AUGUSTA – Most Maine school systems are spending more than the state recommends, and not passing full tax relief on to property owners, a report released Thursday said.

Meanwhile, annual state government spending is within a spending cap, as is spending by county and municipal governments, three years after a tax-relief law was passed.

Overall, the tax burden in Maine has fallen to 11 percent, the lowest in seven years, according to the Maine Revenue Services report. For the third year in a row, the growth of property taxes was lower than before a tax-relief law went into effect. But property tax rates were not harnessed as hoped.

The report shows 82 percent of school districts spent more than they should – collectively $132 million above the Essential Programs and Services levels.

Locally, the Lewiston School Department was among the minority that spent less (4 percent less, or $1.6 million) than what the state recommended. Auburn schools spent more (1 percent, or $408,196.) Lisbon schools spent more (4 percent, or $482,160). Poland schools also spent more (15 percent, or $1.29 million).

The tax relief law, LD 1, was to give more state dollars to school districts with the intent that local property taxes would go down. An extra $800 million for education from the state will have been spent in four years, State Planning Director Martha Freeman said.

LD 1 also encourages, but does not mandate, all levels of government to live within a spending cap, which is about the annual rate of inflation. A report card comes out each year showing how everyone did. That report isn’t giving schools high grades.

Schools were “zero for two,” Freeman said Thursday. Most schools exceeded spending targets in the law and did not reduce spending before LD 1 was passed.

The state’s performance was two for two, Freeman said. “For the third year in a row, General Fund appropriations were within the LD 1 limit,” and the growth of spending was less than before the law.

“Municipalities were also two for two,” Freeman said. Most “were within their estimated property tax limit, and the growth of property taxes has slowed.”

The counties were one for two, Freeman said. As a group, the counties stayed within their spending limits. But the overall growth of county tax grew at a higher rate than before the law. The big reason was that several new jails were built.

Freeman explained that the state’s Essential Programs and Services school funding formula sets benchmarks for how much school districts should spend. That formula calculates what each district needs to educate students to state standards.

“There’s a real inflation factor,” Freeman said. “It takes into account how high heating oil prices are now, electricity. If schools have gotten more English language learner students, they get extra bucks for that.”

Freeman said she’s surprised so many school districts’ spending went over the limit. “The first year we did this, 69 percent of school unit spending was over. I thought, ‘OK, it’s the first year. People need time to adjust.’ But three years later, I am surprised that not only it didn’t level off, the trend is up.”

Meanwhile, state spending for education has gone up. “If the state picks up 55 percent of the cost of education, you’d think that would result in property taxes” going down.

Taxpayers unhappy with their property taxes may want to ask why school spending has risen, Freeman said. “They should ask their school administration officials, the school budget officials, show us one of those transparent budgets right now, show us what EPS would require and explain to us why” costs are higher.

If there are good reasons for the extra spending, taxpayers might support that, Freeman said.

Efforts to reach the Maine School Management Association were unsuccessful late Thursday afternoon.

Dennis Duquette, superintendent of Poland, Mechanic Falls and Minot schools, said his district is over EPS.

Extra things like smaller classrooms, alternative programs and extra guidance faculty at the high school to help more students go to college are not counted in the state formula, but do good things for students, Duquette said. “It’s hard to cut back on education costs when it affects the students.”

And in his case each of his three towns make local decisions about school spending. With more local decisions can come additional inefficiencies, he said. “We’re changing that” with consolidation.

Consolidation is forcing everyone to look harder at efficiencies, he said. “It’s the right thing to do.” The school budget he’s about to present will still be over EPS, but it be at zero growth, Duquette said. “We’re closing the gap and using our money better.”

To view report:

http://www.state.me.us/spo/economics/ld1/index.htm


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