By Stowell P. Watters

Staff Writer

A first ever joint meeting between the Kennebunk budget board, board of selectmen and Maine School Administrative District 71 (MSAD 71) School Board concerning the district’s proposed budget for the 2008-2009 fiscal year highlighted Kennebunk’s mil rate is 76 percent higher than Kennebunkport’s.

“Because of the way the state education funding is structured, Kennebunk’s mil rate is higher for the same quality education offered in Kennebunkport,” said MSAD 71 Finance Committee Chairman John Sharood. “Communities that have a population concentration like Kennebunk, Biddeford and Portland are getting completely screwed.”

According to Kennebunk Finance Director Joel Downs LD1684 is in the last year of its (voter approved) four-year phase-in and now mandates the essential programs and services (EPS) contribution for each municipality within a district must reflect their pupil count. In previous years the statute spread costs through the municipalities by relying on both pupil count as well as a portion of the town’s total property value. 

Because of Kennebunkport’s high property values and low student enrollment relative to Kennebunk, it paid a disproportionately higher share of the MSAD71 education bill compared to a formula that weighes student populations more heavily. In the four years of its phase-in, LD1684 has required less and less property value to be weighed upon when considering the town’s individual contribution, Downs said.

According to Maine Department of Education Director of Finance and Operations Jim Rier, the phase in, or ramp up, was intended to smooth the transition between the two funding formulas by incrementally shifting a $2 milion in education funding from Kennebunkport to Kennebunk over four years. The FY 2008/2009 budget represents the completion of that shift.

MSAD 71 Business Manager Jim Barnes said during the first year of LD1684’s phase-in, Kennebunkport paid roughly $500,000 to Kennebunk to offset the final per-pupil burden. This action was repeated in similar amounts over the following years according to Barnes.

Sharood said the state is currently proposing a 13 percent budget cut and, while that number is likely to change, the impact on Kennebunk is far greater than that on Kennebunkport. With a declining enrollment, MSAD 71 hosts 1,784 Kennebunk students – or 78 percent of the total body – and 460 Kennebunkport students this year. 

As education costs have shifted from Kennebunkport to Kennebunk, so has the criticism of the education formula.

“This is a four year, $2 million shift of tax burden from Kennebunkport to Kennebunk, made worse by the state budget cuts,” Sharood said. “We are going to a no kids – no cost formula, and it just doesn’t make any sense.”

Considering current proposed state budget cuts and the final year of the phase-in, Downs said the net change in local tax assessment for Kennebunk will increase 6.8 percent, with a base increase of 11.4 percent from the year in which LD1684 was enacted. Likewise, he said, Kennebunkport will see a four percent decrease in their tax assessment. 

While this cost sharing formula applies to the current charter structure, it will change when MSAD 71 is dissolved in 2010 and becomes a Regional School Unit (RSU). However, Downs said, the per-pupil cost-sharing method will not be abandoned but will be modified so the towns’ education-related tax burden will be determined by “approximately” 10 percent of their assessed value with the remainder being determined by the per-pupil method.

Because the district was able to leave vacant positions unoccupied this year, it has a $139,883 carry-over surplus from last year’s budget.

School Board Chairman Maureen King said this surplus decreases the projected tax burden to $784,856 – a 2.7 percent budget increase.

“That is a good thing, one thing we can be relieved about as its relatively small compared to what we were expecting,” King said, adding while the state works through a $200 milion budget shortfall this percentage could change.

The MSAD 71 proposed spending budget for the 2008/2009 fiscal year is $29,882,660, a four percent increase from last year’s figure and a 20.2 percent increase from the district’s 2003/2004 fiscal year. According to school board and finance committee member Gayle Spofford, if approved by voters in April as it exists today, 63 percent of the EPS portion of the budget will have to be picked up by Kennebunk tax-payers.

“This is a personal opinion, not a board opinion because taxes are a topic we try not to get into, we try to deal with education. But if we all benefit from having educated neighbors we should all share the cost,” Spofford said.

Sharood said it is the state, not Kennebunkport, that is to blame for what he called a “crazy law.”

“There wouldn’t be a tax increase if the state hadn’t stepped in, as simple as that,” Sharood said.