PHILLIPS – The MSAD 58 school board is expected to finalize a proposed budget for the upcoming fiscal year in their meeting on Monday, April 22. This year’s budget season has presented some interesting challenges with changes in funding and revenue sources. This week, Superintendent Laura Columbia discussed some of those challenges with the Bulldog.
The school district uses four main sources of revenue to fund the operating budget for the year, Columbia said.
One revenue source, the state funding, is for essential programs and services (EPS) which is defined as the programs and resources that are essential for students to have an equitable opportunity to achieve the Maine Learning Results. This funding formula determines both the state and local share of funding needed for each district.
In MSAD 58, the state contributes 64.57% of the EPS funding amount towards the district, and the local communities must raise 35.43% of the EPS funding in order to receive the state contribution. This is the required local contribution, a second revenue source; the district may also ask for additional local funding for expenses beyond the EPS formulas, which would be a third revenue source. Finally, the last revenue source is general revenue such as tuition from other districts, state reimbursements for some expenses, balance forward or unexpended funds from the previous year’s budget, and income from sale of unused equipment and other items.
The district had a decrease in state funding of approximately $124,000 over last year’s allocation. Columbia said this was partly due to decreased local enrollment in the PreK program and decreased reimbursement for special education services and gifted and talented services, although the funding formula is quite complex.
The state funding formula takes into consideration the number of students and staff within the district, Columbia said. Tuitioned students, such as students from Carrabassett Valley, the unorganized territories, and high school students from the Eustis School District, are not counted towards the state funding formula, although the district receives compensation for those students in other revenue.
The district’s student to teacher ratio is ‘on par’ with the state’s recommended ratios, Columbia continued. To create these ratios, the state determines how many students each teacher should be reasonably responsible for. Districts can have a lower student to teacher ratio, with more teachers than the state’s recommendations for the student population, but the district may not receive state funding for the teacher positions that exceed the recommended ratio.
Because MSAD 58 is a smaller district, there is some variance in the EPS formula, allowing smaller student to teacher ratios.
However, while the student to teacher ratio is pretty good, the district is low on the guidance ratios and high on the administration and nursing ratios. The EPS formula does not take into account the number of school buildings. The district has a principal for each of the four school buildings in addition to departmental administrators and the superintendent, but the state ratio considers the administration to be high for the student population served by those four schools and the various departments such as transportation, food service, technology, and special education.
Columbia said that the district’s business manager found a line in the funding formula for ‘isolated small schools’ and contacted the state to determine if the district was eligible for that line. The district is eligible, bringing in an estimated $160,000 in additional EPS funding.
Correctly identifying the student population and the community also impacts the EPS funding. Students who may qualify for additional resources and support include those experiencing homelessness and those with a certain household income level. Making sure that the student population data is as accurate as possible is important to earn the correct EPS funding.
Part of the funding allocations from the state are reimbursements for expenses that have already been paid out, such as the gifted and talented and some of the special ed services such as the out-of-district placement for services. Gifted and talented is reimbursed at 102% of the year’s expenses. If fewer students need those services then less funds are expended, and less funds are paid back in reimbursement the following year, resulting in a decrease in revenue.
Another proposed decrease in revenue is within the district’s control: using the balance forward or unexpended funds to reduce tax commitment.
In the previous year, the district budgeted $700,000 from the balance forward account as a source of revenue. The year before, the district budgeted $550,000.
Columbia is concerned about the sustainability of using the balance forward funds as a primary revenue source for the budget. The balance forward is unexpended funds from the previous year, largely from unfilled positions within the district; Columbia said that using balance forward is not a long-term solution as those positions should be filled to better support students and staff. She would like to gradually decrease the amount of balance forward that is used to reduce the tax commitment, and instead put more unexpended funds into reserve accounts for large expenses.
In the most recent budget draft, Columbia proposes only budgeting $685,000 in balance forward funds, a decrease of $15,000 over last year.
Looking at the rest of the most recent budget draft, the overall budget increase is 3.38%, but due to decreases in state funding, the additional local budgets have an average increase of 11.30%, with Avon at 9.30% and Kingfield at 13.00%.
Under the current draft budget, the state contribution is $4,703,604, a decrease of $124,099 from the previous year. The required local contribution is $2,565,691, an increase of $16,414; the additional local contribution is at $2,629,978, an increase of $512,921 over the previous year. Finally, there is a $15,000 proposed decrease in balance forward under general revenue. The total budget is $11,923,273, with an increase of $390,236 over the previous year.
“I am worried about our budget, and I am worried about next year,” Columbia said. Moving forward, she wants to gather data to make informed decisions about how to best support the district, students, and communities. A facilities assessment is one of the next steps.
The school board will meet on Monday, April 22, at 6 p.m. at Mt. Abram High School, at which time the board is expected to adopt a final budget. Throughout April and May, Columbia will present the proposed budget to the community at local select board meetings.
On May 2, the board is expected to have a special board meeting to sign warrants. The annual budget meeting will be Thursday, May 23 at 7 p.m., for voters to set budget figures. Those budget figures will then be presented to the towns for the budget referendum validation vote on Tuesday, June 11.
More information on the MSAD 58 budget can be found on the district website.
