Imperfect Paradise: Looming strike, budget deficit, and superintendent under federal investigation. What it could all mean for LAUSD's 400,000 students and staff

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Nere the Moreno. It's been a tumultuous school year in the country's second

largest public school district. When school started last August, fewer

students in Los Angeles unified showed up in the wake of widespread immigration

rates. You could definitely feel the change even in the atmosphere. It's like

people are scared to go out. Then in February of this year, a divided LA

USD board voted to eliminate hundreds of jobs to stabilize the district's

budget. No one is excited to lay off anyone. This is what we're doing to

ensure the sustainability of the district. Just one week later, we begin with

controversy around the LA unified school district about the FBI's action at

district headquarters of superintendent Alberto Carballo and at his Sam

Pedro home. And now the district's largest unions are on the verge of a

strike that could shut down schools indefinitely. Are you fired up? Are you fired up?

This week on in perfect paradise, we look at the collision of multiple

challenges for LA USD. What all this could mean for more than 400,000 students,

school staff and their families and communities and the existential

questions around the future of Los Angeles public schools. LA is K through 12

education senior reporter Mariana Dale is here to help us understand how the

district got to this breaking point and what's at stake. Hey Mariana. Hi Nereida.

So let's start with the strike. The announcement happened at a rally in downtown

Los Angeles last week. What was the vibe there? So this was during that heat wave

that we had. It was 95 degrees outside. So it was literally very hot. But that did

not deter thousands of people from gathering. They were in Gloria Molina Grand Park

right in front of LA City Hall. Members of the teachers union,

United Teachers Los Angeles. They were decked out and read. I talked to Emily Reyes

who's been a teacher in the district for more than a decade. And she talked about

how the current system that they have for increases makes it hard for

educators who juggle multiple responsibilities to complete the professional

development that is required for them to be able to earn more money.

I was a caregiver to my child and now to my mother it's made it really

difficult for me to obtain those salary points which is like getting an additional

master's degree. The teachers were also joined by LA USD

classroom aides, custodians, IT workers, bus drivers. Those folks were all in purple.

They're part of service employees, international union or SCIU local 99.

And in a first you also had principals and other administrators showing up at the rally.

They were decked out in green and that was to represent the associated administrators of Los

Angeles. That is a union that is affiliated with the teamsters and Maria Nichols as their president.

We're understaffed, we're overworked, we don't have the necessary resources to really say we

have safe schools and to really say that we're servicing students.

Part of the goal of this rally I think was for the three unions to really show that they are a

united front. Yeah, I was really surprised to hear that principals were participating because I

used to, as you know, be an education reporter and I'd never seen that happen. And I'm wondering

just what is bringing all of these unions together now. I would say at the root of it is a lot of

frustration. Each one of these unions has an expired labor contract with the district.

They've been negotiating for more than a year to try and reach an agreement about pay and benefits

and what unions say are essential supports for students. And the two largest unions,

United Teachers Los Angeles and SCIU local 99, they declared an impasse last year. And an impasse

triggers a process where the state's labor relation board steps in to try and help the two sides

broker a deal, but they have not been successful yet. And the unions had a strike authorization vote

earlier this year and overwhelmingly the members of those two unions voted to give their leaders

the power to call a strike. And that is exactly what happened at this rally. Here's SCIU local 99

executive director Max Arias, begin to this crowd of thousands.

So the union said if there's no deal by April 14th, teachers and support staff will walk off the job.

And what does either side want here? I mean, let's start with the teachers union.

The union UTLA, it's about 37,000 people. The majority are teachers. It's in the name,

but it also includes other educators, including counselors and school psychologists. They want

this salary scale that's going to let educators earn increases more quickly. And just to give a little

bit of context there, according to the district, first year teachers make about $67,000 a year.

And the average teacher pay in the district is about $99,000 right now.

