Chiefs of Ontario Workshop August 7 & 8, 2019 Niagara Falls. - - PowerPoint PPT Presentation

Chiefs of Ontario Workshop August 7 & 8, 2019 Niagara Falls.

George Merasty, B. Comm. (Hons), CA, CAFM Director of Finance MFNERC Our journey of collaboration that supports and strengthens education in Manitoba First Nations communities.

INTRODUCTION

George Merasty, B. COMM, CA

• Flying Dust First Nation
• 2000 Chartered Accountant
• 1997 – 2007 - AMC
• 2007 – PRESENT - MFNERC

Purpose of Presentation

• 1. The History of Funding

Modernization – MFNERC Process

• 2. MFNERC / MFNSS journey and

the benefits of a aggregate model of service delivery.

Relationship conceptual framework

Devolution (1962)

• Tightly controlled
• Reimbursement of actuals
• Social and education

RCAP (1995)

• Introduction of Financial Transfer Agreement

(1995)

• Introduction on the 1995-96 CAP limited the

growth on Indian Affairs spending to 2 percent per year

4

Mandate of Federal Government

5

“As Minister of Indigenous and Northern Affairs, your overarching goal will be to renew the relationship between Canada and Indigenous Peoples. This renewal must be a nation-to-nation relationship, based on recognition, rights, respect, co-operation, and partnership. “I expect you to re-engage in a renewed nation-to-nation process with Indigenous Peoples to make real progress on the issues most important to First Nations. “Work with the Minister of Finance to establish a new fiscal relationship that lifts the 2% cap on annual funding increases and moves towards sufficient, predictable and sustained funding for First Nations communities. “Make significant new investments in First Nations education to ensure that First Nations children on reserve receive a quality education while respecting the principle of First Nations control of First Nations education.”

• Prime Minister Trudeau to Minister Bennett, November 2015

From Budget 2016

in millions of dollars 2016-17 2017-18 2018-19 2019-20 2020-21 Total 35.8 $ 85.5 $ 143.6 $ 206.7 $ 276.0 $ 747.6 $ 55.0 55.0 55.0 55.0 55.0 275.0 20.0 20.0 20.0 20.0 20.0 100.0 115.5 115.5 115.5 115.5 115.5 577.5 226.3 276.0 334.1 397.2 466.5 1700.1 46.6 91.4 132.8 234.3 319.0 824.1 Special Needs Education Subtotal - Investments in the Current ON Reserve Primary and Secondary Education System Supporting System Transformation to Improve Education Outcomes Implementing Transformation Literacy and Numeracy Making sure every First Nations child receives a quality education Improving Primary and Secondary Education for First Nation Children Investments in the Current On Reserve Primary and Secondary Education System Addressing Immediate Funding Needs and Program Cost Growth Language and Culture

Budget 2016 – estimated breakdown

Engagement

Community discussions Technical task teams Survey Leadership dialogues 8

INAC, the AFN Chiefs Committee on Education, and the National Indian Education Council are collaborating to implement an engagement process aimed at developing recommendations to strengthen First Nation education

Nov Dec Jan Feb Mar Apr May Jun Jul 2016 2017

Working Groups & Task Teams

AFN CCOE/NIEC AFN/INAC Working Group

Statutory Funding Task Team Funding Mechanism Task Team Measurement & Mutual Accountability Task Team Community Engagement Sessions Early Childhood Task Team Post- Secondary Task Team

MFNERC AMC AMC/SCO/ MFNERC AFN/INAC Fiscal Relations WG

MFNERC Systems/ Funding WG Early Childhood Experts WG

Funding Modernization

What is the Current Funding Envelop Expenditure Project Who Gets how Much? Where is $ coming From? Analyze Funding Agreement (CFA, Block, Self Gov’t) Understand Provincial Formula’s New Approach Run FN Data through Each Provincial Formula + Enhancements (Interim Formula) What Will Be for 2019/20 Formula + Protection Side By Sides

** Budget 2016 increased investments in proposal-based and targeted programs.

= Core = Proposal-based = Targeted

Expenditure Project

12

The Expenditures Project

The expenditures project was an in-depth analysis project undertaken by ISC to identify all the education-related funding that was provided in one past fiscal year- broken down to the Band level for each First Nation An actual amount from 2017/2018 was calculated. What were the objectives?:

• Determine the government’s actual education-related expenditures (In

2017/18) and attribute them on a per-student basis

• Identify which recipients, other than First Nations, received funding on

behalf of First Nations students

• Compare the total actual education expenditures from 2017/2018, broken

down by FN, to the provincially-based funding formulas based on 2017/18 Nominal Roll data.

