PORTLAND – The town of Wells has lost its dispute over a school-funding law in the state supreme court.

In a unanimous decision Wednesday, the Supreme Judicial Court upheld a lower court ruling that said the revised funding formula for the Wells-Ogunquit Community School District was constitutional.

Ogunquit officials pushed for the law, which relies more on per pupil costs than property values when assessing the costs for the school district. Wells officials said their town will pay approximately $338,000 more for the 2000-2001 school year under the new formula.

Wells argued that the law violated Maine’s constitution because it doesn’t provide the town with state money to make up the additional expense and that the town will have to increase its tax rate as a result.

But the court rejected the argument that the additional costs to Wells meant the law was an unfunded mandate.

Writing for the court, Justice Susan Calkins said that for the law to be considered an unfunded mandate, the state would have had to require the town to expand or modify its activities and spend more local money.

“The harsh reality is that Wells’ portion of the funding formula has been increased, and Wells will have to spend more money if the school budget remains as is. The reality also is that Wells controls the votes on the board of the school district. Wells, not the state, controls the expenditures of the school district,” Calkins wrote. “The state has not required Wells to raise taxes, and the state has not required Wells to expand or modify its activities.”

Charles Micoleau, the lawyer for Ogunquit, said he would not have expected the court to side with Wells given the Legislature’s “lengthy consideration” of the issue.

“The formula is now in line with that of almost every other community school district in the state,” Micoleau said.

In 1980, residents of Ogunquit Village who believed they paid too much for municipal services won legislative approval to split from Wells. Ogunquit gained valuable coastal property in the separation.

School costs were then based largely on property values. But while Ogunquit’s property values were increasing, its population was going down.

Since 1980, the number of students from Ogunquit has decreased from 150 to about 60. Ogunquit paid about $52,000 per student in school expenses in 1999. Wells, with 1,430 students, paid about $6,000 per student.

Under the new formula, two-thirds of the school district’s expenses will be based on property valuation for the 2002-2003 fiscal year.

The formula can be changed if each town approves an alternative by a majority vote.