LAUSD Board Votes to Establish Budget Stabilization Plan, Send Reduction in Force Notices

LOS ANGELES (March 10, 2015) - Responding to declining enrollment and increased costs, the Board of the Los Angeles Unified School District established a three-year budget stabilization plan to place the District on a fiscally responsible path, reduce central office budgets, realign some programs to address priorities and to send Reduction in Force (RIF) notices to more than 2,400 certificated staff. Board President Richard Vladovic and Board Member Bennett Kayser voted against sending the RIF notices.

Chief Financial Officer Megan Reilly presented a broad overview of the upcoming 2015-16 budget, with a $158 million deficit. The shortfall will be resolved by cutting central budgets that support certificated and classified employees by at least 6 percent; realigning arts offerings; after-school programs; Maintenance and Operations, and using the flexibility of redevelopment and bond maintenance dollars as one-time funds. The District must send notices to certificated staff by March 15, based on state law. More than 600 teachers and certificated support staff, and over 1,800 administrators and contract management employees will receive notices that may lead to layoffs or reassignment.

The District faces multiple big-picture funding challenges, including declining enrollment, increasing retirement pension costs, rising health benefit costs for current employees and retirees, as well as the underfunding of Special Education. The three-year budget stabilization plan, which was approved unanimously, focuses on using ongoing funds to pay for ongoing expenses that address the structural deficit. Over the past few years, the District has preserved programs and employees, by using one-time money, despite the lack of state funding.

“If you continue this, you will be another Detroit,” Superintendent Ramon C. Cortines said. “And that’s not that many years away if we do not stop the one-time funding. Unless we have ongoing funds, even though they are for wonderful programs, we can’t do it.”

The decline in enrollment is significant and results from a lower birth rate, as well as the choice of families to send their children to independent charter schools. L.A. Unified lost more than 175,000 students, the equivalent of San Diego Unified School District, in the last decade. In the last three years, the District has lost 40,000 students, the equivalent of the San Jose Unified School District.

“You cannot have 175,000 less students and not cut personnel,” Cortines said. “We just can’t afford it.”

The District will update its budget projections after Gov. Jerry Brown releases his revenue estimates in mid-May. The final budget will be adopted before June 30, the last day of the District’s fiscal school year.

###

Contact: Lydia L. Ramos (213) 241-6766