Megan Reilly, Michelle King and Monica Ratliff at Tuesday’s special board meeting.

*UPDATE

With LA Unified heading toward financial crisis within three years, Superintendent Michelle King on Tuesday kicked off a series of special board meetings to detail her plans for fiscal solvency. Topping that list is keeping kids in the district. Notably absent was cutting staff.

King’s initiatives would initially cost the district — roughly $20 million. But the programs, if successful, would bring in about $40 million, her staff estimated. The district’s deficit is expected to be about $100 million by the 2017-2018 school year and hit $450 million in three years.

“It sounds like a lot to spend, but if we get double our investment back, or we may even get higher than that, it sounds good,” board member Scott Schmerelson said.

Key to King’s plans is boosting enrollment, which has declined by 100,000 in just the last six years. Her suggestions include: increasing attendance by one percent; creating a unified enrollment process to make it easier for families to enroll in local district magnet schools; adding magnet, dual language and International Baccalaureate programs; making more use of marketing campaigns to highlight district successes; scheduling more professional development for teachers, and increasing parent involvement.

Some of those projects are already in the works, while others King presented to the board Tuesday and asked for their guidance — and eventually their vote to fund them when the budget is approved in June.

“We need to prioritize when we know our resources,” King said. “We can’t do 20, not even do 10, but we can determine six of these are good and let’s do two.”

King’s plans were drafted in response to a blue ribbon Independent Financial Review Panel, commissioned by former Superintendent Ramon Cortines to outline problems and possible solutions for the district, and the first part of Tuesday’s meeting was devoted to where the budget is headed and why revenue is expected to decline. The panel had recommended that staff be cut to adjust to declining enrollments, but King is rejecting that, opting instead to decrease staff through attrition, retirement and leaving vacancies open, as well as a concerted effort to renew grants that have run out.

“We have to align ourselves to what the student population is, and we’re able to shrink the overhead by right-sizing,” King said.

Besides, she noted, the panel’s recommended staff cuts would have saved the district only $36 million, while the revenue loss due to declining enrollment is projected at $127 million in 2016-2017.

However, according to the review panel’s report, a loss of 100,000 students means district staff would need to be reduced by about 10,000 people, for a savings of about $500 million per year. The report pointed out that the district has instead grown its staff — to 64,348 full-time equivalent positions — increasing its costs for both salary and benefits.

Chief Financial Officer Megan Reilly said that increasing student enrollment alone will not solve the deficit projections. Board president Steve Zimmer noted, “We have had these discussions for six or seven years now. Declining enrollment, well, we can’t do anything to affect that.”

Board member Monica Ratliff said, “I’m a little bit concerned that the outcome of this report is dark. If there’s a loss of 100,000 students, we lose 10,000 staff, administrators and teachers and more.”

Reilly noted that at its height, the second-largest school district in the nation had just under 1 million students, including in adult education, but since 2002 it has lost 200,000 students. About half of the loss is attributed to lower birth rates, the rest to the growth of charter schools. About 100,000 LA students are enrolled in 211 independent charter schools, the largest concentration of charters in the country. There were 204,124 births in Los Angeles in 1990, but by 2011 they had declined to 130,312, Reilly said.

“We don’t have much control of the local birth rates, but we do with attendance and keeping the students going to school,” Reilly said.

Keeping kids in school was a main focus of King’s report. The financial review panel had stated that attendance is “the single most important driver of district revenues; more than 90 percent of district revenues are based upon actual attendance of students.”

Since 2002, the average daily attendance rate has increased by 3 percent, and a 1 percent increase in attendance would gain $40 million a year in state funding, Reilly said. LA Unified lags about 1.2 percent behind the state average and aims to bring the attendance rate up to 72 percent of students not missing more than a week of school a year.

King also discussed implementing a unified enrollment process that will make it easier for families to choose charter, magnet and pilot schools by putting them all on the same schedule. “We know magnets are popular, there are long waiting lists,” King said. “We want to understand the enrollment declines and why one would want to leave the district, and how we can address those concerns.”

A survey of students who are transferring to non-district schools found that 36 percent said they were leaving to go to schools with dual language programs and 30 percent went to schools that have an International Baccalaureate program. So King suggested offering more of those kinds of options.

