LAUSD Plans To Cut Bureaucracy To Balance Short-Term Budget, But Structural Deficit and Retiree Healthcare Liabilities Remain Ongoing Threats To Kids

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The LAUSD Board is expected to vote Tuesday on a plan to balance the LAUSD budget by slashing the central district staff by 15 percent next year and taking back unspent money from some school-site budgets. The good news for students is that class size increases are not on the table. Teachers also have reason to celebrate. The budget factors in raises for them.

On the down side, however, LAUSD isn’t planning to set aside any money to pre-fund its $15.2 billion retiree healthcare liability, which continues to grow worse and is taking up a larger percentage of the $7.5 billion general fund every year – ultimately at the expense of kids. The district’s Independent Analysis Unit has warned that LAUSD cannot afford to pay as it goes for retiree healthcare and still have enough money left in a few years to educate kids.

The ongoing structural deficit at LAUSD also means that without increased funding or structural reforms, problems are continually looming. LAUSD is already spending about $500 million more per year than the revenue it brings in, eating into its reserves, “which is problematic,” said LAUSD CFO Scott Price.

LAUSD’s new Superintendent Austin Beutner, is expected to look at ways to save money through potential school consolidation and other means, some of which may require negotiations with employee unions.

Board Members George McKenna (BD1) and Scott Schmerelson (BD3) are also introducing a resolution that will be voted on Tuesday authorizing the superintendent to submit language to the County for a parcel tax to appear on the November 2018 ballot. The $150 million a year parcel tax would eliminate the projected 2020 deficit.

The Board also votes Tuesday on two resolutions co-sponsored by Board Members Kelly Gonez (BD6) and Nick Melvoin (BD4) to help more LAUSD students attend college. One resolution calls for LAUSD to administer the SAT or ACT to all high school juniors during the school day, at no cost to students. It also calls for sufficient test prep for students. The resolution directs the superintendent to seek philanthropic funding to pay for it and to work with the mayor’s office and local businesses to provide paid internships for high school students. The second resolution would have LAUSD explore creating a Children’s College Savings Accounts program for students enrolling in first grade in all public schools within District boundaries.