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May 28, 2012 - Committee of the Whole Board (Budget) Meeting
Regular Meeting
Limestone District School Board
May 28, 2012

        A Committee of the Whole Board Meeting of the Limestone District School Board was held in the Board Room at the Limestone Education Centre, 220 Portsmouth Avenue, Kingston, on Monday, May 28, 2012, at 6:00 p.m.      
Present Trustees:
L. French, Vice-Chair
G.  Beavis
H. Brown
E. Crawford
D. Jackson
P. Murray
S. Ruttan
Present Staff:
E. Braidford, Manager of Financial Services
J. Douglas, Communications Officer
D. Fowler, Manager of Facility Services
B. Hunter, Director of Education
D. Kirkpatrick, Recording Secretary
R. Richard, Superintendent of Business
W. Toms, Manager of ITS and Planning Officer
        The meeting was chaired by Vice-Chair French.  She called the meeting to order, reporting that regrets were received from Trustees Chadwick and Goodfellow.

DECLARATION OF CONFLICT OF INTEREST

        Vice-Chair French advised that had Trustee Goodfellow been present she would have declared a conflict of interest as her son is an employee of the Limestone District School Board, and she would have withdrawn from the meeting.

APPROVAL OF AGENDA

        MOVED BY Trustee Jackson, seconded by Trustee Ruttan, that the agenda, as distributed, be approved.–Carried

REVIEW OF PRELIMINARY 2012-2013 OPERATING EXPENDITURE BUDGET

        Superintendent Richard advised that this evening’s meeting consists of a review of the  preliminary 2012-2013 expenditures.  He said that the information contained in the expenditure budget being presented this evening does not include the Capital Expenditure Budget.  Information about the Capital Expenditure Budget will be presented at the Committee of the Whole (Budget) meeting on June 4, 2012, once we finalize the expenditures.

        Manager Braidford advised that page 1 of the agenda package includes a typographical error, advising that the heading in column one should read “2012-2013 Budget”, rather than 2011-2012 Budget”.  She further advised that the figures in the column are listed correctly.

        Manager Braidford provided an overview of the Preliminary 2012-2013 Compensation Expenditure Operating Budget, noting that the total compensation expenditure budget totals $187.5 million, compared to $188.4 million budget for 2011-2012, which is a decrease of $882,000 or less than 1%.  She reported that the PDT agreement provides for 0% salary increases and a frozen grid.  She said that the same assumptions have been carried throughout the compensation budget, and that some cost reductions have been incorporated in light of declining enrolment.

        Manager Braidford provided information, as follows:

Elementary and Secondary Teachers

  •         Elementary increase of $566,000 or 0.82%
  •         Secondary decrease of $1.772 million or 3.39%
  •         Both are enrolment adjusted
  •         Additionally, 5th year PDT agreements are being honoured
  •         Elementary PDT: specialist teachers (i.e. preparation time = additional 5.29 teachers), grade 4-8 class size reductions
  •         Secondary PDT includes secondary programming
Supply Teachers

  •         Increase of $98,000 or 1.98%
  •         Supply teacher costs reflect usage surrounding absences, which includes professional development
  •         Figure has additionally been downward adjusted by $300,000 to reflect anticipated reductions in usage as the proposed PDT reduces overall sick days
Elementary and Secondary Principals/Vice-Principals

  •         Elementary decrease of $260,000 or 3.46%
  •         Elementary Principals have been reduced by two to reflect the closure of 4 elementary schools to be replaced with two new school openings
  •         Secondary decrease of $37,000 or 1.04%
  •         Secondary Principals reflect the same staffing levels
  •         Both have been additionally downward adjusted by $100,000 in aggregate to reflect anticipated reductions in coverage for absences
Coordinators

  •         Increase of $66,000 to 2.68%
  •         Further to funding reductions for consultants, one position has been eliminated
  •         Additionally, figures reflect a reallocation of staff from other lines to better reflect actual duties
Educational Assistants

  •         Decrease of $411,000 or 2.79%
  •         Reflects staffing funded mainly through Special Education grant
  •         Staffing levels consistent for full-time Educational Assistants
  •         However, increased casual support (lift off lemon) and casual support for increased FDK enrolment; reduces total salaries as lower benefit rate applies for casual employees
Professional/Paraprofessional

