“It's Robin Hood in reverse," says Scott Porter, superintendent of AOS 96, of the state's Essential Programs and Services (EPS) funding formula for K-12 education that has been hurting rural school districts that have high property valuations and declining enrollments. "This is the sixth year we have suffered under this funding formula. Enough is enough."
     According to preliminary subsidy figures released on February 15, Washington County school districts, already reeling from several years of cuts in state aid, stand to lose another $1.55 million in state funding. Under the governor's budget proposal, state aid to schools will have increased by over 21% since 2004-05, the year before the EPS formula took effect. During those seven years, a number of coastal Washington County towns have lost almost all of their state funding, while urban and southern Maine schools have gained significantly. According to the preliminary subsidy figures for next year, over that period Jonesport will have lost 98% of its state aid, Machiasport 97%, Lubec 93%, Cutler 73% and Eastport 65%. Meanwhile, Brewer will have gained 124%, Yarmouth 72%, Bangor 42% and Cape Elizabeth 25%.
     However, Maine Senate President Kevin Raye is hopeful that the state's funding formula will be changed this year. Twenty-nine bills have been submitted to revise the formula, including one that Raye is sponsoring, and he points out that Governor Paul LePage has pledged to pursue reform of the EPS funding formula and realizes that it is discriminatory against rural Maine.
     Raye recalls that, the year the EPS formula took effect, the state added in $250 million in new funding for K-12 education, yet Washington County school districts lost $2 million in state funding. "It was outrageous," he says.
     "In some places with high property valuations and declining enrollments, they're expecting the locals to pick up the whole tab," notes Porter. Under the preliminary projections for state subsidies for next year, Jonesport would receive only $11,185, Machiasport $19,117, and Lubec $56,402. In Cutler, the local tax commitment for education has increased by $154,000. "It's tough out there. There will be pain in some districts." Communities particularly hard hit with projected losses for next year include Indian Township, with a drop of $414,785, Princeton, losing $304,333, Pleasant Point $182,615, and Machiasport $111,787. Lakefront towns are being affected as much by property valuation increases as the oceanfront municipalities that have been hurt by the state's funding formula.
     "We have to design budgets to provide a high quality of education for the students -- that will be challenging," says Porter. Noting that some schools in AOS 96 have three grades in the same classroom, he observes, "We cut as much as we can. It's at the point where we've done all we can do."
     In AOS 77, Superintendent Jim Underwood agrees, commenting, "In the 11 districts I have, my difficulty is we have all cut down so far to the bone and try not to raise one dollar more in local taxes than necessary, I'm afraid there's not enough funding. When any revenues fall short, we're in a quandary on how we're going to keep going." He observes that it may be questionable whether school districts will receive funding that they have been told they will be receiving, noting that MaineCare reimbursement has been far below what was projected for this year.
     Underwood notes that two of the school departments in the AOS with small budgets have already cut hundreds of thousands of dollars during the past few years. He calculated, though, that if the schools were closed and the students were tuitioned to other schools, it would cost the towns significantly more, because of costs for tuition, a bus and driver and fuel. Towns also would have to decide what to do with the empty school building. "It's not an easy conclusion that you'll save money. In many cases it'll cost more." A comparison for Robbinston showed that it would cost an estimated $17,000 more to close the school than to keep it open.
     He points out that the per-pupil operating costs for some schools in this area are the lowest in the state. Shead has the third lowest per-pupil operating cost of the 108 high schools in Maine, and costs for the elementary schools in Calais, East Machias, Jonesport and Machias are among the lowest of the 173 elementary schools in the state. Robbinston is almost the lowest for a rural school that size. "We already have the lowest cost per student, so it has to cost more" to tuition them to other schools, Underwood points out. "We're operating far more efficiently than almost all of the schools in the state. I think the state doesn't understand what it's doing. It will cost more to close schools."

Legislators eye EPS formula
     Although Governor LePage's budget proposal would add in $23 million in state aid, the state is losing $59 million in federal stimulus funding, so education funding for the coming year will drop by $36 million. The federal funding had been used by the state to help make up what it had already cut in funding to school districts last year. Under the governor's proposal, the state would be paying approximately 45% of the cost of K-12 education and the local taxpayers 55%, the opposite of the LD 1 law that was backed by voters statewide in 2005.
