Manitoba intervenes in Seine River school board budget fiasco, appoints investigator

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This article was published 05/01/2024 (687 days ago), so information in it may no longer be current.

Manitoba is undertaking its own investigation into a rural school board’s surprise $1.4-million deficit.

The education minister has asked a veteran accountant to sift through the Seine River School Division’s financial records and report back with recommendations to get the Lorette-based board out of debt.

Before the winter break, senior administrators revealed internal accounting errors had resulted in the division mistakenly operating under the assumption it had a $3-million surplus heading into the 2023-24 school year.

“We’re helping this school division come up with solid plans and get back on a solid financial footing,” Education Minister Nello Altomare told the Free Press.

“We’re helping this school division come up with solid plans and get back on a solid financial footing.”–Nello Altomare, Education Minister

Altomare has tapped Vince Mariani, a consultant who worked as a secretary-treasurer and chief financial officer in the public school system for 35 years, to investigate the matter.

Mariani has been given until Jan. 31 to confirm the cause of the deficit, analyze the board’s budget preparation processes, and evaluate short- and long-term plans to resolve the issue.

Department officials met with senior administrators – including a new secretary-treasurer who first identified financial miscalculations shortly after joining Seine River in July — and trustees on Dec. 11. Altomare delivered the latest update, which he said will seek to ensure there are no repeats of this fiasco, via letter Tuesday.

“We regret the fact that we’re in this situation and we know that we need to rectify it as soon as possible,” said Wendy Bloomfield, chairwoman of the board of trustees that serves Ile des Chenes, St. Norbert and surrounding communities in southeastern Manitoba.

“We regret the fact that we’re in this situation and we know that we need to rectify it as soon as possible.”–Wendy Bloomfield, Chairwoman of the board of Trustees

“But we want to be able to do it in as humanely (a fashion) as possible, respecting staff and students and families in our communities.”

The board faced widespread backlash from families and staff members when it initially announced a list of “cost saving measures” to address vague budget pressures on Nov. 3.

One week later, trustees acknowledged the sudden deficit was the result of accounting errors and unreliable budget projections, which had been flagged in late July.

Officials subsequently backed down from plans to start charging for hyper-local bussing and extended-day kindergarten in 2024, but they initiated a partial hiring freeze and made other operational changes to immediately cut expenses.

The division overspent upwards of $5 million, including $2.3 million more than what was budgeted for student support services in 2022-23, according to an audit conducted by professional services firm MNP LLP.

Jonathan Waite, president of the local teachers union, welcomed Mariani’s appointment and review of the audit report as an “extra level of scrutiny” because his members continue to seek clarity about how the deficit came to be.

Waite has been vocal about teachers’ frustration that they were kept in the dark for months and that the board failed to consult them before announcing wide-reaching cuts.

“In my 22 years working in this division, I know that there have been challenging times but none more than this,” he said during an emotional presentation about the state of staff anxiety and uncertainty at a Dec. 12 board meeting.

“If the assumption is that the system can absorb this level of stress and that dealing with the costs to run the system are more important than the system itself, I fear that my members and I will find ourselves in a place for which there is no return.”

During an interview this week, Altomare said he was unaware of any precedent for the situation in Manitoba Education’s history but indicated there are no plans to unseat elected officials as a result of budgeting errors in Seine River.

While the minister declined to speculate on potential resolutions, he did not rule out providing additional funding to bail out the board that is now — alongside its 36 counterparts across the province — in the early stages of planning its budget for the 2024-25 school year.

Seine River has begun surveying stakeholders on their spending priorities for the coming year.

The online poll asks respondents to rank programs and weigh in on everything from the value of no-cost instrument rentals to free field trips.

One section seeks information about whether participants would be willing to help fundraise to offset the division’s debt or donate to a “deficit reduction fund.”

maggie.macintosh@freepress.mb.ca