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Education Financing – An Overview

Education Financing – An Overview. BCSTA Trustee Academy February 26, 2009 Joan Axford / Frank Regehr. Agenda / Overview. Ministry of Education and Provincial Budget Process History of Block Funding and Allocation System Review of Allocation System Funding Predictability

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Education Financing – An Overview

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  1. Education Financing – An Overview BCSTA Trustee Academy February 26, 2009 Joan Axford / Frank Regehr

  2. Agenda / Overview • Ministry of Education and Provincial Budget Process • History of Block Funding and Allocation System • Review of Allocation System • Funding Predictability • Effect of Enrolment Decline • The Saanich Story JA/FR

  3. Predictability • Just about the time you think or believe you have mastered the funding and budgeting process, there will be an announcement and all will change • Always begin every statement about funding and budgets with a disclaimer: “based on the most recent information” JA

  4. Ministry of Education Budget JA

  5. Ministry Budget in Provincial Context • In 2001/02 the Ministry of Education Budget was $4.861 billion or 19.3% of the total Provincial Budget • In 2008/09 the Ministry of Education Budget is $5.675 billion or 15.05% of the total Provincial Budget JA

  6. 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 • School Boards • establish budgets and sets spending priorities • School Boards • allocate funding to schools and programs • Schools • allocate funding to classrooms/programs 2/26/2009 JA

  7. Provincial Government • Establishes the total funding for Public Education; • Allocates the funding to the 60 school districts; • Issues budget instructions and common format for budget documents; • Issues accounting instructions for common allocation of costs. • School Boards • Determine local revenues; • Prioritize expenditures; • Allocate budgets to programs/services; • Prepare budget documents and approve budget. JA

  8. History of Block Funding • 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 JA

  9. History of Block Funding • 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. JA

  10. History of Block Funding • No government has been able to increase the block by a price index and in fact the block was frozen for 3 years (2001/02 to 2003/04) and was unable to fund year 2 and 3 of the previous teachers settlement in 2001-2003 • The resource cost model lost favour in the 1990’s because the per pupil amounts allocated to districts differed and were not understandable JA

  11. History of the Allocation System • In 1995/06 the allocation system was re-stated in a simpler form to reflect common core grants and specific grants to recognize district differences • The core grants allocated a standard amount of money per student, per school, and per district and provided funding for basic classroom, libraries, supplies, equipment, school administration, etc • Specific grants allocated amounts for operations and maintenance, transportation, special education, ESL JA

  12. History of Allocation System • The allocation system today was introduced in 2002/03. • It was announced as a new, streamlined funding formula, honouring government's commitment to give school boards more flexibility, autonomy and control over the delivery of education services. • The new, simplified funding formula now comprises a student base allocation plus supplementary grants. There are 5 broad categories for 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. JA

  13. Recent Changes to the Block • Block 2001 to 2004 $3.794 billion • Salary Increases $432 million • Literacy, arts, special ed $202 million • Distributed Learning $7.7 million • GAAP $35.0 million • Reduction in 2001/02 ($3.5 million) • Total Increase $673 million • Block 2008/09 $4.467 billion JA

  14. Effect of Enrolment Decline on Per Pupil Block JA

  15. The Provincial Block has increased by $673 million since 2001/02 Government allocations within the block since 2001/02 result in the overall block amount being utilized for new expenditures and a shortfall in funding to provide for the maintenance of existing services: Provincial Funding Shortfall JA

  16. Provincial Funding Shortfall • We know that in our district we can save about $2,828 per pupil in associated costs as enrolment declines, so for a provincial enrolment decline of 41,000 pupils this would reduce the shortfall by $118.2 million and leave an actual overall shortfall in funding to maintain services of $132 million. • It is clear that boards are facing cost pressures which exceed the provincial ability to fund. We estimate that Saanich is short by $2.22 million caused by funding increases not keeping pace with cost pressures. JA

  17. Provincial Education Funding - Operating • 2008-09 funding = $4.467 billion • Same formula for all districts • Per pupil block value – operating 2008-09 • Coquitlam $ 7,471 • Central Okanagan $ 7,493 • Central Coast $20,476 • Stikine $22,968 • Tries to be equitable - definitely not equal FR

  18. Equal Funding – 2008-09 – All Districts • $5,851/school age student = $3,150 million • $4,000/adult student (approx) = $ 32 million • Home school and course challenges = $ 0.5 million FR

  19. Equal Funding – 2008-09 – All Districts • Unique students = $308 million • Level 1 $32,000 • Level 2 $16,000 • Level 3 $ 8,000 • Unique students = $120 million • ESL $1,174 • Aboriginal $1,014 FR

  20. Equal Funding – 2008-09 – All Districts • TOTAL unique student funding – addition to per pupil block (not including adult) • Stikine $2,328 • Vancouver Island West $1,783 • Prince Rupert $1,692 • Central Okanagan $ 568 • Revelstoke $ 511 • Arrow Lakes $ 491 FR

  21. 2008-09 Supplements for Enrolment and Funding Decline • School Age Decline >1% up to 4% $2,926 per student = $9 million • School Age Decline >4% $4,388 per student = $1 million • Cumulative decline @$2,926 = $2million • Funding protection - $$$ not less than previous year = $7 million FR

  22. 2008-09 Supplements for Enrolment and Funding Decline • Addition to per pupil block • 18 districts $ Nil • Boundary $ 943 • Fort Nelson $ 995 • Gold Trail $1,321 FR