• Gain understanding of the national picture of education funding being

distributed across Canada to identify particular issues or exceptions.

Step 1: Delivery Model of Current Education Funding

Indigenous Services Canada

Step 2: Analyze 2017/18 Funding

Looked at all education programs: 1) Reviewed the 70+ different Program Areas (FA’s) offered Under Education to establish amounts for each by recipient 2) Removed one-time funding to ensure only regular

• ngoing funding is included (i.e. event funding)

3) Determined what kind of group is receiving the funding (First Nation, Provincial Board of Education, Service Organization). 4) Attributed all funding to students 5) Calculated total funding by band

Step 3: Provide Overview of 2017/18 Allocations

Actual funding from 2017/18 for each Nation is presented, includes both direct and indirect funding received.

New Approach

What is the Current Funding Envelop Expenditure Project Who Gets how Much? Where is $ coming From? Analyze Funding Agreement (CFA, Block, Self Gov’t) Understand Provincial Formula’s New Approach Run FN Data through Each Provincial Formula + Enhancements (Interim Formula) What Will Be for 2019/20 Formula + Protection Side By Sides

The New Approach = Interim Formula

• 1. Review the province’s budgets and funding guides to

determine education-related funding rates

• 2. Develop outline of funding components and applicable

amounts

*Formulas will be updated annually to reflect any changes in provincial rates

• 3. Finalize nominal roll by school for the preceding school year
• 4. Add $1500 per FTE language and culture enhancement
• 5. Add FTEs for up to full-time, K4, K5 - 2-year kindergarten

funded at new provincially comparable model rates

• 6. Add regionally specific enhancements that may have been

developed

Instructional Services Student Support Services Band Employee Benefits School Operations & Maintenance New Paths for Education First Nations Student Success Program High Cost Special Education* Core Funding Proposal-based Funding

New Approach

3

*Where applicable a Component of High Cost Special Education will continue as proposal based funding

1st Level - New Core Operating Funding Based on Prov Formula with Adaptations 2nd & 3rd Level – Regional Service Agreements – New Core Operating Funding New Targeted Funding – HC Sp Ed, Innov’n, EPP

Current Funding New Funding Interim Formula

Provincial Funding Formula Provincially Comparable Funding Enhancements Current Funding Levels Budget 2016 Provincially Comparable Funding FNs (data)

What Will Be for 2019/20

2019/20 Provincial Comparability Formula Amount

2019/20 Notional Allocation for the Nation

Proposal Based High Cost Special Education Funding Enhancements to the Provincial Formula Funding Protection

2017/18 Core Funding $80.00 2017/18 Non- Core Funding $20.00 Total 2017/18 Funding $100 2017/18 Education Funding 2019/20 Education Funding Protection 19/20 Core Funding Protection $0.00

19/20 Non-Core Funding Protection $5.00

Total 2019/20 Funding Protection $5.00 2019/20 Total Non- Core $20.00 Total 2019/20 Funding $105.00 2019/20 Total Funding 2019/20 Core Formula $85.00 2019/20 Education Formula Funding 2019/20 Non- Core Formula $15.00 Total 2019/20 Formula $100 2019/20 Core Formula $85.00

Concept Behind Funding Protection

MB $16,750 per FTE

7/29/2019 24

MANITOBA APPROACH

Band Op Schools Provincia l Schools Provincial Comparability

MB Interim Funding Model

Provincial Alignment: Manitoba Funding of Schools Program, Equalization, Ministry of Education Revenue, Property Tax Revenue

+

Enhanced Indigenous Language & Culture $1,500 / student + Expanded K4 K5 Programming

+

INAC Support for Student Transportation

+

Formula-based Funding for Tuition Students + 5% Admin + $500 / Student

+

Enhanced Support for Private Home Placement

27

INTERIM FUNDING FORMULA

• Insufficient funding for unique

First Nation student needs for: –language and culture and –closing the gap –Socio Economic gap

7/29/2019 28

Page 29

Source: Statistics Canada, 1981, 1991, 1996, 2001 and 2006 Census of Population.The Community Well-Being Index is expected to be updated using the 2011 National Household Survey later this year.

