May 2008 Archives

The school budget validation process, which was part of the school district reorganization law passed last year, is proving popular with voters. The process allows for a referendum vote on all school budgets, a first for many communities.

While most school budgets are being approved by voters under this process, there have been a few examples in recent days of budgets being defeated at the polls. Wiscasset voters turned down their school budget by a wide margin earlier this week, leaving school officials there scrambling to find cuts. According to the article, the town is spending more than$13,000 per pupil.

Voters in Acton narrowly defeated that town's school budget, and voters in Lamoine did the same, voting down a school budget proposal there that would have resulted in property tax increases of "34 to 38 percent."

The message that voters have had about enough of steadily growing school budgets is starting to be heard. Though school board members in South Portland were quick to blame economic issues for the near defeat at the polls of South Portland's $40 million school budget, at least one school board member took the vote to mean that "money is an issue."

Seems voters in some Maine towns are taking advantage of the budget validation process to make that message heard.

This week the Maine Department of Health and Human Services (DHHS) denied capital improvement projects at three Maine hospitals, according the Portland Press Herald. Maine has one of the strictest Certificate of Need laws in the country, requiring bureaucratic approval of many privately-financed hospital expansions and improvements.

In 2004, the Federal Trade Commission stated that "The Agencies believe that, on balance, CON programs are not successful in containing health care costs, and that they pose serious anticompetitive risks that usually outweigh their purported economic benefits. Market incumbents can too easily use CON procedures to forestall competitors from entering an incumbent’s market....Indeed, there is considerable evidence that CON programs can actually increase prices by fostering anticompetitive barriers to entry."

As Eastern Europe and other US states have abandoned the proven failure of central planning, Maine clings to this failed and costly strategy. What is most sad is that CON hurts patients - by driving up costs through reduced competition from new and innovative health care providers and by denying patients new technologies and treatments.

In model health reform legislation released last summer, the Maine Heritage Policy Center recommends that Maine's CON laws be repealed. Health care costs will be reduced from the enthusing competition among current and new health care providers.

Maine DHHS cited increased private health insurance costs as partial justification of denying these projects. Oddly, the Governor and a majority of the Legislature had no problem on April 15 passing a new 1.8 percent claims tax on all private health insurance claims, increasing costs of health premiums by $61 for the average employee with single coverage and $162 for those with family coverage.

In an ironic coincidence, the Wall Street Journal editorialized today about the growing popularity of school choice options in Florida, just a we released a new report outlining how existing school choice opportunities are under threat here in Maine.

The Wall St. Journal editorial relates how Democrats in Florida, who have traditionally opposed school choice out of loyalty to the teachers unions, are starting to realize the popularity of such programs. More Democrats voted to expand Florida's Corporate Tax Credit Scholarship Program than voted for the program itself in 2001.

Yet here in Maine, which already offers school choice options to thousands of Maine students, school choice is under siege. In a report we released this morning, we identified a number of school districts that appear on the verge of limiting or eliminating school choice options as part of the district reorganization effort.

Good to know Maine is leading the way as always...

The controversial school reorganization law that passed last year was supposed to preserve school choice for those communities that had it. The Department of Education's reorganization website says clearly that “Communities that have choice for their students now will continue to have choice after reorganization.” In fact, the reorganization law itself says that "the preservation of opportunities for choice of schools" is “the declared policy of the state.”

What is really happening? A report we'll have out soon describes how school choice options are being lost as a result of reorganization. Here are a few examples of what we found:

• The commissioner has already approved a planned merger of MSAD 16, Monmouth, Richmond, and Dresden. Under the plan, high school choice for Dresden is to be limited to only 15% of high school students, with the remaining 85% to have no choice but to attend Hall-Dale high school in MSAD 16. While approximately that percent of Dresden’s over 100 high school students attend Hall-Dale today, it was not always so. According to data on the state’s School Profiles website, as recently as the fall of 2004 only 71% of Dresden’s students attended high school in MSAD 16, with the remainder attending five other high schools. The commissioner’s approval of a plan that so drastically limits school choice seems inconsistent with both the law and her previous statements regarding the preservation of school choice.

• In a February 1, 2008 letter to the Reorganization Planning Committee developing the Freeport/Pownal/Durham RSU, the commissioner stated that she was confident that their plan would be approved pending legislative action on LD 1932. She congratulated them on being among the first RPC groups to produce a plan that “meets the policy objectives and parameters of the law.”

