FALMOUTH — Preliminary 2011 state funding for Falmouth schools of almost $5.5 million reflects a loss to the district’s budget of nearly $900,000 in general aid to education.

Initially, that figure appears to compare favorably to earlier predictions, Director of Finance and Operations Dan O’Shea said Tuesday.

“We thought we were going to lose $1.9 million, so if you can be excited about only losing a million, I guess we were,” he said. “It was better news than we were planning on until I saw the stimulus fees, which puts us right back to $2 million.”

O’Shea’s reference to stimulus fees is based on new information released this week that shows the state’s 2011 funding calculations included federal stimulus money of more than $1 million, he said.

Without that money, the total state contribution would be nearly $4.39 million – only 21.2 percent of the state’s essential programs and services model, he said. The stimulus money was supposed to be used through 2012, he said, but the state has chosen to use it all in 2011, which could backfire the next fiscal year.

The state had predicted Falmouth would take a bigger hit, but two factors – the change in Falmouth’s property valuation versus the change in the state’s average property valuation, and the change in Falmouth’s enrollment numbers – contributed to less of a reduction in state funding, O’Shea said.

“Valuation is the one (factor) that has a lot of swing to it,” he said.

According to O’Shea, Falmouth’s property valuation is down 2 percent compared to the change in the state average. And enrollment is down 1 percent.

The funding amount reflects the state’s decision to penalize districts that did not consolidate and did not submit an alternative plan by charging them an additional 6 cents on the local mil rate for education, O’Shea said. That decision increased money to districts, including Falmouth, that complied with the requirement.

But the Legislature has discussed removing that penalty, he said, which would decrease the amount of money Falmouth schools would receive – a loss of about $130,000 by O’Shea’s “rough estimate.”

The School Department will likely lose more of its funding from the elimination of some federal grants, O’Shea said. It will lose about $100,000 as a result of changes to the Medicaid reimbursements for eligible special education funding. And with the discontinuation of Money for Safe and Drug-free Schools through a No Child Left Behind grant, Falmouth schools will lose another $6,000.

The 2011 reduction is the latest of several over the last couple of years. For 2009, the initial budgeted state funding for Falmouth was more than $6.6 million. A mid-year curtailment of more than $473,000 that left the district scrambling was replenished by that amount in federal stimulus funds by the end of fiscal year 2009.

The state’s 2010 funding for Falmouth of $6.4 million included nearly $800,000 of stimulus money, O’Shea said. In this year, a mid-year curtailment took away about $700,000 of that amount.

Though the School Department staff has anticipated and planned for cuts, the 2011 funding figure and the expectation of possibly a worse scenario in the next year –  without stimulus funds to soften the blow – will continue to be a challenge.

“We were building three tiers of reductions based on trying to work with the council finance committee,” O’Shea said. “We’re trying to make cuts as far away from instruction as possible, but when you get up to $2 million, that’s difficult to do.”

There will be an all-day school budget workshop on Saturday, March 13, he said. The school board hopes to have the budget approved by April 5.

Peggy Roberts can be reached at 781-3661 ext. 125 or [email protected].

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