AUGUSTA – If the state bows out of the laptop contract with Apple Computer Inc., the Maine Department of Education would be responsible for the first payment of $645,000 and would need to return the machines to the company, Attorney General Steven Rowe said Friday.

Under the contract, Apple is to furnish seventh- and eighth-grade students and teachers with personal portable computers, install wireless networks in each school, train the teachers and provide support and warranty services.

The first installment, due Sept. 30, includes $100,000 for the 2,000 laptops the state received in June for seventh-grade teachers. The payment also covers $545,000 for training, support and warranty services.

Payments for the devices and for services and equipment are to be made quarterly over the life of the $37.2 million contract, Rowe said in a letter to Reps. Brian Duprey, R-Hampden, and Phil Cressey, R-Baldwin.

Last month, in light of the $180 million budget shortfall, the legislators asked the Attorney General’s Office to determine the state’s liability if it breaks a contract with Apple Computer.

Duprey said Friday that Rowe’s findings show that breaking the laptop contract would be feasible.

The department has ordered and accepted 2,868 devices for students at nine demonstration sites and for all seventh-grade teachers, Rowe said in his letter to the legislators. An additional 16,780 laptops have been ordered. These 19,648 computers represent about 55 percent of the total devices for the laptop program.

The contract between the Department of Education and Apple is divided into two parts, one covering the laptops and the other covering services and equipment, software, support and training.

Funds to cover the initial payment already have been allocated, according to officials. “To the extent that the money hasn’t been de-appropriated, we have an obligation to pay it,” Assistant Attorney General William Laubenstein said during an interview.

Rowe said in his letter that some questions remained. For example, it wasn’t clear whether the state would be responsible for services already provided.

Also, Apple may argue that the department should pay rental fees for the 868 devices accepted in the first quarter of the fiscal year that began in July, and for the additional 16,780 machines if they’re accepted before the end of the first quarter of the fiscal year, he said.

Rowe also pointed out that breaking the contract could harm Maine’s business reputation.

He wrote that “failure to fund a program after a contractor has expended considerable resources in fulfilling its obligations under a contract may adversely affect the state’s creditworthiness as well as its ability to contract in the future, undermine its credibility at the bargaining table and-or increase the costs of its agreements.”

The attorney general’s decision means that using the laptop fund to help offset the budget shortfall is an option, said Duprey, who wants the Legislature to call a special session.

“The reason we asked for this opinion is that the governor had said it could cost as much to break this contract as to honor it; we now know this is not the case,” Duprey said.

But Tony Sprague of the governor’s office said the state’s liability is still unclear.

Apple wired all 239 schools for the laptops, he said. “We were paying over a multiyear basis, but Apple already performed the work,” he said.

He also was concerned about the state’s reputation as a business partner. Breaking the contract could have “pretty serious consequences that would have an impact on the entire state’s ability to contract for services and receive bids and do business in the future,” he said.