School officials react to state subsidy figures

Additional state funding and decreases in the required local share for K-12 education are among the positive developments this year for local school districts, as preliminary state subsidy amounts were released on February 15 by the Department of Education. The subsidies are based on the $1.1 billion in public education monies recommended by Governor Janet Mills in her biennial budget. This amount is an increase of $41.3 million from last year and reflects the governor's commitment to increase the state's share of education funding.
During the previous legislative session, some changes were made to the state's funding formula, including an increase from 40% to 44% for the minimum special education adjustment; a move to using the three-year average for town valuations, instead of the two most recent years; an additional allocation for members of regional service centers of $94 per pupil; and a decrease in the mill expectation for towns, from 8.48 to 8.28, which determines the required local share.
That drop affecting the required local share is a significant change, with AOS 77 Superintendent Kenneth Johnson noting that in almost every school district in the AOS the minimum local contribution will be reduced. For instance, in Eastport the required local share is over $43,000 less, dropping to $1,031,311. "The good news is that it gives local units more control over their budgets," says Johnson. "Towns can make the cuts that they want."
"In theory, if towns want to see reductions in their taxation, they will have to use more balance forward or make cuts" in the school budget, says Johnson. However, towns may choose to make up the difference in the drop in the required local share by adding to the additional local share. "It's an oversimplification to say that the tax rate will go down," he notes.
He adds that the additional funding for special education also will help towns in AOS 77.

Baileyville hit with subsidy drop
In eastern Washington County, Baileyville is projected to see the largest subsidy decrease, dropping over $220,000, and AOS 90 Superintendent William Braun says that appears to be caused by an increase in the town's valuation. Town Manager Chris Loughlin notes that with the opening of the St. Croix Tissue mill the town, in 2017, saw a $96 million increase in valuation, from about $205 million to $301 million.
Because of the value of the Woodland Pulp and St. Croix Tissue mills, the local share of the Baileyville school budget is the primary source of funding, providing two-thirds of the monies for the current year. The state funding projection calls for the local share to increase to 75% of the cost in the coming year, with the state contribution dropping from $893,885 to $673,021. In comparison, the local share of the school budget in Calais is only about 28% of the total cost, with most of the funding coming from the state subsidy.
Braun says the Baileyville school system will be looking for more funding from the town and also has begun looking at possible cuts. He expects a negotiation to take place with the town council over how the local share can increase.
Loughlin notes that, with the town now having "more to draw on from taxes" with the tissue mill, he doesn't believe dealing with any increase in local funds for the school budget "will be too bad." He hopes to have a better idea by mid-March, with the town meeting to be held in June.
Also in AOS 90, Princeton will see a $162,457 increase in projected subsidy, which Braun says is caused by increased enrollment.

Calais to see some more funding
Excluding the funding for career and technical education at the St. Croix Regional Technical Center (SCRTC), Calais will receive just over $50,000 more in state subsidy, to a total of $3,685,688. Superintendent Ron Jenkins says he had "hoped for a bit more," noting that there had been an increase in enrollment from October 2017 to October 2018. The subsidy increase reflecting that enrollment hike will take effect later, though. Jenkins also notes that the city's valuation decreased, which he suspects had more to do with the preliminary subsidy number.
The career and technical education (CTE) figures are not final, but Jenkins says that the preliminary numbers indicate funding for the truck driving course at SCRTC, while other instruction areas were reduced. "I'm hoping at least to get the same level" of funding as last year, he says.
While he says the required local contribution to be raised by the city will decrease, Jenkins says the schools "would be better off if they gave us the same amount" as this year. However, he doesn't remember the city ever giving additional funding above the required amount to the schools. He adds, though, "The city council has been really good to work with. We can only suggest, but I'd love to see them do a little more than the minimum to help with safety and infrastructure." He notes that salaries are always increasing, too.
Under the preliminary figures, Robbinston, which contracts with Calais for superintendent services, will see a $107,933 increase in subsidy, to $294,826. Jenkins says that some new families moved into town, with the increased enrollment boosting the subsidy amount. He adds that the subsidy figure relates in part to where Robbinston children attend school, with Perry having a slightly higher tuition rate than Calais.

Subsidy loss in Machias partly reflects CTE funding change
Because Machias received a $230,000 bump last year for career and technical education, without including that one-time increase Machias is losing only about $48,000 in state subsidy, according to AOS 96 Superintendent Scott Porter. The state's change in CTE funding was not fully implemented last year, and the new model will not be used for this year, Porter notes.
Some of the CTE funds that Machias receives are pass-through funds, as Machias administers the program at Narraguagus High School. This year a CNA class was added at the Narraguagus program, mostly funded through a grant. In two years, four additional career and technical education programs -- welding, automotive technology, diesel technology and early childhood education -- are proposed, although a location for offering the programs has not yet been determined.
Enrollment has dropped some in Machias, which is causing the loss in subsidy to the town. Likewise, a projected $101,000 decrease in subsidy for East Machias is largely due to a decline in enrollment, with Porter noting that both Machias and East Machias had smaller Pre-K classes. "I expect they'll bounce back for the upcoming year," says Porter. East Machias also had less subsidy for special education and less for school bus reimbursement.
While the increase in the minimum special education adjustment from 40% to 44% and the mill rate expectation decrease have helped some towns in AOS 96, Porter says the overall increase in education funding in the governor's budget proposal was used, in large part, for additional special education costs and did not particularly help increase subsidies for towns.

No significant changes in AOS 77
The subsidy numbers do not show any significant changes for AOS 77 schools. Alexander would see a $28,222 increase to $221,017; Baring a $1,680 increase to $242,981; Charlotte an $8,915 increase to $461,960; Crawford, a $3,920 decrease to $882; Dennysville a $1,608 decrease to $171,764; Eastport a $9,446 increase to $164,347; Lubec a $611 decrease to $240,800; Pembroke an $11,582 increase to $534,668; and Perry a $39,438 decrease to $384,273. However, Superintendent Johnson notes that "Perry can carry on nicely," since it also has tuition revenue from Robbinston students attending the Perry Elementary School.

More funding needed for county
The proposed $85 million increase in education funding in the second year of the governor's two-year budget will help with the proposal to increase the minimum teacher salary to $40,000, Porter says. However, he'd like to see changes in the funding formula to sustain the salary increase long-term. Noting that his district is in the lowest labor market area in the state, at 84% of the state average, the funding formula deducts 16% in the subsidy calculations for towns in that labor market area. "They need to bring us all up to" the state average, Porter says. When the minimum teacher salary was previously increased to $30,000, it was "a big challenge" for area districts. "We're much further away from $40,000," he notes. "Teachers deserve $40,000, but we need the state to participate. They need to invest more money in areas like Washington County." He says the salary increase in 2020-21 "will be difficult to do at the local level without state support."
A number of area school departments are minimum receiver districts, receiving little state subsidy because they have highly valued shorefront property. Noting that places such as Eastport, Lubec and other coastal communities have high property valuations but low median incomes -- they're property rich and cash poor -- Porter says, "The state needs to invest more money to move forward with salaries and other costs. The formula does not work that well for coastal Maine." He hopes that bills will be put forward to help rural areas of the state.
Superintendent Braun notes that there are some legislative bills being considered during the current session that could help schools in Washington County, including one that would eliminate the regional labor market area adjustment that is used in the state funding formula.