SALEM TOWNSHIP — It may cost taxpayers close to $1 million more to operate SAD 58’s four elementary schools and one high school in 2012-13.

Last year, the district asked the five member towns to pay $3.9 million and this coming fiscal year, the proposed request, as of March 15, is $4.9 million. Increases come from a combination of factors.

The district is requesting $258,422 more for operating costs, including salaries, insurance, transportation, and maintenance. The budget includes another $473,827 to absorb decreases in 2012-13 state subsidies and tuition revenues. Last year, school directors softened the budget increases by taking $300,000 from the $650,000 surplus fund.

“Last year, the school board voted to substantially increase the amount of surplus going toward the budget, because there were additional funds, much due to the superintendent’s reduced salary when he went to half-time,” Business Director Luci Milewski said.

The average surplus balance of the previous five years has been $300,000. The proposed budget does not include taking any money from the current surplus of $350,000, but dipping into that fund could be an option as the budget process continues.

Teacher salaries are a large part of the proposed budget. Elementary school salaries totaling $2.4 million and high school salaries totaling $1 million are close to one third of the $10 million proposed budget. This year’s budget is $9 million.

At the beginning of 2012, the five towns were sending about 601 students to the five schools.

The Maine Department of Education pays General Purpose Aid subsidies to the district, calculated on several factors. One is property valuation, and Strong, Avon, Phillips, Eustis and Kingfield valuations all have increased.

Conversely, the student population has declined steadily each year, and state subsidies are calculated on those figures. State tuition payments for students in unorganized territories have been cut by $146,000. The district has a tuition contract with Carrabassett Valley, which pays $11,469 per student.

“In the current year, the tuition rate for students from the Unorganized Territories or towns such as Coplin Plantation, Highland Plantation, and Carrabassett Valley is $8,284.66 per student in elementary and $8,694.37 per secondary student,” Milewski said.

Another financial factor, the state’s Essential Programs and Services subsidy, is calculated on total student population ratio to the total number of teachers. If the district has fewer students per teacher than the EPS subsidy ratio, taxpayers in the five towns must decide whether or not they will pay the difference.

The DOE subsidizes school construction debt by including an extra 10 percent of the per-student tuition rate to cover SAD 58 debt service for 10 years, or until the debt is retired. Kingfield’s and Phillips’ debt service will be paid in 2012, and Stratton’s and Strong’s will be paid in 2015 and 2016, respectively.

At least two towns, Strong and Phillips, will have to raise taxes if the proposed budget is passed.

“We’re looking conservatively at a 2.1 mill rate increase from 11.8 to 13.9, based on the current district budget,” Strong Board of Selectmen Chairman Rupert Pratt said.

Pratt also sits on the budget committee for Franklin County, and he estimated that his town’s tax rate could go above $14 per $1,000 of assessed valuation if both school district and county budget requests are approved.

Lynn White, chairman of the Philips Board of Selectman, projects at least a 2 mill rate increase from 18 to 20. He has spoken with Strong and Kingfield selectmen and plans to attend Avon and Eustis selectmen’s meetings to ask for support to prevent a tax increase.

State-assessed property valuation increases:

Avon: 7.62 percent; $39.35 million

Eustis: 32.28 percent; $166.6 million

Kingfield: 27.89 percent; $143.95 million

Phillips: 15.74 percent; $81.25 million

Strong: 16.47 percent; $85 million