There’s no answer sheet for questions about how LePage’s tax reform plan would affect Maine schools

Published Jan. 22, 2015, at 10:55 a.m.     |      Modified Jan. 22, 2015, at 2:24 p.m.
 
Maine Central Institute is seen Tuesday in Pittsfield.
AUGUSTA, Maine —

How would taxing large nonprofits affect state education funding for cities or towns with large nonprofit organizations? Maine’s school funding formula heavily factors a municipality’s overall taxable property value into the calculation to determine how much state aid local school districts receive. Towns and cities with high property values — such as coastal, urban and industrial communities — generally receive less state education funding. Adding properties like hospitals and colleges, which are currently untaxed, to a town’s assessed value could reduce state funding.

Service centers such as Portland, Bangor and Lewiston could experience significant decreases in state aid to education if the taxable value of hospitals, colleges and museums is added to current overall valuations. Those communities would have to use new tax receipts from nonprofits not only to compensate for LePage’s planned elimination of state revenue sharing, but also to cover reduced state aid to local school systems…..

How will the proliferation of charter schools affect school funding? LePage has proposed paying for public charter schools out of the pool of all state money earmarked for local schools, as opposed to the current practice of having a charter school student’s former school district pay the local cost. It’s an approach that has been debated extensively in recent years as a means of minimizing the financial impact on any single district. LePage says he is proposing $6 million in new money for charters while essentially flat-funding the overall state budget for local schools at $888 million per year, which is a less than 1 percent increase over the current level. However, he is also proposing to shift more of the cost of education to municipalities by increasing how much they must raise from property taxpayers in order to trigger full state funding. He proposes that towns pay $8.44 for every $1,000 of their valuation, as opposed the current rate of $8.10. That equates to a shift in costs to municipalities of tens of millions of dollars statewide. That essentially means that LePage wants credit for dedicating money for charter schools even though overall, the state’s percentage share of education costs is decreasing. As Maine’s seven charter schools increase enrollments, including two virtual schools, and up to three more charter schools are created under Maine law, state funding for traditional public schools will be diluted to some degree as long as overall funding stays flat because there will be more schools drawing from the same pool of money…..    READ MORE…

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