Budget 101: Breaking down Surrey Schools’ billion-dollar budget

Surrey Schools has a billion-dollar budget, but where does it come from? And how is it spent? Here's a crash course on the district's budget and how operating, capital and special purpose funds are used. (Image via iStock)

The annual budget for Surrey Schools once again exceeds $1 billion, and with so many zeroes, it’s important to understand where and how the district’s money is spent in any given school year.

According to the 2023-24 Annual Budget, the total revenue for this school year is $1,031,841,955 (that’s one billion, thirty-one million-plus dollars).

Like every school district, the vast majority of the budget comes from the B.C. government: 95% of Surrey Schools’ overall budget comes from the Ministry of Education and Child Care, across operating, capital and special purpose funds.

Operating Funds (87.4% of overall budget)

Operating funds make up the lion’s share of funding, accounting for 87.4% of the overall budgeted revenues.

• Operating revenue pays for the day-to-day operations of the district, including staff salaries and benefits, services, utilities and supplies. (Those expenses cost more than $900 million every year!)
• Most of the district’s operating revenue comes from provincial grants, which are based on the number of students enrolled. As B.C.’s largest school district with nearly 82,000 students, Surrey receives sizeable grants that are earmarked by the Ministry to keep the district up and running.
• Operating funds cannot be used towards building schools. New schools, additions and seismic upgrades are paid with capital funds. (However, the district has had to spend a portion of operating funds to purchase and install portable classrooms in recent years. Portables are not covered by capital funds).

Capital Funds (3.3% of overall budget)

This year’s capital funds account for only 3.3% of the overall budgeted revenues.

• Capital funding pays for the design and construction of new schools, additions and seismic upgrades. (The capital revenue from this year’s budget is already spoken for with previous capital projects.)
• The provincial government determines how much money is allocated to capital projects based on the capital submission process: Every June, the district submits a comprehensive Five-Year Capital Plan to the Ministry, outlining priority school construction projects and requesting funding for them.
• In March, the B.C. government decides how much money is spent on capital projects and which projects across the province receive funding and are greenlit for construction. Surrey’s most recent capital wish list includes funding requests for 10 new schools and 17 additions to existing schools.

Special Purpose Funds (9.3% of overall budget)

Special purpose funds take up the remaining 9.3% of this year’s budget, most of which comes from provincial grants.

• Special purpose funds are targeted for specific activities or purposes that are not covered by operating or capital funds. For example, a portion of special purpose funds could be designated for costs related to prolonging the life of a building, but would not include labour costs that would be covered by operating.
• Like operating funds, special purpose funds also cannot be used towards building schools.
• Provincial grants for special purpose funds are determined through a combination of factors, including number of students, submissions and initiatives.

Beyond these grants from the provincial government, other funding sources are limited to such revenue streams as tuition fees from international students, facility rentals and investment income.

The need for capital funding in particular is exceedingly great. Last May, the board approved the 2024-25 five-year capital plan, which outlined the need for $3.17 billion in funding – triple the annual budget – for 50 major capital projects to address rapid student enrolment growth in Surrey and White Rock.

The district cannot tax residents to raise money for schools or take out a loan to fund new schools, leaving government grants as the main source of funding. The Surrey Board of Education and the district continue to advocate for increased funding from the Ministry of Education and Child Care.

As new enrolment outpaces historical student population increases, it is more important than ever that funding is allocated to accommodate the district’s students – all 81,838 of them, and growing.