This change that the union is pushing for would bring an estimated 17% pay increase to teachers

over two years. And the union says this is important not only for the teachers that are in

classrooms right now, but also future teachers. They want to bring more stability to a workforce that

has had quite a lot of turnover. And we even saw that a recent survey from the news outlet Ed

Week found that almost half of California teachers plan to retire or quit in the next 10 years.

Now, L-A-U-S-D's latest offer to the district, nowhere near what the unions are asking for.

It's about 8% over two years with the possibility of negotiating further raises in the third year

of the contract. And what about the union that represents school support staff? So that union

SEIU local 99 is about 30,000 members. They are among some of the lowest paid employees in the

district. The union says their workers earn about $35,000 on average. They are seeking 30% increases.

The districts offer less than half that a 13% raise over three years plus a small bonus every

year. The union also wants more hours for its staff. Not everyone in this union is full time.

And they say that budget cuts have reduced their members hours so much so that they don't qualify

for benefits like health insurance. The unions also criticize the district for contracting outwork

to external vendors. And how have the school district leaders responded to these unions?

But say the bottom line is that the district says it does not want a strike, acting superintendant

and Andres Chate led a press conference the morning after the rally where the strike was announced.

Strikes are not good for students. They are not good for our schools. They are not good for our families.

I truly believe that our labor partners also do not want a strike. We will continue to work together

around the clock to come to an agreement that avoids this outcome.

Chate says the district is aware of the region's high cost of living and says the district has

increased their salary proposal since bargaining started. The district also committed to fully

funding health care for all of its employees as well as their dependents. And Chate pointed out

that the district's workforce isn't the only stakeholder in these negotiations though.

We also have a responsibility to be careful stewards of the financial resources that our taxpayers

entrust to us. Any increases in salary must be balanced and consider the entire public school

system we are here to serve. And for the last several years I have been listening to L.A.

U.S.D. leaders say that it is really at risk of running out of funding in future years without

serious changes to their budget. After the break, what's at stake if L.A. Unified and the

unions fail to reach a deal and the other challenges compounding the tension within the nation's

second largest public school district. Stay with us on Imperfect Paradise.

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This is Imperfect Paradise. I'm Nireita Moreno and I'm talking with L.A.

Senior K-12 reporter Mariana Dail about the challenges facing the Los Angeles Unified School

District including a looming strike and budget deficit. L.A. Unified Teachers and Staff are on

the verge of a strike which could have significant consequences. Mariana, what would a strike mean for

students and their families? So let's just talk about how many students there are first about

400,000 from the four-year-olds in TK all the way up to your high school seniors and especially

in those younger years. Working families are relying on the district not only to provide their

child and education but also to take care of them while they are at work and the district also

provides hundreds of thousands of free meals to students for breakfast, lunch and also supper in

some cases and a strike pretty much all but guarantees that schools would shut down. This is

what happened back in 2023 and the district also is responsible for the education of about 32,000

grown-ups adults that are enrolled in the district's adult education program.

Shouting down school for a few days is much different than the more than a year closure that

happened during COVID but I think there are some common themes between those two experiences.

One is that there is a wide range of what families are able to do for child care and some of

that's dependent on their income and the type of job that they have. The caregivers can take

time off of work and stay home with their kids or maybe they are able to work remotely or if they

have family members that can take care of kids but for other folks they're really left scrambling.

Now acting superintendent Andres Chate has said the district is preparing for the possibility that

this actually happens and schools shut down. They are reaching out to external organizations that

might be able to provide child care or some meals but just with the size of the district it is

really hard to imagine that you could find like a substitute school system that would be able to

take care of kids and we also don't know how long this strike could last. UTLA says that this

would be an open-ended strike so they would be out of the classroom until they reach a deal

not specifically for like one two or three days. And I want to go back in time a bit. I want to

understand how we got here. Like how is the district's history shape the tensions that we're seeing

here today? Yeah L.A. U.S.D. has really experienced a huge transformation over the last three decades.

