An Act to Amend the Essential Programs and Services School
Maine Legislature, Session 132, LD 2226
Committee: Education and Cultural Affairs
Amends: 20-A MRSA §2413, 20-A MRSA §2413-A, 20-A MRSA §15672, 20-A MRSA §15675, 20-A MRSA §15676, 20-A MRSA §15680, 20-A MRSA §15681, 20-A MRSA §15681-A, 20-A MRSA §15682, 20-A MRSA §15682-A, 20-A MRSA §15688, 20-A MRSA §15689

Legislative Document
No. 2226
H.P. 1503
House of Representatives, March 3, 2026
An Act to Amend the Essential Programs and Services School 
Funding Formula
Reported by Representative MURPHY of Scarborough for the Joint Standing Committee 
on Education and Cultural Affairs pursuant to Resolve 2025, chapter 84, section 2, subsection 
4.
Reference to the Committee on Education and Cultural Affairs suggested and ordered 
printed pursuant to Joint Rule 218.
ROBERT B. HUNT
Clerk
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  20-A MRSA §2413, sub-§2, ¶B, as amended by PL 2011, c. 570, §19, is 
further amended by repealing subparagraph (3).
Sec. 2.  20-A MRSA §2413-A, sub-§2, ¶B, as enacted by PL 2015, c. 54, §5, is 
amended by repealing subparagraph (3).
Sec. 3.  20-A MRSA §2413-A, sub-§2, ¶H, as enacted by PL 2015, c. 54, §5, is 
amended to read:
H.  A public charter school may receive payment pursuant to paragraph A for students 
residing in the unorganized territory based on the state average EPS per-pupil rate as 
defined in section 15672, subsection 7‑A.  A special education student residing in the 
unorganized territory must be treated the same as a resident student from a school 
administrative unit for special education costs pursuant to paragraph B.  The 
responsibility for providing a free, appropriate public education for a special education 
student passes to the charter school in which the student enrolls.  As with other resident 
school administrative units in accordance with section 15681‑A, subsection 2, 
paragraph B, the department shall pay for high-cost in-district students.
Sec. 4.  20-A MRSA §15672, sub-§22-A, as repealed and replaced by PL 2005, c. 
519, Pt. AAAA, §4, is repealed.
Sec. 5.  20-A MRSA §15672, sub-§22-B is enacted to read:
22-B.  Predicted transportation costs.  "Predicted transportation costs" means the 
average of:
A.  A pupil density model based on the net cost per resident pupil for each school 
administrative unit that is predicted by pupil density per mile of road in the school 
administrative unit, including transportation costs for in-district and out-of-district 
special education programs, career and technical education programs and 
transportation of students who are experiencing homelessness pursuant to provisions 
adopted under section 5205, subsection 7.  Adjustments may be made for transportation 
costs of island school administrative units; and
B.  The most recent year's net transportation costs adjusted for inflation.
Sec. 6.  20-A MRSA §15675, sub-§2, as amended by PL 2021, c. 635, Pt. C, §2, is 
further amended to read:
2.  Economically disadvantaged students.  For each economically disadvantaged 
student, an eligible school administrative unit receives the following additional weights:
A.  An additional weight of between .15 and .35 based on an index developed by a 
statewide education policy research institute.  The index must be updated at least once 
every 5 years.  The number of economically disadvantaged students for each school 
administrative unit is determined by multiplying the number of resident pupils in the 
most recent calendar year by the most recent available elementary that are eligible for 
free or reduced-price meals percentage.  The elementary free or reduced-price meals 
percentage may be applied to determine the number of economically disadvantaged 
students in the unit's secondary grades; and.
B.  An additional weight for approved extended learning programs that specifically 
benefit economically disadvantaged students equal to .05.  The commissioner shall 
approve qualifying extended learning programs based on evidence-based research by 
a statewide education policy research institute.
To be eligible to receive funds under this paragraph, a school administrative unit must 
certify that any funds previously received under this section and any funds that will be 
received are used in direct support of learning for economically disadvantaged students 
through summer schools, extended learning programs, tutoring and other evidence-
based practices conforming to rules developed by the department and informed by 
evidence from a statewide education policy research institute.
