Greenwood on the District Deficit

The Langley Advance features a very interesting letter today from outgoing School District secretary-treasurer Peter Greenwood on the District deficit--a rare step for a senior bureaucrat:

To the Editor,

At its June 16 meeting Langley's Board of Education reported a projected $4.8 million deficit in its 2008-2009 operating budget. Board chair Joan Bech shared some preliminary conclusions that have been provided by the accounting firm Deloitte, which was engaged to conduct an independent review of accounting and budgeting procedures in the district.

The board indicated in its public statement that it would be sharing information in the report, which the board will formally receive in September. In the meantime, a few things can be said to clarify the situation.

The projected $4.8 million deficit is not due to past decisions of the board. As chair Bech stated, it was due to "incorrect and incomplete calculation of expected expenditures" and "accounting errors in calculations and reconciliations." These errors, which have been identified and corrected and will not be repeated in subsequent years, led to a situation where the district spent more money than it had.

Although the district has dealt with the causes of the deficit, it has not addressed the overspending that occurred in 2008-2009. The district had to reduce expenditures by $3.1 million for 2009-2010 to bring them in line with projected revenues. Those reductions were necessary to balance the 2009-2010 budget and ensure another deficit will not be incurred.

As for the 2008-2009 deficit, the Ministry of Education has been informed of the situation, with formal notification to take place when the financial audit for 2008-2009 is completed. At that point the district will request a meeting with the ministry to work out a plan for eliminating the outstanding amount.

Peter Greenwood
Secretary-treasurer