If Vice-President of Finance/Chief Financial Officer Marc Jones is correct (and he usually is), St. Clair will record its sixth consecutive annual budgetary surplus in excess of $20 million when the 2023-24 fiscal year concludes.
He predicted that spectacularly black-inked bottom line in the 2023-24 budget that was presented to the college’s Board of Governors during its March 28th meeting.
Like all provincial agencies, the college operates on a fiscal year running from April 1 to March 31.
At the end of this month – the conclusion of the 2022-23 fiscal year – the college’s financial forecast officially predicts a surplus of just over $30 million. But, unofficially at the February Board meeting, Jones said trends are indicating that the surplus could be closer to $40 million.
For the coming year, he is forecasting total revenues of $302 million (up from this year’s $289.9 million), $264 million in expenditures (up from this year’s $259.8 million), for a 2023-24 year-end surplus of $37.9 million.
The college has been using its year-end surpluses to carry out long-overdue (deferred) maintenance on some of its aging buildings, and to establish significant reserves ($70 million total by the end of this year) that would allow it to ride out any catastrophic economic downturn – or any sort of global crisis that might, for instance, severely curtail the influx of international enrolment.
In detail, here is Jones’ presentation to the Board:
The Mid-Year Review of the 2022-23 budget ... provided for a surplus position of $30,112,480.
The Statement of Operations Budget for 2023-24 is projecting a surplus of $37,924,022, representing an increase of $7,811,542 or 26 percent over the Mid-Year Review 2022-23 budget.
The projection for total operating and ancillary revenue for 2023-24 is $302,015,821, representing an increase of $12,052,408 or four percent over the Mid-Year Review 2022-23 budget of $289,963,413.
The projection for total operating and ancillary expenditures for 2023-24 is $264,091,799, representing an increase of $4,240,866 or two percent over the Mid-Year Review 2022-23 budget of $259,850,933.
CHANGES TO REVENUE
The following highlights the major changes in revenue compared to the Mid-Year Review 2022-23 budget:
• Total Ministry of College and Universities (MCU) Operating Grants decreased by $164,138 or 0.4 percent of the Mid-Year Review 2022-23 budget primarily due to the following:
- Increase in the International Student Recovery program due to planned higher international student enrolment;
- Appropriate planning to reflect 2023-24 being the fourth year of Strategic Management Agreement performance-based funding where the funding “freeze” is scheduled to be removed (a new provincial funding formula).
• Total Contract Income decreased by $5,945,380 or 43 percent of the Mid-Year Review 2022-23 budget primarily due to the following:
- Discontinued funding and wind down of the College’s Employment Ontario operations (that function has been transferred to another agency);
- The Ontario government’s accelerated Personal Support Worker program ending on March 31, 2023 (special funding to train more PSWs).
• Total Tuition revenue increased by $13,628,757 or eight percent of the Mid-Year Review 2022-23 budget due to the following:
- Decrease in domestic postsecondary tuition revenue of $812,330 or three percent, based on an enrolment projection of 6,594 domestic students. This is a planned decrease of three percent or 230 students from the Day 10 Fall 2022 enrolment of 6,824, and does not reflect a tuition increase (because the provincial government has maintained a tuition freeze);
- Increase in international postsecondary tuition revenue of $16,302,035 or 25 percent based on an enrolment projection of 4,279 international students (at the Windsor and Chatham campuses). This is a planned increase of 23 percent or 809 students from the Day 10 Fall 2022 enrolment, of 3,470 and does not reflect a tuition increase;
- Decrease in Public College Private Partnership (PCPP) revenue of $1,706,148 or two percent based on a decrease in overall registrations from the prior year. An enrolment projection of 3,500 international students is a planned increase of 0.09 percent or 30 students from the Day 10 Fall 2022 enrolment of 3,470, and does not include a tuition increase. (This refers to St. Clair’s “sister school” relationship with the Toronto’s area’s Ace Acumen Academy.)
• Total “Other” income increased by $3,751,345 or six percent of the Mid-Year Review 2022-23 budget, due to Interest Income increasing $3,067,400 as a result of significant increases in the Bank of Canada’s policy interest rate and interest realized from maturing GICs.
CHANGES TO EXPENDITURES
The following highlights the major changes in expenditures compared to the Mid-Year Review 2022-23 budget:
• Total Salaries and Benefits increased by $597,622 or one percent of the Mid-Year Review 2022-23 budget due to the following:
- Administrative Full-Time salaries: $189,177 decrease;
- Administrative Part-Time salaries: $384,233 decrease;
- Faculty Full-Time salaries: $1,238,039 increase;
- Faculty Part-Time salaries: $398,205 decrease;
- Support Full-Time salaries: $368,470 increase;
- Support Part-Time salaries: $129,198 decrease;
- Fringe Benefits of $91,925 due to the above salary increases and rising benefit costs.
The $597,622 increase is due to full-time positions across several constituent groups not have been filled during the 2022-23 year and hiring was delayed, and compensation adjustments. In addition, part-time staffing resources have been adjusted to those levels required to address institutional priorities and work volumes.
• Total Non-Salary Expenditures increased by $2,143,307 or one percent of the Mid-Year Review 2022-23 budget is primarily due to the following:
- Decrease in Advertising: $734,426;
- Decrease in Contracted Educational Services: $992,404;
- Increase in Contracted Services Other: $3,690,795;
- Increase in Equipment Maintenance and Repairs: $981,816;
- Increase in Equipment Rentals: $456,442;
- Increase in Instructional Supplies: $701,742;
- Decrease in Stipends & Allowances & Scholarships: $3,943,854;
- Increase in Other Expenses: $1,103,124;
- Increase in Amortization: $981,048.
CHANGES IN ANCILLARY (NON-ACADEMICALLY RELATED) OPERATIONS
The total Ancillary Operations surplus of $544,938 is a decrease of $718,113 from the Mid-Year Review 2022-23 surplus of $1,263,051. The decrease in the surplus projection is due to the following:
• Parking Operations due to lower parking permit sales and increased costs for the Downtown Windsor parking garage and ground lot maintenance.
• Varsity Sports due to the success of the college’s varsity athletes, operation of the St. Clair Fratmen, and the budget for athlete scholarships being re-allocated to Varsity Sports.
... AND ...
Jones also informed the Board that the administration intends to spend $17.5 million on deferred maintenance projects (overdue renovations and repairs to existing buildings and campus properties) in the coming year. Some of that money will come from the surplus-generated reserves, coupled with provincial grant funding.
One significant capital (new building) project will get underway in 2023-24: the construction launch of the so-called Welcome Centre. That will be a new structure that will jut out from the main floor of the front of the main building at South Campus, to centralize many of the Student Services most commonly used by students (and prospective students).
MORE STORIES FROM THE BOARD OF GOVERNORS MARCH MEETING
• Saint athletes excelled during the past year: https://news.stclair-src.org/need-know-news/board-hears-athletic-feats
• The college continues to contribute to the economic well-being of southwestern Ontario: https://news.stclair-src.org/need-know-news/college-economic-engine-southwestern-ontario
• The “jumper effect” in international enrolment numbers: https://news.stclair-src.org/need-know-news/international-enrolment-fairly-stable-despite-jumpers
• The college will continue to pursue its Strategic Directions in the coming year: https://news.stclair-src.org/need-know-news/were-being-directed-strategically