Maine school districts that will see an increase in state funding under the state’s updated biennial budget are making plans to spend the money on tax relief, building projects and to offset long-term costs that are currently being paid for with federal coronavirus relief money.
The plans follow the Legislature’s approval of Gov. Janet Mills’ proposal to add $187 million for K-12 education to the new two-year state budget, allowing the state to fund schools at 55 percent for the first time since it was mandated by a statewide ballot question in 2004.
“I think the responsible thing is to make sure that money benefits taxpayers,” Biddeford Superintendent Jeremy Ray said. “For us, we won’t be in a situation where we’re adding new positions or anything like that.”
State funding for schools is based on a complex formula that includes enrollment, municipal valuation, the number of low-income students and other factors. Some districts like Portland, which is anticipating an additional $6.2 million in state funding, are seeing significant increases in the updated state budget, though others won’t see any additional funds.
Biddeford, like most school districts around the state, already has approved its 2021-22 budget, so an extra $1.58 million in state funding there comes as a boost that wasn’t included in the original spending plan. The $40.1 million budget approved by voters included a $494,265 increase to taxpayers, or about 2 percent.
Ray said the school department will be working with the City Council to come up with the best use of the additional funds. He said his first recommendation will likely be to eliminate the tax increase. After that he said the district could use the money for building or capital improvement projects.
“Those are always one of the tougher things for cities to try to fund,” Ray said. “I think this could be an opportunity to take care of some of those things that will eventually hit the budget. It may not be right now because we know building costs are high right now, but it may be something where we put money in a building improvement account and can use it when we think we will get the best value for that money.”
In Portland, the school board will meet Tuesday to discuss a finance committee proposal that calls for $1.49 million to eliminate the combined city and school tax increase, $1.3 million to move the cost of custodians currently being paid for with federal relief dollars back to the general fund and $3.5 million to create a debt service reserve fund. The debt service fund could help with the costs of four school renovation projects the district is undertaking as part of the Buildings For Our Future bond approved in 2017.
At the time Portland’s $125.2 million school budget was approved, the combined tax increase translated to a $54 increase on a home assessed at $300,000, though homeowners will likely see additional changes to their tax bills this year due to a citywide property revaluation.
In a memo to the board, Superintendent Xavier Botana said a plan for the additional funds also must be approved by the City Council. If the school board approves a plan Tuesday, the council will subsequently be asked to consider it at a special meeting July 19, Botana said. Once approved by both bodies, any reductions to the expected tax revenue needed would be reflected in the bills scheduled to be sent out in September.
“With regards to the several choices they’re looking at for that $6.2 million, I know one of them is some funding that would affect the tax rate and would actually bring the tax levy to a zero percent increase,” Portland Mayor Kate Snyder said. “I’m sure that will be a welcome opportunity for Portlanders as they start to receive their new valuations in the mail.”
Snyder said she hasn’t had a chance to thoroughly study the school finance committee’s recommendation, but she is looking forward to hearing more at Tuesday’s school board meeting. She said the proposal to move custodians that are being paid for with federal funds back into the regular budget could also be a good move. “They would have to make that transition anyway, so getting them back into the local budget is the right thing to do,” she said.
Not every school district in Maine will see additional state funding under the budget change package. Districts identified as “minimum receivers” won’t benefit from the additional funding because the state already has determined they are able to cover the cost of education locally without help from the state. Several districts, however, are seeing increases of over $1 million.
In Lewiston, which is anticipating an additional $1.5 million on top of $65 million the district is already getting from the state, Superintendent Jake Langlais said it’s most likely the money will go toward tax relief, though the city’s charter also states additional funding can be used for “emergency expenditures.”
That could mean facilities and staffing or community outreach to help students who have struggled to stay connected during the coronavirus pandemic. And while the district does have federal money to help with COVID-related costs, Langlais said they’re also trying to be cognizant of the fact that money will eventually expire. “School funding has been incredibly tight and it remains incredibly tight, especially with relief dollars that have a sunset provision on them,” he said. “I’m hopeful communities around the state will maintain a commitment to schools so this is a correction to better fund education and not a one-time thing.”
Ray, who also serves as superintendent in Saco, said that community is expecting about $1.5 million in additional state funding. He plans to recommend the district use about $995,000 to pay back a negative fund balance owed to the city. Another $300,000 could go to school design costs for a new elementary building to replace the Young School. The balance could then go to tax relief or a capital reserve fund.
“We wouldn’t be using any of these funds for new positions or places like that,” Ray said. “It would be looking at how do we bring relief to taxpayers and deal with bills from behind. I would like to thank the Legislature and the governor for enacting this budget and finally matching what the voters of the state of Maine have called for years ago — 55 percent state funding.”
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