Stakeholder Report at Board Meeting

CAPSC Stakeholder Report
Presented at the June 28, 2011 Public Meeting of the CBE Board of Trustees

Thank you Chair Cochrane, Trustees. My name is Eryn Kelly and I am the Co-President of the Calgary Association of Parents and School Councils. We are a city-wide parent and school council non-profit group that brings parents, community members and guests together on a monthly basis throughout the school year to network and engage around educational issues that impact our students. We also advocate on those educational issues that require the ‘voice’ of our constituency to speak out upon.
While our roots go back to the early years of public education in Calgary, CAPSC, in its current form, will celebrate its 10th anniversary this September. We have held a stakeholder seat at public meetings of the board of trustees since 1985.

In the 2010/2011 school year, we have facilitated public engagement opportunities for our members and the public in a variety of ways:

In the fall, we hosted former Trustees Gordon Dirks and Nancy Close who led a discussion around the roles and responsibilities of trustees and the importance of making an informed vote. This led into the trustee candidate forums that we organized and held across the city in each ward pairing during last years’ civic election. In partnership with ATA Local 38, we provided each Trustee candidate with a questionnaire in advance of each of the forums. Their responses to these important educational queries were collected and then posted online for access and commentary by our members and any other interested member of our community.
We utilized social media for the first time to advertise both of these initiatives and our reach was expanded exponentially.

The new Education Act was introduced in the spring legislative session. Prior to that, Alberta Education kindly sent a representative to discuss the framework for this legislation with our parents and bring their feedback back to Edmonton. This was very well received by our members. Several trustees were also there to listen and share their perspective.

Education Minister, Dave Hancock, Chief Superintendent, Naomi Johnson, and Chair, Pat Cochrane participated in our education panel discussion which brought out over 300 concerned citizens. The Chief Superintendent also attended one of our monthly meetings along with several members of the finance and communications departments to discuss the issue of the budget shortfall. Following that meeting, Finance and communications facilitated and attended a follow-up get-together to further explore and explain.

CAPSC could not do this job alone and we deeply value the collaborative relationship we have with the board, administration, ATA and other stakeholder organizations.

Over the year, our members and the public have also had many opportunities to engage with trustees at our meetings around a variety of issues both formally and informally. Our role as a critical friend to the board has a rich and varied history and is something we and our members place great value on. We will continue to ask provocative questions and offer informed perspectives and constructive criticism as a friend. As a critical friend we will always take the time to fully understand the context of any information presented and the possible threats and opportunities that will affect the Calgary Board of Education students and their families. We will continue to be advocates for the success and improvement of public education.

We hope that trustees will continue to place great value on this role as well and continue to maximize the public engagement opportunities that our meetings offer as they have proven to be a very effective way to engage parents. CAPSC will continue working in collaboration with our stakeholders and with an educative purpose to provide parents with meaningful information and resources.

Poll: 7 in 10 Albertans believe the government is underfunding education

The Alberta Teachers' Association released the results of a public opinion poll today. The poll was conducted by Environics Research Group and is accurate to within 3.4 percentage points, 19 times out of 20. The poll was commissioned by the ATA.

Highlights:

70% believe government is underfunding education

18% of Albertans believe the right amount is being spent on education (lowest level in 10 years)

57% believe the Government is most responsible for cuts to education (20% blame education sector unions, 11% blame school boards, 3% blame teachers)

Financial Accountability and Best Practice at the CBE

At the May 3 Regular Meeting of the Board of Trustees, CAPSC submitted two questions related to financial accountability and best practice at the CBE during Question Period. The questions were read into the record and while responses were not immediately available, the board did respond to us in writing and read them into the public record at a later board meeting (these responses are in regular text). CAPSC felt further clarification was required so they were resubmitted but not for Question Period (these responses are in bold italic text).

Question #1

Alberta Education’s Accountability Framework requires detailed reporting from school boards. For example, school boards are required to submit audited financial statements to the Minister on an annual basis. The Ministry closely reviews the statements and documentation surrounding these filings and provides feedback to the boards either in the form of incentives for good performance or penalties and disincentives for poor performance. The Auditor General also reviews the work of not only the Ministry of Education but also school boards. Reviews by the Ministry or the Auditor General are not limited to financial reporting but would also include important items like governance. From reading what is publicly available, nothing seems to indicate that the CBE is in trouble in either case. Boards who are judged to be poor performers are being dealt with publicly as is the case with the Northland School Division. There may be recommendations for improvement for some other school boards that are not specifically named but there is follow up and continued monitoring of these boards. Could the CBE share any feedback that they have received from the Ministry in regards to the Accountability Framework?

