Transcript 2010 - School District 63

Presentation to VISTA
February 27, 2010
Public Education FundingLearning from the Past
Overview of Presentation
Roles and Responsibilities to Establish
Budget
 Provincial Budget for Education Over Time
 History of Funding and Policy Changes
 1983 to 1989/90
 Royal Commission
 Spangelo Review and Resulting
Consultations
 2002 Funding Allocation System
 Current Picture
 Summary

Roles and Responsibilities
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Cabinet and Treasury Board
– establish the overall budget and Individual
Ministry Amounts
Ministry of Education
– sets priorities within the set overall amount
Ministry of Education
– allocates dollars to school boards
Boards of Education
– establish budgets and sets spending priorities
– allocate funding to schools and programs

Schools
– allocate funding to classrooms/programs
4/13/2015
3
Provincial Budget for K-12
Education Over Time
Ministry of Education as a Percentage of the Total Provincial Budget
30.00%
25.00%
20.00%
15.00%
10.00%
5.00%
1991/92 2000//01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10
% of Prov. 26.36% 20.06% 19.67% 19.02% 19.41% 19.77% 18.71% 18.41% 18.45% 16.12% 15.34%
History of Financial and Policy Changes
1981-2010-Public Education Funding
1981/82-Non Residential property tax to
provincial revenues
 1982/83-Fiscal Restraint program-no
supplementary residential taxation
 1983/84-Fiscal Framework Introduced
 1986/87-Supplementary residential taxation
returned
 1988/89-Royal Commission Report (Legacy
for Learners)
 1990/91-Block Funding Introduced and
residential property tax becomes
provincial

History of Financial and Policy Changes
1981-2010-Public Education Funding
1992/93-Spangelo Review of public
education funding
 1993/94-Follow up Committees on
Accountability, Education Finance and
Technical Review of Allocation system and
targeted funding for aboriginal and special
needs and administration cap
 1994/95-Funding Allocation System
introduced
 1996/97-School District Amalgamation
 2002/03-Funding Allocation System moves
to focus on per pupil allocations

1983 to 1989 School Financing
Sources of Revenue
Provincial Grants
From 55% to 100% of Budget
Average 75.25%
Gross Operating Budget
Pay For
Residential Property
Taxation
Pay For
Shareable
Operating
Amount
Fiscal
Framework
Allocation
Shareable Misc.
Revenue
Residential Property
Tax determined by Boards
Local Misc. Revenue
Pay For
Supplementary
Operating
Amount
1983/84 Fiscal Framework


“Under a system called the “fiscal framework”,
the province calculates the shareable budget
amount for each school district. The shareable
amount is based on provincially acceptable
service levels and cost factors….and amounts for
provincially accepted but locally diverse
requirements for special education programs and
transportation.”
In addition, a Board may include expenses
funded by operating surplus, miscellaneous
revenues and taxes levied on residential
properties
Sources of Funds 1983-1989/90
Sources of Revenue
100.00%
90.00%
80.00%
70.00%
60.00%
1983
1984
1985/86 1986/87 1987/88 1988/89 1989/90
Misc. Revenue & Surpluses 4.79%
Residential Taxation-Local 1.13%
5.19%
4.10%
4.75%
4.68%
4.82%
1.09%
0.89%
4.26%
6.22%
6.03% 10.39%
Residential Taxation-Prov
7.56%
7.14%
8.09%
7.34%
8.81%
8.38%
Provincial Grants
86.52% 86.58% 86.92% 83.65% 80.29% 80.78% 78.36%
4.29%
6.96%
Total School District Budgets 1983-1989/90
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1983
$1.907 billion
1984
$1.913 billion
1985/86
$1.850 billion
1986/87
$1.950 billion
1987/88
$2.084 billion
1988/89
$2.277 billion
1989/90
$2.589 billion
Increased by 36%; enrolment by 5.9% between
1985 and 1990
1980s recession and compensation stabilization
program
First Teacher Collective Agreement in 1988
– Two year agreement with 15% salary increases, class
size limits, noon hour supervision costs, preparation
time costs
Royal Commission
Block Funding was introduced in 1990 in
response to the 1988 Royal Commission
for Public Education
 It was recommended as a way to
determine the amount of provincial
funding needed for educational services
 It was recommended that the distribution
of the funding be done by a stable,
predictable, supportable allocation system

