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Derailed FMAP May Trigger Education Cuts

By   /   July 1, 2010  /   2 Comments

The derailed federal funding that impoverished Maine’s budget by $100 million last week may need to be offset by cuts in education spending.   

Without the federal revenues for state-administered programs like Medicaid and TANF that Augusta legislators anticipated in the budget, Governor Baldacci may resort to education cuts to re-balance the budget. 

Jim Rier, Director of Finance and Operations at the Maine Department of Education, said that curtailment is the only tool the Governor has to respond to the expected budget shortfall: “Given that education spending is a major component of the budget that can be curtailed without legislative approval, it is one of the only places where the Governor can turn to make cuts.” 

He said it’s premature to imagine what cuts would look like: “At this stage, the Governor has no choice but to respond with the curtailment process because the legislature required that in the budget they passed.  So it’s quite speculative to decide, but making mid-year adjustments of any size will be difficult for school districts this year.” 

Several school superintendents expressed their concerns about further cuts. 

Patricia Hopkins, who oversees two districts in the Camden area, said that her initial reaction to the news was dismay.  “To be honest,” she said, “we were feeling pretty optimistic that we were not going to experience another cut this year.  We were seeing state revenues turning around, so we were going into this year feeling better.”

Hopkins said that school budgets are already lean: “We’re concerned that we won’t be able to absorb additional cuts.”  Within her purview last year, a minimum receiver district sustained a $70,000 reduction, and a five-town Community School District (CSD) suffered a $300,000 blow.

Marc Gendron, the Superintendent of RSU 86 in Fort Fairfield, said that his district has already laid off two staff members.  Although some federal revenues have mitigated the state cuts to the education budget, Gendron said that most of the cuts that could be made have already been made.  “Additional curtailments,” he said, “will result in position losses.” 

David Walker, Superintendent for Regional School Unit 34, which includes Old Town, Alton, and Bradley, said the news that the Governor may cut education funding was “pretty discouraging.” 

He said: “If the curtailments become a reality, we will have less revenues than we had anticipated, which means we would need to go back into the budget and reduce spending to offset the loss of revenues.” 

The district, which employs about 250 people, had expenditures that were $350,000 less than they were last year, so the budget was already very tight: “We built a very bare bones budget this year.” 

Additional cuts, he said, would be hard to absorb: “Now to perhaps lose more money would result in additional reductions in staff and programs.” 

Governor Baldacci recently issued an executive order indicating that curtailments may ensue.  State departments and agencies must submit spending cuts by September 1 in the case that the Governor chooses to exercise his curtailment authority.

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