The Portland School Department is putting the finishing touches on its proposed Fiscal 2026 budget, but uncertainty about potentially losing more than $8 million in federal funding has officials biting their proverbial fingernails.

“I’m very concerned,” said School Superintendent Ryan Scallon. “It would be significant and pretty devastating to programming at any school district if we were to see a loss in federal funds.”

If the district were to lose that funding, Scallon said, he would be forced to make “significant programming adjustments, and that would include reductions in staffing.”

Right now, the proposed $171 million budget, if approved, would lead to a 5.3% increase to the school portion of the city’s tax rate. For the owner of a $500,000 home, that adds up to an annual increase of $210, or about $17.50 a month. 

Scallon said that number includes known amounts of state-level subsidies the district will get, and an estimated $8.3 million in federal subsidies.

But the federal government has not yet indicated how much money it will allocate to the district, if anything at all.

Worrying about allocations is an annual exercise for school districts throughout Maine; the state Department of Education doesn’t usually announce allocations until March, and federal allocations often aren’t disclosed until May.

For any school district, that’s too late to start the budget process, so they have to put the budget together earlier, including their best guess as to how much their district will get. 

But 2025 got off to a rough start, with President Donald Trump taking office with a series of executive orders and related changes slashing the federal budget across the board. Federal subsidies for all manner of projects have been put in jeopardy as the president works to cut costs.

Complicating matters is a fiery exchange back in February between Trump and Gov. Janet Mills, after the president called her out in public for not complying with an order banning transgender athletes from competing in school-related sporting events.

Within a day of that confrontation, the US Department of Health and Human Services launched an investigation into whether Maine was violating the 1972 Title IX anti-discrimination law, with the threat of cutting off funding to the state.

Factors such as these mean Scallon and the district are more anxious than usual about guessing right, especially with $8.3 million on the line. 

“It’s a little bit harder to plan for than it would have been last year,” he said. “Last year, you didn’t know your exact dollar amounts, but you knew approximately where it was going to be. This year, there’s more up in the air.”

Scallon said he is already working on a contingency plan in case the school loses the subsidy, but he will still have to take it before the school board.