Politics

April 29, 2013

Portland, school officials clash on budgeting for cutbacks

Mayor Michael Brennan urges schools to ignore proposed cuts in state revenue. Others disagree.

By Randy Billings rbillings@pressherald.com
Staff Writer

PORTLAND – City and school officials clashed Monday night over how to account for revenue cuts proposed by Gov. Paul LePage, including a nearly $2 million hit to the school budget.

The school budget presented to the City Council on Monday assumes LePage initiatives to reduce spending on public schools will be passed by the Legislature.

The school district estimates a proposal to shift teacher pension costs to municipalities will cost $1.4 million and the Baxter Academy for Technology and Science will cost $300,000.

In a workshop before Monday's meeting, Mayor Michael Brennan said the schools should ignore the proposed state cuts, as the city did. The city could lose $10 million in revenue sharing and General Assistance cuts.

"We did not put together a city budget that included any of the proposed cuts that are currently in the budget in Augusta," Brennan said. "To do that on the school side just doesn't make sense."

The Legislature is not likely to vote on a budget until June, but the city has scheduled a citywide school budget referendum on May 14, meaning certain assumptions need to be made.

City Councilor John Anton, who heads the council's Finance Committee, disagreed with the strategy of ignoring potential cuts, as did Councilor Edward Suslovic.

"If you're going to assert something you don't know, you might as well go with a more conservative approach," Anton said.

The City Council sets the bottom line for school spending, but cannot exercise line-item control.

On Monday, the council referred the $97.9 million school budget, which cuts 46 full-time positions and gives teachers $1.7 million in contractual raises, to the Finance Committee, which will meet Tuesday and Thursday.

The school budget for the year starting July 1 would require the school portion of Portland's property tax rate of $18.82 per $1,000 valuation to increase 3.7 percent, from $9.57 to $9.92.

The increase would add $70 to the annual property tax bill for a home valued at $200,000. Portland's tax rate also depends on the size of the municipal and county budgets.

The Finance Committee plans to vote Thursday on sending a school budget to the full council. The council is scheduled to vote on the school budget Monday so a citywide referendum can be held on May 14.

The rift, which culminated in a spirited back-and-forth between Anton and Brennan, emerged as the council sought ways to maintain maximum flexibility in the budget so it can react when the state approves a budget -- likely in June.

Councilors discussed the rules that would apply if they decided to spend more than the budget amount that is ultimately approved by voters.

Brennan seemed poised to take advantage of a gray area in the state statute that governs school budget referendums. The law requires districts to have a budget referendum.

City attorney Danielle West-Chuhta described the statute as "permissive," meaning that it states the city "may" go back to voters if it needs more money than was previously approved by voters.

Brennan, a former legislator, said that wording is more than simple semantics; he said it makes a referendum to spend more than the amount approved by voters a suggestion, not a mandate.

"There's no enforcement or penalty," he said.

Anton shot back, saying that he would vote against any budget proposal that did not take the proposed cuts into account. West-Chuhta said she spoke with an experienced school attorney, who advises school districts to hold additional referendums if they decide to spend more than was initially approved.

School board members defended their decision to budget conservatively and account for the proposed state cuts.

Board Chairman Jaimey Caron said the district did not want to repeat the financial debacle of 2007, when the district ended the year with a $2 million deficit.

"Some would argue we take the optimistic view of the not-yet-finalized state budget," Caron said, "but ... the parallels to the type of overly optimistic budgeting that got us in trouble in 2007 (were) too strong for the board to ignore."

Also, the district must provide 90 days notice to staff members being laid off.

"If we wait until July, we're going to have to cut deeper," board member Laurie Davis said.

Meanwhile, councilors were ambiguous about their limits for a tax increase.

Anton set a personal cap on the city-school tax increase at 2 percent, while Councilor Jill Duson said, under "extreme circumstance," she may support a 3 percent increase.

The proposed tax increase in the city portion of the budget is 3.3 percent.

Even under the best-case scenario, Anton said, the school budget is still too high.

He noted that even if one ignores the impact of the charter school and teacher pensions, the school budget would increase its share of the tax rate by 3.11 percent, while still cutting dozens of positions and giving $1.7 million in catch-up raises to teachers.

Staff Writer Randy Billings can be contacted at 791-6346 or at:

rbillings@mainetoday.com

Twitter: @randybillings

 

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