She also proposed more marketing of positive messages about district schools, such as current campaigns that include a mobile billboard in Ratliff’s district for Arleta High School and that encourage students to wear T-shirts in the community so the schools are more visible.

The district also has campaigns that address chronic absences of students who miss 15 or more days of school, promote dental and eye care in the schools, and promote Restorative Justice programs to prevent bullying and encourage safe environments.

Board member George McKenna talked about some of the ways he turned around Washington Preparatory High School by offering incentives for teachers and extra pay to make phone calls to students and to work with them on weekends or after school.

Student school board member Leon Popa pointed out how parental involvement is important in increasing attendance rates. He said, “Working on improving parent integration into the school community could build more of a connection to the school.”

Ratliff said the state should be more involved in deciding where to allow charter schools so they’re not concentrated in one area. “I have no problem with charter schools, but the saturation is something we could bring up,” she said, noting that she had spoken with some charter school operators. “They thought that competition is good and just makes you stronger if we’re right next door.”

Ratliff added, “We must embrace them as real partners and have a more open relationship. The charter schools don’t want to see the district die. I don’t think they want to see our employees devastated. They just want to run schools. How can we work with them and give more autonomy to our principals? We make it so difficult with paperwork and checked boxes, and we must take a look at that in the long run.”

Zimmer added, “We need to connect with kids and their families so that they believe LAUSD is the best choice for their public education dream.”

Tuesday’s meeting, the first of at least four special meetings, was held at the LA ’84 Olympic headquarters and library in the West Adams district. The superintendent and school board members were seated around a table in a casual setting. Representatives of the search firm Hazard, Young, Attea & Associates, including president Hank Gmitro, took notes on large sheets of paper for the board members to review. Gmitro told LA School Report that this was part of the final portion of their contract with the district when they led the search for the new superintendent.

Board member Richard Vladovic pointed out that having the special meetings off-sight will probably lower the amount of public comment that the board will get prior to the meetings, keeping them shorter.

“If we have it downtown, we will have longer meetings and we will regret it,” Vladovic said.

The next meeting involving the budget is planned for May 3 at 1 p.m., with the location yet to be announced. The board is scheduled to vote on the overall budget on June 21.

*The unified enrollment process will not include charter schools.

Michelle King studies science experiement

Los Angeles Unified’s new superintendent, Michelle King, said today the district is working on a response to a review panel‘s examination of district finances, and ideas would go before the school board next month.

“It’s a huge concern of mine,” King said today, during a 2 1/2 minute interview with LA School Report. “I have work groups working on it now. We are looking to come to the board mid-to late February with some thoughts and recommendations for our consideration.”

The interview came as King walked to a waiting car after visiting Windsor Hills Elementary Math/Science Aerospace Magnet, a school she once attended. She was racing to a meeting and had little time to spare.

Does she plan on bold initiatives and changes since taking the helm of the district where she worked for 31 years?

“Interesting, that’s a question I’m asked a lot,” King said. “The bold initiative is getting my kids to graduation and to college. That’s for me the number one thing.”

Inside the school, she asked the students how many want to go to college. All raised their hands.

“That’s why I asked that question in the classroom because sometimes people don’t want to believe that all kids really want to go to college,” King said. “That’s why I want to see for myself and that’s what they want. They want choice and opportunity, so for me it’s getting kids to that graduation, and more importantly for choice and opportunity to be able to compete and be productive citizens in our communities and to be able to come back and give to their communities.”

But what specifically can she do? What could accomplish that?

“So, with my team and my working with the board, I will work on a strategic plan in terms of coming out with that,” King said. “I believe in that being a collaborative effort, because you got to get buy in, to be able to move an agenda.”

Despite working closely with both of her two most recent predecessors, she appears more in the mold of Ramon Cortines than John Deasy, in her willingness to take a more collaborative approach with the school board.

“Part of my listening tour, going out and talking to community schools and principals, is to hear, listen and gather information and be able to inform me to develop that plan,” said King, who is touring schools for feedback and input even after 30 years of experience in the district.

