February 25, 2013

Lawmakers question plan to shift schools' retirement costs

By Noel K. Gallagher ngallagher@pressherald.com
Staff Writer

AUGUSTA — Legislators pressed a Department of Education official Monday to explain why the state was proposing to shift half of Maine’s teacher retirement costs onto local districts, and how they could be expected to pay for it. 

Department of Education Deputy Commissioner Jim Rier said the retirement cost shift was done to “balance the budget in a way to be less impactful” than other options, such as cutting funds to schools. The deputy commissioner was there to brief the committee on the education portion of the governor’s proposed $6.2 billion biennial budget.

Rep. Matthew Pouliot, R-Augusta, said he wanted the deputy commissioner to be frank about the discussion within the LePage Administration about education funding.

“Is the discussion about how can we get to 55 percent?” Pouliot said, referring to the voter mandate of having the state pay 55 percent of school costs. “Or, is it how to move funds around to make it look like we’re giving more money to education when we’re not?”

Under the retirement cost shift, 71 school districts would end up paying 100 percent of what the state had been paying toward the retirement costs of their public school teachers. Other districts would pay a portion of those costs, either more or less than 50 percent, depending on the value of the town's property.

The state calculated a municipality's ability to pay using a formula based on its mill rate, the amount of tax paid per dollar of assessed property value.

On Monday, several legislators also questioned why new casino money – roughly $14 million a year – was being included in the larger pot of money going to schools instead of being considered “extra” funding.

“Wasn’t that intended to be above and beyond (existing funds)? ” Sen. Christopher Johnson, D-Lincoln, asked Rier. “I have a problem with this.”

Rep. Brian Hubbell, D-Bar Harbor, read a portion of the law, saying the money would “supplement, not supplant” education funding.

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