ACTION ITEM #10.3
PROVINCIAL COUNCIL MEETING:
October 27, 2012
STATEMENT OF ISSUE: 2012/2013 BCSTA Budget Planning
Submitted by:
Jane Kellett, Director
Chair, BCSTA Finance Committee
BE IT RESOLVED:
That Provincial Council provide input to the Finance Committee to assist in the
preparation of the draft 2013/2014 BCSTA budget for receipt at the February 2013
meeting and adoption immediately following AGM 2013.
RATIONALE:
The purpose of this agenda item is to:
1. Provide a review of 2012/2013 budget highlights;
2. Introduce factors that may impact the 2013/2014 budget; and
3. Invite input from Provincial Councillors to assist the Finance Committee in preparing
a draft budget for 2013/2014.
-1-
Action Item 9.3
2013-2014 BCSTA Budget Planning
Review of 2012/2013 Budget Highlights
1.
Student Enrollment
Student enrollment has been declining since 2000/2001 which has resulted in a
reduction in member fees over the past twelve years. In September 2010, full-day
kindergarten programs were available to approximately 50 percent of eligible
children and in September 2011 they were made available to all eligible children. As
a result, full-time equivalent (FTE) students for 2012/2013 were increased for the
first time since 2000/2001. However, because of the structure of BCSTA’s fee
formulas with per student costs decreasing as FTE’s increase, and the current trend
of FTE movement from rural (a decrease of 768 FTs) to urban centres (an increase
of 1,658 FTEs), the total FTE increase of 890 FTE students resulted in a member fee
decrease of $4,070.
2.
Membership
BCSTA has full membership in 2012/2013.
3.
Interest Revenue
This budget line, which had been reduced by $33,000 in 2010/2011, was increased
by $10,000 in 2011/2012 and by $4,000 in 2012/2013 to reflect a slight
improvement in interest rates.
-2-
Action Item 9.3
2013-2014 BCSTA Budget Planning
4.
Government Grants
BCSTA has not received funding through government grants since 2007/2008;
however, as part of BCSTA’s long-term financial planning, the Board of Directors set
aside the 2006/2007 Student Achievement Grant of $150,000 to mitigate the impact
of the loss of grant revenue over a period of several years. As a result, a total of
$20,000 in government grant funds was approved for use to support AGM 2013.
5.
BCSTA Meetings and Events
Based on the Vancouver Consumer Price Index (CPI) average of 1.78 percent for
2006 through 2010, inflation was projected to be approximately two percent for
2012/2013. Typically, these inflationary increases have the largest impact on the
AGM, Academy and Provincial Council budget lines, but also affect the Board of
Directors and Standing Committee budget lines.
The AGM budget line was increased $5,000 to reflect increased hotel, meal, audiovisual and speaker costs for 2012/2013.
The December 2012 Academy was replaced with a November 2012 Joint Conference
to be hosted by BCSTA, BCSSA, BCASBO, and BCPVPA. The Academy revenue and
expenditure budget lines were therefore eliminated for 2012/2013.
-3-
Action Item 9.3
2013-2014 BCSTA Budget Planning
6.
Board of Directors
In accordance with 2006/2007 Board of Director Honouraria Review Committee
recommendations, the Finance Committee (excluding members of the Board of
Directors) reviewed Board of Director honouraria amounts, based on the most
recent five-year average of the Vancouver Consumer Price Index, calculated as 1.78
percent.
For 2012/2013, the Board of Director Honouraria Review Committee recommended
that Board of Director honouraria be automatically increased each year by the most
recent five-year average of the Vancouver Consumer Price Index.
However, given the economic climate, the Board of Directors approved the following
resolution at their January 2012 meeting:
“That the Board of Directors defer Board of Director honouraria increases until the
provincial government’s net-zero mandate has been removed”.
As a result, the Board of Directors did not receive their recommended honouraria
increase in 2012/2013.
-4-
Action Item 9.3
2013-2014 BCSTA Budget Planning
7.
Standing Committees
The Finance Committee, Education Committee, and Aboriginal Education Committee
budget lines were all decreased in 2009/2010 to reflect cost savings achieved by
using an online meeting format and by holding meetings in conjunction with other
BCSTA events.
At AGM 2010, Extraordinary Motion 2. Increased Size of the Aboriginal Education
Committee was approved, increasing the size of the Committee from seven
members to nine; consequently, the Aboriginal Education Committee budget line
was increased a total of $4,000 in 2011/2012.
No change to the Finance Committee, Education Committee, or Aboriginal Education
Committee budget lines was made in 2012/2013.
The Legislative Committee budget line was created in 2011/2012 to reflect costs
associated with the Committee’s review of BCSTA’s Policies, as directed by the
Board of Directors in September 2010. While this work was completed in
2011/2012, the Finance Committee retained this budget line for 2012/2013 to
reflect costs associated with holding meetings to review Provincial Council and AGM
motions. As these costs were previously captured under Advocacy – General, funds
were reallocated from that budget line to the Legislative Committee budget line.