If we talk about the early 2000s you had schools that were severely overcrowded. There were about

750,000 students attending L.A. U.S.D. schools. I mean they were bursting at the seams. You had more

than 200 schools that were holding classes year round to help relieve that crowding. And so what the

district did was go to the voters and ask them to approve property tax increases to fund new

construction in the district and they did that. In five elections over 10 years voters passed more

than 20 billion dollars in bond funding and that money went in part to help build 131 brand new schools.

But by the time that last new school opened in 2017 you had the opposite enrollment trend

happening. Enrollment was falling and today L.A. U.S.D. enrolls about 40% fewer students than it

did in the 2000s. There's a couple of intersecting factors here. It's become less and less affordable

for families with children to live in Los Angeles. So they are physically leaving. So they're not

enrolling their kids in school. People generally are having fewer kids. You've also had an increase

in independent charter schools and in L.A. U.S.D. more than 100,000 students attend those schools

instead of district schools. There has been some areas where there's been growth and enrollment

in recent years. For example students that are new to the country. But you also saw those enrollment

numbers take a hit in the last two years. And the district says that this is in part because of the

immigration rates that we've seen throughout Los Angeles. And with fewer students there are

clear questions about how the district is planning to save money or whether it's reducing the

number of campuses. What has L.A. U.S.D. done to address increasing costs despite having 40%

fewer students? So I'll flip it a little and talk about what the district has not done. So we

have not really seen school closures of traditional public schools. And there is actually more people

working for the district today than when they were at their peak enrollment. Part of that is

we've seen a push for more services for students. For example related to mental health. So schools

have hired school psychologists and social workers. And the district got a bit of help to do that

during the pandemic by way of those federal relief dollars. But the problem is that those were

one-time dollars. And the district used some of that money to hire permanent staff that they have

to keep paying even though federal relief dollars are now gone. So I watched the budget talks

every year. It's part of you know bread and butter of covering education. And for the last two

years the budget approved by the board has been a deficit budget which means the district acknowledges

that they are spending more money than they're bringing in. And the way that they have filled that

gap is through reserves that have been saved up over the years. Now the teachers union points to

that reserve as a way to possibly pay for some of these increases that they're asking for.

The district's response though is that this money is rapidly depleting and it's not really

going to get restored anytime soon. And then we have some external factors that are putting pressure

not only on L-A-U-S-D but other districts in the state. You've got fixed costs going up just

like inflation. Districts are seeing increases in the goods and services that they pay for.

Salaries are going up, utilities, insurance, districts say the state funding hasn't kept up.

And then in recent years districts have been paying out millions of dollars to settle lawsuits

related to decades old sexual assault claims and sexual abuse claims. And so what is the district's

plan to balance its budget? Last summer along with the budget the district adopted a plan to cut about

$3 billion from the budget over four years. It's called the fiscal stabilization plan. Now this

discussion was happening under then superintendent Alberto Carvalo. He's currently on leave. We'll

get into that in a minute. But here's how he introduced the challenges last summer.

We know that we are entering difficult times. The math doesn't lie.

And that fiscal stabilization plan that was approved. It has these different options for saving money.

School closures, they call them consolidations, layoffs, cutting transportation.

Historically schools have been able to keep money that they don't spend one year and then spend

it in the next year. That's called carryover. That's something that has been severely reduced.

That money now flows back to the district. But these are just options. I want to make that

really clear. The board approved this plan, but it would still have to vote to approve any of these

kind of individual options for saving money. And one of the most significant votes of that nature

that has been taken happened earlier this year. The district staff presented a plan to eliminate

650 positions. Now Carvalo said these cuts would come primarily from the district's central

offices, not school sites. Does it do it at 100% no? But this approach reflects the deliberate

effort to shield students and frontline educators and support staff from the most severe

impacts of this fiscal downturn. The district is accepting additional measured risk, fiscal risk.