Royal Commission



The Royal Commission recommendation was that
the block be increased annually by an education
price index which recognized the unique costs of
public education
The allocation system of the day, a resource cost
model, was supported by the system and
recommended for retention
The resource cost model was very detailed and
provided a service level for each specific function
such as class size, library and counseling
services, etc.
Establishment of the Block
Relief to the homeowner as residential
taxation authority removed from Boards
 1989/90 Block was comprised of actual
school board expenditures including those
funded by local capital and taxation
 The new system covers all public
education programs and is to be adjusted
annually to reflect economic indicators,
growth in enrolments and changes in
mandate

Published Advantages of Block
Funding
Recognizes all 1989/90 spending plus
economic adjustment of $305 per student
or 6.17%
 Adequate increases through the annual
adjustment to the block
 Automatically increases with enrolment
 Block will include funding for mandate
changes
 The education system was to be more
predictable, stable and easier to
understand

History of Referendum
Introduced with Block Funding in 1990
 Two held in 1990 by Vancouver and
Richmond with Vancouver being successful
 Legislation changed to make more
restrictive
 Quesnel and North Vancouver later held
unsuccessful referendums for equipment
needs

1990/91 Fiscal Framework
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Described as a system representing a sound basic
education program suitable to meet the
educational needs of students throughout the
province
A series of provincially acceptable service levels
or standards set out along with cost factors
indicating the acceptable costs in which the
province is willing to share
Service levels X Cost Factors = Program
Allocation
Recognizing the different needs of districts such
as geographic, special needs, transportation, etc
Fully Supported by Boards in Royal Commission
consultation but later criticized as being too
complicated
History of Block Funding 1990 to
2010
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1990/91
2001/02
2005/06
2006/07
2007/08
2008/09
2009/10
$2.668
$3.794
$3.860
$4.243
$4.345
$4.467
$4.551
billion
billion
billion
billion
billion
billion
billion
Increased by 67% since 1990/91 with
20% since 2001/02
 Enrolment increased between 1990/01
and 2009/10 by 7% with a decline of 7%
between 2001 and 2009

Early Years of Block Funding followed the
Principles of the Royal Commission
1990/91
 1991/92

6.17% economic
3.75% economic
– Plus $28 per pupil for ESL and Sp. Needs
student growth, and
– Plus $15 per pupil for learning resources and
primary transportation

1992/93
2.40% economic
– Plus $18 per pupil for technology and
– Plus $11 per pupil for Facility planning

Economic adjustments, mandate
adjustments and enrolment adjustments
Education Funding Review Panel
(Spangelo Report)
 When
NDP elected in 1991, a
funding review was promised
 Cindy Spangelo was appointed to
head up a public consultation in
1992 entitled the Education
Funding Review Panel
Education Funding Review Panel
(Spangelo Report)
 The
Education Funding Review Panel
believed that the implementation of
their recommendations would make
the education finance system easier
to understand for a number of
reasons:
– The division of responsibilities between the
Province and school boards would be clearer.
The role of the province would be to define and
fund a common level of service throughout the
province and the role of school boards would
be to manage schools and deliver programs
Education Funding Review Panel
(Spangelo Report) - continued
– The block of funds would be linked to a
resource costing model based on
defined services, required resources and
actual costs. This means it would be
easier to understand how the block of
funds was determined.
– The resource costing model would also
establish a clear connection between the
block of funds and the distribution of
funds between districts
Education Funding Review Panel
(Spangelo Report) - continued
– The distribution formula would be easier
to understand. The formula would be
divided into four broad categories:
common costs, special resource costs,
exceptional costs and local
programming
– The distribution of funds would be on
current costs. Each district would be
able to compare its allocation with that
of other districts-where costs are
different, allocations are different
1992/93 Spangelo Review and
Followup

In 1993 the Minister of Education
established three committees to build on
the process:
– An Education Finance Advisory Committee
made up of all partners of education to provide
advice on the allocation of resources available
for public education
– A Technical Distribution Group to conduct a
detailed analytical review of the funding
distribution system
– A Financial Reporting and Accountability
Committee to address the issues of
accountability raised in the Panel’s report
Report of the Education Finance
Advisory Committee-December 1993
 Desirable
Attributes of an Education
Funding System:
– Equitable system that enables delivery
of the provincial education program in
all districts –horizontal and vertical
equity
– Understandable system that is easily
obtainable, clear, and one that Boards
have confidence in
Report of the Education Finance
Advisory Committee-December 1993
 Desirable
Attributes of an Education
Funding System:
– Balanced system that should allow
provincial uniformity and local creativity
– Efficient system that should maximize
the use of available resources to meet
educational goals
– Effective system that should be
supportive of educational outcomes and
neutral to Board decisions
Report of the Education Finance
Advisory Committee-December 1993

