EDITORIALS

Property wealth, wages and enrollment should drive education funding fix

Second-grader Dean Lazore (left), 8, and third-grader Ian Blackstone, 9, swing at the playground of the Shirley Elementary School during recess. The two boys are the only pupils at the school, which has had declining student enrollment and will close this year. They spent the last day of the school year visiting Greenville Elementary School, where they will continue their studies.
Second-grader Dean Lazore (left), 8, and third-grader Ian Blackstone, 9, swing at the playground of the Shirley Elementary School during recess. The two boys are the only pupils at the school, which has had declining student enrollment and will close this year. They spent the last day of the school year visiting Greenville Elementary School, where they will continue their studies.
Posted July 08, 2011, at 8:58 p.m.

Schools in rural Maine are hurting. But helping them should not come at the cost of schools in the state’s larger communities. Unfortunately, that was a consequence of a law change approved by the Legislature in its final days.

Because the state only allocates so much money for public schools, changes that send more money to some districts result in less money for others. The changes enacted in the final days of the Legislature, which make small changes to the state’s Essential Programs and Services formula, will send more money to rural areas, but Bangor will receive nearly $190,000 less next year and Portland will see its state funding drop by more than $900,000.

No one should be satisfied with this outcome. That is why a more serious look is needed at the state’s two school funding formulas — and the consequences of declining student enrollment — so that helping schools in one part of the state doesn’t have to mean hurting those in another.

Many lawmakers in Augusta took particular aim at the state’s Essential Programs and Services formula. EPS isn’t entirely to blame for the shortcomings identified by legislators. The way a community’s ability to pay for its schools is calculated also warrants review, a point made by many lawmakers during the debate on the bill to change the EPS formula.

First, it must be remembered that the state has two formulas for school aid. EPS determines what districts should be spending to adequately educate students. The state’s funding formula then allocates state school support based on calculations of communities’ ability to pay. This second formula, which relies on property values, is as much to blame for declining state funding for rural schools as EPS. That’s why both deserve a closer look, with strong consideration of the fact that school enrollment in many rural parts of the state is declining.

EPS was developed about a decade ago as a way to ensure that students in all Maine schools received an adequate share of state education dollars. EPS determines how much money is needed to provide students with the education they need to meet the state’s Learning Results, a set of state benchmarks. Adjustments are made for poverty, English proficiency, distance school buses travel and other variables.

For the 2011-12 school year, the statewide EPS allocation is about $2 billion. The state share, as set by the budget recently passed by the Legislature is roughly $895 million, leaving about $1.1 billion to be raised by local communities. This local amount is divided by the state’s total property valuation to reach a statewide education mill rate, which is 7.47 for 2011-12.

Every district must raise 7.47 mills for its schools locally; the state makes up the difference to reach the determined EPS level. It is how this ability to pay is calculated that has caused heartburn for years.

Obviously, an assessment of 7.47 mills raises different amounts of money in communities with a lot of valuable property versus those without. Communities, of course, can spend more money than the EPS formula calls for.

A major criticism of the funding formula is that a community’s ability to pay for its schools is based solely on property values. So, coastal communities with a lot of expensive properties may receive little state aid, although their residents don’t make much money. An income calculation was included in the funding formula for about a decade until 2005. Income accounted for 15 percent of the calculation of a community’s ability to pay under that formula, which was still the target of much criticism.

When the state adopted the EPS formula, it also went back to using only property values as a measure of a community’s ability to pay. This is part of the reason that some coastal communities have seen their share of state school funding drop in recent years while their education expenses have not.

This problem was highlighted by a 2010 report by the Education Law Center. The center ranked Maine 14th in the country for the amount of money allocated per pupil, saying the state spent about as much as would be expected based on poverty rates, wage variation, population density and other factors. However, Maine received a D when it came to the distribution of that money. This is, in part, because wealthy districts have more money to spend than poor ones, when state and local spending is combined.

The recently passed law makes a tiny change to address this by including an adjustment to some districts’ state funding allocation based on the percentage of students who qualify for free and reduced lunches.

What was missing from the debate in Augusta was the consequence of declining student enrollments, which also cause state support to be reduced. According to figures from the Department of Education, resident student counts from October 1995 to October 2004 dropped an average of 6.26 percent statewide. The drop was more than 20 percent in Piscataquis County, nearly 20 percent in Washington County and more than 15 percent in Franklin County. Only one county, Cumberland, saw an increase in enrollment, of about 3 percent.

Until lawmakers are honest about this trend, any solutions will be temporary.

The next Legislature could do the entire state a real service by looking at all aspects of school funding with an eye toward a fairer way to disburse the money, which encourages efficiencies without penalizing schools that truly need more state assistance.

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