U of L, union negotiator disagree about surplus
Administration says most of surplus locked up in funding, reserves
The University of Lethbridge invited members of the media to an information session this week about how to interpret their publicly available budget documents, which show a large accumulated surplus of about $206 million in 2017-18.
University administration explained, despite what the public documents show, most of that surplus is locked up into the university’s grant funding, restricted reserves, capital assets and investment portfolios. This, said Nancy Walker, U of L vice-president of Finance and Administration, left the institution with an actual unrestricted surplus of only $465,000.
On Friday, AUPE 053 members, who are locked in protracted bargaining with the university over a new contract, were saying the U of L’s interpretation of these numbers was misleading.
“Their numbers just aren’t adding up,” said AUPE negotiator Dale Perry, citing the administration’s claim in 2017-18 it would be facing an operating budget shortfall of $1.2 million when bargaining began last summer. “If you delve into their finances, it doesn’t appear to be a financial issue. Clearly their own documents indicate the operating surplus for 20172018 was $880,000. If you look year-over-year, you can see their total accumulated surplus (operations + assets, investments, grants and reserves) increased to $209 million in 2018-2019. So it is not about whether or not they have money, it’s about a willingness to spend it on their employees.”
Perry pointed out the $49 million the university has locked up in restricted reserves as another example where university administration seems to be playing a shell game with union members.
“It is all well and good to talk about restricted funds,” Perry said, “but who restricted them? And why? From our perspective, it comes down to choices, and you are certainly making choices (with those restricted funds). They (the Board of Governors) take money out of the operating budget that’s provided every year to them; that’s guaranteed money from the provincial government each year we are bargaining for. They take money out of those grants and put them into capital and other areas that the money wasn’t necessarily intended for. So it comes down to the university making choices on how they allocate their money.”
“There is no question the board has discretion on where to allocate the internal reserves,” stated Walker, when asked about the restricted surplus this week, “but you also have to think about we have to keep the place operating. So we just can’t keep increasing expenses. We have to be very careful about that.”
“No different than in your own household,” she added, “you know you have to put money into utilities, you know you have to put money into your food and your mortgage. That’s what we do with the reserves as well. If something breaks down, we have to be able to operate. We would not look like good planners if we spent everything. So, yes, the board has discretion, but it also needs to keep the place running.”
Walker rejected the notion of tapping those restricted reserves to put more cash on the table for the current collective bargaining negotiations with AUPE 053 members.
“We have to have a balanced budget; so it means we will have to reduce somewhere else (in our operating budget),” she explained.
Perry said that’s the problem, and that’s why mediation between the sides has so far failed. Perry explained the union wasn’t necessarily looking for salary increases, only increases in benefits for its members. But the university administration does not seem inclined to give anything more to its employees, he said, while at the same time redirecting millions of dollars from its operating budget into its restricted reserves.
“We have already had two rounds of mediation, and so far it has been less than fruitful,” Perry said. “If mediation fails, then the parties are in a strike and lockout position. We are hoping it doesn’t get to that, but certainly we are talking to our members about what they want to do moving forward. We’re not yet sure where we’re going to go.”