Other Policy Issues addressed:
– Costs should be recognized at a current level
– Funding for special programs should be
incremental with all students funded the same
for regular programs
– Targeting should be kept to a minimum and the
funding system should be neutral to Board
decisions
– The Province should not influence fund raising
efforts at a local level-concern that local
funding raising should be for special initiatives
and for on-going programs
Report of the Education Finance
Advisory Committee-December 1993

Other Policy Issues addressed:
– Governance-clarification of the role of the
Province and school boards in the funding and
spending decisions
– No consensus on local taxation
– Multi year funding for planning
– Better relationship between funding and
spending for greater accountability
– Retain a resource cost model as it provides an
accountability mechanism for provincial
funding
Funding Allocation System


Introduced in 1995/96
Three main areas of funding
– General Operating includes core grants –same per pupil,
school and district amounts
– Specific grants to recognize the differences in costs
between districts
– Targeted grants-special education, aboriginal education,
learning resources and the maximum amount that could
be spent on administration
– Developmental grants-staff training for program
implementation, amalgamation support

A translation of all the factors in the fiscal
framework to something more understandable
March 1, 2002 – New Formula
Announced
 Introduced
by Minister Christy Clark
as providing Boards more flexibility,
autonomy and control over
educational services
 Funding Allocation System had 60
different funding categories
(translated from the fiscal
framework)-people interpreted those
categories as indicating how much
boards were to spend on each
program area
March 1, 2002 – New Formula
Announced


Move to 82% on a student allocation and five
broad supplementary grants:
– Unique student needs, including special needs,
English as a Second Language, Aboriginal
Education, and Adult Education programs;
– Enrolment Decline, where enrolments decrease
by more than one per cent in a year;
– Salary Differentials, for districts with higher
average teacher salaries;
– Transportation and Housing; and
– Unique Geographic Factors.
Only aboriginal education is targeted
Recent Changes to the BlockMillion $
 Block
2001 to 2004
$3,794
 Salary Increases
$516
 Literacy, arts, special ed
$202
 Distributed Learning
$7.7
 GAAP
$35.0
 Reduction in 2001/02
($3.5 )
 Total Increase
$757 million
 Block 2009/10
$4.551 billion
4/13/2015
31
Provincial
Funding
Shortfall
Recognized Increased Costs and
Services in the Funding Formula
Distributed Learning
$53,961,441
GAAP
$35,002,907
Targeted Literacy, Arts and Special Needs
Summer School
Course Challenge
$152,000,000
$15,431,647
$457,748
Special Needs increases
$238,286,786
Labour Settlement
$557,732,146
Total
$1,052,872,675
Actual Increase to the Provincial Block
$757,484,403
Shortfall
$295,388,272
Provincial Funding Shortfall