Principal Aresa Allen-Rochester, Cheryl Hildreth, George McKenna and Michelle King

In the school, students showed the how they were learning about cell structure, using Play-Doh and egg yolks in a science experiment. King asked students some questions about what they were learning and how they were using their iPads to supplement their learning.

In the interview, which lasted as long as the science experiment, King said, “The best part of this job is when you have opportunity to go in and you can look at the faces of the kids and just see the excitement in their eyes, it inspires me and helps me to know that the work we are doing is important to our youth and when you go into a class like we are just in, they’re just so eager to learn and share with me what they’re doing, it just blows me away. The two teachers in that classroom, sharing fourth and fifth grade science class, that model is incredible.”

She said some teachers have asked her why it has taken the board so long to promote her to the top spot, when she seemed like such an obvious choice all along.

“It’s a journey for me and I think things happen at the right time and now I think it’s my time, and it’s the right time for the district and we’re really poised to do great things here,” King said. “I am a product of this district and a longtime educator here. It’s about family. And I’m part of the family, and when you have family relationships you know, it’s different sometimes than when you’re not part of the family.”

UTLA President Alex Caputo-Pearl

Spending cuts. Layoffs. Early retirement packages. Reductions in benefits.

These needs, which were among recommendations made by LA Unified’s independent Financial Review Panel on Tuesday, are the kind that would make any union leader lose sleep. But three full days since the doom and gloom report was presented at the LA Unified school board meeting, with recommendations that would hit the district’s employees hard, the unions have had little if anything to say about it — even after several board members described the need for an all-hands-on-deck collaboration to forestall financial instability.

Messages seeking comment from three of the district’s largest unions —  those representing the teachers, administrators and staff workers — produced only a response from SEIU Local 99, a statement that does not suggest it agrees or disagrees with the financial panel’s conclusions.

The union leaders had an early opportunity to respond. After the presentation, board President Steve Zimmer invited the district’s labor leaders to make any comments. Only Alex Caputo-Pearl, president of the teachers union, UTLA, accepted the offer, but he used the opportunity to attack the Broad Foundation‘s proposed charter school expansion plan due to the big impact it would have on district enrollment.

Declining enrollment is one of the reasons the panel foresees a loss of revenue in the coming years, and while the Broad plan would hit the district’s enrollment in an enormous way, the panel’s report does not take it into consideration. Even if the Broad plan were cancelled tomorrow, the panel’s dire financial predictions remain.

Among the predictions was a $600 million budget shortfall by 2019 if changes are not made. Among its recommendations that would hit LAUSD unions are:

• Reduce staff by 10,000 to accommodate decline of 100,000 students over the last six years.
• Offer early retirement packages to most senior staff.
• Encourage higher staff attendance to cut down on need for substitutes.
• Change ratio for benefit package to 90/10 (vs 100/0).
• Eliminate the teacher pool.
• Integrate pension entitlements with social security for those who have both.
• A new regulation to make staff pay for benefits extended to family.

When approached by LA School Report outside the Tuesday meeting to discuss the report, Caputo-Pearl doubled down on his Broad attacks.

“The most important finding that this panel came up with is that there needs to be an increase in enrollment, and the Broad plan does just the opposite,” Caputo-Pearl said.

Caputo-Pearl and Juan Flecha, president of the Associated Administrators of Los Angeles (AALA) did not respond to messages yesterday, seeking comment about the specific cuts to jobs and benefits the panel recommends. Blanca Gallegos, spokeswoman for SEIU Local 99, which represents school cafeteria workers, custodians, special education assistants and other school workers, forwarded a statement from union Executive Director Max Arias that does not mention the potential layoffs or other recommendations from the panel,

“As LAUSD reviews the financial and operating issues raised by the panel’s report, we cannot forget that the District is, ultimately, charged with caring for the well-being and future of Los Angeles’ children,” the statement said. “Nearly half of SEIU Local 99’s members are parents of children attending LAUSD schools. Ensuring that working families in our communities have access to quality and affordable benefits has a direct impact on the safety and health of students.

“The reality is that LAUSD has vast purchasing power and needs to look at new and creative ways to leverage this power to ensure health care for all. This can include aligning with the City of Los Angeles to increase access to health care to more families, at a lower price. The challenges presented by this report require a continued partnership between the District and all stakeholders and SEIU Local 99 members are eager to have this conversation.”

