CANMORE – The Canadian Rockies Public School (CRPS) division will head into the 2021-22 school year with a conservative budget as the impacts of COVID-19 are still being felt.
The CRPS school board approved the budget at its May 26 meeting, which saw a forecast of a slight decrease in both revenue and expenses compared to the audited financial statements for the 2019-20 school year.
The division will head into the next school year with a budgeted $29.8 million in revenue compared to $30 million in expenses.
However, with it only being a forecast and the school system reliant on entrepreneurial aspects such as international students and outdoor learning, the revenue could shift based on the post-pandemic lifting of public health restrictions.
“It’s predominantly because of COVID the tourism industry has taken a hit, and some families have moved out of the valley, so enrolments have gone down,” said Mike Guindon, the secretary treasurer for CRPS. “Staff has been adjusted to that as well. It’s a direct correlation. … If enrolments do increase, staffing will have to be adjusted.”
Guindon said CRPS had a decline of 77 students last year, which during a regular budget year would have impacted the school system by about $800,000 – or three per cent of the overall budget.
The school division received COVID-19 mitigation funding to offset the costs, and depending on the ability to run both the outdoor learning program and host international students, could bring in additional revenue.
The provincial budget had them “held harmless,” meaning they don’t have to accommodate that drop in student numbers in the budget for at least one year, which is done on a three-year weighted average for enrolment.
CRPS superintendent Chris MacPhee said in a good year the two programs combined help raise between $900,000 and $1 million toward the bottom line. Due to the pandemic, last year saw little outdoor learning programming being run and about 22 international students in the valley.
He said following the provincial reopening announcement, there is optimism for the popular summer Career and Life Management (CALM) programming that is set to begin June 29. The budgeting, however, goes ahead as if it isn’t being run as a precautionary step.
“We can’t do it ahead of time otherwise we’d drive ourselves into debt right away if it doesn’t happen, so it’s a double whammy if we have staff we’re paying and we don’t get the revenue,” MacPhee said. "If you hire $200,000 worth of staff and there’s $200,000 worth of revenue that doesn’t commit, you could have yourself a $400,000 shift.”
The announcement by the province for the reopening stages gives reason for optimism. Depending on the stage Alberta reaches, the outdoor learning program – which is designed to accommodate a group of 30 participants and involves staying overnight – could help the overall budget.
MacPhee said they’re also aiming to have a full complement for the international student program in the fall, with students quarantining for two weeks after arriving. But with COVID-19, two months away is a lifetime.
The school division will receive $23.95 million from the province, including $16.84 million for kindergarten to Grade 12, to cover 80 per cent of the $29.8 million in revenues. The division will also receive about $3.5 million from the federal government, another $1.1 million from fees and the remainder from sources such as gifts and donations, rental of facilities and fundraising.
On the expense side, $22.3 million goes to benefits, salaries and wages. An additional $5.32 million goes to services, contracts and supplies, while the amortization of supported tangible capital assets is $1.9 million.
The total expenses are budgeted at roughly $30 million, for an anticipated $200,000 shortfall in revenue.
This past school year, CRPS budgeted expenses of $30.36 million for a decline of about $600,000 heading into the next school year. Revenue is also budgeted for the upcoming year at $400,000 less than the $30.43 million during the 2020-21 school year.
The budget is based on categories of instruction for kindergarten to Grade 12, operations and maintenance, transportation, system administration and external services.
Most alarming in the budget was a continued and significant increase in insurance costs.
The 2020-21 school year saw a 274 per cent increase in insurance for a total paid of $436,700 in premiums. The year prior had CRPS pay $177,300 in insurance.
Since the 2018-19 school year, CRPS has seen a more than 330 per cent increase, Guindon said, which saw them and other school divisions shift to Armic Insurance. The increase meant a jump from $185,000 in 2019 to roughly $430,000 in 2020.
“It’s something we can’t control. We’ve identified them as concerns since the magnitude of the dollars we’re talking about and the ability to mitigate it as well,” Guindon said.
In the insurance world, it’s known as a hard market where rates increase and companies are less likely to negotiate different terms. It has also seen more domestic insurance companies shift away from what they cover, leaving less options to pick up insurance policies.
The impact could have ramifications on another aspect of CRPS' entrepreneurial efforts in transportation.
During the year, CRPS uses its bus fleet as a charter system. It means about half of the roughly $195,000 transportation costs are covered and as a result, parents do not pay bus fees.
However, MacPhee told the board there is uncertainty around if Armic Insurance will cover that aspect, but added the school system, insurance company and its underwriters continue to be in discussions.
“If worse came to worse and that’s what they decide, not only has our insurance gone up extensively, we’ll lose $100,000 of that transportation budget that was generated from charters,” he said.
Guindon said without the additional revenues from transportation, the division would run a net loss for transit.
“It’s a unique opportunity for the Canadian Rockies because we’re situated in the Bow Valley, so instead of charging a fee to parents we’ve capitalized on being able to use the buses in the summer months to generate revenue from our fleet,” he said.
“About half of the $195,000 is charter services. We earn money from chartering our buses to generate those extra dollars, so we don’t necessitate the collection of school fees for transportation. It gives us a win-win situation.”
Guindon noted the budget is a “live document” and it’s consistently being revisited to address potential impacts.
“Our aim is to maximize resources as much as possible and be able to balance the budget when you finish the fiscal year,” he said. “There are so many factors at play, to hit that target is near impossible. It can go in either direction where we could have a surplus or deficit since there are so many variables.”