Sec. 7.  20-A MRSA §15676, sub-§1, as amended by PL 2017, c. 284, Pt. C, §31, 
is further amended to read:
1.  Teaching staff costs.  Beginning July 1, 2017, the salary and benefit costs for school 
level teaching staff that are necessary to carry out this Act, calculated in accordance with 
section 15678 and adjusted by the regional adjustment under section 15682 15682-A;
Sec. 8.  20-A MRSA §15676, sub-§2, as amended by PL 2017, c. 284, Pt. C, §31, 
is further amended to read:
2.  Other staff costs.  Beginning July 1, 2017, the salary and benefit costs for school-
level staff who are not teachers, but including substitute teachers, that are necessary to carry 
out this Act, calculated in accordance with section 15679 and adjusted by the regional 
adjustment under section 15682 15682-A; and
Sec. 9.  20-A MRSA §15680, sub-§1, ¶D, as enacted by PL 2003, c. 504, Pt. A, 
§6, is amended to read:
D.  Cocurricular and extracurricular activities; and
Sec. 10.  20-A MRSA §15680, sub-§1, ¶E, as enacted by PL 2003, c. 504, Pt. A, 
§6, is repealed.
Sec. 11.  20-A MRSA §15680, sub-§1, ¶F, as enacted by PL 2003, c. 504, Pt. A, 
§6, is amended to read:
F.  Instructional leadership staff support.
Sec. 12.  20-A MRSA §15681, sub-§2-A, as amended by PL 2013, c. 506, §16, is 
repealed.
Sec. 13.  20-A MRSA §15681-A, sub-§2, as amended by PL 2017, c. 284, Pt. C, 
§37 and affected by §66, is further amended to read:
2.  Special education costs.  A school administrative unit receives an additional weight 
of 1.50 for each special education student identified on the annual December 1st child count 
as required by the federal Individuals with Disabilities Education Act for the most recent 
year, up to a maximum of 15% of the school administrative unit's resident pupils as 
determined under section 15674, subsection 1, paragraph C, subparagraph (1).  For those 
school administrative units in which the annual December 1st child count for the most 
recent year is less than 15% 17% of the school administrative unit's resident pupils as 
determined under section 15674, subsection 1, paragraph C, subparagraph (1), the special 
education child count percentage may not increase more than 0.5% in any given year, up 
to a maximum of 1.0% in any given 3-year period.  For each special education student 
above the 15% 17% maximum, the unit receives an additional weight of .38. In addition, 
each school administrative unit must receive additional allocations:
A.  For lower staff-student ratios and expenditures for related services for school 
administrative units with fewer than 20 enrolled special education students identified 
on the annual December 1st child count as required by the federal Individuals with 
Disabilities Education Act for the most recent year;
B.  For high-cost in-district special education placements.  Additional funds must be 
allocated for each student estimated to cost 3 times the statewide special education EPS 
per-pupil rate.  The additional funds for each student must equal the amount by which 
that student's estimated costs exceed 3 times the statewide special education EPS per-
pupil rate;
D.  Beginning July 1, 2018, to ensure the school administrative unit meets the federal 
maintenance of effort requirement for receiving federal Individuals with Disabilities 
Education Act funds in accordance with recommendations of any legislative task force 
established in the First Regular Session of the 128th Legislature to identify special 
education cost drivers and innovative approaches to services; and
E.  A separate allocation must be determined for high-cost out-of-district special 
education placements in accordance with this paragraph.
(1)  For private school placements, additional funds must be allocated for each 
student estimated to cost 4 times the statewide special education EPS per-pupil 
rate. The additional funds for each student must equal the amount by which that 
student's estimated costs exceed 4 times the statewide special education EPS per-
pupil rate.
(2)  For public school placements, additional funds must be allocated for each 
student estimated to cost 3 times the statewide special education EPS per-pupil 
rate. The additional funds for each student must equal the amount by which that 
student's estimated costs exceed 3 times the statewide special education EPS per-
pupil rate.
