Fall Budget Update - Challenges and Changes
As happens each year, the province requires a Fall Budget Update. This is an exceptional year as the Provincial Budget, usually received in March, was not provided until October 24, 2019. The Provincial budget resulted in significant changes to school jurisdiction funding across the province. As a result, Foothills School Division (FSD) has been working diligently to adapt to this new funding reality while maintaining high quality teaching and learning throughout the Division. We are experiencing challenging times as we continue to plan for current and future school years. However, thanks to ongoing efforts, FSD continues to have an extremely successful year.
We have seen consistent growth in Accountability Pillar Results, with the 2018-2019 results showing 13 of 16 measures rated at or above the provincial average. Our Division has moved to a fully inclusive model that provides a continuum of supports and is reflective of the Provincial goals for education. With respect to FSD's stewardship of public funds, our recently completed independent audit of the 2018-2019 Financial Statements notes that we continue to manage our financial resources appropriately and efficiently. We have recently rewritten our Policy 1, Division Foundational Statements, and added the important area of Engagement to our existing directions of Support and Success. Congratulations to each member of the FSD Team for their commitment to each of our learners.
Looking ahead, our commitment to the 3 Year Education Plan needs to be mindful of the current budgetary context and our obligation to fiscal responsibility. With our understanding of the 2019-2020 budget parameters, we find ourselves in the position of needing to realize further cost savings moving forward. This applies both to the current school year as well as the 2020-2021 year.
As shared with you recently, the Board had approved a deficit budget of $2.6 million for the 2019-2020 school year to be covered by reserves. Foothills School Division has a modest surplus to cushion the shortfall this year, but it will not be enough to make up the entire shortfall. We have learned that an additional amount of $1.3 million will be added to projected deficit amount as a result of funding changes from the Provincial budget. In addition, we were made aware recently that our insurance costs have been increased for this year by close to $800,000. Together we are experiencing a total deficit of over $4.7 million that needs to be immediately addressed. As we continue to update the fall budget, we have included additional revenue and expenses based on changes to individual grant funding and ongoing project planning.
We want to ensure that all of our stakeholders understand the fiscal reality we face. This is not new for Alberta school jurisdictions as we have faced significant financially based challenges in the past. Building the best education system for our FSD students requires consistent effort, relentless creativity, and innovation to succeed in our mission to find out what each learner's unique gifts and abilities are, explore them, develop them, and celebrate them. This is essential.
We are committed to minimizing disruption and impact on the classroom. We must also be prudent in our spending and be the best stewards of taxpayer dollars. The Board of Trustees passed the Fall Budget Update at the December 11, 2019 Board Meeting to help offset current budgetary challenges. Based on the feedback gathered, we are initiating the following changes to the 2019-2020 budget:
- Implementing a hiring freeze for new positions
- Revising the hiring approval process for replacement positions
- Considering reassignment of existing staff
- Reviewing all service contracts and temporary positions
- Updating the purchasing approval process
- Significantly changing professional development, including:
- Eliminating non-essential out-of-Division travel and professional development
- Aligning professional development and Division Office meetings with professional learning days to reduce guest teacher costs
- Reducing the number of individuals attending Division Office meetings
- Adjusting staff professional learning plans
- Suspending future 2019-2020 CPIP grant applications
- Delaying non-essential technology purchases
- Stopping all support staff hours outside regular schedules unless addressing urgent situations
- Reducing school-based budgets
- Asking for provincial approval to repurpose over $1 million from IMR (Infrastructure, Maintenance, and Renewal) funding. This is a one time option which would provide us with short-term flexibility but is not sustainable over time and may have future infrastructure implications.
- Accessing additional $0.8 million from reserves for the current school year.
We anticipate the above changes to operating expenses will reduce the forecasted deficit from $4.9 million down to approximately $3.2 million, a reduction of $1.8 million in the 2019-2020 school year. The conclusion of these efficiencies and adjustments is that the original plan to utilize $2.6 million of operating reserves has increased to $3.2 million. We appreciate the work and effort of our colleagues across the system in realizing these adjustments.
We now turn our attention to the 2020-2021 process. The province is undertaking a review of the funding framework. As a result school jurisdictions across the province are taking a cautious approach and anticipating further budgetary changes to future years. We expect continued challenges as we move towards a Provincially mandated balanced budget and adapt to a new funding framework. We commit to engaging our stakeholders through this process. We are launching an assurance engagement plan to gather stakeholder input into our 2020-2021 budget and Education Plan.
We promise to keep you informed, listen to and acknowledge your concerns and aspirations, and provide feedback on how the stakeholder input influenced our decisions. We remain dedicated to achieving our Education Plan goals with a focus on continuing to deliver high quality teaching and learning for each learner in all our schools.
Foothills School Division
Christopher Fuzessy, PhD
Superintendent of Schools
Foothills School Division