Prairie South School Division is running “a fairly significant deficit” of nearly $15 million because some provincial funding has not arrived yet but still expects to finish the year with a small surplus.
Division administration presented a report about third-quarter financials and year-end projections during the board of education’s June 6 meeting.
The document showed budgeted revenues this year are $99.3 million, actuals to June 1 are $66.6 million and projected by Aug. 31 is $100 million. Meanwhile, budgeted expenses are $95.8 million, actuals are $81.3 million and projected are $96.8 million.
The budgeted operating surplus is $3.49 million, the actual operating deficit is $14.7 million, and the projected operating surplus is $3.19 million.
Ron Purdy, superintendent of business, explained that the division would use $12 million in cash this year to fund operations until the rest of its provincial grant arrives at the end of the month. Meanwhile, at the end of the third quarter, the division was $300,000 over budget, based on expenses being $1.1 million over budget and revenue being roughly $780,000 over budget.
Purdy noted that most revenue and expense categories were close to budget, which was positive.
Revenues
According to Purdy’s report, grant revenues were likely to be slightly over budget since the Ministry of Education had provided $79,000 for French language instruction.
Complementary revenues were $50,000 over budget due to an increase in provincial funding for the Early Learning Intensive Support (ELIS) program.
The “other revenue” category was over budget by roughly $760,000, with that category including miscellaneous items, rentals, investment income and gains on sales of capital assets, the report said.
Purdy noted that two school buses were written off after being involved in accidents. Also, with how amortization works, the cost to the division to replace them was zero because insurance paid for them.
Expenses
Governance expenses were $106,460 under budget in the third quarter and were projected to be under budget by $42,659 at year-end because of fewer consulting fees and less professional development, the report continued.
Administration expenses were roughly $530,000 under budget in Q3 and were projected to be over budget by $351,632 at year-end due to building expenses, the audit, and wages.
Instruction costs — the largest expense that includes salaries — were $8,161,322 under budget in Q3 and were expected to be slightly under budget by $410,143 at year’s end.
Plant/building expenses were $3,424,193 under budget by June 1, although they are projected to be $1,224,117 over budget by Aug. 31. Included in this category was more than $1 million in preventative maintenance and renewal (PMR) funding that PSSD carried into this year from 2022.
“We did all our tenders and stuff earlier … at the end of February,” Purdy said. “We’ve spent, I think, $2.3 million so far of actual payments, so we’ll see if the projects actually get finished that are contracted before the end of the year.”
Transportation expenses are expected to be under budget by $74,427 by Aug. 31 because fuel costs were lower and there have been fewer repair costs, the report said. Division administration will direct most of those savings to improve the parking lot at the transportation shop.
There is $9 million in the budget this year for capital funding for the new joint-use school, with $4.7 million of that — split between Prairie South and Holy Trinity — to be spent by Aug. 31, Purdy said. Including that latter amount would make the projected operating surplus closer to $750,000 instead of $3.1 million.
Trustee Patrick Boyle asked Purdy whether he considered pulling out the capital expenses from the overall budget so finances were more accurately represented. Purdy replied that he was only following a template the province provided and expected school divisions to follow.
“It’s just odd to read it that way,” said Boyle.
“It does distort (the overall budget),” agreed Purdy.
