Selectmen receive dismal financial forecast from school district

By Bill Pearson
Staff Writer

    GUILFORD — SAD 4 Superintendent Paul Stearns has informed municipal leaders that the prevailing political and fiscal conditions in the state indicate the 2013-14 budget process would be another vexing enterprise for both town and school officials. Stearns updated municipal leaders with a letter last week  regarding  how Gov. LePage’s budget proposal would impact town budgets and  local property owners.

 Stearns estimated that LePage’s proposal to reduce revenue sharing would result  in a $460,000 loss to district towns. He also indicated that reductions in general assistance aid, business equipment tax reimbursement (BETR) exceptions, trailer truck excise tax shift, and eliminations of the Homestead Property Tax exemption and property tax circuit breaker programs would make budgeting this year “extremely difficult”.

    “These are municipal issues that I am aware of and there may be more,” Stearns said. “Again, it’s critical that the school department directors and personnel understand these issues from a municipal perspective.”

    Stearns also informed the communities about issues affecting Maine’s rural schools. A plan to reduce educational costs by making retirement more enticing to older teachers seemingly hasn’t worked. SAD 4 has several teachers beyond the retirement age, but none of them plan to retire next year.

    “They simply have become very nervous about the economy as well as legislation that erodes their retirement benefits. It seems our retirement age teachers are not retiring and they’re hunkering down to weather the fiscal storm,” Stearns said.

    The superintendent also reported the state isn’t living up to their legal obligation to provide 55 percent for public education. General Purpose Aid to schools will remain as it was in 2007. He added the aggregate level of state funding remains at 45 percent instead of the 55 percent mandated by state law.

    Among other challenges facing lawmakers in funding education is that the state is using millions of dollars in GPA to fund reform initiatives such as financing the charter commission and transportation for students that don’t like the offerings at their local high schools.

    “Any special initiatives that take funds from GPA transfers costs for these mandates and essentials to local property owners,” Stearns said.

    He is also concerned that the proposed budget calls for shifting of the normal state retirement costs from the state level to the local school units. The governor’s proposal would pass 50 percent of the contribution the state makes to the employee pension system to the local taxpayer beginning in 2014. Stearns indicated this would cost the local taxpayer an additional $14 million per year.

    He also cited concerns about apparent inequities in the funding formula which continued to allocate additional subsides to district who spend above the 100 percent essential programs and services (EPS) formula. SAD 4 spent 2.9 percent below the EPS formula while as many as 20 school districts spent 26 percent above it. Stearns calculated if all school districts limited their spending to 100 percent of the EPS level then it would save the state over $63 million.

    Stearns believed the policy disproportionately hurts rural school districts like SAD 4 which is in the bottom 12 percent of per pupil spending. He stated that state budget cuts and curtailments adversely affects other rural communities and other low spending school systems disproportionately.

    SAD 4 has invited all five select boards and local legislators to join them at 6:30 p.m. on Wednesday, Feb. 27 for  an informational exchange regarding the fiscal challenges the community faces in the upcoming year.

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