Saturday, November 02, 2013

THE MYSTERIOUS CASE OF LAUSD’S FINANCES + (there’s no accounting for) smf’s 2¢

by Richard J. Riordan and Tim Rutten | LA Daily News |

11/01/13, 3:15 PM PDT | Updated: 9AM 11/2/13 9AM   ::  Now that the drama over the Los Angeles Unified School District’s superintendent is behind us, there are some other, deeper issues worth exploring.

For example, ask anybody who’s looked at the budget for one of America’s urban school districts how much money really is spent per pupil or what the connection is between the size of that expenditure and what students actually achieve and the answers are like to be:

“Hard to say” … “Not clear” … “It’s controversial” … “Good question”… Nobody knows.”

This year, LAUSD — America’s second-largest public school system — will spend a little more than $7 billion to educate nearly 600,000 students. Ask how much will be spent on each of those pupils in this school year, and the answer you’re almost sure to get is a little more than $7,000 — followed quickly by the caveat, “it’s probably a lot more.”

How much more? Once again, nobody knows for sure.

In part, that’s because a substantial part of LAUSD’s budget comes from the state and federal governments in the form of so-called categorical funds. Sacramento, for instance, contributes money specifically earmarked to hold down the size of kindergarten through third-grade classes, for students from low-income households, to pay for transportation between home and school, and to provide high school counselors. Washington’s largest categorical grant is to assist students whose families the U.S. Census records as living in poverty. There also are substantial federal categorical grants for pupils who don’t speak English and for disabled youngsters. Given that 90 percent of LAUSD’s students are from minority groups and that many of them are immigrants or their children, the categories mount up: In all, LAUSD receives money earmarked to aid more than 140 categories of students.

So why is it so hard to determine how much of that money is spent on the pupils? You should be able to simply take the number of poor or disabled students, for example, and divide that figure into the amount of the federal or state grant to assist them, then add the result to $7,000 and get an answer. Except — dozens of the categorical grants do not “attach” to the individual students they’re intended to help. The district is free to spend those categorical funds as it wishes. This year the situation is even harder to track because Gov. Jerry Brown’s education budget has collapsed most of the state’s categorical grants into allocations weighted according to the number of poor students. Some of that money will go to the needy students for whom it was intended. Some will not. How much? Impossible to say.

Because most estimates of how much LAUSD spends on each student simply accept that $7,000 baseline, it appears — on paper, at least — that the district spends substantially less per pupil than the District of Columbia at $29,409, New York City at $21,408 or Boston at $19,181. Some analysts think L.A.’s actual expenditure probably is about what those other urban districts say they’re spending. A few think it could be more. We asked the Rose Institute of State and Local Government at Claremont McKenna College to take a look at LAUSD’s budget and give an estimate of per-pupil spending. They came up with $15,134. Who’s right? Once again, nobody really knows.

If for the sake of simplicity you choose just to accept LAUSD’s $7,000 per year figure, then multiply that by the number of students, you get a total of $4 billion. So where will the other $3 billion go this year? If you guessed nobody knows for sure, you’ve got it.

Scholars and economists who’ve studied the question and to whom we spoke — none of them willing to go on the record — confessed that it really was impossible to say with any real precision. One educator who once worked inside LAUSD said, that despite his MBA, he “never could make heads or tails” of the district’s voluminous budget. Some of the analysts attributed the mystery of LAUSD’s finances to the district’s sheer size and the numbing complexity of its overlapping state and federal categories. Others alleged that district bureaucrats deliberately create a budget nobody can decipher — in part to avoid accountability for themselves, in part to conceal money from LAUSD’s powerful teachers’ union. Who’s right? Impossible to say for sure.

Given that LAUSD can’t tell you exactly how much it spends per pupil, it’s not surprising that it can’t really be precise about what it gets for that money. Would it make a difference if, instead of $7,000, the baseline number was $17,000 or $27,000? Nobody knows. What can be agreed upon is that the district is failing far too many of its students, betraying the aspirations that trusting and hardworking parents have for their children.

However, just how badly LAUSD is failing also is uncertain. The district says it graduates 66.2 percent or 43,124 of its students from high school and that 20.3 percent of them drop out between ninth and 12 grades. A recent study by the respected Harvard Strategic Data Project used LAUSD’s own data, but reported that the actual graduation rate is only 62 percent. Worse, the outside researchers found that only one-third of LAUSD’s 2011 graduates had completed the requirements necessary for admission to either the University of California or California State University systems. That means that of every 100 students who enter the ninth grade, only about 20 will graduate having taken the courses required to attend one of California’s state-supported four-year colleges. Don’t bother asking who’s right. You already know the answer.

By the way, nobody currently tracks how those “qualified” graduates do once they get to a UC or Cal State, but by some estimates fewer than 10 percent of them graduate with a degree.

The screenwriter William Goldman once said that Hollywood’s dirty secret when it comes to making a successful movie is that nobody really knows anything. As it turns out, that is LAUSD’s secret, too. That’s unacceptable. Everybody may love a mystery, but not when it involves our children and their future.

  • Former Los Angeles Mayor Richard J. Riordan is a philanthropist actively involved in educational reform.
  • Tim Rutten is a columnist for the Los Angeles News Group.

2cents smf:  One cannot kick-off the LAUSD Budget Season without at least one article about how LAUSD is unauditable. Much is written, little is done.

I almost stopped reading at “Sacramento, for instance, contributes money specifically earmarked to hold down the size of kindergarten through third-grade classes…”  The Class Size Reduction (CSR) Categorical finding was flexed away in 2009-10 ….

BUT WAIT – it was the specific earmark that was done away with …NOT the money – LAUSD has been happily getting that money and spending it on whatever-they-wanted ever since! 

OMG!: “Three-Mayors-Ago Riordan”and Columnist Rutten are right!

Now, to pretend to be fair: The CSR money was done away with this year – but the Local Control Funding Formula (CCFF)  - which kicked in when CSR and the rest of the categoricals  went away - means the money “for students from low-income households” kicked up exponentially. The counselor money has been spent on something else for years and the transportation money was never enough. Going forward, LAUSD is going to have even more money to abuse in its fuzzy accounting.

It is kind of weird that the LAUSD employee unions and Dick Riordan actually agree on LAUSD’s unaccountable+unauditable accounting. I wonder how they all feel about Mom and Apple Pie?

The  cheap+easy way to figure LAUSD’s per-pupil expenditure would be to divide 660,000 students by that $7 billion budget.  That would mean $10,606. per student. Half that of New York City or Boston, a little more than a third of what they spend in D.C.

That isn’t what it is of course – there’s Adult Ed and Early Chidhood Ed and pension funding and repayment-and-debt-service on the school bonds and a thousand other things. But it absent a real number, it works for me.

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