(3)  For public regional special education program placements, additional funds 
must be allocated for each student estimated to cost 2 times the statewide special 
education EPS per-pupil rate. The additional funds for each student must equal the 
amount by which that student's estimated costs exceed 2 times the statewide special 
education EPS per-pupil rate.  Resident students for the fiscal agent of the regional 
special education program are considered out-of-district placements for purposes 
of this determination.  The commissioner may expend and disburse funds pursuant 
to section 15689, subsection 9 for direct contractual agreements to provide legal 
services, facilitation services and other services to assist a school administrative 
unit with planning and implementing a regional special education program.
The commissioner shall develop an appeals procedure for calculated special education 
costs for school administrative units;
Sec. 14.  20-A MRSA §15681-A, sub-§2-B is enacted to read:
2-B.  Maintenance of effort adjustment cap.  Beginning in fiscal year 2027-28 and 
in each subsequent fiscal year, the department shall implement a cap on the total amount 
of funding allocated per school administrative unit per fiscal year for the maintenance of 
effort adjustment. The cap must be no more than 80% of the difference between the school 
administrative unit’s base special education allocation calculated in subsection 2 and the 
school administrative unit’s prior fiscal year’s actual special education expenditures;
Sec. 15.  20-A MRSA §15681-A, sub-§2-C is enacted to read:
2-C.  Midyear adjustment; out-of-district special education placement costs.  
Beginning in fiscal year 2027-28, the department may not allocate additional funds midyear 
for unexpected out-of-district special education placement costs;
Sec. 16.  20-A MRSA §15681-A, sub-§3, as repealed and replaced by PL 2005, c. 
519, Pt. AAAA, §8, is amended to read:
3.  Transportation costs.  For fiscal year 2006-07, the commissioner, using 
information provided by a statewide education policy research institute, shall establish for 
each school administrative unit a predicted per-pupil transportation cost as defined in 
section 15672, subsection 22‑A.  The established predicted per-pupil transportation cost 
multiplied by the number of the school administrative unit's resident students for each 
school administrative unit must be no less than 90% of the most recent year's reported net 
transportation expenditures.  Beginning in fiscal year 2007-08 2027-28, and for each 
subsequent fiscal year, the per-pupil transportation costs for each school administrative unit 
are its predicted per-pupil transportation cost costs for the most recent year adjusted by the 
Consumer Price Index or other comparable index, except that the established predicted per-
pupil transportation cost multiplied by the number of the school administrative unit's 
resident students costs for each school administrative unit must be no less than 90% of the 
most recent year's reported net transportation expenditures and no more than 105% of the 
most recent year's reported net transportation expenditures adjusted for inflation.  The 
commissioner shall develop an appeals procedure for established per-pupil transportation 
costs for school administrative units;
Sec. 17.  20-A MRSA §15682, as amended by PL 2011, c. 419, §2, is repealed.
Sec. 18.  20-A MRSA §15682-A is enacted to read:
§15682-A.  Regional adjustment
Beginning in fiscal year 2027-28, and for each subsequent fiscal year, the 
commissioner shall make a regional adjustment in the total operating allocation for each 
school administrative unit determined pursuant to section 15683.  The regional adjustment 
must be based on the regional differences in the cost of living, as computed by a statewide 
education policy research institute using a nationwide index or combination of nationwide 
indices.  The regional adjustment must align with the salary matrix described in section 
15677 so that the minimum index value is sufficient to pay the minimum teacher salary 
established under chapter 505. The regional adjustment must be applied only to appropriate 
teacher salary and benefit costs as calculated under section 15678 and salary costs of other 
school-level staff who are not teachers as calculated under section 15679.
Sec. 19.  20-A MRSA §15688, sub-§3-A, ¶A, as enacted by PL 2005, c. 2, Pt. D, 
§56 and affected by §§72 and 74 and c. 12, Pt. WW, §18, is amended by amending 
subparagraph (2) to read:
(2)  The total of the full-value education mill rate calculated in section 15671‑A, 
subsection 2 multiplied by the property fiscal capacity of the municipality adjusted 
for relative income level using an index calculated by a statewide education policy 
research institute.  The index must be based on the percentage of resident pupils 
that are identified as economically disadvantaged under section 15675, subsection 
2.
