses of $94.7 million and capital purchases of $11.6 million. In comparison, last year, those numbers were $93.1 million, $90.8 million and $2.3 million, respectively. 

Budget overview

While there will technically be a surplus of $3,498,567, because the Ministry of Education provided $9.25 million in capital funding for the new school, that capital funding is removed from overall revenues and the surplus turns into an deficit of $5.7 million, explained business superintendent Ron Purdy.

The division will use $4 million from reserves and $1.7 million in ministry grants to cover that deficit and maintain the same level of educational services as this year, he noted.

Prairie South achieved “operational efficiencies” during the last decade, which allowed it to establish — and now access — a reserve fund. That reserve ensures the division can pursue the board’s priorities of managing classroom size and support, enhancing student opportunities and maintaining infrastructure.

“I’d like to commend the board on your commitment with continuing to support classrooms because we know classrooms are the place where students learn and where students are taken care of,” said education director Ryan Boughen.

Overall grant funding is up $5 million over last year, which includes additional funding in December for increased enrolment and extra money earlier this year for the new school, educational assistants, and Preventative Maintenance and Renewal (PMR) projects, Purdy told board trustees at their recent May meeting. 

Enrolment was up “significantly” in September — 180 more students — which is why the ministry provided more funding, said Boughen. However, the division expects about 60 more students to enrol next fall. 

More students mean more grant funding, he added.

Revenues and expenses

During the meeting, Purdy reviewed the main revenue and expense categories in the 2022-23 budget.

The largest expense is instruction at $63 million, which covers employee salaries, he said. That figure includes an extra $2.5 million for increased staffing costs and $350,000 more for CPP and EI deductions. 

Furthermore, the division plans to spend $14.7 million to maintain buildings, almost $1 million more than this year. 

While the division will spend $85,000 more on heating costs next year, that will be almost offset by $75,000 in savings from new LED lights, he added.  

Other notable expenses include:

  • $100,000 more in insurance costs 
  • $1.7 million in total fuel costs, including $300,000 more this year and $400,000 more next year
  • $300,000 in total carbon tax costs
  • Four per cent more on utilities 
  • $300,000 more for new school buses
  • $30,000 more to cover teacher contracts
  • $770,000 in joint-use school costs

Board discussion

The provincial budget looked at conditional funding for new educational assistants, said trustee Shawn Davidson. He wondered if the division met the criteria to use the funding for those support positions.

That funding of $7 million is for 200 new EAs province-wide, while the division is still waiting to hear from the ministry about how that money can be used, said Purdy. With this budget, the division is spending half that amount on new staff. However, PSSD might not be able to hire new staff and could be forced to remove funding.

“There again, it highlights some of the challenges around conditionality of funding … ,” said Davidson. “It makes budget processes like this incredibly difficult, and further to that, there’s a huge sustainability piece because … the province has not offered any sort of commitment to continuity of that funding going forward.” 

School divisions don’t budget for one-year programs but plan for 13 since that’s usually how long students are in school, Davison continued. Meanwhile, drawing down reserves by 25 per cent would not be sustainable after four years. If something didn’t change funding-wise, the board would have to look at “swinging a gargantuan hammer in the future” to balance the budget.  

Classroom complexities

Handling the challenges of “classroom complexity” is not as simple as hiring more EAs, said Boughen. While more is helpful, that complexity remains regardless of how many EAs are hired.

The main budget highlight is that PSSD did not receive enough provincial funding to produce a status quo budget, said board chair Giselle Wilson. The board is taking $4 million from reserves to balance the budget, while it is fortunate that it does not have to cut staff. 

“It worries me greatly that we would have had to find $3.5 million in cuts to balance the books,” she added. “We’ve done that before; it’s not fun. I’m glad we don’t have to do that today.”

The next PSSD board meeting is Tuesday, June 7.