It is understood that some of this
shortfall can be offset by cost savings
from enrolment decline. In 2009/10 it is
estimated we can save about $3,000 per
pupil in associated costs as enrolment
declines, so for a projected provincial
enrolment decline of 45,000 pupils this
would reduce the shortfall by $135
million and leave an actual overall
shortfall in funding to maintain
services of $157 million.
Effect of Enrolment Decline on
Per Pupil Block
Comparison of Provincial Funding 2001/02 to 2009/10
30.13%
35.00%
30.00%
25.00%
19.97%
20.00%
15.00%
10.23%
10.00%
5.00%
0.00%
Change in Total Block
4/13/2015
Change in Per Pupil Block
Change in Core Per Pupil
34
Provincial Funding/Student
2005-06
2006-07
2007-08
2008-09
2009/10-As at
Nov 2009
Block funding – 4,027,603,717 4,243,496,038 4,345,211,469 4,426,685,547 4,507,930,215
operating
School age and 567,523
adult enrol
559,499
556,310
545,269
541,917
Total block
funding per
student
$ 7,584
$ 7,811
$ 8,118
$ 8,318
$ 7,097
Provincial Education Funding $ per school aged and adult
student
2006-07
2007-08
2008-09
2009-10
Dec 2009
Block funding –
operating
4,243,496,038
4,345,211,469
4,426,685,547
4,507,930,215
Unique student
funds (not
including adult)
399,204,975
414,879,981
428,173,434
446,050,481
Labour
settlement
funding
196,372,946
320,913,967
460,825,069
557,732,146
12,776,550
15,431,647
New program –
summer learning
Remaining block
funding
3,647,918,117
3,609,417,521
3,524,910,494
3,488,715,116
School age and
adult enrol
559,499
556,310
545,269
541,917
Adj. block
funding per
student
$6,520
$6,488
$6,465
$6,438
Comparison of Per Pupil funding
9000
8000
7000
6000
5000
4000
3000
2000
2005/06
2006/07
2007/08
2008/09
2009/10
Adjusted for Cost
Pressures
6409
6520
6488
6465
6438
Block Per Pupil
7097
7584
7811
8118
8318
Enrolment Decline Grants
 Only
provided for one year
 Fluctuate as enrolment decline
changes
 Cannot depend for ongoing services
Effect of Enrolment Decline
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
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Funding allocation
70% funding allocation = 5,851 per student
If enrolment declines 200 students=
$1,170,200
Teachers for 200 FTE @ 30:1 @ $85,500 = 570,000
Clerical support + supplies, est. @
30,000
_______
Funding reduction (after year 1)
$280,200
4/13/2015
39
Predictability of Current Allocation
System
 Formula
Changes
 Salary Differential
 Factors that Depend on other
Districts
 Allocations provided too Late in
Budget Process
 No longer an Estimator
Education Programs-Blue Book
Million Dollars
Block Funding
Infrastructure(AFG Seismic)
Funding of Suppport Staff
(Pay Equity, LTD, etc.)
Support for Schools
(Community Link, PRP's
PLNet, etc.)
2011/12
4,458,823
40,700
2010/11
4,458,823
40,700
Sept 1/09
2009/10
4,458,639
40,700
80,279
80,279
80,279
82,600
82,600
82,600
Other
Full Day Kindergarten
Total Public Schools Component
58,985
90,200
4,811,587
32,492
37,400
4,732,294
32,492
4,694,710
Independent Schools
Early Learning
Total Education Programs
248,367
23,338
5,083,292
248,367
23,338
5,003,999
248,367
23,338
4,966,415
13,130
61,540
13,130
62,528
13,130
63,013
5,157,962
5,079,657
5,042,558
Public Libraries
Management Services
Total Ministry of Education Budget
Ministry of Education Budget
Ministry of Education Budget 2009/10
Independent
Schools
4.93%
Public Libraries
0.26%
Early Learning
0.46%
Executive and
Support
Services
1.25%
Public Schools
93.10%
4/13/2015
42
Ministry Budget in Provincial
Context
 In
2001/02 the Operating Budget of
the Ministry of Education Budget was
$4.779 billion or 19.6% of the total
Provincial Budget
 In
2009/10 the Operating Budget of
the Ministry of Education Budget is
$5.042 billion or 15.3% of the total
Provincial Budget
43
4/13/2015
Source of Funds for School District
Budgets-2000 to 2010
SD Budgeted Revenue Sources
2009/10
2005/06
2001/02
1990/91
90%
92%
Prov. Grants
94%
96%
Local Revenue Operating Surplus
98%
Referendum
100%
Cost Pressures for 2010/11
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HST Implementation
Medical Service Plan Increases
Teacher Salary
Teacher Pension Costs
Carbon Offsets and Smart Tool
BC Hydro Rate Changes
CUPE trades rate adjustment
Loss of Reserves
Full Day Kindergarten
Estimated by the BC School Business Officials to
be $282 million across the province
BCPSEA Presentation April 1999


“…currently we have systems that are not
harmonized. The allocation system is based
primarily on the premise of full local autonomy,
the amount of dollars to fund public education is
calculated without consultation with Boards about
the needs and realities, the centralized
bargaining system is not adequately reflected in
either the allocation system or the amount of
funding available and there is a lack of trust of
the financial information between parties”
Are we still there today?
Summary
The Select Standing Committee on the
Budget recommended a review of Public
Education funding
 Should it address the following:

– Rationalization of amount of funding and
service expectations
– Relationship of overall block amount and
allocation system
– Role of special grants and accounting
requirements
– Effect of enrolment decline and recognition in
the allocation system
Summary

How should public education be resourced
in the future?
– What should be the relationship
between the total amount of funding
and service/mandate expectations?
– What is the appropriate % provincial
contribution to school district budgets?
– How should individual district choices
and costs be recognized?
– How should public education be held
accountable for its funding and
spending?