Program Delivery – Socio-Economic Realities

Community Well-Being Index (CWB)

Average CWB Scores, 1981-2006

• There has been progress
• ver the last 25 years in

improving the socio- economic conditions in First Nations and Inuit communities.

• A significant gap still exists

in the socio-economic conditions of First Nations and Inuit communities compared to those of

• ther communities.

Technical Team: Davin Dumas, Fisher River Greg Halcrow, Cross Lake George Merasty, MFNERC Steve Power, Consultant

REGIONAL FUNDING MODEL

7/29/2019 31

FIRST NATIONS POSITION FN s Data Regional Funding Formula Sufficient Predictable Sustainable Funding FN s Data FRONTIER BASE + ENHANCEMENTS Sufficient Predictable Sustainable Funding

FRONTIER AS A BASE

7/29/2019 32

2017/2018 BUDGET DIVISION / DISTRICT EXPENSES (1) PER PUPIL BEAUTIFUL PLAINS 20,147,114 11,218 BORDER LAND 34,280,089 15,944 BRANDON 101,481,400 11,897 DSFM 88,470,031 15,883 EVERGREEN 20,637,536 14,976 FLIN FLON 14,687,106 15,835 FORT LA BOSSE 18,330,496 13,014 FRONTIER 127,668,087 20,879 GARDEN VALLEY 48,664,417 11,217 HANOVER 84,740,600 10,941 INTERLAKE 36,874,400 13,382 KELSEY 20,579,595 13,546 LAKESHORE 16,306,021 14,757 LORD SELKIRK 57,647,663 14,802

7/29/2019 33

Issue Incremental Funding 1 How to determine the $24.9M increase in envelope for property total funding (all) tax related components 2 How to cover the $2.8M increase in O&M costs for total funding schools that rely on (applied to 3 generators communities) 3 How to apply the $80K increase in Occupancy total funding (all) component Ensures equitable distribution of funding

7/29/2019 34

5 Transportation $742Kincrease costoffueltaxes. hoursforbusdrivers $1.5Mincrease from5to6hoursperday. benefits $2.2Mincrease 6 Howtoapplythetax usingtheBCMremotenessindex Ensuresequitable basetotheNorthern (2northernrates=$724&$846,3isolatedrates=$954, distributionof Allowancecomponent $1265,$1516) funding

7/29/2019 35

Operational Funding

FN Schools

TotalFunding

318,067,159 $

• A. First Nations Schools

15,666 $

Avg Funding per FTE

20,304 $ 96.2% Frontier Base Amt 21,104.00 $

What is the Current Funding Envelop Expenditure Project Who Gets how Much? Where is $ coming From? Analyze Funding Agreement (CFA, Block, Self Gov’t) Understand Provincial Formula’s New Approach Run FN Data through Each Provincial Formula + Enhancements (Interim Formula) What Will Be for 2019/20 Formula + Protection Side By Sides

7/29/2019 37

First Nation Number: First Nation Name: Large Rural First Nation >500 Funding Agreement Type: Set/Fixed/Flex <50 Direct to First Nation To service Provider(s) *3 Band-Operated - School- based 6,727,364 $

• $

Band-Operated - Second Level

*4

• $

643,493 $ 614,491 $ (A)*7 643,493 $ (B)

• $
• $
• $

190,976 $ 2,171,868 $

• $

8,899,232 $ 834,469 $

*8

2017-18 Student Enrolment Data *1 First Nations Profile First Nation Schools FTE Enrolment Provincial/Private FTE Enrolment Total First Nation (Band-Operated) School Funding 2017-18 Actuals*2 2019-20 New Interim Funding Formula Direct to First Nation To service Provider(s) *3 9,225,215 $

• $

HCSE - School-based*5 1,768,406 $

• $

HCSE - Second Level

• $

190,976 $ HCSE - Proposal-based*6 403,462 $

• $

Sub-Total 12,011,575 $ 834,469 $ GRAND TOTAL $9,733,701 $12,846,043

The Funding Model is only a method for determining the amount and is not intended to prescribe how each First Nation should allocate or expend funding. Each First Nation has the discretion to allocate and expend the funding based on its own budget and expenditure decisions and Education Programming priorities

Next Steps

Regional Education Agreement Option 1 Business Case AFN Federal Government Budget 2020 Option 2 Business Case Federal Government Budget 2020

