June 24, 2018
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Newport, Plymouth residents hear need for loan from RSU 19 superintendent

By Alex Barber, BDN Staff

NEWPORT, Maine — RSU 19 Superintendent Greg Potter held the first of six town meetings on Wednesday night in order to address the district’s budget gap and need for a $2.8 million loan.

In the meeting inside Newport-Plymouth Elementary School, which was also attended by half of RSU 19’s board of directors, Potter explained how the district built a $4 million deficit over the last three years through errors and oversights.

Because of serious errors in previous budgets, RSU 19 has a $3.6 million shortfall this school year. The district already has cut $1.6 million from the budget for this school year. RSU 19’s board of directors previously voted to ask residents for a $2.8 million stabilization loan. The district would use $1.5 million to repay its revenue anticipation loan to Androscoggin Bank, while the other $1.3 million would be used to pay bills. The loan will be put on the referendum on March 8.

Potter explained how the debt got compounded in the budgets and invited the public to look over the audits themselves.

“Believe me, we’ve been through the books. I can’t believe it myself,” said Potter. “I can go through and show you exactly why” there is a shortfall.

He said the $2.8 million loan is needed to cover the $1.5 million revenue anticipation note, $1 million in obligations, $100,000 in cuts from state funding and $200,000 to cover other expenses that may arise.

He explained how the 21st Century program, an afterschool program, costs $92,000, but isn’t in the district’s budget. It is a federal program, but the district has to first spend the money in order to get it back.

“There are other things that didn’t make it into the budget. I don’t know exactly what other gremlins may be left in there that we have to deal with,” said Potter. “So there’s a little bit of wiggle room.”

Business manager Jerry Nault handed out fliers to better explain what the tax impact might be on the $2.8 million loan.

Based on a 3.7 percent rate loan over 10 years, the equivalent mill rate impact on Newport taxpayers would be $0.43. For Plymouth, it would $0.38.

Nault said a property in Newport valued at $50,000 last year will likely see a tax increase of $21.59 per year, or $1.80 per month. For a property valued at $100,000, it would be $43.18 per year, or $2.70 per month.

Next year’s budget, should the loan be passed, could be $22 million, said Potter, which would be a drop of $1.3 million from the current school year’s budget.

In order to get to that number, cuts would need to be made in every area, said Potter. That included teaching positions, central office staff and not replacing a principal that may be retiring. Other cuts would be made as well, he said.

After the presentation, Potter fielded questions from the audience, which numbered about 40. Some of the questions centered on how to get Potter’s message out to the voters.

“We’re going to pay this one way or the other. We have no choice,” said Donna Hodges of Newport. “It’s going to be a loan or all in one year with taxes or whatever. So it has to be paid.”

“I think a lot of it falls on us to get the word out,” said Mike Beane. “It’s great that everybody here today is here, but it’s a very small crowd.”

Other questions and comments were critical of the school board in allowing the budget gap to get to where it is.

Board of Directors Chairman Dan Costain started the evening by apologizing to the crowd on behalf of the board.

“We’re very sorry this happened. We’ve put a lot of different things in place to try to make it so we don’t have this situation happen again,” said Costain.

“I’d like to thank him for apologizing on behalf of the board tonight. I’ve attended many meetings, it’s the first time I think I’ve heard that,” said Newport Town Manager Jim Ricker.

The next town meeting will be at the Corinna Elementary School at 7 p.m. Tuesday, Feb. 26. It will be a day after a regional public budget meeting at Nokomis Regional High School in Newport at 7 p.m. on Feb. 25, where residents will once again vote on whether to place the loan on a referendum ballot.

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