More than a decade after voters agreed the state should pay for 55 percent of the cost of K-12 education, a ballot measure this November proposes a way to actually pay for it: a surcharge on the state’s top earners.

The Stand Up for Students initiative would assess a surcharge on Maine households earning more than $200,000 a year – $30 for every $1,000 over $200,000 – and require the state to use that money to supplement any shortfall in the General Fund appropriation to reach that 55 percent. It would affect the top 2 percent of income earners and is expected to generate an extra $157 million in the first year.

“I think that people are aware that education is really important to us. It’s the pathway in Maine, so people are supportive,” said Lois Kilby-Chesley, president of the state teachers union, the Maine Education Association. “We are very, very hopeful that it is going to have a huge following by November.”

From 2008-09 and the projections for 2016-17, the state’s share of education funding has decreased from about 53 percent to 47 percent.

Last year, Moody’s Investors Service called out Maine for failing to meet the 55 percent mandate, in place since 2004. Moody’s said the state budget is a “credit negative” for municipalities because it increases the burden on local property taxes and leaves cities and towns with tough decisions about how to make up the difference.

To avoid program and staff reductions, many Maine communities have opted to raise property taxes, a 2013 Maine Policy Review paper found, putting more pressure on local taxpayers.

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The Maine Department of Education provides funding under an essential programs and services model that distributes money to communities through a complicated formula based on enrollment and tax valuation.

This month, state education officials announced they anticipate spending $986 million on education this year, a $2.3 million increase in state funding from last year – but that amount means there’s a $20 million gap that local municipalities must fill.

For years, education leaders have decried state policies that emphasized tax cuts for the wealthy while not funding education at 55 percent.

“People with the highest incomes have gotten all kinds of tax reductions in the last four and a half years. (The initiative is) shifting the money back so it’s more equitable,” Kilby-Chesley said. “It’s time to bring it back into balance for the rest of us.”

The Stand Up for Students initiative has support from several unions and other organizations, including the Maine AFL-CIO, the Maine Education Association, the Maine Parent Teacher Association, the Maine State Employees Association, the Maine Small Business Coalition, the Maine People’s Resource Center and the Maine People’s Alliance.

The initiative language spells out that the revenue would go into a specific fund, which would be used to reach the 55 percent mandate if the General Fund appropriation falls short. Any money from the fund must be used for so-called “direct support,” such as instructor salaries, and may not be used for administrative purposes. The state Department of Education would administer the fund.

If the initiative passes, it could result in lower property taxes because the state would be contributing more to local districts, Kilby-Chesley said.

“We are very hopeful that property tax relief will come from this,” she said.

 


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