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School funding woes hit towns hard
OXFORD HIILS — The situation with SAD 17's budget is bad and getting worse, district superintendent Rick Colpitts said during a presentation to the school board on April 4.
While the district's proposed budget will increase by about 1.25 percent, the impact on local taxpayers would be a 4.84 percent hike.
The hardest-hit town under a proposed 2011-12 budget will be Harrison, where taxpayers will see their assessment increase by 7.74 percent over last year. There will also be a significant increase in other local towns, including Oxford (5.08 percent), Paris (4.79 percent), and Norway (4.5 percent)
Despite the stiff increase for local taxpayers, the budget includes significant cuts, with more than a half-million dollars cut from staff, supplies, and programming.
Various fixed-cost increases and a reduction in state funding are responsible for the bigger tax bill.
Expenditures for budget items including heating oil increased by $976,000.
"This includes huge increases in heating oil. I know you're probably feeling the pinch at home, and we're feeling it here, only 100,00 times more because of the number of gallons we use here," said Colpitts. "Our diesel fuel for our buses went up astronomically, and we've predicted insurance increases of 10 percent. We haven't heard officially from the insurance company what the increases are, so there could be some savings there, but we're anticipating a 10 percent increase."
Proposed reductions, as well as a spending freeze from last year mitigated the tax impact, but also had a negative effect on the school's programming, said Colpitts. The school was able to carry over more money from last year, but did so at the expense of investing in education.
"We typically carry over around $500,000 to $1 million. We're projecting that this year it's going to be $1.14 million that we're going to be able to carry over; that's $644,000 more than the previous year. We were able to do that for a couple of reasons. The big one was that we had a budget freeze and the budget freeze went into place in October, middle of November, and it was a hard freeze meaning we froze positions that were open; we didn't hire replacements, we used substitutes. We didn't buy materials and goods that we probably needed. I'm not necessarily proud of that but we did carry over for this year ... an additional $644,000."
Further, decreases in total revenue, including an end to federal stimulus money, means that the burden of funding the budget has shifted even more to the taxpayers.
"My reductions came to $548,000, which brings our adjusted share of the budget to about 427,000. This means our budget is only increasing 1.23 percent," he said. "However, we had a reduction in our revenue. Even though we've maintained our expenses, it still represents a 4.84 percent increase in local assessment to the taxpayers."
The state requires schools to raise a certain amount of money through local taxation.
If districts try to shelter local taxpayers from increases, they stand to lose massive amounts of state support.
Colpitts says that, last year, the district raised far less money through local taxation than the state requires.
In 2010-11, said Colpitts, the school district placed last in the state in the amount of local money raised toward Essential Programs and Services (EPS) funding, coming in roughly $1.8 million below the required share.
"We're number one at the top of the list if its sorted according to who spent the least of their local share," said Colpitts. "And we're one of seven districts that comes in below our local share."
State law requires that local districts raise a certain amount in order to get full funding from the state. The amount expected of the district and the amount given by the state changes from year to year based on factors such as a town's valuation and population.
An exception in the law has allowed SAD 17 to raise less than its minimum share, which currently stands at 7.47 mils, as long as the state comes in below its required share as well. In 2010-11, the district raised roughly 84 percent of its share, about the same percentage as the state. In 2012-13, that exception will "sunset" or no longer exist, meaning that the towns will be required to raise 100 percent of their share or face cuts from the state.
"We're at 1.8 million dollars lower than the required mil rate for education and just a hair above the minimum-required share," said Colpitts, "which is in this case around 84 percent. You folks are ... raising the bare minimum to get the state share."
When the clause expires, SAD 17 could lose as much as $3 million from the state, compounding current budget problems.
This year's local tax increases are one way for the district to hedge its bets against this catastrophic scenario.
To make up the difference in one year would put too much stress on the towns' finances, said Colpitts. Raising the full local share of EPS funding for 2011-12 would mean that the towns' would have to raise 12.2 percent more than the prior year. For some towns, such an increase would be extremely difficult to cope with.
"In the budget ... it's actually looking like, for this year, we would have had to raise the share for education 12.2 percent," said Colpitts. "Imagine that you're in Hebron and you see that your share for the bill of education would grow 22 percent."
Of the eight towns in SAD 17, only Paris would see less than a 10 percent in order for the district to fund its entire share.
"It's impossible for us to get to 100 percent of the required local share in one year," said Colpitts.
Colpitts said that some federal money received this year will go toward making up the funding gap should the state allow the clause allowing districts to raise less than their full EPS funding to expire.
"We did receive a federal jobs bill grant for $791,000. That jobs bill we've put in the bank, and we're going to use it next year to offset the amount taxpayers have to raise."
Last year, the district lost 36 staff positions, three administrative positions, and funding for a variety of educational programs were cut.