A staff investigation has revealed that the Okanagan-Skaha School District can’t use school-generated funds to balance its books, as the district continues to face financial trouble.
School principals sounded the alarm after it was proposed that $300,000 be clawed back from local schools to address a deficit in the 2019-20 amended budget.
The district, at the time, assumed district money had been transferred into the school accounts and earmarked for future technology and transportation purchases.
But secretary-treasurer Helena Drury looked into it further and determined that the source of the funds currently held in school accounts “is largely from donations, vending machine revenues, student fees, textbook deposits and interest income,” she said in a report presented to the board of education on April 27.
Further, no records were found to suggest that the funds originated with the board.
“I don’t see how we could actually make that transfer at the end of the year,” Drury told school trustees Monday night.
Board chair James Palanio said even without the $300,000, the district still expects to balance its books this year, due to savings from school closures related to COVID-19.
“Unfortunately, COVID-19 has provided us with the benefit of less expenses. Our budget will be better than we originally anticipated when we amended it,” he told Global News.
The district found itself in a financial crunch due to lower than expected enrollment numbers and an increase in staffing costs.
Concerns were raised about a lack of transparency and accountability on behalf of district administration when it came to the budget, prompting trustees to hire an external auditor in February.
While the district now anticipates a surplus in 2019/20 that is sufficient to pay off this year’s remaining deficit and create a contingency reserve for the 2020/21 year, financial advisors retained by the board anticipate further budget challenges in the future.
“After adjusting operations for enrollment decline as well as losses of other revenue and forecasting increases in expenses, the budget pressure that remains is $1,253,000,” a report to the board says.
SD 67 is projecting a decline in enrollment of 187 students next year. International enrollment is also projected to decline by 50 full time students.
The majority (95%) of the funding for the operating budget comes from the provincial government operating grants.
The largest local revenue is from international and out of province students, who pay tuition.
“I am very concerned going forward.” Palanio said. “Over the past two years, the total decline is about 270 students so those numbers, extremely rough numbers, of $8,000 per student is over $1.5 million.”
Palanio said he’s perplexed as to why the school district is losing students.
Palanio said declining enrollment projections will also translate into fewer teachers and support staff.
“With those declining enrollment numbers, the indication is that at the start of the year we will have less teachers in September,” Palanio said.
“It’s going to depend on attrition, every year we have a good number of teachers retiring, we are going to do our best to try to work it so that those who want and need to work will continue to work.”
Palanio said further cutbacks are anticipated in administration and the supplies budget, but students and classrooms won’t be impacted.
“In the classrooms they won’t notice a difference with approximately 270 or so kids over the last two years not being there, there is obviously going to be less classes, but within the classroom there should be no noticeable differences,” he said.
A proposed final draft of the 2020-21 budget will be presented to the board for approval at the business committee meeting on June 9 with the final draft being approved by the board on June 22.
The deadline for submission to the Ministry of Education is June 30, 2020.