For the first time in a long time, the Chilliwack board of education may have to look at program budget cuts.
This comes after a tough year financially, in large part due to COVID-19 related revenue losses. And next school year’s budget is looking even more dire, says the district’s secretary treasurer, Gerry Slykhuis.
He said it took a bit of creativity to balance this year’s school district budget, which had a shortfall of about $864,000. Some of the blame is on the loss of rental income, which is now down $300,000 from two years ago. They had anticipated at least $100,000 in losses in the preliminary 2020/2021 budget, but this latest amendment reflects a loss of a further $200,000.
The international student program was also hard hit, at almost a million dollar loss.
While the pandemic also meant cost savings and extra funding from the provincial and federal government, it wasn’t enough to balance the ledger book. So, the finance team decided to balance the $864,000 deficit by including a holdback funding allocation in the same amount, as revenue.
“The ministry won’t be happy that I’ve done that but I had to balance the budget,” Slykhuis told the board of education Jan. 26, during the first reading of the amended budget. “There is a risk to this strategy.”
Holdback funding is given out to school districts when they have been underfunded throughout the school year. It’s not money that’s guaranteed, and there is no hard and fast amount.
If no holdback funding is given to Chilliwack School District at the end of this budget cycle, then the district will have to take those funds from reserves. And those reserves are in the process of being allocated to two capital projects: Stito:s La:lem Toti:lt and the expansion at Vedder elementary, both of which already in various construction phases.
Several trustees were unsure of the implications of passing a budget with this sort of question mark. The Ministry of Education has the ability to terminate an entire school board for failing to pass a budget, and has done just that in recent years.
But Slykhuis noted that the budget would be balanced by moving the capital funding to cover the deficit — something they don’t want to do.
“We would have to back off what we were putting toward the new school,” he said. “But next year is looking like an extremely difficult year funding wise. We have been meeting since before Christmas to see what we can to do to balance the budget for next year.”
Next year’s budget could come up as short as $2 million, staff told trustees.
Heather Maahs noted that they’ve faced tough times before.
“We may have to start looking at making cuts to our budget and that’s never pleasant but sometimes you have to make cuts,” she said. “You have to roll your sleeves up.”
“We have to take a hard look at some programs to make sure we have a sustainable budget,” Slykhuis agreed.
Trustees Heather Maahs and Barry Neufeld wanted to see more readings of the budget pass. Maahs said it would allow staff to move on from this year’s budget and focus on next year’s.
A motion to give the amended budget a second reading failed, with Darrell Furgason, Willow Reichelt, David Swankey and Jared Mumford voting against it.
Both Furgason and Reichelt want more time to read over the budget, and to consider the implications of passing it.
The budget is due to the Ministry of Education by Feb. 28, and currently sits at $174,169,299.
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