AUGUSTA – While the state plans to infuse local school districts with additional cash, Education Commissioner Susan Gendron has cautioned administrators that the money is aimed at reducing property taxes, not expanding programs.

Gendron met with more than 100 school superintendents Monday at the University of Maine at Augusta to outline Gov. John Baldacci’s proposed Act to Increase the State Share of Education Costs, Reduce Property Taxes and Reduce Government Spending at All Levels.

During the meeting, Gendron described how Baldacci’s property tax relief plan would benefit education. She also detailed the impediments facing school districts if they attempt to increase spending.

Under the proposal, which is known as LD 1 and will be presented at a legislative public hearing today, the Baldacci administration plans to boost the state’s contribution to K-12 education by $250 million over the 2006-07 biennium, bringing the total state share to $893 million. In order to reach that goal, the governor plans to propose a flat-funded budget for all state agencies.

The $250 million in tax relief, which will raise the state’s share of the cost of education to 50 percent by the end of the two-year budget cycle that begins July 1, 2005, is still short of the 55 percent share approved by Maine voters last June.

The Maine Municipal Association, which spearheaded the June referendum mandating the 55 percent state share of education, has already indicated that it wants to see the 55 percent share implemented immediately. The governor, however, maintains that budget constraints make it difficult to come up with the full share right away, and his plan aims to phase in the extra amount over four years.

“The ongoing debate is, ‘Is the four-year increase fast enough?’ There are those who think it should be shorter,” Gendron acknowledged.

State finance analysts estimate the gap between projected revenues and the cost of state programs in the 2006-07 biennium at $733 million.

Besides increasing aid to education, the governor’s proposal calls for statutory caps on state, municipal, county and local education spending in order to reduce the state’s overall tax burden to meet the national average.

Gendron told the superintendents Monday that the administration wants to fast-track LD 1 through the Legislature by mid-January in order to have it in place for them to determine their 2005-06 school budgets.

“We know that a lot is going to be happening very, very quickly,” said Gendron.

Also, during the coming months, the Department of Education will finish determining the full cost of essential programs and services – including special education – for each of the state’s 286 school administrative units. Once the amounts are established, local communities will have to commit to raising 8.25 mills – or $8.25 per $1,000 of assessed property values – as their local contribution of education costs to receive full state support.

“The key will be to define what is comprised in essential programs and services,” acknowledged Gendron.

Gendron said that 86 school districts are at or near the 8.25-mill level. About 100 districts already spend more than 8.25 mills on their budgets, while another 100 fall below that level.

She noted that once essential programs and services costs are set for each school department, any annual budget increase that exceeds a proposed spending cap would need to be approved by a local referendum. The cap is based on the 10-year average growth of personal income, which is now between 2.5 percent and 2.75 percent.

“He [the governor] felt very strongly that the citizens should have the last say if they want to increase the budget,” she said. “The citizens should have a choice if they want to spend more or have property tax relief.”

Department of Education attorney Richard Spencer also advised the group that the provision in the law as now proposed removes a school district’s authority to hold referendums. He said that while a school department could request a referendum, it would be up to the individual board of selectmen or city council to put the matter before the voters.

“If the selectmen or city council decides not to call for a referendum, the school board’s hands are tied,” noted Spencer.

Gendron said that while she expected many portions of the proposed law to be hotly debated in the coming weeks, she told the superintendents that her sense of the mood of the Legislature was toward tax relief.

“The conversations will be extremely delicate in the individual committees, because there is a strong feeling for property tax relief,” she said.