BELFAST, Maine — In order to meet Gov. John Baldacci’s edict to cut the state budget by 10 percent, the Department of Education has recommended flat- funding General Purpose Aid to schools for the next two years.

Department spokesman David Connerty-Marin said that if the Legislature goes along with the proposal, the state’s subsidy to local school units will total $1.97 billion for the 2010 and 2011 fiscal years, about the same amount given schools the past two years. Connerty-Marin said the budget restrictions could be even greater if the current economic slump continues.

“Depending on what happens with the revenue forecasting in November, the governor and the Legislature may ask for even more cuts,” Connerty-Marin said Wednesday.

Gov. Baldacci’s order to find cuts based on 10 percent of current spending levels was prompted by a projected $500 million revenue shortfall for the coming budget. With education accounting for 40 percent of the overall state budget, the department was particularly aware of the need to find savings, Connerty-Marin said. He said departmentwide cuts were being proposed along with flat-funding the General Purpose Aid.

Connerty-Marin said recent changes in state law that required the department to fund 55 percent of the overall cost of education had resulted in education getting a greater share of the budget the past few years. As the percentage of money for education continued to increase, the percentage of financial support for other departments declined, he said.

He said that while the department currently was funding 53 percent of the cost of education, two years of flat-funding not only would prevent the state from reaching its goal of 55 percent, but also would backslide the current proportion.

“Big increases in funding are going to come to a close,” he said. “We’re obviously trying to do everything we can to minimize the impact on education but we have to reduce spending.”

Flat-funding on the state level could result in deep cuts on the local level, said Bruce Mailloux, superintendent of schools for SAD 34 in Belfast. Mailloux said he expected inflation would increase the overall cost of doing business and, coupled with salary and benefit increases already built into school budgets, administrators will be faced with some difficult choices in the coming years.

“There is no question that flat-funding is going to hurt everyone,” Mailloux said Wednesday. “The only good part is that the commissioner has given us some lead time before going into the budget process. The bad part is that it is a significant financial impact. But at least we have time to work on it.”

Connerty-Marin noted that consolidation offered schools an opportunity to reduce costs while retaining educational programs. He said that when confronted with the need to find areas where savings can be targeted, the duplication of administrative, transportation and facilities costs should be the places to consider.

“It’s a question of overhead with or without reorganization. If you want to get out from under it, you have to change the way you do things,” he said. “We’ve been saying for a long time that the system we have is unsustainable because the resources are limited and the costs keep going up. There are not too many choices. You can raise more taxes, you can reduce expenditures or you can change the way you do business.”

Mailloux agreed that consolidation would help reduce the impact of flat-funding. He said SAD 34 and SAD 56 in Searsport had adopted a consolidation plan that the voters will act on next Tuesday. He estimated that the districts would be hit with more than $400,000 in penalties each of the next two years if the proposal fails. That was why reducing costs in difficult times was imperative, he said.

“If the state’s revenues continue to decline, what choice do you have? If it’s not coming in you can’t pay it out,” Mailloux said.