An Act To Encourage Cost Efficiency in Administration of and Contribution to Tax Burden Reduction by School Districts
Maine Legislature, Session 123, LD 0976
Committee: Education and Cultural Affairs
Sponsors: WOODBURY, TURNER, EDGECOMB, RECTOR, STRANG BURGESS, MILLS

Legislative Document 
No. 976 
H.P.736 
House of Representatives, March 2, 2007 
An Act To Encourage Cost Efficiency in Administration of and 
Contribution to Tax Burden Reduction by School Districts 
Reference to the Committee on Education and Cultural Affairs suggested and ordered 
printed. 
Presented by Representative WOODBURY of Yarmouth. 
Cosponsored by Senator TURNER of Cumberland and 
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MILLICENT M. MacFARLAND 
Clerk 
Representatives: EDGECOMB of Caribou, RECTOR of Thomaston, STRANG BURGESS of 
Cumberland, Senator: MILLS of Somerset. 
Printed on recycled paper 
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Be it enacted by the People of the State of Maine as follows: 
CONCEPT DRAFT 
SUMMARY 
This bill is a concept draft pursuant to Joint Rule 208. 
This bill proposes to establish a multitiered school funding formula that is designed to 
provide additional school funding assistance to school districts that are sufficiently 
consolidated to gain cost efficiency in administration and to school districts that are 
contributing to statewide tax burden reduction. 
Specifically, the proposal would change the Essential Programs and Services funding 
formula, or EPS, as defined in the Maine Revised Statutes. Title 20-A, chapter 606-B, to 
create a gradation of mill rate expectations that depend explicitly on district consolidation 
and budget decisions made by individual school districts in the previous year. The idea is 
to retain local control of school operations but create much stronger incentives for 
administrative cost efficiency. 
The baseline mill rate expectation for all school districts would be set annually at the 
rate that could be supported with state general purpose aid funding, or GPA, that is 
equivalent to 50% of EPS costs. 
The additional 5% of the State's GPA funding. as 
required under current law, would be allocated into a supplementary school funding 
bonus system that would further reduce the mill rate expectation in eligible communities. 
The local mill rate expectation would be reduced by a fixed amount for each "efficiency 
point" earned up to a maximum of 5 efficiency points in each school district. Thus there 
would be in effect 5 tiers of mill rate expectation, depending on the administrative cost 
efficiency and tax burden reduction targets achieved. 
I'. District size. Consolidated school districts would be awarded efficiency points 
based on the size of the district, as follows: 
A. At least 3,000 students, 3 efficiency points; 
. B. At least 2,000 but fewer than 3,000 students, 2 efficiency points; and 
C. At least l,OOO but fewer than 2,000 students, 1 efficiency point. 
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2. EPS spending. Districts could earn another 2 efficiency points by: 
A. Spending at least the EPS baseline on education but exceeding EPS by no more 
than 5%; or 
B. Exceeding EPS costs by proportionately less the previous year than the year prior 
to that year, indicating a proportional movement toward tax burden reduction. 
The value of the efficiency points in terms of their reduction in mill rate expectation 
would be based on the cost of the mill rate reduction to State Government, calibrated to 
equate exactly to the incremental resources available from the last 5% of the State's 55% 
commitment. 
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