LAUSD Spends More Even as Enrollment Drops
Editors Note: By almost every objective standard, the educational outcomes delivered by the Los Angeles School District are among the worst in the nation. The following article documents how LAUSD has spent millions, hundreds of millions, on budget items that have little impact on the quality of classroom education, all the while attempting to blame charter schools for their budget challenges. We’ve dug into this issue in other articles published this month: “LA Story: The Poorer You Are, the More Likely You Are to Support Charters” documents how, ironically, it is the wealthy enclaves of Los Angeles where voters support union backed school board candidates, and how voters in underprivileged communities are more likely to support reform candidates and charter schools. In “ACLU Turns its Back on LA’s Poorest Students in Attack on Charter Schools” we describe recent efforts by the ACLU, surprisingly, to discredit charter school performance using biased statistics. In “Anti-Charter-School Rhetoric Isn’t Helping L.A.’s Kids,” a board director of the nonprofit Alliance College Ready Public Schools debunks the unfounded anti-charter school claims that are relentlessly pushed by the teachers union. There is a war in Los Angeles for the future of the next generation of citizens. The war is not between unions who care about students and “millionaires and billionaires trying to hijack education for profit.” The war is between innovative charter school operators, nearly all of them nonprofits, who are logging impressive successes against a teachers union that is bent on their destruction.
The Los Angeles Unified School District is hemorrhaging cash, and the teachers union wants you to believe the problem is charter schools. The real problem is closer to home: district officials and teachers union leaders who systematically raid the coffers with no regard for the consequences.
LAUSD’s new $7.6 billion budget, issued in June for the coming fiscal year, adds $700 million in new spending. Most of that new spending will fund expenses outside the classroom as the district struggles to pay for increased benefits. This new budget comes just after state officials ordered the district to stop misallocating funds intended for high-needs students. Local advocates say the new LAUSD budget continues to violate the state order.
LAUSD continues to spend more even as the district has lost over 100,000 students since 2006 – a drop of more than 20%. Despite the exodus, union leaders have pressed the district to add teachers and administrators. The district has seen a 22% increase in administrative staff over the last five years. Those teachers and administrators earn relatively generous salaries and benefits despite the abysmal performance of LAUSD schools overall. That generosity has produced unfunded pension liabilities of roughly $13 billion – about 1.5 times the district’s annual operating budget. Its operating budget runs a deficit of $333 million and rising, projected to exceed half a billion annually by 2019-2020.
Then there are the district’s laughable, myriad budgeting failures. LAUSD has spent $73 million for a new ethnic studies program that was supposed to cost $4 million. The district will have spent more than $200 million for a new computer system by 2018 – for which they originally budgeted $27 million. That miscalculation was so severe that it required a temporary districtwide hiring freeze.
The truth, then, is that charters are not the problem.
The problem is that LAUSD schools are consistently
among the worst in the United States – and that residents
pay a premium for those miserable results.
Last year, the district clocked several financial disasters. In April 2015 alone, Superintendent Ramon Cortines asked the school board to set aside $1 billion in additional funds for a union health care agreement – and wanted the board’s approval before they’d even been presented with the district’s annual budget. This being the LAUSD, the school board agreed, even refusing board member Monica Ratliff’s request for a 10 year analysis of the district’s future obligations.
At the same time, the LAUSD school board unanimously approved a teachers contract that included a 10.36% pay raise and added $278.6 million a year to the district’s budget deficit. Board president Richard Vladovic, endorsed by the teachers union, claimed the contract was “the right thing to do” because teachers “are worth every penny, and more.” A good idea, but can the district afford it? Vladovic said the superintendent would figure out the math. In the same agreement, the school board agreed to hire 139 additional teachers and allowed teachers to collect 14.3% of their annual salary in back pay over the next two years.
Despite this assortment of imprudent financial decisions by the union controlled school board, United Teachers Los Angeles, the LAUSD teachers union, blames charter schools for the district’s problems. As part of their propaganda effort, the union funded a study claiming charter schools have cost LAUSD $591 million in lost revenue due to declining enrollment. Many district officials and charter school leaders disagree, pointing to numbers that suggest charter schools actually bring LAUSD money.
The truth, then, is that charters are not the problem. The problem is that LAUSD schools are consistently among the worst in the United States – and that residents pay a premium for those miserable results. Instead of solving its financial problems, Los Angeles Unified makes them worse with every new budget. LAUSD requires serious financial reforms to maintain fiscal solvency, and these reforms must start with reining in unions, not attacking charters, the only part of Los Angeles Unified that is successful.
David Schwartzman is a junior studying economics and applied mathematics at Hillsdale College. He is a Journalism Fellow at the California Policy Center in Tustin.