While Maine will continue to meet its obligation to pay 55% of the cost of K-12 education under Governor Janet Mills' budget proposal for 2023-24, a milestone first achieved last year, many superintendents are still not happy with the state subsidy amounts for schools in their districts. Preliminary state subsidy figures for next year were recently released, and schools in coastal Washington County will continue to receive either only a minimum subsidy amount or a small amount more than that.
      While the state has increased its overall funding for public education, AOS 77 Superintendent Ken Johnson points out that the total cost of education is continuing to increase, so the amount that is provided by municipalities through local property taxes also increases. Also, the 55% state funding is "at the macro level," Johnson notes. "When you go through the state's EPS [Essential Programs and Services] formula, it mostly goes to larger schools in southern Maine."
      As has been pointed out for years, Johnson says, "The trouble is when property valuation is used as a measure of wealth or a town's ability to pay. There are towns that are land rich but have a depressed economy." They may also have a smaller population and fewer students, which also affects the subsidy formula. "If you use property valuation as a measure of the ability to pay, it hurts small, rural areas."
      Pointing to property valuations of area municipalities, he asks rhetorically, "Does anybody think that Lubec is $17 million richer than Calais? There is no comparison in terms of the strength of the economy between those two communities." Yet the state subsidies covered nearly 65% of the Calais school department's $9.5 million budget in 2022-23, while only providing 12% of Lubec's $2.4 million budget and 11% of Eastport $3.2 million budget.
      Calais Superintendent Ron Jenkins agrees with Johnson, noting of the state's subsidy formula, "The formula is not good for Washington County in general." While areas like Calais receive a reasonable amount of subsidy, he says, coastal areas like Eastport and Lubec with a large amount of shorefront property do not. "They have a lot of water and higher property valuations. But just because there's water doesn't mean there's money there. It doesn't translate into a lot of income that can go to schools."
      In addition, Superintendent Scott Porter of AOS 96, which covers towns in the Machias Bay area, notes that the state is not paying 55% of the total cost of K-12 public education, but rather just 55% of the cost defined by the state's EPS funding formula. "Many districts pay an additional local share outside of the funding formula," he says.
      Pointing out that there are over 100 school districts in the state that receive only a minimum required amount of state subsidy, he says that five of the 11 schools in AOS 96 are minimum receivers: Wesley, Roque Bluffs, Whiting, Machiasport and Northfield. Porter points out that, for minimum receivers, the state only pays 50% of the prior year's special education costs.
      Porter also notes that the required mill rate municipalities must pay for education is going up this year from 7.1 to 7.29 mills, which will make a significant difference. The required local share is based on a town's total valuation multiplied by the required mill rate set by the state. "It puts more of a burden on the required local amount. When a town's valuation goes up plus when the required mill rate goes up, it's a double whammy." While many towns pay an additional local share amount, Porter observes that when the required local share goes up, the state subsidy amount is reduced.
      "A lot of superintendents in the state are upset with the subsidy amounts," he says. "None are happy with what they're receiving."
      Also, the state had changed a couple of factors in the EPS formula during the pandemic that have now been lifted, Porter says. "That has also had an impact, particularly in larger districts."
      When the state's EPS formula was designed, the two major factors for determining state subsidies were property valuation and the number of students in the district. "The poor coastal communities were hurt the worst," he notes. "I'd like to see some changes in the funding for Washington County. We need a median income factor." In southern Maine, the median income in many communities is double that of Washington County towns. "Hopefully, some day it will be changed so it will be friendlier for rural Maine."

Subsidies for area towns
      For AOS 77 towns, Johnson points out, "All of the towns in the AOS will see an increase in the required local share, mostly due to increases in town valuations." He adds, "The biggest reasons the towns that got hit hard got hit is because of the property valuation or they lost kids."
      Charlotte will be especially hard hit, with the subsidy dropping by $169,865, to $212,727. "It will be a very challenging year in Charlotte," Johnson observes.
      The school budget will also be a challenge in Lubec, as the town's valuation increased by $11 million to $188 million. As a result, the required local share is up by $108,000. The town's subsidy is down by $115,560, to $182,177, so Johnson notes that there is a $224,000 hole in Lubec's school budget.
      In Perry, the subsidy dropped by $71,916, to $385,065, and the required local share is up $32,312, so that town faces a $104,000 hole. However, Johnson points out that all of the towns in the AOS provide additional local share funds beyond the required amount, so "there may not be that great a hole."
      Eastport's required local share went up by $49,542, and the subsidy amount is increasing by $36,803, to $392,769.
      Johnson spoke with a financial specialist with the Maine Department of Education about the subsidy figures and says, "The biggest driver for decreasing subsidies is declining enrollment," which is the case in Charlotte and Perry. He also notes that there are other factors, including a reduction in the weight factor for the number of low-income students and the ending of some temporary adjustments made during the pandemic, such as for the student-teacher ratios.
      Calais will see an increase of $236,369, to $6,287,698, and Jenkins says the modest gain in funding means that "the city will not have to raise much additional money" for education this coming year.
      Porter says the towns in AOS 96 "did OK" with the new subsidy amounts, and he notes East Machias is receiving $161,179 more because of an increase in the number of students. Machias will be receiving $36,000 more for the town's school budget, along with $35,182 more for the career and technical education programs that are operated at the Coastal Washington County Institute of Technology in Columbia.
      For other AOS 77 towns, Alexander will receive $322,692, for a $5,047 increase; Baring's subsidy for next year is $185,431, for a $5,019 decrease; Dennysville will receive $258,723, for a $6,176 decrease; Pembroke will receive $586,917, for a $56,473 increase; and Crawford will receive $1,537, for a $288 decrease. Johnson notes there is only one school-age child in Crawford.
      For other towns in eastern Washington County, Baileyville's subsidy will drop by $210,003, to $290,903; Cooper, a $12,529 increase to $18,714; Cutler, a $9,298 decrease to $527,179; East Machias, a $161,179 increase to $1,889,348; Indian Township, a $522,324 increase to $3,098,118; Jonesboro, a $61,461 increase to $477,260; Jonesport, a $52,782 decrease to $178,286; Machias, a $71,282 increase to $3,714,872; Machiasport, a $56,299 increase to $200,488; Meddybemps, a $2,376 increase to $8,636; Moosabec CSD, a $19,018 decrease to $323,528; Pleasant Point, a $274,909 increase to $3,209,933; Princeton, a $13,721 increase to $1,074,570; Robbinston, a $49,963 decrease to $518,065; Roque Bluffs, an $11,381 decrease to $12,466; Whiting, an $11,230 increase to $46,832; and Whitneyville, a $14,937 decrease to $233,508.