Gov. Paul LePage’s budget proposal may end up shifting more costs to local taxpayers, according to school officials.

Several local school districts would lose state subsidies under the governor’s proposal, according to the Maine Education Association, leaving local taxpayers to fill in the gaps, including:

• Brunswick: Loss of $1 million

• Lisbon: Loss of $169,000

• RSU 5 (Freeport, Durham, Pownal): Loss of $220,000

• SAD 75 (Topsham, Harpswell, Bowdoin and Bowdoinham): Loss of $367,000

“Folks need to remember that we see a continuing shift — and it’s been happening for several years now and we will see it if the governor’s budget prevails — of costs being shifted to the local share that were not there in the past,” said School Administrative District 75 Superintendent Brad Smith.

Some districts will fair better than others, however. Under LePage’s proposal, Regional School Unit 1 (Bath, Phippsburg, Woolwich, Arrowsic) will see an increase of $74,000; West Bath an increase of $12,500 and Wiscasset an increase of $121,000.

West Bath School Administrative Unit Superintendent Emily Thompson said that community currently only receives state subsidy for special education, due to factors including the town’s high property values. LePage is proposing to reimburse schools for 33 percent instead of 30 percent of special education costs, Thompson said, which is why West Bath would see an increase.

According to Smith, the cost shift could be the result of a proposed change to the Essential Programs and Services — or EPS — funding model.

The EPS model is “designed to insure that all schools have the programs and resources that are essential for all students to have an equitable opportunity to achieve Maine’s Learning Results,” according to the Department of Education website.

The budget proposed will “repeal the existing state funding formula to redirect state support to direct instruction, accountability, and teachers, enabled by a statewide teacher contract,” according to a briefing issued in January. That includes proposing to repeal and replace the current EPS formula in 2019 with a new funding formula that will provide direct support for student learning.

“I find the proposed budget to be very troubling,” said SAD 75 board member Jane Scease in testimony to the Legislature. “The most obvious problem is that it would continue the trend of reducing the state’s support of our local school budgets, despite the long ago decision by Maine voters that the state provide 55 percent of education expenses, not to mention the referendum recently passed. The burden has been shifted to local property owners. Under the proposed budget, MSAD 75 residents would be required to pay $367,375 more next year.”

The state is required to fund 55 percent of the cost of public education following the passage of a 2004 citizens initiative, but has never done so. For SAD 75, the state is only providing 48 percent of EPS costs, and only 39 percent of SAD 75’s total budget for fiscal year 2018, Smith said.

A 3 percent surtax on those making $200,000 or more to fully fund the state’s obligation was passed by referendum last year. However, the governor’s office has sought to delay implementation, warning as far back as October that passage would “drive successful people out of Maine.”

According to the briefing, the state will surpass the 55 percent threshold by 2020 should LePage’s new funding formula proposal be implemented.

Administrative shifts, retirement costs, enrollment

Under LePage’s proposal, the state will no longer pay for local administrative costs such as the superintendent’s office, school board, and the business office, which deals with human resources such as teacher certification, fingerprinting for employees, and payroll.

As an alternative, LePage’s proposal provides $11 million in the funding formula to regional education service agencies with which districts can contract to provide services.

“It is unacceptable that we have underpaid teachers in Maine schools who must take money out of their own pockets for classroom supplies while there is bloated administration for over 240 school districts led by 148 superintendents for only 175,000 students,” LePage said in a January radio address.

Michelle Lickteig, RSU 5 director of finance and human resources, said the consensus among Freeport, Durham and Pownal is that the cuts would result in unfunded mandates.

In SAD 75, LePage’s proposed budget would remove about $566,000 in administration funding.

“From my point of view, that is a political decision, that’s not an educational decision,” Smith said. “Anyone who looks at the complexity of a school system and managing a school system in the state of Maine would understand you can’t simply operate without system administration, and shouldn’t simply turn to towns and say, ‘If you want system administration, you can pay for it locally.’ And that’s what his budget has done.”

In testimony to the Appropriations and Education committees, Brunswick Superintendent Paul Perzanoski said that consolidation needs to be done “in a professional and objective way,” and will take time, coordination, legislation and money to implement.

“Taking money away from school departments and providing a pot of money for consolidation with no guidance is comparable to the an old quote, ‘Let’s hurry up and wait!’”

Other factors at play include teacher retirement — once a state funded cost — that has increasingly been locally funded since 2013.

The cost of teacher retirement will increase in excess of $100,000 for SAD 75, and cost an estimated total of $720,000 in fiscal year 2018. Next year, Brunswick will pay more than $680,000 in teacher retirement.

The proposal would also remove an adjustment for declining enrollment so that enrollment reflects the actual number of students enrolled, in order to more accurately reflect education costs.

In the past, the DOE used an average of the previous three years of student enrollment to calculate state aid, so a loss wasn’t felt in a single year.

Smith and Perzanoski both lamented the loss of the declining enrollment formula, Perzanoski adding that the formula doesn’t take into consideration school systems that may lose more enrollment to nearby charter schools.

‘Doesn’t make sense’

Tim Harkins, chairman of the RSU 1 school board, said LePage’s proposal “doesn’t make any sense.”

“We have a system in place that seems to be working, and yet here we have through the governor’s new budget attempts being made to modify that to take administrative costs out of the formula and put that burden on property tax and local communities,” Harkins said.

Harkins pointed to a 2013 independent analysis of the funding formula conducted by Picus and Associates, which found the formula to be equitable, stating that the current system “operates well,” though it found some issues.

“Without having that report in front of me, my understanding was the Picus report spoke favorably about the EPS method, and in fact sort of held the state to task and said based on how you’re currently funding your schools, if you want to improve upon that you need to be sending more money to your local school districts,” said Harkins.

Smith said he doesn’t believe all of LePage’s proposed cuts will come to pass. The district does need more numbers and the more accurate they are, the less last minute changes are needed.

Any cuts to a budget that is extremely tight already is concerning, said Lisbon School Committee Chairwoman Traci Austin.

“I don’t think there’s been a year when we haven’t had to do cuts to scale back services or staff in a while, so any type of proposed cuts for funding is going to hurt any district,” Austin said.

Juliette Laaka, Darcie Moore, Nathan Strout and John Swinconeck contributed to this story.

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