  23. 2008-09 Supplement for Teacher Salary Differential • Additional funding to districts with higher average salary • Based on formula to calculate number of teachers funded • Intended to fund actual cost difference between districts • Does not fund teacher allowances, principal salaries, teachers of adult students FR

  24. 2008-09 Supplement for Teacher Salary Differential • 2008-09 Total Funding $96 million • Addition to per pupil block • Vancouver Island West $ Nil • Gold Trail $ 43 • Kootenay-Columbia $362 • Stikine $473 FR

  25. Supplement for Labour Settlement Costs • Funding for teacher, support staff, and admin staff labour cost increases since 2006 • Ministry formula started in 2006 recognizes • TOC cost increases as estimated in 2006 • Category 5+ teacher grid placements as estimated in 2006 • Estimated teacher grid harmonization costs • Remainder of $345 million allocated proportionately based on district salary expenditures FR

  26. Supplement for Labour Settlement Costs • 2008-09 Total Funding $458 million • Addition to per pupil block • Abbotsford $ 750 • Burnaby $ 812 • Campbell River $1,103 • Stikine $2,328 FR

  27. Supplement for Unique Geographic Factors • Small Communities – Elementary Up to $126,000 / > 5 km / < 250 FTE $29 million • Small Communities – Secondary Up to $374,500 / > 25 km / < 635 FTE $19 million • Small Communities – Grade 11 and 12 Up to $150,000 / < 215 FTE $ 8 million FR

  28. Supplement for Unique Geographic Factors • Low enrolment $47 million • Up to $1.25 million / sch. dist. • Maximum funding at 2,500 FTE • Phased to $0 at 15,000 FTE • Rural factor $21 million • Distance to Vancouver/regional centre FR

  29. Supplement for Unique Geographic Factors • Climate $ 9 million • Heating and cooling using district’s degree day temperatures • Sparseness factor $12 million • Dispersion within district FR

  30. Supplement for Unique Geographic Factors • Addition to per pupil block • Vancouver $ Nil • Surrey $ 4 • Conseil Scolaire $ 2,554 • Central Coast $10,220 • Stikine $11,161 FR

  31. Supplement for Transportation and Housing • Formula based on bus routes mileage and costs approved for 2001-02 • 2008-09 funding for each district remains at 2001-02 level • Subsequent issues affecting transportation costs include: • enrolment decline • school closures • changes to costs or bus routes FR

  32. Supplement for Transportation and Housing • Addition to per pupil block • New Westminster $ 3 • Prince George $ 290 • Cariboo-Chilcotin $ 932 • Stikine $1,376 • 2008-09 Funding $86 million FR

  33. Supplement for Summer Learning • Addition to per pupil block • 23 school districts $ Nil • Richmond $ 66 • Vancouver $ 70 • Nisga’a $ 73 FR

  34. Supplement for Summer Learning • Funding first established in 2007 • In 2008, funded $400 per full credit courses and $200 for any other course $ 13 million FR

  35. Holdback Supplement – 2008-09 Funding is calculated 4 times per year: 1) March – estimate for next school year 2) November – funding recalculated using September enrolments 3) February – Distributed Learning and special education students funding using February enrolment 4) May – DL students funded using May enrolment FR

  36. Holdback Supplement – 2008-09 • Ministry funding holdback for Nov/Feb/May count $84.5 million • November 2008 allocation $47.5 million • Funds available for Feb/May $37.0 million • Ministry commits to allocation of all funds FR

  37. 2008-09 Fall Recalc = $4,467 Million FR

  38. Ministry Education – Autumn 2008-09 JA

  39. Per Pupil Block Amount FR

  40. FR

  41. Provincial Education Funding - Operating • 2008-09 funding = $4.467 billion • Same formula for all districts • Per pupil block value – operating 2008-09 • Coquitlam $ 7,471 • Central Okanagan $ 7,493 • Central Coast $20,476 • Stikine $22,968 • Tries to be equitable - definitely not equal FR

  42. Diverse Province • District differences include: • Compact or dispersed • Large or small • Metro or remote • Student diversity – incidence of unique students • Understandable formula? FR

  43. Provincial Funding/Student FR

  44. Provincial Education Funding$ per student w/o labour settlement & unique student increases FR

  45. SD’s – Additional Revenue Reported 2008-09 Budgets • Provincial Total $219 million • Provincial avg/student $ 402 • Port Alberni $ 68 • Vernon $ 812 • West Vancouver $1,829 • Nisga’a $2,438 • E.g. international prog., rentals, interest FR

  46. Predictability of Funding - Enrolment FR

  47. Predictability of Funding - Enrolment • For two years – 2006-07 to 2008-09 • Enrolment up in 8 districts • down in 52 districts • down > 5% in 27 districts • Each student decline – ($5,851) • Funding protection may delay impact • > 200 in SD67 FR

  48. Predictability of Funding - Formula • Since 2006-07, new funding count February and May – Distance Learning • Since 2006-07, Labour Settlement $$$ now fund employees serving adult students and employees funded from SD businesses and other revenues • October 2007, Grades 10 to 12 FTE count • In 2008-09, Summer Learning - $13 million FR

  49. Predictability of Funding • Ministry announced funding – March 2008 • 2007-08 $4.345 billion = + $116 million • 2008-09 $4.467 billion = + $122 million • 2009-10 $4.543 billion = + $ 76 million • Labour settlements costs • 2007-08 $125 million • 2008-09 $137 million • 2009-10 ??? 12/1/2014 FR

  50. Predictability - Holdback • Predictable for Ministry • Less predicable for districts 12/1/2014 FR

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