The Aquinian

STUSU to run another deficit

Budget balanced thanks to “extra budgetary fund”

Not a saint: VP administration Mary-Dan Johnston says her job isn’t about corporate accounting. Instead, it’s about representing the students giving them the services they deserve. (Tom Bateman/AQ)

Members of the Students’ Union laughed and smiled awkwardly as Mary-Dan Johnston gave a quick comment about the financial situation of the union on Oct. 21.

“We’re not really making any money,” Johnston said.

The update showed the union will be spending about $277,000 of students’ money this year. It’s only expected to receive $268,000 in total revenue, mostly from student fees. The union will end the year with a budgeted deficit of $8,636.

Previous unions have relied on an “extra budgetary fund” to balance the budget at the end of the year.

The fund was created when a previous administration was involved in a lawsuit. Money was diverted into the fund in the event the union was forced to pay a settlement or make an extraordinary purchase. It now holds $128,452.

Last year the union ran a $993 surplus, an exception to a nearly five-year trend of deficits.

Johnston said that was only because less money was spent for emergency bursaries and academic assistance.

Using the fund this way has been the case for nearly a decade according to former VP administration Corben McLean.

McLean served as VP admin from 2007 to 2009. He said budgets would be written in the spring with a built-in deficit. At the end of the year, the extra budgetary fund would be used to balance the budget.

“[The Union] would inject ten to fourteen thousand dollars from the accumulated surplus, and that was what balanced the budget, taking from that extra budgetary fund,” McLean recounted of his time in office. “So really when you look at it, the only reason the budget looks balanced is because we’re taking from that surplus.

“The Students’ Union has been running deficit budgets for a number of years,” said McLean. “We’re not building up any debt by doing it because we’re doing it out of the surplus.”

After McLean resigned in the fall of 2009, Johnston won the by-election to replace him. She was re-elected last spring.

Johnston ran on a platform of reform and promised to “look at the consistent deficits that have been part of the STUSU budget and address that with a long-term plan to eliminate reliance on the accumulated surplus,” according to her spring campaign Facebook group.

The group remains active and contains a more detailed financial platform. The platform says Johnston would work to create a student review process for future budgets and create a long-term plan for use of the fund.

When asked where these promises stand, Johnston said they are in progress but did not give specific details.

Johnston said she does the job not to be a corporate accountant, but “because [she] wants to represent students,” and “give students the services they need” to be able to enjoy their time at university.

She said most of the day-to-day finances are managed by the union’s full-time general manager, Tina Reissner.

The current union has decided that they will attempt to reduce spending but has rejected raising the student fee. Since last year, spending on the yearbook has been cut in half. Funding for plaques and awards have also been cut.

But Johnston isn’t concerned “about the well running dry.”

She said the union is trying to avoid spending money from the extra budgetary fund unless it is for a project that would benefit students in the long term.

Two weeks ago, $850 was spent from the extra budgetary fund to help the university start a bike share program.

“The goal of the union isn’t to run a surplus or a deficit,” said Johnston. “It is to provide services to students to help make their lives easier, to work for them and speak for them at the municipal, provincial and federal levels.

“I’m by no means a saint…I think that elected representatives are not infallible and I don’t claim to be. So I hope students feel comfortable saying ‘we don’t think this should happen and that money should go here.’”

Johnston said she would consider most options from students unless it would mean major service reductions or cutting employees.

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Next: From the editor ~ Nov. 8, 2010