-5-
Action Item 9.3
2013-2014 BCSTA Budget Planning
8.
Building
A reallocation of $5,000 was made from this budget line to Office Administration in
2012/2013 to reflecting a change in oversight responsibilities.
9.
Financial
A total of $8,000 was moved to this budget line from Salaries/Benefits to reflect
current oversight responsibility. Additionally, this budget line was increased $8,000
to reflect the following:
i. Increased audit costs of approximately $6,000 resulting from:
1. annual inflationary increases over the five-year contract, estimated at
$2,000; and
2. estimated costs to transition to new not-for-profit accounting standards,
which BCSTA is required to adopt in the 2012/2013 fiscal year, estimated
at $4,000;
ii. Increased software and support costs of approximately $2,000 to:
1. facilitate the interdepartmental exchange of BCSTA’s financial information
and improve expenditure tracking and control;
2. provide a platform for Boards of Education to provide input into BCSTA’s
budget development process.
-6-
Action Item 9.3
2013-2014 BCSTA Budget Planning
10. Depreciation
Depreciation was increased $1,000 to reflect the planned replacement of BCSTA’s
telephone system in 2011/2012.
11. Supplies
This budget line was decreased $3,000 in 2010/2011, reflecting the reduction in
paper and toner costs that resulted from changing the Education Leader to an
electronic publication; by using double rather than single-sided copies wherever
possible; and by sending Board of Director, Standing Committee, and Provincial
Council agenda packages electronically. In 2010/2011, it became apparent that
savings were higer than originally projected and the 2011/2012 Supplies budget line
was reduced an additional $4,000.
This budget line was renamed Office Administration in 2012/2013 to reflect an
expanded oversight role. $5,000 was allocated to this budget line from the Building
budget line and an additional $3,000 was allocated from Messaging Charges.
-7-
Action Item 9.3
2013-2014 BCSTA Budget Planning
12. Salaries/Benefits
BCSTA staff salary increases have been tied historically to teacher-negotiated
settlements. As the provincial government’s net-zero mandate applies to teacher
bargaining through June 30, 2013, no increase was applied to the salary grid in
either 2011/2012 or 2012/2013.
This budget line was increased $30,000 in 2011/2012 to reflect movement on the
salary grid, rising benefit costs, and 2010/2011 staffing changes. An additional
increase of $24,000 in 2012/2013 reflects the following offsetting factors:
i. An increase of $22,000 to reflect rising benefits costs;
ii. An increase of $10,000 to reflect movement on the salary grid; and
iii. A decrease of $8,000 as these funds were allocated to the Financial budget
line to reflect current oversight responsibilities.
For 2012/2013, the Finance Committee prepared a balanced draft budget focused on
maintaining BCSTA’s high level of service to member boards and its commitment to keep
member fee increases to a minimum. As additional budget cuts were likely to impact
BCSTA’s service delivery model and internal and external factors continue to put
pressure on a number of budget lines, the Finance Committee recommended a twopercent increase in member fees for the 2012/2013 budget. This member fee increase,
totaling $38,000, was reduced by $4,000 as a result of changes in FTE enrollments.
-8-
Action Item 9.3
2013-2014 BCSTA Budget Planning
2013/2014 Budget Discussion
At its June 20, 2012 meeting, the Finance Committee discussed a number of items likely
to impact the 2012/2013 budget:
1.
Student Enrollment
As shown on page two, BCSTA member fees have been declining since 2000/2001
as a result of changes in FTE student enrollment. 2012 enrollment data and the
resulting impact on 2013/2014 member fees will be available in December 2012.
2.
Membership
2007/2008 was the first year in which full member fees were allocated to the
operating budget. Full membership has continued through to 2012/2013 and is
expected for 2013/2014. If BCSTA does not have full membership in 2013/2014,
member equity will be used to fund the loss of member fees for the first year of
board withdrawal.
3.
Member Equity
BCSTA does not currently have a member equity surplus. When a surplus exists, it is
used to offset member, Academy, or AGM fees. For instance, in 2003 boards
received a 50-percent reduction in AGM registration fees, and in 2009, boards of
education received a two-percent member fee rebate.
-9-
Action Item 9.3
2013-2014 BCSTA Budget Planning
4.
Interest Revenue
As shown on page two, this budget line was reduced by $33,000 in 2010/2011 as a
result of declining interest rates and subsequently increased by $10,000 in
2011/2012 and $4,000 in 2012/2013 as a result of a slight improvement in rates.
As rates have not risen significantly since last year, an adjustment to this budget
line is not recommended at this time; however, an adjustment to this budget line
may be warranted prior to the adoption of the budget if interest rates change or are
likely to change.
5.
Sales Revenue
Sales of the Guide to School Legislation are expected to decrease in 2013/2014,
resulting in a projected loss of sales revenue of approximately $4,000.
6.
Government Grants
As shown on page three of this document, BCSTA has not received funding from
government grants since 2007/2008 and will therefore be reducing its reliance on
grant funds to support its operating budgets. Grant funds are available to support
AGM 2014.