Response:

Alberta Education expects a clean audit opinion (unqualified audit) annually from school districts. The CBE has experienced a clean audit for at least the last 15 years. The CBE has never experienced a performance or operational review by either Alberta Education or the Office of the Auditor General.

The Office of the Auditor General undertook a budget process review of 13 school districts (including the CBE) approximately five years ago and the CBE was identified as having exemplary budgeting and reporting processes.

In regards to the Accountability Pillar tied to financial matters, there are no prescribed stand-alone documents stated or required from Alberta Education. However, when it comes to accountability and financial reporting to Alberta Education, the Calgary Board of Education provides an Audited Financial Statement (AFS) in the format mandated by Alberta Education and as required by the School Act (November 30th of each year). Feedback is provided to all jurisdictions on the submitted AFS. The feedback is usually received two to three months after the submission of the statements. Feedback received pertains to disclosure and confirming amounts in any of the statements or schedules.

In addition, embedded in the Calgary Board of Education’s Annual Education Results Report there are financial summary details of the most recently completed fiscal year, including revenues, expenses by program, any net use or application of operating funds and the organization’s overall financial position. As mandated by Alberta Education, the organization further provides financial information regarding School Generated Funds (SGF) and under this program how revenues are generated and how funds are spent to augment student learning.

Question #2

Alberta Education has a role in supporting school boards in their financial oversight which includes reviewing budgets, quarterly updates, and audited financial statements. In response to the 2005/2006 Auditor General’s Report, Alberta Education set up a Task Force under MLA Janice Saarich, Parliamentary Assistant to the Minister of Education. Out of this 2010 report came a set of best practices to assist trustees and superintendents to improve the efficiency and effectiveness of their financial oversight activities. This checklist, found in Appendix 6 on page 53 of the report, is described as an assessment tool for current practice in oversight activities. Could the board go through the list and comment on each of the best practices as they pertain to the Calgary Board of Education.

http://www.asboa.ab.ca/PDF/jsfinancialtaskforceeditsfinal.pdf

Response:

Alberta Education has identified the budgeting and reporting processes that are required to be followed and the CBE conducts this work in alignment with these processes and ensures best practices are followed.

It is incumbent upon the Calgary Board of Education (CBE) to utilize best practice; sound financial business processes and incorporate these within the budgeting, monitoring and reporting cycles of the organization.

Below is a commentary on how the CBE incorporates these as referenced in the checklist found on page 53 of the Appendix 6 to the 2010 report identified above.

Building Financial Capacity for School Board Trustees and Superintendents – Appendix 6 – Best Practices:
Budget Assumptions

• Considerable planning for the Operating Budget takes place – usually commencing in December of each fiscal year.
• The CBE fully considers the enrolment projections forecasted for the upcoming year (all types) and these are provided to the Board in January.
• The CBE identifies and incorporates the following budget assumptions which are shared with the Board:
o CBE Finance Department considers and collaborates with Human Resources regarding resolved and expected salary increases based on comparable organizations (ie: City of Calgary) and considers general economic conditions for all staff.
o CBE considers all grid movements anticipated for staff in those specified categories.
o CBE considers all announced statutory changes (employer’s share of CPP, EI, Pension plans).
o The CBE includes revenue change expectations (uses the Provincial Budget announcement and all associated grant rate changes).
o Other income sources (non Provincial) are fully considered (ie: interest income/Fees).
o Transportation budget is considered including inflationary increases (fuel prices, etc.) and expected service offerings.
o Identifies all other contractual obligations (changes).
o The CBE builds and develops the budget in full alignment with the CBE Three-Year Education Plan.
o The Preliminary Budget and supporting assumptions and documentations are shared with the Board of Trustees as part of the budget approval process.

Budget Updates
• The entire CBE budget is recalculated in the first quarter of every school year and reflects the confirmed student count at September 30 and all program requirements based on confirmed student need (ie: demand for Full day Kindergarten.) All revenues are recalculated and the Resource Allocation Method (Fall Schools RAM process) confirms the spending at schools and any required amended operating reserve draw(s) are placed before the Board for their consideration and approval.
• The Fall Budget Update or a full Budget report, as prescribed by Alberta education, is placed before the board of Trustees for approval before being formally submitted to Alberta Education.
• The budget is updated to reflect changes for revenues and associated expenses, staffing changes and finalization of operating reserves for the previous year.

