School district finances bounce between red and black

Just weeks after Nanaimo school trustees finalized next year's budget, the district received both a new bill and additional revenue from the province.

Just weeks after Nanaimo school trustees finalized next year’s budget, the district received both a new bill and additional revenue from the province.

Last week, the Education Ministry decided to shift the bill for school building insurance premiums to school districts. Until this year, the province paid the premiums directly, while districts paid the deductible when claims were made. Starting July 1, all districts are expected to pay into a $3-million insurance pool.

Phil Turin, secretary-treasurer for Nanaimo school district, said this adds a cost pressure of about $85,000 to next year’s budget, which was balanced and approved on May 4.

“It’s $85,000 we didn’t know we had to budget for when we passed the budget,” he said.

The premium will cost the district more than $76,000, said Turin, but the deductible for claims is also rising to $10,000 from $3,000.

Staff estimate the deductible increase will add an extra $33,000 per year in expenses for the district because it will have to pay out of pocket for damages under $10,000. But some of the increase will be offset because he was anticipating some sort of change to the property loss program and put an extra $25,000 in the budget.

The B.C. School Trustees Association spoke against changes to the property loss program earlier this week.

In an e-mailed response, Education Minister George Abbott said ministry staff have communicated the changes to districts for more than a year and made the decision to bring the property loss program in line with the liability insurance program following discussions with the B.C. Association of School Business Officials and its members.

Then on Wednesday, the ministry announced it would distribute $8.1 million in holdback funds to school districts – an additional $15 per student.

The funding is part of the holdback the ministry retains as a contingency for districts that receive more students than predicted. A portion of the $8.1 million will be used to pre-pay school insurance premiums.

Turin said the district will receive more than $200,000 in holdback funds, so after paying the insurance premium, it should end the year with about $129,000 in contingency funds for next year.

Wednesday’s funding announcement came as a surprise to Turin, as the province does not normally distribute these funds until June – if these funds are distributed at all.

“We had not budgeted for anything coming,” he said. “The ministry has not always distributed holdback funds.”

 

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