Tuesday’s school board meeting while the union report was delivered.
* UPDATED May 13
As district officials and other analysts pick apart the UTLA-funded study released Tuesday that claims that independent charter schools drain half a billion dollars from LA Unified, the district’s own numbers show LA Unified actually makes money from charters.
The first finding of the 42-page union-funded Cost of Charter Schools report states that the revenue collected from charter schools does not cover the annual budget of the district’s Charter Schools Division.
But that’s not what the district’s own numbers reveal.
In January when the Charter Schools Division presented its budget, it showed that the district receives half a million dollars more than they need to pay for the division. That report, presented to the Budget, Facilities and Audit Committee by Charters Division Director Jose Cole-Guttierez, showed that the 1 percent oversight fee collected from charter schools brings in $8.89 million while the annual expenses of the division’s 47 employees including their benefits total $8.37 million.
The UTLA report puts the indirect administrative costs of the division at $13.8 million, including the cost of the square footage of space used in the Beaudry headquarters by the staff, janitorial costs and time managing and investigating charters that could be spent on traditional schools. These costs, it states, are not supported by the 1 percent oversight fee collected from charters that is used to fund the district’s charter schools division.
The UTLA study notes the district doesn’t charge the charter schools the full 3 percent it says they could charge for the 56 schools that are located on district sites. That could result in an increase of $2 million for the district, it says. School board member Monica Ratliff pointed out at Tuesday’s board meeting that many of her constituents ask why the full amount is not collected from the charter schools.
The report was immediately criticized by district staff and others, as both inaccurate and an attempt to divert attention from far larger drains on the district’s finances. District officials have been directed to refrain from commenting officially, but they are planning to respond to the report as early as a special school board meeting planned for Tuesday to discuss the budget.
An initial analysis by the Associated Administrators of Los Angeles (AALA), the district’s bargaining unit for middle managers, also noted that the district’s own figures for its charters division contradicted those in the UTLA report. AALA reported that a district official said the number of charters contracting outside the district for special education — and the ensuing financial impact — was vastly misrepresented in the UTLA report. And it questioned whether UTLA was reading the regulations on charter fees correctly and whether the district could charge charters a full 3 percent.
“The report is full of glaring inaccuracies,” the California Charter Schools Association stated in a email. “It mischaracterizes how special education is funded, it ignores millions of dollars that charters pay to the district for facilities, and it guesstimates the staff time of hundreds of district employees, among many other distortions and false conclusions. We’re encouraged that the district will be scrutinizing the report to assess its accuracy. But what’s especially frustrating is that this report totally ignores the most important part of public education: student learning.”
It added, “When it comes to the district’s finances, the elephant in the room is the $13 billion in unfunded post-employment benefit liabilities that places LAUSD in the unenviable position of having to make very hard decisions in the months and years to come. It’s of course no surprise that UTLA’s report made no mention of that issue; they’d rather blame everyone else than offer real solutions for the district’s complex financial problems.”
The UTLA report comes as the district is facing a potential $450 million deficit within three years due to declining enrollment and increasing fixed costs, including pension costs, legal liability and other post-employment benefits.
The report was but together by a Florida-based consulting company, MGT of America, and Susan Zoller, a former teacher and administrator who compiled the report, presented it to the school board on Tuesday.
UTLA spokesperson Anna Bakalis said in a statement, “The data used in the MGT report came directly from the district. We stand behind the figures as given to MGT. We are glad this financial impact report has sparked a dialogue about these issues, and look forward to finding out more ways to address the findings that were laid out in this report.”