7.
CSBA Congress
BCSTA will be hosting CSBA’s Annual Congress in 2013 and will be responsible for all
associated revenues and expenses. It is expected that revenues will offset 100% of
the expenditures for this event.
- 10 -
Action Item 9.3
2013-2014 BCSTA Budget Planning
8.
BCSTA Meetings and Events
Based on the Vancouver Consumer Price Index (CPI) average of 1.72 percent for
2007 through 2011, inflation is projected to be approximately two percent for
2013/2014. Inflationary increases have the largest impact on the AGM, Academy
and Provincial Council budget lines, but also affect Board of Director and Committee
budget lines. Hotel, meal, speaker and audio-visual costs are also expected to
increase in 2013/2014, which will further impact these budget lines.
9.
Board of Directors
As shown on page four, in 2006/2007, the Board of Director Honouraria Review
Committee recommended that Board of Director honouraria be reviewed annually,
with increases to be based on Vancouver’s CPI. In 2011, the Review Committee
recommended that honouraria be automatically increased based on the most recent
five-year rolling average of Vancouver’s CPI.
As the Board of Directors passed a resolution at its January 2012 meeting that
Board of Director honouraria increases be deferred until the provincial government’s
net-zero mandate has been removed, the Board of Directors did not receive their
recommended honouraria increase in 2012/2013.
The net-zero mandate will remain in effect through June 30, 2013. Honouraria
amounts are therefore expected to increase automatically in 2013/2014 in
accordance with Review Committee recommendations.
- 11 -
Action Item 9.3
2013-2014 BCSTA Budget Planning
10. Standing Committees
No changes to Committee budget lines are recommended for 2013/2014.
11. Building
As shown on page six, $5,000 was moved from this budget line to Office
Administration in 2012/2013 to reflect a change in oversight responsibility. No
change to this budget line is recommended for 2013/2014.
12. Audit Fees
Every five years, BCSTA issues a request for proposal to potentially suitable audit
firms. As 2012/2013 will be the fifth year in BCSTA’s five-year contract with its
current auditors, the Finance Committee will be undertaking a review of auditor
firms for the next five-year term, beginning in 2013/2014. Costs for BCSTA’s annual
audit are captured in the Financial budget line. An increase to this budget line may
be needed in 2013/2014.
13. Depreciation
BCSTA’s capital assets are depreciated in accordance with the expected useful life of
the asset. In practice, asset replacement is deferred until such time as equipment
becomes problematic. Equipment replacement schedules expected to impact this
budget line in 2013/2014 are as follows:
- 12 -
Action Item 9.3
2013-2014 BCSTA Budget Planning





BCSTA replaced all of its workstations in 2010/2011. While the majority of
these workstations were expected to have an estimated useful life of four years,
with the heavy-use machines having a useful life of three years, hard-drive
upgrades implemented in 2011/2012 are expected to extend the useful life of
these machines by one additional year. Workstations are therefore not
scheduled for replacement in 2013/2014;
BCSTA’s servers are on a three year rotation, with three of its nine servers
replaced each year. Three servers are therefore scheduled to be replaced in
2012/2013 and in 2013/2014;
As shown on page seven, BCSTA’s telephone system was scheduled for
replacement in 2011/2012. It is expected that this equipment will be replaced in
2012/2013;
BCSTA’s mailing machine is currently scheduled for replacement in 2013/2014;
however, BCSTA is looking into the possibility of contracting the Vancouver
School Board to look after BCSTA’s future mailing needs; and
BCSTA’s document management system may need to be replaced in
2013/2014.
If the servers, telephone system and document management system are all
replaced in accordance with current projections, the Depreciation budget is
expected to increase approximately $5,000 in 2013/2014.
- 13 -
Action Item 9.3
2013-2014 BCSTA Budget Planning
14. Office Administration
As shown on page seven, this budget line (formerly called Supplies) was increased a
total of $8,000 in 2012/2013 to reflect a change in oversight responsibility. No
changes to this budget line are recommended for 2013/2014.
15. Salaries/Benefits
As shown on page eight, BCSTA’s staff salary grid increases have been tied
historically to teacher salary negotiations. As it is not known if the teachers will
negotiate a salary increase for 2013/2014, it is not known if a corresponding salary
grid increase will be required.
At this time a number of staffing changes are expected in 2012/2013 and
2013/2014. Once the staffing complement for 2013/2014 is known, an estimate of
costs for this budget line can be calculated.
Given the number of unknown variables that are expected to impact the Salary
budget line, an estimate of salary costs for 2013/2014 is not yet available.
While there are a number of budget line increases projected for 2013/2014, such as AGM
and Depreciation, there are also a number of budget lines that have not yet been
quantified, such as member fees, which are based on FTE data available in December
2012 and Salaries/Benefits, shown above. At this time it is not therefore known if a
member fee increase will be recommended for 2013/2014.
- 14 -