June 19, 2018
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State may freeze school subsidies

By Mal Leary, Maine Public

AUGUSTA, Maine — Schools may have to get by with the current level of $986 million in state subsidies for the next budget year, Education Commissioner Susan Gendron warned school officials this week.

She also said she cannot rule out a cut in this year’s aid.

“I don’t want to put fear into people, but we don’t know what the size of the curtailment will be,” she said in an interview Wednesday. “We are trying to mitigate the impact on general purpose aid at the local level by absorbing much of that curtailment within the agency.”

Gendron sent a memo to school superintendents late Tuesday that warned them as part of the targeted 10 percent reduction in the next two-year budget, she was submitting a proposal to Gov. John Baldacci to freeze aid at this year’s level.

That would save about $170 million, she said, considering state law mandates an increase of that amount to move the state toward its goal of providing 55 percent of general purpose aid.

The governor also has asked agencies to plan how to cut spending this year, with revenues below estimates by $9.8 million for the first three months of the year.

“People are calling and are certainly concerned about a freeze,” said Dale Douglass, executive director of the Maine School Management Association. “But they are even more worried about whether there will be a curtailment this year, the budget year we are in now.”

Douglass said freezing general purpose aid would have a “serious, negative” impact on schools, but at least officials would have time to take steps to deal with fewer dollars from the state. He said a curtailment during this budget year would be hard to manage.

Gendron, who served as a school superintendent before becoming commissioner, said she understands the impact on schools if a significant curtailment is made. She said some schools may have to lay off teachers or other staff, and she is working to avoid that.

“I am at the State Board [of Education] meeting today and we are looking at construction projects to see if there are any that can be delayed,” she said.

Gendron said the Department of Education is looking at other options to reduce spending and mitigate any curtailment that may have to be made to general purpose aid. For example, she said, travel will be reduced for the rest of the budget year.

“We are looking at possibly eliminating a spring writing assessment that would save us a significant amount of money,” she said. “What we don’t know yet is what the November revenue forecast will show and what that means to [general purpose aid]. But we are working hard to identify cuts at the department so we can mitigate any curtailment that has to be made.”

Douglass said he is urging superintendents to start looking now at where they can reduce spending, knowing that some sort of reduction in aid is likely to occur this year. He said it is a prudent step given the economy and the revenue problems facing the state.

“I know it is difficult, but it’s clear to see the economic problems we are all facing,” he said.

Douglass said the freeze proposal also raises questions as many school districts are in the process of merging with other administrative units.

“There are teacher contracts that need to be melded, other contracts that need to be renegotiated and some of the new districts are not going to see savings for two or three years and they will have additional costs to implement the new units,” he said. “We don’t know how all of that is addressed in a freeze.”

Gendron acknowledged there are many details to work out to accomplish a freeze at the same time as new school administrative units take over from existing units. She said the department plans to meet with superintendents in the next few weeks to discuss the possible freeze and its impact on the schools.

“We are trying to be transparent on all of this,” she said. “The governor wants a 10 percent plan because the revenues are not there and we want everyone to know what is being considered.”

Douglass said he is concerned that any decrease in state aid may simply mean a shift to the property tax in many communities.

Baldacci has stated that he has made no decisions on what to include in his budget or how to proceed with a curtailment of spending. He said he has asked departments to provide him with memos on how to achieve a 10 percent spending reduction and how they would curtail spending this year.

“Everything has to be on the table, we have to look at everything,” he said.

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