Financial Monitoring
• The Board of Trustees receives quarterly reports with projections to year end (Variances) for both the operating and capital budgets in accordance with Executive Limitation 11: Financial Condition.
• Superintendents’ Team monitors all spending for the organization as a whole and individual Superintendent’s monitor their own operating or capital budgets at the Department and Service Unit level, significant variances are investigated and mitigated as required during the year.
• Managers, Directors and Superintendents have explicit responsibility for budgetary control as articulated in their position description for their area of accountability.
• Recommendations for budget adjustments by the Board of Trustees is communicated through these quarterly reports for consideration and approval.

Financial Health
• Is a dual responsibility of the Board of Trustees and Superintendents Team. Avoiding fiscal jeopardy is always in the forefront of the operating budget process to ensure a liquid and long term sustainable service offer to students. The Board of Trustees has prescribed Executive Limitations and especially Executive Limitation 10 – Budget Process to ensure prudent budgeting processes to ensure the long term financial health of the organization. The Board monitors compliance with EL-10 on an annual basis. The Financial Health of the organization is also considered with respect to available operating reserves to support any planned expenditures on a one time basis. The Board’s auditors also monitor the health of the organization as part of the annual audit process (going concern).
• Projections are forecast out two to three years to ensure the long term fiscal health of the organization is not jeopardized.

Audit Committee
• The Board of Trustees has a fully functioning audit committee that recommends approval of the audit plan and recommends to the Board of Trustees approval of the year end financial statements. The audit committee exercises its function through approved Terms of Reference. The Audit Committee includes Board members and external public members to review internal control adequacy. Members of the Audit Committee are able to ask questions of the appointed external auditors about any audit findings or other matters with and without administration present.

Internal Audit
• The organization has an internal controls advisor position within Corporate Financial Services whose primary function is to provide general advice and best practice concepts regarding matters of internal control. In addition, the auditors through their audit findings, report potential internal control improvements to Administration.

Capacity Training for School Board Trustees and Superintendents
• Internal training is provided to new Trustees following election, and includes financial reporting, financial literacy, financial monitoring and governance by CBE staff and through the Alberta School Boards Association.

Medicine Hat Catholic Considering Transportation Fees

An article in the Medicine Hat News, "ASBA member suggests fees for Catholic school busing," discusses the issues arising from the $116,000 that the board spends on subsidizing bus students who are ineligible for provincial transportation funding. Currently, money is coming out of the operating budget to cover this cost. While it appears no action will be taken this year, the board is predicting its deficit will grow from 835,000 to $1.2M in the 2012/2013 school year and if funding doesn't increase, fees could likely become part of the conversation.

'"It would be a real departure from what we have traditionally done, and we're quite sure some parents wouldn't be happy about it," Leahy said.'

Positive Trend in High School Completion/Drop Out Rates

In a recent news release, "High school completion rate continues upward climb," Alberta Education shares that the three-year high school completion rate rose to 72.6% in 2010 from 71.5% in 2009. The five year completion rate remained at 79%. The drop out rate for students between the ages of 14 to 18 declined from 4.3% in 2009 to 4.2% in 2010.

At the Calgary Board of Education, the Interim Three-Year Education Plan 2011 - 2014 report went to the Board of Trustees at the June 14 public meeting. Good news around high school results were in the report. The three-year high school completion rate was improved and now stands at 70.8% The drop out rate for students between the ages of 14and 18 improved significantly and now stands at 4.1%.

Kids drop out of school for many reasons and the process often starts early on in their school career. Alberta Education has recently introduced an interesting website High School Completion Strategic Framework. There is a Parent Info tab that has links to resources that can help parents keep their kids in school or help those who dropped out return to high school.

Editorial: Education is part of a prosperous province

An editorial that appeared in the Canmore Leader, "Education is part of a prosperous province," opens with the statement, "If you are a parent in Alberta, if you are even thinking of raising a child in Alberta, if you care about the future of this province in any way, you might consider writing a letter to ..."

Education funding is an issue across this province and touches every school board. While a few boards may weather this storm and minimize impacts to the classroom with dwindling reserves, they have shared that it is only a matter of time before their well runs dry. At the last board meeting, we learned that eight school boards in the province were in such dire straights that the province had to provide some assistance.

