Boothbay selectmen seek school funding formula change

Tue, 01/20/2015 - 7:30am

Boothbay selectmen believe local taxpayers shoulder too high a burden for the community school district.

The board hopes discussions with their Boothbay Harbor counterparts about modernizing the 1954 school charter will also lead to changes in the funding formula.

The funding formula is based on student population; Boothbay pays a higher portion because it has 68 percent of the student population.

“The entire discussion is amicable about every topic until cost share,” Town Manager James Chaousis said. “That is going to be the elephant in the room. The cost share isn’t written in an advantage to Boothbay.”

Selectmen’s Chairman Steven Lewis said during the Jan. 14 meeting that he believes Boothbay’s portion of educational costs will continue to grow.

Lewis said he wants educational costs to be capped, similar to how the charter handles borrowed funds. As the higher assessed town, Boothbay is only responsible for 60 percent of borrowed funds.

Lewis said he hopes the ongoing discussions will bring about an amicable solution beneficial to both parties.

“Borrowing was capped in the 1950s so one town — in that case Boothbay Harbor — didn’t shoulder too high a burden,” Lewis said. “What I’m saying now is why shouldn’t some sort of cap be set for educational funding? Maybe it’s 70-30,  I’m not sure what the number is, but something needs to be done before we get to the breaking point.”

Lewis said both towns are in agreement about a charter change creating an capital improvement fund. But that change may prove costly for Boothbay taxpayers.

“If we create the fund, we’d be responsible for 68 percent of the costs. If we borrow the money, we’re only responsible for 60 percent,” Lewis said. “So shouldn’t we seek some sort of cap on educational funding while we are looking at the whole charter.”

In 1954, Boothbay Harbor had more students. But now, Boothbay sends more students to the district. In the past six decades, Boothbay has seen growth in population while Boothbay Harbor has seen an increase in commercial property. The Boothbay selectmen believe the formula should reflect both student population and commercial property values.

Boothbay contributes over $6 million to the $9 million-plus school budget, according to Lewis. Without a cap, Lewis believes the time will come when it makes sense to withdraw from the district.

“Right now it makes sense to have a mutually acceptable agreement,” he said. “The agreement shouldn’t put a hardship on one of the members. We don’t want to get to the point where it’s no longer economically feasible for us.”

State law allows communities to base school funding on student population. But many districts use a formula combining student population and property valuation.

“It’s really an anomaly. There should really be a mixture of the two,” said Chaousis.

The funding formula became problematic when real estate values plummeted, according to Chaousis. Property values increased higher than educational costs for the decade preceding Chaousis’ arrival in 2010.

But the combination of a poor economy, stagnant real estate market and continued rising educational costs has put increased pressure on the Boothbay property tax payer.

“When property valuation grew by 12 percent a year and educational costs grew at three percent, everything was fine,” Chaousis said. “But now property valuation is stagnant and school costs continue to grow. And that’s causing the problem.”

Any changes to the school charter need approval by both boards, voters and a change to the special and private law by the state legislature.