Sec. 1. 20-A MRSA §15603, sub-§26-A, ¶F, as amended by PL 1995, c. 665, Pt. J, §2, is repealed.

Sec. 2. 20-A MRSA §15613, sub-§17, as enacted by PL 1997, c. 395, Pt. R, §1, is amended to read:

17. Unobligated balances. Unobligated balances from amounts appropriated for general purpose aid for local schools may not lapse but must be redistributed to school administrative units in the same fiscal year. The commissioner shall make the final determination of the total amount of unobligated funds and must redistribute 75% of those funds to program costs and 25% of those funds to out-of-district placement costs. To redistribute the 75% portion to the state share of program costs, the reduction percentage originally calculated for program costs pursuant to section 15603, subsection 26-A, paragraph F must be reduced by an amount sufficient to distribute the 75% share. The reductions in these percentages apply to all program cost areas except the transportation operating cost allocation.

SUMMARY

This bill removes the so-called "percentage reduction method" from the School Finance Act of 1985. Under this bill, the state share of school funding would return to 55% of the combined total state and local allocations for school funding.