Media Update from the Maine
Department of Education
March 3, 2008
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Reporters and editors: Just a quick update to clarify the status of the
budget, GPA, and the release of the ED-281’s showing early projection of each
school district’s subsidy. This is not intended as a release, though you
are welcome to use anything in it, of course. Call if you have questions.
-David
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The Budget and GPA
In response to downward revenue projections, in anticipation of possible further reductions in revenue, and following federal Medicaid rules changes that are anticipated to result in a significant reduction in Medicaid revenue in FY ’09, the Legislature’s Appropriations Committee recently asked the committees of jurisdiction to identify proposed cuts totaling $99 million. This is in addition to the $95 million ni reductions in the Governor’s supplemental budget which was already presented.
The Education Committee was charged with finding $37.2 million in reductions for FY ’09. Education Commissioner Susan Gendron provided information to the Committee, showing reductions totaling $36.8 million to GPA (General Purpose Aid to Education) and another $400,000 in the Department of Education. These were in response to the request by the Appropriations Committee and were not a proposal by the Commissioner or the Governor for reductions.
Governor Baldacci has not made recommendations yet and has asked his commissioners to provide him with various scenarios for achieving additional savings. He has indicated publicly that he does not want to see $36.8 million in cuts to GPA and has asked Commissioner Gendron to explore all scenarios for savings elsewhere, and to explore ways in which any cuts to GPA can minimize any undue hardship on individual units.
On Feb. 26 the Education Committee’s Senate Chair Peter Bowman presented his committee’s recommendations to the Appropriations Committee.
GPA for FY ’09 in the current budget is a little over $1 billion. The Department’s budget is a little under $6 million. More than half the positions in the DOE are federally-funded.
The FY ’08 (current year, ending June 30, 2007) GPA is $978 million. If the reductions proposed by the Committee are adopted, GPA would remain essentially flat (a bump of approx. $3 million).
Again, a reminder: the reductions currently proposed by the Education Committee would still reflect a slight increase in funding over FY’08 – it would be a reduction from the originally-budgeted amount, but not less than last year.
ED-281’s have been released
Each February the Department is required to release information to school systems statewide showing what they should anticipate for funding from the state in the form of General Purpose Aid to education (state subsidy). The Department was prepared to release these via the ED-281 forms early in February when the Appropriations Committee asked for the additional reductions in anticipation of the downward revenue projections. The state Revenue Forecasting Committee met last Monday, Feb. 25 and confirmed expectations of reduced revenues for FY’09 of nearly $100 million.
Based on these developments and the possibility that GPA could rise by only $3 million, as opposed to the originally anticipated $40 million, the Department decided to hold off on releasing the 281’s so as not to provide projections that might change dramatically.
Following discussion by the Education Committee that gave direction as to how GPA might be adjusted, the Department has revised the 281’s and sent them by regular mail to school systems on Friday, Feb. 29. They reflect the lower GPA amount, though the Appropriations Committee and the full Legislature have yet to finalize the budget and so they are not a guarantee of the final subsidies.
We are preparing a summary of the ED-281’s for the Education Committee and will make it available publicly when it is presented to the committee, sometime in the next few days. (We will send it via media update, and also post on the Department website.)
Meanwhile, Gov. Baldacci will be submitting his proposed changes to the budget, reflecting the now-larger shortfall anticipated for FY’09, this week. In addition to the possibility that the total reduction for GPA may differ from that proposed by the Education Committee, his proposal could also include differences in the way any reductions are achieved. Such changes could impact how districts – as a group and individually – are affected by the reductions.
We will release those revised ED-281’s to districts as soon as they are available, probably sometime next week, as well as a statewide summary (spreadsheet).
Status of LD 1932
LD 1932 was at one time intended to be the non-controversial “financial fixes” to the reorganization law. It was to be taken up very early in the legislative session to allow communities the tools they need to move forward with reorganization – regardless of whatever other concerns or suggestions for improvements to the law people might have.
The bill originally contained three major provisions: first, and most important, it would allow units that are reorganizing to develop their own local cost-sharing agreements in order to compensate for any cost-shifting that might occur; second, it would allow minimum subsidy receivers to continue to be eligible for the minimum subsidy (and thus not be penalized for consolidating); and last, it would remove the requirement that all districts raise at least $2 per $1,000 toward the cost of education (about two dozen municipalities currently raise less than the “2 mills”). In addition, the bill would give school units an extra year before having to employ the new budget referendum process. That process gives all voters in a school unit the opportunity to weigh in on the final school budget.
The bill did not move quickly to the floor. It has since seen several additions in committee and then on the floor of the Senate including, most notably: one that allows for some districts of between 1,000 and 1,200 students under certain circumstances (the current minimum is 2,500 with an absolute minimum of 1,200); and another that would allow for the re-emergence of the “school union” structure. The Department has vocally opposed the union structure as it is inefficient both financially and educationally. In school unions, the superintendent and central office report to multiple school boards with no comprehensive K-12 budget or curriculum. In many cases, an individual K-6 or K-8 school will have its own board, in addition to a high school board and an overall board. (Read more on why the Department believes unions are inefficient.) The Senate passed the bill, with the union provision.
The House is expected to take up the bill this week, perhaps as early as Wednesday.
The cost-sharing provisions are essential to local units as they work to implement the law. Several units have completed or are close to completion of their reorganization plans, but cannot be approved until a cost-sharing provision is added to the law. Gov. Baldacci has indicated he does not support the union provision, so the fate of LD 1932 remains unclear. If LD 1932 is not enacted, we are confident that the necessary provisions that everyone knows are necessary to successfully implementing reorganization will be enacted one way or another. Even those who oppose the reorganization do not want to force their own school units into mergers that will result in cost-shifting to their own units.
Next deadline – March 28
All reorganization planning committees must submit complete reorganization plans by Mach 28 or an update on their progress. A number of units are moving forward successfully with plans, though many have slowed their work as they wait to hear the results of the Legislature’s actions.
Falmouth and SAD 51 have received conditional approval for their plan. The plan includes a cost-sharing agreement that the Commissioner cannot approve until the law allows her to do so. Several other regional partnerships are moving forward with plans and we anticipate that a half dozen or more may hold public votes in June on their reorganization plans. In most areas we anticipate votes in November.
e-news updates
Read what superintendents, teachers, and members of the public are reading. Sign up for e-news updates from the Department:
http://www.maine.gov/education
David
Connerty-Marin
Director of Communications
Maine Department of Education
Tel: 207-624-6880 (office)
207-831-3313 (mobile)
david.connerty-marin@maine.gov