Education minister Mike Bernier is sending a team to conduct a forensic audit of the Vancouver School Board. The review will examine the board’s decision-making and how the “almost half of a billion dollars they receive” is being spent.
“We need to take an unflinching look at the books and the board governance at the VSB,” Bernier said at a Thursday morning press conference.
The announcement was made in the wake of the board’s refusal to submit a balanced budget by today’s deadline, which put trustees at risk of being fired. School boards must file balanced budgets by June 30 as a requirement of the School Act.
On Wednesday night, trustees rejected the government’s last-minute proposal to sell Kingsgate Mall, the commercial land the VSB owns, which the government pitched as a way to address some of the board's $21.8 million shortfall.
Bernier said he was surprised by the board’s decision, stating that VSB chairman Mike Lombardi, a Vision Vancouver trustee, and vice-chair Janet Fraser, a Green Party trustee, were not only included in the drafting process of the proposal letter, but that Fraser “brought up the idea” of Kingsgate Mall. According to the proposal, the Ministry of Education guaranteed the board $5.59 million in exchange for a small ownership share in the mall, if the sale did not happen in the next school year.
Lombardi held his own press conference an hour after the Ministry of Education’s. After publicly welcoming the audit, Lombardi said the board rejected the ministry’s proposal because it doesn’t meet the district’s needs or provide any additional provincial funding.
“The proposal was that we take potentially up to $6 million dollars out of capital asset proceeds and put them into the operating budget. That’s the equivalent of taking out a second mortgage to buy your groceries,” Lombardi said.
What Bernier and Lombardi did agree on Thursday morning was that they both were trying to work in students’ best interests.
Kingsgate Mall on the East Side is one of the four non-school properties the VSB owns, bringing in an annual revenue of $750,000. The VSB is the only district of B.C.’s 60 school districts to refuse to submit a balanced budget this year.
This will be its fifth audit since 2010 — two of the audits were ordered by the province.
In 2010, then Education Minister Margaret MacDiarmid appointed a special advisor to examine the district’s financial performance, while in 2012, the VSB hired PwC to produce a “Resource Allocation Report.”
In 2015, then Education Minister Peter Fassbender appointed EY, formerly Ernst and Young, to serve as special advisor on the board’s budget even though the board had already hired PwC to undertake similar work — to update the 2012 report and identify opportunities for additional savings. Trustees opted to continue with the PwC contract despite the potential for duplication.
Bernier said he hopes the latest audit will “help end the political games in Vancouver,” referring to the board’s refusal to submit a balanced budget while claiming its staff is working towards doing so.
“It’s time for those games to end,” he said.
Meanwhile, on Tuesday, Vancouver city council passed a motion backing the VSB’s request for more provincial funding.
It was followed by a Thursday morning press release from Vision Vancouver Mayor Gregor Robertson who echoed the call for more funding. The statement pointed out that in 2015, for the first time, Vancouver provided more in school taxes — $463 million — than it received in provincial funding —$448 million.
“I am urging the Minister to work with the Vancouver School Board to find a way forward that respects the wishes of Vancouver voters and provides stable, long-term and predictable funding that responds to the complexity of needs in our schools, and avoids the cuts that will fall disproportionately on our most vulnerable kids,” Robertson’s statement read.
On June 20, the VSB released a list of 12 mostly East Side schools it’s considering closing, which would save about $8.2 million a year.
