LACOE Appoints Fiscal Experts To 'Compel' LAUSD To End Deficit Spending, As UTLA Denies Reality Of Fiscal Crisis

UTLA President Alex Caputo-Pearl Denies District’s Financial Challenges, Despite County Warnings

UTLA President Alex Caputo-Pearl Denies District’s Financial Challenges, Despite County Warnings

With LAUSD showing “signs of serious fiscal distress that cannot be ignored,” the Superintendent of the Los Angeles County Office of Education, which oversees LAUSD's budget, has appointed a team of fiscal experts to "compel the district" to end its deficit spending. The move brings LAUSD one step closer to a takeover and the loss of local control over its budget.

In a press release and a letter sent to LAUSD Board President Monica Garcia, LACOE Superintendent Debra Duardo expressed concerns over the risk of district insolvency, calling into question whether LAUSD’s latest offer to United Teachers Los Angeles under threat of teachers strike is affordable. Among the concerns were:

* Inability to consider long-term impacts of collective bargaining agreements

* Staff unrest and/or low morale

* Deficit spending and failure to maintain adequate reserves and fund balance

* Lack of control and monitoring of total [employee] compensation as a percentage of total expenses 

* Inattention to the district’s $19 billion unfunded retiree healthcare liabilities. 

If LAUSD does not bring its expenses under control, the next step would be for the county to install a fiscal advisor who could rescind Board authority, negate any decisions on a new labor contract and start slashing the budget unilaterally. Board President Garcia took the warnings to heart. "I want to maintain my authority to do my job," she said Wednesday.

Despite the sternly worded warnings and action from the county, UTLA leaders continue to deny the reality of LAUSD’s fiscal crisis. When asked to produce a single independent expert who could back up the union’s interpretation of the district’s finances, UTLA President Alex-Caputo Pearl cited UTLA’s own forensic accountants and those from the statewide teachers union. This begs the question of whether Caputo-Pearl understands the meaning of the word “independent.”

Instead of taking LACOE’s warnings to heart, UTLA continued to attack the credibility of the county overseers and falsely claimed that the district has no deficit spending. The union’s rejection of the consensus of county and state overseers, two independent financial review panels and a neutral state-appointed fact finder — which confirmed the district’s deficit spending — is drawing comparisons to climate deniers who reject the consensus of science. 

In fact, at a press conference at the conclusion of talks Wednesday, Caputo-Pearl even criticized LAUSD Superintendent Austin Beutner for traveling to Sacramento on Wednesday to meet with state leaders to plead for more education funding, claiming that it showed Beutner wasn’t serious about negotiating. (Beutner said he had a team of skilled negotiators at the table, and “we can walk and chew gum at the same time.”)

UTLA’s words and actions Wednesday demonstrate that the union is determined to strike on Monday, no matter what, and is willing to stretch the truth beyond all credibility in order to justify actions that will massively disrupt the lives of LAUSD teachers and families. While LAUSD has made multiple offers to break the impasse with UTLA, the union has not budged on salary and class size demands that are so costly that they would send LAUSD over the fiscal cliff and would likely be reversed by the county.

“We cannot afford everything they asked for,” Beutner said. “Our regulator will not allow us to accept their demands.”

Talks are scheduled to resume Friday, but not even the promise of more funding from the state will stop UTLA from striking. Caputo-Pearl made it clear that he wants all the union’s demands met now, not at some future date when we might get more state funding. His intransigence has echoes of the federal government shutdown over demands for a border wall. Facts only seem to be getting in the way.