City Council and School Committee members learned Tuesday that it could take more than one special election, at a cost of $50,000 each, to be paid by Portland taxpayers.
If Portland voters don't approve a school budget before July 1, the start of the next fiscal year, the city won't be able to set a tax rate, collect taxes or pay for municipal and school operations.
"We won't have any money," said Ellen Sanborn, Portland's budget director, after a meeting of the two panels.
The consolidation law doesn't address how municipalities can continue operating if they are unable to pass school budgets by June 30, said James Rier, deputy commissioner of the Maine Department of Education.
It's one of many glitches, difficulties and questions related to the new law, which the Legislature passed this year as an alternative to Gov. John Baldacci's initial call to rein in the cost of education by reducing the number of school districts from 290 to 26.
The law is designed to decrease the number of districts to 80 by requiring a minimum of 2,500 students per district, with some exceptions, and still reduce the cost of education overall.
As a result, state education spending next year will increase by only $43 million, 4.4 percent, rather than $79 million, 8.1 percent, as initially anticipated, Rier said.
The consolidation law is expected to be difficult for many districts to accommodate, Rier said. It comes at a particularly troublesome time for Portland, which is reeling from a $2 million deficit in last year's school budget and the recent resignations of School Finance Director Richard Paulson and Superintendent Mary Jo O'Connor.
Interim Superintendent Jeanne Whynot-Vickers said school administrators and city finance officials are working on several initiatives at the same time, including adopting the state's accounting system and starting to plan the 2008-09 budget three months early so the council can get it to voters in time. Both are necessary to develop a budget under the new consolidation law.
The council and School Committee met for the first time Tuesday with Robert Kautz, a state-appointed facilitator who will help Portland develop a cost-cutting plan required by the consolidation law.
Because Maine's largest district has about 7,000 students, it doesn't have to merge with any other district. It must submit an alternative plan to the state by Dec. 1.
Kautz, a retired superintendent and former state education official, said the complexities of the consolidation law make it imperative that councilors and School Committee members collaborate in developing a school budget that everyone, including voters, can support.
Kautz said he will schedule a meeting soon with the finance committees of both panels to establish a communication and action plan for the consolidation process.
Staff Writer Kelley Bouchard can be contacted at 791-6328 or at: kbouchard@pressherald.com
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