Maine bill would raise school construction debt service, allow local cost sharing and create finance authority

Representative Michael Brennan briefed the Portland Public Schools Public & Legislative Affairs Committee on LD 1892, legislation he is sponsoring to overhaul how Maine funds major school-construction projects.

Brennan said the state currently sets aside $150 million a year for debt service for school construction out of general-purpose education aid. LD 1892 would raise that set-aside first to $175 million and later to $200 million, changes Brennan said would increase the state's annual capacity to support construction. He described a mix of possible revenue sources — tobacco, marijuana, liquor, gambling and lapsed general-fund balances — and said the most realistic near-term source is a redirect of lapsed balances he estimates at $30 million to $40 million annually.

The bill would also move the state away from the existing 100% reimbursement model for major projects toward a negotiated cost-sharing arrangement (Brennan cited a 75/25 example) and would grant the Department of Education and the state board flexibility to set or negotiate percentages. Brennan said that change is intended to stretch available dollars so more projects statewide can advance, while acknowledging some communities will still need near-total state support.

LD 1892 includes language to create a Maine public-school finance authority that could issue bonds and help finance projects; Brennan said the authority is intended to expand financing options and, long term, could allow partial cash funding to reduce interest costs. He described that as a multiyear goal that will require study and coordination with existing state bonding entities.

Brennan told the committee that Portland High School is currently ninth on the state's list of projects and that these changes are intended to expand capacity so more districts can be funded. He also noted the legislature has faced pushback: the Maine Education Association and the state comptroller oppose aspects of his proposal while the administration signaled support. Brennan said LD 1892 had a public hearing in June and is carried over with a work session expected in January.

Committee members asked about timeline and mechanics for creating a finance authority and about funding cycles. Brennan replied that the legislature will likely request further study this session; historically cycles have varied from two to seven years and he said he favors three- to five-year cycles going forward.

The committee did not take any formal vote on LD 1892 at the meeting; members agreed to watch the bill and support outreach as needed.

Ending: The committee was advised to monitor the January work session and to coordinate with state legislative staff and district leadership as LD 1892 moves through the education and appropriations committees.