CBE News Release

CBE ADMINISTRATION PRESENTS 2011-2012
OPERATING BUDGET TO BOARD OF TRUSTEES
CALGARY —CBE Administration will present the detailed preliminary operating budget for the 2011-2012 school year to Trustees during the public board meeting on June 14.

The report is Administration’s recommendation to optimize learning and delivery of our Three-Year Education Plan to more than 100,000 students while balancing the budget.

The Board of Trustees will review the operating budget for information on Tuesday, and are scheduled to approve it on June 28. The budget is not finalized until Sept. 30 when student enrolment for the school year is confirmed.

“Everyone in the Calgary Board of Education is committed to student learning,” says Naomi Johnson, Chief Superintendent of Schools. “We are educators who build the best possible plan for students with the funding we are provided.”

The operating budget recommends exactly how Administration proposes to deal with the budget shortfall resulting from the provincial budget. Since February, the Calgary Board of Education has estimated the accumulated shortfall to be $61.7 million for the 2011-12 school year. Although a budget process is dynamic and numbers have been refined, $61.7 million remains a reasonable estimate of the shortfall.

To close the budget gap, Administration’s approach has been consistent since it was first outlined in March. Costs have been reduced through initiatives in three categories:

1. redesigning central services;
2. depleting available reserves; and
3. fulfilling a commitment to keep students first by asking schools to contribute last in reducing school-based budgets.

The contribution from each category has been refined over time. For example, the amount of applicable reserves is now calculated to be $19.3 million. On March 22, the amount was estimated to be $12 million. By April 19, the estimate increased to $18.5 million. The changes—which are relatively small in the context of a $1.1 billion budget—ultimately reduce the impact on schools

Here are additional facts from the report and the budget process.

- The revenue from the provincial government is $1.012 billion compared to $1.002 billion for the current year. The revenue for 2010-11 has been restated to reflect a budget requirement from the provincial government for 2011-12. The province’s share of the cost of teacher pensions will flow through the CBE operating budget starting next year. The revenue increase is offset by an equal expense so there is no bottom-line change. The change is being made to fully reflect the cost of teachers to school districts across the province.


- The CBE budget breaks down into four major expense categories: salaries and benefits: 77 per cent; services: 11 per cent; supplies and materials: eight per cent; and amortization charges: four per cent.


- The CBE is expected to employ 8,783 full-time equivalent (FTE) positions, 331 fewer FTEs than the current year. The estimated reduction is comprised of 174.2 school-based positions, 170.7 of whom are teachers. The full impact on positions and employees will not be known until enrolment and budget are finalized.


- Budgets are not finalized until after Sept. 30, 2011, when actual enrolments are known by schools and school districts.


- The CBE estimates enrolment will increase for the 2011-12 school year by 658 students or 0.6 per cent. Budgeted enrolment for the current year was 102,674.


- The administrative cost, as a percentage of the total budget, will be 3.8 per cent, including the Board of Trustees. This figure betters the provincial maximum of four per cent.


- The board-funded capital budget of $19.75 million, which was approved May 17, is not included in the operating budget.

The full details of the 2011-2012 operating budget are attached below and available at www.cbe.ab.ca.

“No matter how difficult, a budget is merely a means to an end,” says Johnson. “As we finalize the budget and close one school year, we can begin to look forward to learning of a new year—after a well-deserved break for our students and employees.”

2011 - 2012 CBE Budget Webpage

2011/2012 Preliminary Operating Budget

CAPSC Executive became aware that the 2011/2012 Preliminary Operating Budget had been leaked over the weekend by someone at the board when media began contacting us on Sunday morning for comment. We did not see the document until it was released to the public this afternoon and have not yet had the opportunity to fully review the contents of the approximately $1.1B budget document.

The 2011/2012 Preliminary Operating Budget is now available online along with the agenda and other reports going before the Board of Trustees Tuesday evening. CAPSC Executive will be at the meeting and commit to bringing complete and accurate information back to our parents and school councils. There will be a two week period before the trustees approve the budget on Tuesday, June 28 where you will have an opportunity to provide feedback and ask questions of your trustee. We would also be interested to hear what you have to say so please drop us a line.

Eryn Kelly, Co-President eryn.kelly@capsc.ca
Leslie Newton, Co-President Leslie.Newton@capsc.ca