The March 11, 2008 version of their plan, however, would ultimately eliminate school choice for both Durham and Pownal. Under the provisions of the plan, school choice opportunities are to be essentially “grandfathered” for students already taking advantage of high school choice, and for those currently in grades 6-8 in Durham and in grade 8 in Pownal. Once these students are through the system, school choice is to be eliminated. Today, the over 200 high school students in Durham attend seven different high schools, and as recently as the fall of 2004, they attended eleven different high schools. Given a choice today, only two Durham high school students attend Freeport High School, the very school to which every Durham student is to be sent in a few short years. As recently as 2004, the almost 70 high school students from Pownal attended seven different high schools, despite Pownal’s unique and legally questionable practice of paying only half the state tuition rate for private schools. The proximity of these two towns to so many high school options has made them among the best communities in Maine for school choice. Choice for students in the two towns will be gone in a few short years, however, despite the fact that the regionalization law guarantees its preservation.

• A grandfathering provision is also being put into place in the RSU being developed for MSAD 23 and Hermon. As recently as the fall of 2004, high school students from MSAD 23 attended six different high schools under a “waiver” system. Under the provisions of the reorganization plan, however, existing waivers are to be grandfathered, after which time no more waivers will be granted, thus eliminating school choice options entirely for the almost 300 MSAD 23 students who have that option today. As if to slide the question of school choice completely off the table, under the “school choice” heading of the reorganization plan the plan’s authors simply wrote “not applicable.”

• That same strategy is being employed by opponents of choice in MSAD 38 and MSAD 48, who are looking to form an RSU there. Like MSAD 23, MSAD 38 has historically allowed choice using a waiver system. As a result, the 125 high school students from MSAD 38 currently attend six different high schools. The reorganization plan under discussion there would eliminate such waivers, forcing all MSAD 38 high school students to attend Nokomis high school in MSAD 48, with which MSAD 38 has historically had a tuitioning contract. Choice supporters there have threatened lawsuits to block the proposed loss of choice.

We'll soon release a report that goes into more detail on what exactly is going on here, but the important thing at this point is that those in school choice communities and those supporters of school choice across Maine need to be keeping a very careful eye on reorganization developments. In all likelihood, we'll see more examples of threats to choice as the district consolidation effort moves forward.

Patrick Fleenor, Chief Economist at the Tax Foundation, has more to say about the ill effects on society from illicit cigarette smuggling in a column in today's Wall Street Journal.

As the Reorganization Planning Committees (RPC's) get back to work developing plans for the creation of Regional School Units (RSU's), they will have to deal with latest wrinkle in the consolidation debacle, which is the advent of so-called Alternative Organizational Structures (AOS's).

Readers will recall that the legislature passed a bill this past session, (which the governor promptly vetoed) allowing for the creation of super-sized school unions, in place of the RSU's proscribed in the original law. RSU's are modeled on existing School Administrative Districts. Made up of several towns, they share a common school system and school administration and are governed by a single school board. School Unions, by contrast, share certain administrative functions, but remain as independent municipal school systems, each with their own school board. The legislature approved a plan to allow a school union-type model as an option for consolidating districts, but the governor's veto sent them back to the drawing board.

What emerged was a provision to allow the Commissioner to approve an "alternative organizational structure," as long as she feels it will "satisfy the purposes of the school reorganization law." Such a structure, the law says, must result in:

(a) Consolidation of system administration;

(d) Adoption of consistent school policies and school calendars and a plan for consistent collective bargaining agreements.

This provision has received mixed reviews from the school community. The group from MDI, which was the primary force behind the push for a school union option, has said that given the situation, the AOS provision represents a workable option. Others have claimed that the new bill contains little in the way of helpful changes, and that serious obstacles remain, including the requirement that merging districts create some kind of cost-sharing formula.

The most serious obstacle of all, which is the state's instance on a one-size-fits-all solution that only it can approve, was made apparent yet again in the following statement from Department of Education spokesman David Connerty-Marin, which appeared in a recent Bangor Daily News article, and which touched in whether or not MDI would get a "waiver" to be approved as an AOS:

"The reality is that MDI, if they work at it, will get a waiver, but not a waiver for what they have now," he said. "What MDI has now is pretty close to what we want. So with a little bit of work MDI can operate as a single system. Under the law the state will write a single check to a single system and reporting will be done for the entire unit. They will be treated like a single entity and they will have to act like a single entity.""

Ah yes, all must bend and stoop before the state, which knows better than anyone how school should be run. "They are close to what WE want," he says. The condescending arrogance of these people is astonishing.

So, the long march toward district consolidation continues. Off in the hills, though one can sometimes still make out the sound of repeal petitions still being signed. Help may be on the way...