Sec. 20.  20-A MRSA §15688, sub-§3-A, ¶B, as amended by PL 2015, c. 494, Pt. 
A, §13, is further amended by amending subparagraph (2) to read:
(2)  The total of the full-value education mill rate calculated in section 15671‑A, 
subsection 2 multiplied by the property fiscal capacity of the municipality adjusted 
for relative income level using an index calculated by a statewide education policy 
research institute. The index must be based on the percentage of resident pupils 
that are identified as economically disadvantaged under section 15675, subsection 
2.
Sec. 21.  20-A MRSA §15689, sub-§15, as enacted by PL 2017, c. 284, Pt. C, §53, 
is amended to read:
15.  Special education budgetary hardship adjustment.  Beginning in fiscal year 
2018-19 2026-27, the following provisions apply to adjustments for special education 
budgetary hardships.
A.  If a school administrative unit determined eligible pursuant to paragraph B petitions 
the commissioner and demonstrates that the unexpected education costs of placement 
of a student in a special education program will cause a budgetary hardship, the 
commissioner may provide to the unit an amount not to exceed the allowable costs of 
the placement less 3 times the statewide special education EPS per-pupil rate for in-
district placements or less 4 times the statewide special education EPS per-pupil rate 
for out-of-district placements. The allowable costs are those special education costs 
described in section 15672, subsection 30‑A, paragraphs A and B.
B.  The commissioner shall determine that a school administrative unit is eligible for 
an adjustment under paragraph A if:
(1)  The student's placement is a result of an appeal approved by the commissioner 
pursuant to section 5205, subsection 6 or the student became the fiscal 
responsibility of the school administrative unit after the passage of that unit's 
budget for the current fiscal year; and
(2)  The school administrative unit's unexpected allowable costs result in a 5% 10% 
or more increase in the percentage of the unit's special education budget category 
to the unit's total budget excluding the debt service budget category.
C.  The funds for adjustments under paragraph A are limited to the amount appropriated 
by the Legislature for that purpose, and any unexpended balance from another 
program's appropriated amounts under this chapter may be applied by the 
commissioner toward the adjustments.
D.  A school administrative unit may expend the funds from the adjustment under 
paragraph A without seeking approval by the unit's legislative body.
SUMMARY
This bill is reported out by the Joint Standing Committee on Education and Cultural 
Affairs pursuant to Resolve 2025, chapter 84. The committee has not taken a position on 
the substance of this bill. By reporting this bill out, the committee is not suggesting and 
does not intend to suggest that it agrees or disagrees with any aspect of this bill. The 
committee is reporting the bill out for the sole purpose of having a bill printed that can be 
referred to the committee for an appropriate public hearing and subsequent processing in 
the normal course. The committee is taking this action to ensure clarity and transparency 
in the legislative review of the proposals contained in the bill.
The bill makes the following changes to the essential programs and services school 
funding formula.
1.  It provides a new calculation for predicted transportation costs for school 
administrative units and provides that a school administrative unit's transportation costs 
may not exceed 105% of the most recent year's reported net transportation expenditures 
adjusted for inflation.
2.  It provides for a variable weight for students identified as economically 
disadvantaged to be applied based on an index developed by a statewide education policy 
research institute.
3.  It removes a per-pupil cost component for professional development and inserts a 
new per-pupil cost component for instructional staff support.
4.  It increases the special education prevalence threshold from 15% to 17%, removes 
the additional allocation for high-cost in-district special education placements and corrects 
cross-references to the high-cost in-district special education allocation. 
5.  It updates the method of calculating the regional adjustment, to be based on a 
nationwide cost-of-living index, and provides that the regional adjustment must align with 
the salary matrix.  It also corrects cross-references related to the regional adjustment 
calculation.
6.  It inserts an income indicator into the calculation for a school administrative unit's 
local contribution to the cost of education. 
7.  It changes the eligibility requirements for a special education budgetary hardship 
adjustment. 
8.  It directs the Department of Education to implement a cap on the maintenance of 
effort special education expenditure adjustment based on the difference of the base 
allocation and the prior fiscal year's expenditures.
9.  It directs the department to discontinue midyear funding adjustments for out-of-
district tuition costs for special education students.