Could Portland seek a local option sales tax to help its public schools?

With a new fundraising task force set to spend the next two months looking for new revenue streams, Portland Public Schools has taken its most significant step yet down the increasingly well-trodden path of public school systems looking for ways to make up for increasingly scarce state dollars.

And in addition to checking under the couch cushions, the Portland group is going to be exploring some things that in the past have generated significant discussion around this state, such as a local option sales tax or new educational programs that create revenues.

The Budget and Revenue Advisory Task Force, whose formation was approved by the Portland Board of Education last spring and is made up largely of business leaders and fundraisers, is due to deliver its final report to the board on Dec. 1.

Efforts like this are becoming more and more frequent around the state as local school systems grow tired of the annual “What-do-we-cut-this-year?” budget deliberations that result from unreliable state subsidies and ongoing pressure by locals to keep property taxes under control.

Even with $1.9 million in additional state education funds that came to Portland as a result of the Legislature’s overrule of Gov. Paul LePage’s budget veto, the local school district had to eliminate about 47 positions in its current fiscal year spending plan.

Emmanuel Caulk, superintendent of Portland Public Schools (BDN photo by Troy R. Bennett)

Since Emmanuel Caulk was hired as the superintendent of Portland Public Schools last year, he’s advocated for the district to get creative and get out in the community, to reach out early and often in hopes of developing partnerships with organizations or businesses that can provide mentorship, expertise, in-kind resources or, yes, funding.

The task force, which reported to the Board of Education this week with its proposed fall work schedule, will be tackling that last one. Chairing the panel is attorney and former Portland mayor Jim Cohen, and he’ll be joined in the effort by former school board member Ed Bryan, Linda Cohen of the nonprofit LearningWorks and Chris Hall, CEO of the Portland Regional Chamber of Commerce, among others (see the full roster here).

Said Caulk in a statement:

We’ve got a talented team with lots of financial experience volunteering to help our district. I’m excited to hear their ideas for finding alternative revenue streams and creating new partnerships.

According to the district, the task force will explore “acquiring competitive grants, increasing technological efficiencies, starting programs and other initiatives that could generate revenue, funding capital and technology investments and
pursuing local and state funding sources other than property taxes that could become available through local or state initiatives, such as a local option sales tax.”

Competitive grants are always a strong place to look, and many districts — Regional School Unit 1 in the Bath area comes to mind — have formed nonprofit fundraising arms to legally qualify for grants that public entities can’t access.

The “programs … that could generate revenue” idea can be a sticky wicket. On the one hand, a lot of schools across the country promote mini- business incubator-type education programs in which the students form teams and use math, science and writing to develop value-added products or services. It can be a really forward-thinking, less abstract way to teach those concepts to kids in real-world situations. Then again, you run the risk of being accused of running a business using free student labor. You’ve got to be really careful how you do it, and I’m sure the task force will look at it from all sides.

The local option sales tax proposition could turn some heads. It’s used in some other states and has been proposed before in Maine.

The idea came up in the state Legislature as recently as June, when the House gave it overwhelming bipartisan support, but the Senate stomped it dead with overwhelming, bipartisan opposition.

Here are a few graphs about that debate in Augusta as pulled from a story written by the Sun Journal’s Scott Thistle:

Sen. Linda Valentino, D-Saco, said she supported the bill because tourist towns such as … Old Orchard regularly collected large amounts of sales tax and often received only a small portion of that in return through the state’s revenue sharing program. Last year Old Orchard collected $75 million in sales tax but saw only $816,000 in revenue sharing from the state, Valentino said. …

Opponents argued that towns such as Freeport with huge retail businesses and mail-order giant L.L. Bean would have been able to gain giant windfalls on fairly small sales tax increases while others with little sales activity would be left short. …

Sen. Doug Thomas, R-Ripley, said a local option sales tax would unfairly hit residents of rural communities who have to shop or make large purchases such as farm equipment in service center communities, where those bigger retail operations are based.

If Portland rallies its delegation, gets Mayor Michael Brennan lobbying for it and renews interest from those York County legislators, could it come back in the coming session?

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Seth Koenig

About Seth Koenig

Seth has nearly a decade of professional journalism experience and writes about the greater Portland region.