     Raye says the federal funds "gave a false sense of security" to school districts and were "a mixed blessing," since they created a funding cliff, with most all districts losing state aid this coming year. If districts just built the federal funds, which were aimed at bridging the loss in state funding, into their regular budgets, "they would fall off a cliff" this coming year. "Now that bridge is a precipice."
     Porter, who is on the board of the Maine Small Schools Coalition, is disappointed that the preliminary subsidy figures were released now, since schools will begin to develop their budgets around those projections, and the numbers don't usually change much before they're finalized. "I had hoped they wouldn't be released until the EPS bills were considered."
     However, Raye believes that the EPS reform bills can affect funding for the upcoming year. "I'd hate to have that inequality continued for another year." He notes, though, that more affluent and populous areas that might lose funding under a new formula would protest. But he points out that the release of the preliminary figures will help to show legislators "the inequality, bias and failure of the EPS formula."
     Of the 29 bills that seek changes in the EPS formula, Porter believes that the bill sponsored by Senator Raye is supported by the Republican leadership in Augusta and "would move millions of dollars to rural Maine." The bill would use, in the funding formula, the lower of either a three-year average of a town's property valuations or the current valuation, "which would be a tremendous help to some communities," says Porter. He notes that East Machias' valuation is going up over $13 million and this year the town is facing an $85,000 loss in state subsidy, even though the school's enrollment is increasing. Raye's bill also would provide for a 10% reduction in the number of teachers in the required student/teacher ratios, for districts with fewer than 1,200 students, which also would provide "more money to smaller school units," says Porter.
     Raye believes the legislature's Education Committee will be receptive to changing the formula, and he notes that LePage's position is "a sea change" from former Governor Baldacci's. "It's so refreshing to have the governor see the failure of the EPS formula," says Raye. "There's definitely a renewed vigor among rural legislators and a determination to try to make some corrections."
     Concerning the governor's budget proposal, Raye notes, "No one expected it to increase funding for K-12 education, but it does." He adds that LePage has "carved out education as a priority. It gives me the most optimism I've felt in a long time for the future of rural education."

Preliminary numbers by towns
     Preliminary state subsidy changes for Washington County school departments are as follows: Alexander, $67,891 loss to $167,799; Baileyville, $48,598 loss to $719,365; Beals, $12,143 loss to $9,309; Calais, $79,358 loss to $4,458,185; Charlotte, $13,551 loss to $392,265; Cooper, $49,019 loss to $4,079; Crawford, $4,291 loss to $65,013; Cutler, $61,733 gain to $105,255; Dennysville $85,241 loss to $320,533; East Machias, $84,934 loss to $1,212,440; Eastport, $42,639 gain to $418,463; Grand Lake Stream, $626 gain to $1,303; Jonesboro, $22,108 gain to $267,500; Jonesport, $4,351 loss to $11,185; Machias, $2,380 gain $1,468,079; Machiasport, $111,787 loss to $19,117; Marshfield, $40,238 gain to $320,649; Meddybemps, $728 loss to $4,059; Pembroke, $2,047 loss to $721,133; Perry, $33,294 loss to $495,735; Princeton, $304,333 loss to $512,682; Robbinston, $56,920 loss to $353,794; Roque Bluffs, $10,537 loss to $20,867; Talmadge, $11,594 gain to $57,126; Waite, $77,163 loss to $629; Wesley, $236 gain to $1,445; Whiting, $39,178 loss to $42,100; Whitneyville, $22,303 loss to $150,104; Baring, $33,962 loss to $255,935; MSAD 19, Lubec, $36,151 loss to $56,402; MSAD 37, Harrington, Milbridge, Cherryfield area, $48,014 gain to $2,395,988; Indian Township, $414,785 loss to $1,384,295; Pleasant Point, $182,615 loss to $1,309,123; East Range CSD, $24,414 loss to $244,904; Moosabec CSD, $18,359 gain to $270,133.