For the first time in three years, the Delta School District is projecting a shortfall in its annual operating budget.
The district’s draft operating budget for the 2020-2021 school year, released on Thursday, April 9, is $162.8 million. However, the district is projecting a “moderate” $582,000 shortfall, or about 0.4 per cent of its budgeted operating expenses.
“It’s not a very large shortfall, thankfully, but it is a shortfall nonetheless,” Nicola Christ, secretary treasurer for the Delta School District, told the Reporter.
Last month, the Ministry of Education unveiled its new funding model, which is being phased in over the next two years. Under phase one of the new model, Delta is getting $1.79 million more from the province it did in the district’s original 2019-2020 budget.
The district expected to receive $1.456 million over last year to cover increased enrollment, based on the old funding model. The district projects an increase of 144 full-time enrolled (FTE) students in 2020-2021, bringing the total FTE students in Delta to 15,551, though the actual number of students and which schools they will attend won’t be known until the new school year begins in September.
The rest of the increase — $334,000 — is specific to the change in funding formula. Under the new funding model, a number of separate grants are being discontinued and rolled into the per-pupil amount in the district’s operating grant. The resulting $1.674-million increase in the operating grant is largely offset by the loss of those previous grants — totalling $1.34 million — including the Employer Health Tax grant ($1.279 million) and the Carbon Tax Reimbursement ($61,000).
Ultimately, however, provincial funding for the district in 2020-2021 is estimated to be $933,000 less than it would have been under the old formula when last fall’s settlement with support staff — reached outside of the original budget timeline — is considered.
The $1.79-million increase in funding over what was previously budgeted doesn’t completely cover the $2.372 million in increased costs that the district is now looking at for next year, resulting in the $582,000 shortfall.
Among those cost increases are $1.267 million in labour settlements, benefit rate increases of $378,000 and utility rate increases of $766,000.
Despite the shortfall, the district is not proposing any staff reductions to balance the budget, and normal staffing procedures will still apply.
Instead, the district is planning to decrease its expenses by $179,000, including a $29,000 reduction in administrative costs, a $50,000 reduction in its technology funds — which is used to replace computers and other equipment — and “unavoidable hiring delays” that will save another $100,000.
“We looked behind the scenes at our costs and we looked for amounts we could take out that would have the least impact,” Christ said.
As well, the district has increased its utilization of anticipated International Student Program revenue by $403,000.
“For this budget, we anticipate using a modest amount of the total contribution expected from the International Student Program. This is because at the time we develop the budget, we do not yet have a clear indication of what international student registration for the upcoming year will be, and so feel we cannot rely on an estimate of the full amount,” Christ said. “For the 2020-2021 budget, we are utilizing a slightly higher, still modest, amount compared to the same budget last year.”
The district opted to balance the budget without using its reserve funds in order to maintain a buffer against potential revenue shortfalls caused by the COVID-19 pandemic.
“We don’t know whether next year is impacted by [COVID-19] at all or whether it is somewhat impacted or severely impacted — nobody can know,” Christ said.
“International student enrollment, facility rentals, even investment income, all these things can be impacted by it; to what extent, we don’t know. So it would be hard to build a budget that captures that somehow. And how conservative would you be? So we chose to create a good budget for the next year and we also developed a backup plan so if these things do come about to a certain extent, we feel we can cover ourselves against that reasonably well.”
The COVID-19 pandemic is also forcing a change in the budget process this spring. School board meetings are typically held at district headquarters in Ladner once a month — three times in April as trustees consider the budget for the following school year — and are open to the public.
However, to ensure physical distancing protocols can be followed, board meetings are currently being held via conference call, with a full transcript of the meeting available on the district’s website within 24 hours.
“Obviously, with the budget process, normally we would have an opportunity for the public to come in person and provide any feedback in the draft budget. Instead of that, we will be asking them to email us their feedback,” Cathryn Tucker, communications manager for the Delta School District, said. “So that’s a pretty important change when it comes to the budget process this year.”
Residents and stakeholders can send the board their feedback and/or questions by emailing firstname.lastname@example.org. Input on the draft 2020-2021 operating budget must be received by end-of-day on Thursday, April 16.