Manitoba First Nation School System

Funding Source CHIEF AND COUNCIL LOCAL ADVISORY COMMITTEE Agreement T & C $ $

32,043,763 $

Governing Documents (Tool Belt) By Laws Strategic Plan Finance Policies HR Policies

Brokenhead Pinaymootang $ 2,471,073 Bloodvein $ 6,232,103

$ 3,719,415

Roseau

Central Finance Unit

Lake MB $ 3,789,396 $ 5,292,428 Fox Lake York Factory $ 1,126,751 Lake St Martin Dakota Plains $ 2,386,584 $ 4,223,369 $ 1,093,411 Keeseekoowenin $ 1,709,233

Reporting Services PTI ORGANIZATION

Investments to Support the Manitoba FNSS

Pre-Agreement & Structural Readiness

$1.38 million for new school buses Up to $2.85 million for renovations in school facilities $13.5 million from 2014/15 to present in approved Structural Readiness activities Additional $1.92 million for Structural Readiness in 2017/18 pending approval $535,000 for resources and materials through New Paths for Education Band Support Funding Maintained

42

Considerations

Relationship Based

Resource Sharing Fairness and Equity

Comparability

Efficiency and Effectiveness Own Source Revenues

Accountability and Transparency

Federal Financial Contribution

• INAC – Transfer to MFNERC using the

Comprehensive Funding Arrangement (CFA)

• Multi Year – 5 years
• Funding Authority - Fixed Contribution Funding
• Funding – based on Fixed Annual Estimate
• Redirection of Funding? – Yes can be redirected
• Surpluses? – Carry forward allowed

Own Policies & Procedures Finance Human Resources Operations

Before Date Joined MFNSS After

Recipe for Success

FINANCE DEPARTMENT RECIPE

Ingredients Recipe

STAFFING Director of Finance Role & Responsibility ( Internal Controls) Accounts Payable A/P Process Flow Chart Contracts Administration Process Flow Chart Purchase Order P/O Process Flow Chart Accounts Receivable A/R Process Flow Chart Payroll P/R Process Flow Chart Inventory Control Process Flow Chart Tools Accounting Software Set up Hardware Backups Filing Cabinets Record Keeping & Storage Financial Policies Consistent application of transactions

Revisit & Adjust

• Budgeting in a circle

allows you to revisit your goals and priorities regularly.

Set Your Goals List Your Expenses Analyze Your Expenses Set Your Budget Manage Your Budget Revisit and Adjust

Principals Identify Purchase Need & Refer to Budget Availability Obtain Quote Estimated Cost & Complete PO & Code Transaction Step 1 Step 2 Authorized PO Submitted to Finance for Processing Step 3 Step 4 Finance assigns PO # and Returns PO to Managers To submit to Supplier

Supplier sends: Invoice to Finance Goods to Manager

Finance COMPARE PO TO INVOICE Enters Invoice Into Accounting Software Step 7

Issue Payment To Supplier Based on Cash Flow

BANNOCK RIVER FIRST NATION

PURCHASE ORDER FLOWCHART GOODS OR SERVICE FLOWCHART

Step 8 SUPPLIER:

Sends goods

• r

performs service

RECEIVER:

Compares shipping doc to PO

• r

ensures service performed

Step 9 Step 10

Inform finance if issues with supplier: goods or services

Step 5 Step 6

ACCOUNTS PAYABLE FLOWCHART

Timely Reporting

• Doctor: I have some bad news and some very bad

news. Patient: Well, might as well give me the bad news first. Doctor: The lab called with your test results. They said you have 24 hours to live. Patient: 24 HOURS! That's terrible!! WHAT could be WORSE? What's the very bad news? Doctor: I've been trying to reach you since yesterday.

Funding Source CHIEF AND COUNCIL LOCAL ADVISORY COMMITTEE Agreement T & C $ $

32,043,763 $

Governing Documents (Tool Belt) By Laws Strategic Plan Finance Policies HR Policies

Brokenhead Pinaymootang $ 2,471,073 Bloodvein $ 6,232,103

$ 3,719,415

Roseau

Central Finance Unit

Lake MB $ 3,789,396 $ 5,292,428 Fox Lake York Factory $ 1,126,751 Lake St Martin Dakota Plains $ 2,386,584 $ 4,223,369 $ 1,093,411 Keeseekoowenin $ 1,709,233

Reporting Services PTI ORGANIZATION