Maine Funding Formula Under Scrutiny

Last Updated: May 29, 2011

This article appeared in the May 2011 Rural Policy Matters.

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Communities in rural Maine that have experienced dramatic changes in property valuation are seeking help in dealing with shrinking state support. They want the state’s funding formula changed to better address their needs.

Representatives and school leaders from places such as coastal Jonesport and other small towns along the Atlantic say that the Essential Programs and Services (EPS) formula does not recognize that high property values do not always correspond with high incomes. They argue that high local property values should not automatically relieve the state of its responsibility to support local school districts. Property values in many coastal communities have risen dramatically. But incomes of many long-time and full-time residents have not increased.

These communities argue that sudden drops in state funding triggered by rapidly rising local property values are extremely harmful to local district operations.

A number of bills proposing changes to the EPS were introduced this session. But the Maine Department of Education has only publicly supported one that directly addresses the valuation issue. Legislative Bill 1274 would allow small districts to vary their required staff-student ratios by 10%. The MDE recommends a comprehensive examination of the EPS rather than piecemeal change.

Other legislators have cited the recent Education Law Center national report, “Is School Funding Fair?,” which awards Maine an ‘A’ on education spending relative to income but only a ‘D’ on its distribution method. The EPS formula has been criticized almost since its inception, but reform proposals have largely failed. One sponsor of current legislation has said that EPS is “an urban formula foisted on a rural state.”

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Local coverage:

Maine Department of Education Response:

Link to text of LB 1274 here:

Read more from the May 2011 Rural Policy Matters.