AUGUSTA — A proposal to help towns struggling with paper mill closures — including Madison — advanced Wednesday and Thursday despite some lawmakers’ concerns about how the last-minute bill would change the state’s education funding formula.

The bill would offer roughly $900,000 in additional school funding to be split among the four towns that have lost paper mills by tapping into unspent funds within the Maine Department of Education. The bill goes even further, however, by changing the state education formula in order to help towns that lose a single large business in the future qualify for additional education aid.

Madison Paper Industries announced last month that mill would close in May, laying off its more than 200 workers and threatening the town’s tax base.

House Majority Leader Jeff McCabe, D-Skowhegan, said in a statement Thursday that the issue is “about basic fairness.”

“The state’s system for school funding can’t account for extraordinary circumstances like those our communities are facing,” McCabe said. “This scenario can happen anywhere in Maine whose tax base relies heavily on a major employer — not just the mill towns of Somerset County. This is a scenario that can threaten property taxpayers and students elsewhere in rural Maine as well as coastal and southern parts of the state. This approach brings us together as one Maine.”

Todd LeRoy, superintendent of Madison-based School Administrative District 59, said Thursday that any additional money the district could secure would be helpful, but he wasn’t sure how much of the proposed $900,000 the district would receive.


“It certainly would be helpful, but I don’t know if it’s enough to really take care of the issue,” LeRoy said.

Officials in Madison have been looking at another piece of legislation, L.D. 281, which originally was proposed by McCabe, since a major loss in tax value at Madison Paper Industries hit the town in 2014. That bill would ask the state to recognize the lower valuation of the town immediately and could bring around $1 million in additional school funding to the district immediately, LeRoy said.

The Madison district stands to lose more than $500,000 in state education funding for the 2016-2017 school year, yet LeRoy said officials are hoping to prevent a tax increase for residents.

“Some schools in the state are having to cut back on their extras, but we’re hoping just to keep good teachers in the classroom, the very basics,” he said.

Some lawmakers on Wednesday objected to changing the funding formula via a bill that was introduced in the final days of the legislative session and was being pushed through the Legislature without a public hearing.

“This is major legislation,” said Rep. Stedman Seavey, R-Kennebunkport. “It may only affect four or five towns in this bill now, but it could potentially impact every town in the state, depending on your neighboring town’s circumstance. This legislation deals with state valuation, county tax and school funding formulas.”


House lawmakers eventually changed the Senate bill to make it applicable for only one year. The Senate on Thursday agreed to the one-year limitation, though another enactment vote was needed later before final passage.

The late-session bill, L.D. 1699, sprang from negotiations between LePage administration staff members, lawmakers and representatives of towns affected by the turmoil in the state’s paper industry. Paper mills have closed in East Millinocket, Bucksport, Old Town and Lincoln in recent years, and the Madison mill will close in May.

The bill introduced by Gov. Paul LePage and sponsored by Sen. Rodney Whittemore, R-Skowhegan, would provide additional aid to several of those towns.

But over the long term, the bill also would make any town eligible for emergency education aid if the municipality’s state valuation — a key factor in calculating state education funding — declines by 4.5 percent because of property tax losses attributable to a single business or taxpayer.

“What I’m asking you to think about is there are four towns that can use this right now,” said Rep. Bradlee Farrin, R-Norridgewock. “They are Madison, Skowhegan, Lincoln and East Millinocket, and going forward any other town or city that found themselves in the same situation.”

Seeking to address concerns within his Democratic caucus about the late timing of the bill, McCabe said the legislation was based on several proposals that have been heard by the Legislature before, including his. But in the end, the House and Senate voted to limit the bill to one year.


Rep. Ben Chipman, D-Portland, was among the lawmakers who supported providing emergency funding to the struggling mill towns, but he raised concerns about the broader implications.

“I’m very leery of something that could impact the funding formula going into the future,” he said.

Senate Minority Leader Justin Alfond, D-Portland, said the matter was not a small vote, because “I kid you not, your superintendent is going to know about this vote.”

“This vote right here is one of the biggest votes we are going to take,” he said.

Staff writer Rachel Ohm contributed to this report.

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