  •         Increase of $1.155 million or 13.85%
  •         Large increase due to increases in Early Childhood Educators (42 projected staff up from 20 in previous year) for year 3 of FDK, with 8 new schools and total enrolment of 1,124 (520 in 2011-2012)
School Secretarial and Clerical

  •         Decrease of $330,000 or 5.66%
  •         Reductions in staffing due to closing of four elementary schools and two opening
  •         Additional reductions of four secondary positions
Continuing Education

  •         Decrease of $131,000 or 9.52%
  •         Reductions to align with loss of Federal Employment Resource Centre (FERC) program ($146,000 lost revenue)
Governance and Administration

  •         Increase of $184,000 or 3.62%
  •         Addition of 1 Communications Officer
  •         Additionally, a position was reallocated from Facilities to Admin. to better reflect the duties of the staff member (planning/enrolment)
Transportation

  •         Relatively flat – increase of $6,000 or 1.53%
  •         Reflects similar staffing levels
Facilities Services

  •         Relatively flat – decrease of $6,000 or 0.04%
  •         Changes with an offsetting impact
  •         Reductions: vacancy not replaced and decreased sick leave re: PDT proposal
  •         Increases: lost ability to capitalize compensation against GPTL (funding over) but we are investigating the possibility of capitalizing against school renewal
       Manager Braidford provided an overview of the Supplies and Services Operating Expenditure Budget, noting that the total budget if $42.2 million, compared to $41.6 million budget for 2011-2012, an increase of $578,000 or 1.39%.  She reviewed the following information related to the Supplies and Services budget:

Schools

  •         Increase of $362,000 or 3.20% due to more EPO grants being announced
Governance and Administration

  •         Decrease of $15,000 or 0.76%
  •         Reflects mostly froze budgets
  •         Reduction due to a placeholder for 2010-2011 communications resource which has been moved to admin. Compensation as a new position was added in the year
  •         This is mostly offset by an increase for international insurance, agent fees, homestay, etc. as international enrolment increases
Transportation

  •         Increase of $481,000 or 3.51%
  •         Significant increase year over year, due to increased fuel costs, as well as the loss of the French Language Board’s route and cost sharing arrangement
School Operations and Maintenance

  •         Decrease of $295,000 or 4.31%
  •         Reflects mostly frozen budgets
  •         $250,000 of maintenance costs have been reallocated to the capital budget as the school renewal grant has increased by $348,000 versus 2011-2012 original budget due to the Ministry’s change to the factors affecting the grant calculation
Utilities

  •         Decrease of $150,000 or 2.80%
  •         Based on actual costs in 2010-2011 and actual costs for far in 2011-2012 – reductions are resulting from energy efficient initiatives
Debt Charges

  •         Debt charges are interest costs only and are completely funded by Ministry
  •         Pertain to 55 School Board Trust (pre-amalgamation liabilities), RBC debt for Frontenac and Bayridge and Ontario Financing Authority (OFA) debt for Good Places to Learn projects
        Manager Braidford reviewed the following information:

Revenue
                                        

2012-2013 Budget
Revised Estimates
2011-2012
Original 2011-2012 Budget
Allocations from Funding Model
  Operating Grants
  Debt Charges
    Permanently Financed
    Capital Debt Support – Interest

$214,449,000

        457,000
     2,187,000

$221,086,000

        457,000
     1,992,000

$219,270,000

        457,000
     1,992,000
$217,093,000
$223,535,000
$221,719,000
Other revenues
$   10,858,000
$    7,910,000
$    7,146,000
Capital revenues taken into income
$                  0
$                  0
$                  0
Deferred revenues taken into income
$                  0
$                  0
$                  0
Prior year’s deficit
$                  0
$                  0
$                  0
Current year operating deficit
$    1,805,000
$    2,167,000
$    1,195,000
Total
$229,756,000
$233,612,000
$230,060,000

Expenditures
                                

2012-2013 Budget
Revised Estimates
2011-2012
Original 2012-2012 Budget
Compensation
$187,527,000
$190,807,000
$188,409,000
Supplies and Services
$  42,229,000
$ 42,805,000
$  41,651,000
Total
$229,756,000
$233,612,000
$230,060,000

        Manager Braidford provided the following information regarding the total preliminary Operating Expenditures Budget totalling $229,576,000:

  •         Summary data brought forward from last week’ presentation for completeness
  •         No changes to revenue or enrolment projections
  •         Unfinanced operating expenditures for 2012-2013 budgeted at $1,805,000
  •         The deficit would have been $3.1 million, before $1.3 million of cost reductions were incorporated
  •         2011-2012 original budget forecast a deficit of $1,195,000, but this was increased in Revised Estimates as the Board approved an additional $1 million of spending further to the positive 2010-2011 year end results
  •         Year over year deficit growth $610,000 ($1.805 million in 2012-2013, versus $1.195 million in 2011-2012 original)
  •         Growth in deficit is due to the loss of the Program Enhancement Grant of $598,000 – hope to partially offset with EPO (not yet announced)
        Manager Braidford advised that under Ministry of Education balanced budget rules, a balanced budget is calculated in accordance with PSAB, with some transitional measures.  She advised that the vacation liability is no longer excluded from compliance; however, the Board fully absorbed the accumulated vacation liability in 2010-2011.  She indicated that we only need to absorb the growth in this liability going forward, noting that it is projected flat for 2012-2013.

        Manager Braidford reported that growth in employee future benefits, other than retirement gratuities, must now also be absorbed over a four year phase in period, noting that in Limestone DSB, the figure decreased; therefore, no in-year expense to absorb.

        Manager Braidford advised that retirement gratuities are now expensed on a PSAB actuarial valuation basis that it amortized over the Expected Average Remaining Service Life (EARSL), rather than being expensed as payments are made.

        Manager Braidford indicated that the compensation budget includes PSAB basis for retirement gratuities (i.e. reflected on a compliance basis), which is not materially different from the old cash/payment basis.

        Manager Braidford noted that increases in the cost of accrued interest will continue to be excluded.  She said that an in-year deficit is determined without regard to the use of accumulated unrestricted surplus to balance – limited to the lesser of 1% of revenue and any accumulated unrestricted surplus.

        Manager Braidford indicated that the preliminary budget deficit of $1,805,000 is within the 1% limitation of $2.149 million and the Board has sufficient accumulated unrestricted surplus to offset the deficit.  She said that Accumulated Surplus available for compliance includes operating surplus of $1.5 million ($2.5 million from last year-end net of $1 million additional Board approved expenditures), and WSIB balance of $3.9 million at August 31, 2012.

        Manager Braidford stated that, under PSAB, the capital budget is to be presented separately.  It will be presented in the same way as last year, and that it will be presented next week.  She said that boards will have depreciation expense in the operating budget, which is offset by a form of deferred revenue titled Deferred Capital Contribution (DCC), noting that this is the same as last year.  She indicated that consolidation of related entities is also required for PSAB.

        Manager Braidford noted that School Activities funds total $6.2 million, which is approximately $600,000 of school council funds and $5.6 million in schools as “non board funds”, noting that this is offset by revenue.

        Manager Braidford noted that the Limestone District School board Charitable Trust amounts to $200,000, and that this amount is offset by revenue.

        In response to a question from Trustee Ruttan, Superintendent Richard stated that the Board does make money on international education, and that money helps to offset Administration and Governance in the budget.

        In response to a question from Trustee Jackson regarding the withdrawal of the French Language Board from Tri-Board Student Transportation Services, Superintendent Richard stated that our Board will not have any difficulty in terms of managing the budget for transportation as it is balanced at the moment.
        
        Trustee Jackson indicated that the expenditure operating budget shows that utility costs have been reduced, and asked if all of the Board’s energy saving initiatives are in place.  Superintendent Richard stated that we still have future projects to come on line, one being the biomass project.  He said that we are still awaiting approval from the Ministry of the Environment before we go ahead with the biomass project.  He said that when this project comes into effect, there will be further savings.  He commented on the work being done at Perth Road Public School this summer, noting that we anticipate further savings next year because of these projects.

        Chair French thanked Manager Braidford for presenting the above-noted information.

Other Business

        Manager Braidford indicated that in response to a question from a Trustee, she had distributed enrolment projections by families of schools for the fiscal year 2012-2013, that include both the secondary projection and the elementary projection.  

Next Meeting Date

        The next meeting of the Committee of the Whole Board to discuss the budget is scheduled for Monday, June 4, 2012, at 6:00 p.m.

Committee to Rise and Report

        MOVED BY Trustee Crawford, seconded by Trustee Brown, that the Committee of the Whole Board rise and report to the Board.–Carried

Adjournment

        MOVED BY Trustee Murray, seconded by Trustee Jackson, that the meeting adjourn at 6:30~p.m.–Carried