RSU 1 changes cost-sharing formula; Bath tax hike may climb to 5.7%
Bath tax hike may climb to 5.7%
BATH — The Regional School Unit 1 Board of Directors voted unanimously Monday to shift its cost-sharing formula so that a law that created the school district will apply to its entire local tax calculation.
As a result of the change, residents of Bath, Arrowsic and Phippsburg could shoulder a greater share of costs than in a previous version of next year's proposed budget. Meanwhile, West Bath and Woolwich taxpayers could see substantial decreases in their share of the fiscal 2013 costs.
"This will obviously have a big impact on the tax rate in Bath," City Manager Bill Giroux said Wednesday. "The (City) Council and I are very concerned."
The board sought a new legal opinion this month on whether the law should apply to all or part of the local tax calculation. Bryan Dench, an attorney with Skelton Taintor & Abbott, recommended all the calculations be determined by that law, RSU 1 Superintendent Patrick Manuel said.
Several residents questioned the use of two formulas at a RSU 1 Board of Directors meeting earlier this month. Some, including Woolwich Selectman David King, argued that the law should have always applied to all of the local calculation.
The local contribution from RSU 1's five communities – the funds raised through taxes – has been split into two pieces: a minimum amount that the state requires, and a portion over and above that amount. State subsidy to the district has been presented on a form based on the essential programs and services model.
RSU 1 board Chairman Tim Harkins said earlier this month that the form states that for the district to receive subsidy from the state, "we need to raise a certain dollar amount at the local level. And they break that down by community. They say each community should raise X amount of dollars."
The other local contribution piece is the additional amount each community must raise, beyond the EPS model. That contribution stipulates a cost-sharing formula based on equal thirds: student population, state valuation of a community and the community's population in the most recent census.
By the cost-sharing method RSU 1 has been using, Bath was to be assessed $8.3 million, a 1.52 percent increase. Under the new method, that assessment climbs to $8.6 million, a 5.66 percent increase.
Arrowsic's assessment would rise from about $449,000 to about $495,000, from an increase of 5.45 percent to 16.27 percent. Phippsburg would have seen a 1.68 percent decrease, down to $2.7 million, but now stands to experience a 9.83 percent increase, up to nearly $3 million.
West Bath's assessment was going to increase less than 1 percent, but now could decrease 16.75 percent, from $2.6 million to $2.2 million. Woolwich was faced with a nearly 10 percent increase, to $3.4 million, but its assessment could now increase about 2 percent, to $3.1 million.
The overall amount to be taxed from the five communities remains the same, regardless of the method: $17.4 million, an increase of 2.51 percent from the current year.
The budget itself also stays the same: $26 million, up 1.86 percent from this year.
Manuel said Wednesday that he plans to meet with administrators of the five communities next week to discuss the vote on the method change, and also the potential formation of a committee to explore other cost-sharing options for future years. Any further changes in the method would have to go to a district-wide referendum.
Harkins said that in 2008, when it was time to approve the district's first budget, there was ambiguity about how the EPS formula should be applied to the local share. If RSU 1 applied that formula to the entire local share, he recalled, "we felt there was a possibility that one community might not reach the state-required minimum, therefore putting us in potential jeopardy of not complying with the state requirement, and not receiving state funds."
Then-Superintendent William Shuttleworth received conflicting opinions when he sought legal advice, Harkins said. William Stockmeyer, who wrote the state legislation, said it should be applied to the entire local share; Roger Therriault, Bath's city solicitor, said it should only have been applied to the additional amount, Harkins noted.
The School Board voted unanimously in 2008 to apply the formula to just the additional funds, and to allocate the other required costs according to state policy. The district has used that breakdown ever since.
The board is scheduled to vote on the budget on Monday, May 7. That meeting will be held at the West Bath School at 6 p.m. The budget then goes to two public votes: a district budget meeting on June 5 and the budget validation referendum June 12.