School Bus Ontario upset over new funding formula

School Bus Ontario is frustrated with a new funding formula which they believe will hurt bus drivers in all regions of the province – including those in northern Ontario.

In this photo taken using a drone, school buses are seen in a lot in Ottawa, Ont. on April 18, 2022. (Sean Kilpatrick/The Canadian Press)

School Bus Ontario (SBO) is a non-profit association providing advocacy, education and legislative consultation services to the owners of school bus fleets, school boards and transportation consortia across Ontario for more than 60 years.

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The Ontario Government has cut back funding for school bus operators in many regions across the province, and according to SBO, that is leading to urgent concerns about the ability to keep buses on the road amidst increasing costs.

Officials with the non-profit told CTV News that the new funding formula that contained harsh fuel cuts and other changes that negatively affected each region. As a result, the association said it feels there isn’t enough money flowing to the operators to pay for basics like adequate driver compensation, driver retention bonuses and new buses.

On top of that, the Ministry of Education imposed a reduction of between .56 to .58 cents per litre of fuel, according to SBO.

“(This) has left operators in certain regions worried about filling their tanks to cover the millions of kilometres a day travelled by their professional drivers,” said SBO, in a news release.

Nancy Daigneault, SBO’s executive director, said all regions will be hit including northern Ontario.

Nancy Daigneault, executive director of School Bus Ontario, talks with CP24 on September 2, 2021. (CP24)

“Some bus operators are still owed millions for the 2023/24 school year and are heading into this new year without knowing how they will be paid for fuel,” she said, in the news release.

Many impacts

Daigneault told CTV News that each area is going to be impacted differently.

“This decision to radically cut fuel funding flies in the face of common sense,” she said.

Daigneault said this cut by the province has created an untenable situation and each region or operation will now have to evaluate how to deal with such a massive loss of funding – some operators may cut back in office staff to deal with cuts or try to make do with less dispatch staff.

SBO said some operators are considering legal action.

Daigneault said that with these cuts, eventually slowdowns, delays or continuous cancellations will persist.

Student ready to head back to school

Daigneault added the situation is frustrating with the first day of school on the horizon.

“The first day of school is upon us, and once again bus operators are facing funding shortfalls that not only create a September of discontent, but raise the possibility of even more school bus cancellations and disruptions in some regions,” she said.

“Operators require proper funding so they can focus on job-one: getting our kids to school and home safely.”

SBO has reported that the costs to operate school buses have risen dramatically in the last four years in Ontario:

• Price of new buses is up 71 per cent,
• bus parts – including tires and brakes have increased 50 per cent,
• insurance rates have risen more than 30 per cent, and
• driver wages have gone up about 38 per cent.

“These cuts have left operators shouldering skyrocketing costs for bus maintenance, fuel, and driver wages,” said SBO officials.

Confusion, oversights and frustration

“The new funding formula that went into effect in 2023/24 school year, created an overwhelming amount of confusion among school boards and transportation planners due to a complicated patchwork of different local contracts,” reads the SBO’s news release.

“Some bus operators faced fuel cuts and others faced issues with funding for minivan routes, and still more were left without direction on overall rates.”

SBO said that the ministry in “a stunning oversight” initially left out funding for minivans for special education in their original release of the new formula.

“The confusing formula begs the question ‘who’s running the show?’” said SBO President Nick McRae, in the news release.

“We’re not delivering groceries, we are safely transporting a very special cargo – our children.”

School Bus Ontario President Nick McRae is pictured standing in front of a Roxborough Bus Lines school bus in this undated file photo. (LinkedIn)

McRae said that cost increases have left operators scrambling to cover expenses let alone “make ends meet.”

“(This is) no way to do business,” he added.

Pleading to the new minister

Jill Dunlop was named Ontario’s Minister of Education on August 16, 2024, replacing Todd Smith, who resigned from the role and as a member of the provincial parliament earlier in the month. Dunlop, the then Minister of Colleges and Universities, sits at the Ontario Legislature in Toronto, on May 28, 2024. (Chris Young/The Canadian Press)

School Bus Ontario is calling upon newly appointed Minister of Education, Jill Dunlop to immediately reverse the cuts to fuel funding, to ease pressures facing bus operators – including fears of not having the money to pay for enough gasoline to complete routes and get children to their schools or homes safely.

“Ontario families know very well that prices are soaring for everyday necessities, so why is the Ministry slashing what it pays the school bus operators for fuel by .56 cents to .58 cents per litre? This must be addressed,” said Daigneault. “The new Minister undoubtedly has her hands full ahead of the first day of classes, but we are asking Jill Dunlop to intervene and fix the fuel issue so operators can safely and reliably transport our children to school.”

Larger impact in northern Ontario

The SBO director said she believes the gas reduction will hurt the north especially.

"Northern areas have a harder time because of the distance travelled – many, many more kilometres than urban routes and a fuel funding cut will hit harder," said Daigneault in a statement last week.

"The province claims these issues are local in nature but the problem was created by the provincial funding formula which local boards/consortia must follow – a cut in fuel or any other area impacts local contracts. This is not just a local issue because the only way it can be fixed is with the province changing the funding formula.”

Impacts seen last year

SBO said that a ministry report on cancellations and delays in the Ottawa area last year points to a reduction in transportation funding as a result of the new formula.

Officials in the industry are advising that the new formula does not recognize the true cost of operating buses, resulting in overall service reductions in key areas.

The Ottawa Student Transportation Authority told CTV News that it was short 24 drivers as of Aug. 24 – less than a week from the start of classes – and has had to cancel routes.

Sudbury Student Services Consortium also had several cancellation last year due to driver shortages, often only communicated to students and parents the morning of.

CTVNorthernOntario.ca has reached out to the Sudbury Student Services Consortium and Nipissing-Parry Sound Student Transportation Service to inquire if there are driver shortages in northeastern Ontario heading into the school year but has yet to receive a response.

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“Our hands are tied, the boards and consortia hands are tied," said Daigneault.

“Only the province can fix this.”