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TO:                  Superintendents of Schools, School Board Chairs, and Members of the State Board of Education


FROM:            J. Duke Albanese, Commissioner


DATE:             March 26, 2002


RE:                  Adoption of Supplemental Biennium Budget, FY 2001-02 and FY 2002-03.



As you know by now, last night the House and Senate adopted, and Governor King signed, a supplemental budget bill covering the 2001-02 / 2002-03 biennium.  The final bill mirrors the Appropriations Committee package I described to you in my Informational Letter #67 on March 19, 2002.  What started as a very challenging budget scenario with the state facing a $250 million shortfall concluded with a new balanced budget, covering a scaled down $160 million shortfall.  All in all, the budget process was certainly a tough undertaking, but education fared much better than we might have predicted just a few weeks ago.


Below are the highlights of the supplemental budget:


General Purpose Aid for Education (GPA)


            The adopted supplemental budget provides $730,817,941 for GPA, a 4.11% increase over the present FY 2001-02 appropriation.  In light of where we were when this session began, the level of commitment to this budget line - the largest single account in the state budget - is pretty remarkable given the $160 million in necessary reductions to realize a balanced budget.


Important aspects of GPA include: 1.) the Operating Costs subsidy appropriation is increased by $7,806,315 to the same amount as during the current year, FY 2001-02; 2.) the Program Costs subsidy appropriation is increased by 10.12% over the current year, and allows the Program Costs reduction percentage to drop from - 4.98% in the current year to - 2.99% in FY 2002-03; 3.) an additional appropriation of $2,459,350 is included for State Agency Clients and for State Wards for FY 2002-03, in addition to the 25% increase in this line that was already part of my Recommended Funding Level and included in the Governor’s proposed budget. 


This additional funding allows the Department to pay 100% of all bills presented for payment during FY 2002-03.  The final GPA appropriation also includes an additional appropriation of $6,699,734 for State Agency Clients and for State Wards for FY 2001-02, providing sufficient resources for the Department to pay 100% of all bills presented for payment during this fiscal year, 2001-02.  In the weeks ahead the Department, working with our sister agencies - the Department of Human Services and the Department of Behavioral and Developmental Services - will be analyzing all programs that receive State Agency Client / State Ward monies, shaping some policy changes that will improve the predictability and equity of reimbursement practices for these programs.  We’ll keep the field apprised of any prospective policy changes in this area as you consider local needs for next year’s budget cycle (FY 2003-04).



Maine Learning Technology Initiative


            The supplemental budget retains the $25 million in the Maine Learning Technology Initiative account, allowing this program to go forward, while providing a foundation of state funding that can be used to attract outside contributions.  With recent donations from MBNA and associations representing Maine’s banking industry we feel that prospects are bright for other sizable contributions.  My recent trip to Washington gave us every indication that the USDOE views Maine in the national lead regarding learning technology.  Top officials from the USDOE will be visiting Maine schools in the next several weeks, and our legislative delegation stands ready to help support federal monies for technology in our schools.



Adult Education


            As indicated in a communication last week, the supplemental budget maintains the original 6% increase in adult education subsidies in each of FY ’02 and FY ’03.



Proposed Bond - Maine School Revolving Renovation Fund


            Today the Appropriations Committee will return to its deliberations leading to a recommended bond package.  We have proposed a $15 million bond for the Maine School Revolving Renovation Fund.  As you know, Maine voters supported overwhelmingly a similar bond issue this past November.  Your support of the bond proposal is essential since there are many competing needs statewide; please communicate to your legislators the importance of continuing our investments in improving the condition of Maine schools.



Summary - ED 261 Printouts


            Importantly, be advised that the Department is working diligently to prepare unit-by-unit 261 printouts regarding the adopted supplemental budget appropriation for GPA.  We plan to mail your printouts Wednesday, March 27, 2002, recognizing that many of you are in the midst of difficult budget deliberations and need to know your subsidy levels as soon as possible.