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Former state treasurer Bill Lockyer on panel to advise LAUSD.

* UPDATED

A blue-ribbon panel of leading figures in education, politics and finance has been working behind the scenes to help LA Unified identify financial challenges and solutions as the district faces budget deficits in the near future.

The panel includes people who have worked with the district in the past, and many have won awards or honors for their involvement in education. One member is now working for the search firm hired to find the district’s next superintendent.

Known as the Independent Financial Review Panel, the group was formed in March by Superintendent Ramon Cortines and is being supported by $250,000, approved by the board. The panel’s findings and recommendations are due before the end of the current academic year. Cortines has expressed his desire to step down by the end of the calendar year.

The money to support the examination was approved in June, but no one is being paid, said a district spokesperson, adding, “We will be buying them sandwiches.”

Despite the constant refrain by board members to bring transparency and accountability to the business of the district, the work of the panel is being conducted in private. The members of the panel were not identified publicly (see below), and meetings are not open to the public. The panel was mentioned almost as an afterthought in a report earlier this week before the Budget, Facilities and Audit Committee by Chief Financial Office Megan Reilly, whose office is overseeing the panel’s work.

In her presentation, Reilly said it is an “all-volunteer” panel that will take “a comprehensive deep dive and look at the financial problems facing the district.” She said they were “outside experts asked to join us on behalf of Mr. Cortines.”

Reilly has projected a budget shortfall of $333 million in 2017-18, presumably one of the reason the group was impaneled.

During the public forum section of the committee meeting, led by board member Mónica Ratliff, a former school board member, David Tokofsky, pointed to the secrecy surrounding the panel and its work.

“This is the first time in a public meeting that this financial review panel has ever been mentioned,” he said.

Late today, the district provided a package of information, reflecting the material the panel has been examining over its first four meetings, with two to go. The subjects reviewed include a history of the district finances, the evolution and mechanics of the Local Control Funding Formula, reviews of state and federal education funding, district budget schedules, personnel costs, and debt, tax and bond information.

Some of the material has been reviewed at previous board meetings, but taken as a package — all 260 pages of it — it’s the kind of material any panel of this kind would need to make informed recommendations for a district with an annual budget $7 billion, excluding federal dollars.

According to Reilly, Cortines asked her in March to establish a group of experts in California public finance and education. The panel convened that month to “help review and make recommendations concerning the long-term financial sustainability and health of the district,” according to a slide she presented at the committee meeting. She added, “Their work is intended to provide a foundation for our discussions regarding the district’s long-term priorities and investments.”

This is the first time such a high-profile panel of outside experts have been asked to look at LAUSD’s budget and other financial material.

According to another statement, the panel is “expected to review and make recommendations concerning long-term financial matters, financial priorities and the health of the district’s finances.” The report says the panel “will not be involved in the development of current budget plans or discussions with the district’s collective bargaining units.”

These are the members of the panel:

• Maria Anguiano, an architect of the University of California-wide fiscal improvements plan and a former senior advisor to the Bill and Melinda Gates Foundation Post-Secondary Success Team.
• Delaine Eastin, the 25th California State Superintendent of Public Instruction and the first woman to be elected to that position.
• Michael Fine, chief administrator for Fiscal Crisis and Management Assistance Team.
• Bill Lockyer, former California Treasurer and veteran politician.
• Darline Robles, the former superintendent of Los Angeles County Office of Education and the Salt Lake City School District who is now part of the search firm seeking the next LAUSD superintendent.
• Miguel Santana, former city administrative officer for Los Angeles Antonio Villaraigosa and deal with a time of severe belt-tightening for the city.
• Darrell Steinberg, longtime state politician and president pro tem of the Senate who authored more than 70 bills involving education, mental health and foster care.
• Peter Taylor, president of ECMC Foundation, chaired the James Irvine Foundation and is on the boards of the Kaiser Family Foundation and the J. Paul Getty Trust.
• Kent Wong, the director of the UCLA Labor Center, and former staff attorney for the Service Employees International Union.
  

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  *Adds informational about the panel’s activities and updates background of Michael Fine.