June 13, 2013

Schools lack certainty ahead of budget votes

By Leslie Bridgers lbridgers@pressherald.com
Staff Writer

and Gillian Graham ggraham@pressherald.com
Staff Writer

Published Tuesday, June 11, 2013

click image to enlarge

A political sign stands on Spring Street in Freeport on Monday in advance of Tuesday’s school election.

Gabe Souza/Staff Photographer

Residents in dozens of southern Maine communities will vote Tuesday on budgets proposed by their respective school districts. But, regardless of the election results, some of those voters may have to do it again soon.

Because lawmakers in Augusta continue to debate the details of the state budget – including how much money to allocate to schools – school districts can only make their best guesses about what funds they’ll get for the fiscal year that starts July 1. The lack of a state budget means voters will have to make decisions Tuesday based on revenue predictions that may, or may not, come true.

Some districts may end up getting less state funding than officials predicted, while others may end up getting more money. “At this point, we’re in limbo,” said Sanford Superintendent David Theoharides. “Until we get these revenue figures (from the state), I don’t know how to go forward.”

Many districts have accounted for Gov. Paul LePage’s proposal to shift half of the $29 million teacher retirement costs from the state onto them.

On Friday, however, the Legislature’s Appropriations Committee approved a budget that would maintain the state’s overall contribution to teacher retirement costs.

If the additional state revenue comes through and those funds are not included in the school budgets approved by voters, districts may have to hold another referendum in order to use the additional state funds, said Jim Rier, deputy commissioner of the Maine Department of Education.

Rier said the department is advising districts to seek legal counsel on whether their local budgets would require another vote. Some districts, he said, are considering holding onto any unanticipated money and not using it until the following budget year. That is, if the Appropriations Committee’s budget passes.

The budget has not yet been voted on by the full Legislature, and it’s unclear if the committee’s budget compromise can survive an expected veto by LePage.

Sanford, for example, budgeted $278,000 to cover the shift in retirement costs proposed by LePage. However, even as the voters head to the polls Tuesday to vote on the budget, the district has instituted a hiring freeze while it awaits the final state figures.

“It’s very abnormal to be sitting here in the second week of June and not even have your hiring done,” Theoharides said.

Gorham and Saco-based Regional School Unit 23 are among the other districts seeking voter approval Tuesday and moving forward with the latest figures from the state on the shift in retirement costs.

“We just had to forge ahead and try to develop a budget the best we could,” said RSU 23 Superintendent Patrick Phillips, who noted that state funding has been a question mark in past years, too. “We’re used to this.”

The more cautious districts that planned for less state funding may need voter approval for future adjustments in revenue, but they have covered their expenditures, Rier said.

If the districts do get money that’s not in their budgets, it will be up to them to figure out how they can use it, said Rier. “These are individual judgment calls by the units themselves,” he said.

Meanwhile, school districts that were more optimistic about state revenues may end up having to reopen their budgets to cut spending or increase taxes.

Portland, which has already approved a budget, did not account for a retirement cost shift in its budget, for example. Neither did Scarborough, which is conducting a second budget validation vote Tuesday.

Scarborough’s school board had budgeted for the governor’s proposal and a substantial decrease in state revenue, but the Town Council removed the funding because it was only a potential cost, said Kate Bolton, business manager for the schools. She said the district plans to return to the council for a budget amendment if the Legislature passes a state budget with the cost shift.

The potential shift of teacher retirement costs is not the only unsettled state budget issue for school districts.

The Appropriations Committee’s budget plan also includes additional funds for school districts through the distribution of $13 million from the state’s share of casino revenue and an increase in the state’s contribution toward special education, said Connie Brown, executive director of the Maine School Management Association.

“We are pleased that the Appropriations Committee has recommended the additional resources for this biennial budget,” she said.

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