An accounting error has left schools in Kamloops, B.C., facing a budget deficit of more than $2 million from the 2023-24 school year.
The shortfall means School District 73 will now be looking for ways to cut back on spending — at a time when Kamloops schools are already facing financial pressures due to a growing number of students and inflation.
School district management said they found the error in advance of an annual audit.
According to an audited financial statement that’s publicly available on the school district’s website, “an error in the financial projection process” led to a $784,021 deficit in its operating fund, and a $1.27 million shortfall in the local capital fund, which is used for things like desks, computers and portables.
School district secretary treasurer Trina Cassidy said the annual operating reserve — a fund for unexpected costs like broken equipment — has about $1.5 million in it, which is “not near enough” to get through the year.
Cassidy said it’s best to have three to five per cent of the annual budget in that particular fund. But $1.5 million represents less than one per cent of the school district’s budget for the year, which is around $240 million, Cassidy said.
Meanwhile, the local capital fund was completely depleted.
When it was created, the budget indicated a surplus in the operating fund, so money was spent based on that projection. Staff discovered the error in the spring.
Cassidy takes responsibility for the inaccuracy, one she calls “an honest mistake.” A line item in the budget, one source of revenue, was accounted for twice, she said.
“I didn’t catch it until it was too late in the year,” she said.
District superintendent Rhonda Nixon said by the time they learned about the deficit, money had been spent on things like portables and new desks. She said the money wouldn’t have been spent if the district had been made aware of the shortfall.
“It wasn’t like we had additional money,” she said. “We were spending money we needed to spend.”
Plan to address shortfall
School board chair Heather Grieve declined to comment on the situation, referring CBC News to Nixon.
Nixon said school district staff will present a budget reduction plan to the public on Monday, but would not provide CBC News with details on what will be included.
However, she said the plan was created with the intention of “staying as far away from students and the schools as possible.”
She also said while staff reductions aren’t in the plan at this time, it is possible.
“That doesn’t mean that it couldn’t happen. It means that right now we hope that our plan is sufficient, but we will have to see,” Nixon said.
She added that the district hopes to rectify the shortfall within a year, but if that isn’t possible, within the next two years.
Kamloops Thompson Teachers’ Association president Darcy Martin declined to comment until after the plan to address the shortfall is presented on Monday.