So they voted to eliminate 650 positions. District staff say that they are going to work to move

people into vacant positions or if people are retiring, for example, there's also a process where

people who are getting laid off but have more seniority in the district might bump someone with

less seniority out of their position. So we won't really know the final total of people that are

getting laid off until later this year. As LA Unified is dealing with these budget challenges and

looming strike, there was a shocking shift in the district's top job earlier this year. Let's talk

about that. On the morning of Wednesday, February 25th, the FBI searched the home and office of

Superintendent Alberto Carvalo and things started to rapidly evolve from that point. So within two

days, you had the school board voting unanimously to put Carvalo on paid administrative leave after

an hour's long close meeting. At the same time, they also appointed one of their longtime

administrators, Andrés Chate as the acting superintendent. Now, Carvalo has not made any public

appearances since the raids. However, he did issue a statement through illegal firm Holland

tonight earlier this month. And it reads, quote, Mr. Carvalo respects the rule of law and the

investigative process and has always acted in the best interest of students and within the bounds

of the law, end quote, in that same statement, Carvalo asked the board to reappoint him to his

job. But there's no indication that that's going to happen anytime soon. What do we know about the

reason for the investigation into Carvalo? So at the time, a Department of Justice spokesperson

said that the agency had a court authorized warrant for the searches, but they declined to provide

additional details. And the underlying affidavit, which is like the justification for why they

sought to do these searches, is under a court ordered seal. And no charges have been filed to date.

These issues are a lot to process. And I'm sure they would be concerning for a lot of families

who might be having kids soon. Or maybe those were thinking about school and just wondering whether

or not L.A.USD has made any improvements. We have seen improvements in recent years. The pandemic

was hugely disruptive for students, not only in L.A.USD, but across the country. But since students

returned to the classroom in 2021, L.A.USD has improved its attendance. Academic outcomes,

at least as they're measured by test scores, have shown that the district is outpacing the state

in terms of growth. And their scores are actually now above pre-pandemic levels, which is a

real accomplishment. The number of students who enroll in advanced placement or AP classes

is increasing. And students are increasingly erding scores that can get them college credit.

I also take a lot of stock in what I hear directly from students. And they talk to me about programs

like dual language, where they can learn not only in English, but as second or even third

language for some of them as well. They've also been really interested in programs focused in

social justice and science. And I hear when students are excited to learn. On the first day of

school earlier this year, I met a student named Kevin. And this is what he told me about starting

first grade. It's gonna be filled with funding. His mom Vivian Figaroa says the people at 24

three elementary and West Adams are like family to her son. Everyone knows Kevin. So everyone was

just like, welcome back Kevin. You know, and everyone's excited to have him. And it makes him feel,

you know, better to be here. And it's a reminder to me that it's the people that work at schools

that are creating the relationships that can really lead to some of these learning outcomes that

we talked about. Coming up with the district can learn from past strikes and the difficult

systemic decisions about schools and staffing it must ultimately make for L.A. U.S.D.'s future

in the long run.

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But what school finance experts point out to me is that this makes the funding kind of tricky to predict because it's volatile.

Here's a leak scalger who studies education policy and outcomes at the nonpartisan organization policy analysis for California education or pace.

It's a real problem. We've known about this for a while.

The decision to be so heavily reliant on income taxes, which are so heavily driven by the stock market, means that the budget in California is unstable.

And that leads to a bunch of things that make it really difficult for districts to do a good strategic job.

This year's revenues are looking to be higher than expected, in part because of the boom in artificial intelligence, but there's no guarantee that that funding will last.

And so we see state leaders, including Governor Gavin Newsom, invest heavily in one time funding, which looks really good on paper.

Like no one is mad about more investments in education, but when those investments aren't long term, it's hard to sustain programs in schools over time.

What are their factors determine how much money school districts like L.A. U.S.D. get?

So one is their attendance, and that's because California distributes money based on an average of how many students show up each day.

And then there's additional funding when students are low income, English language learners unhoused or foster youth.

And so as we see enrollment going down or challenges with attendance, that is something that impacts how much money schools get.

We also see the cost of living continue to go up, which is hard for families, also the people that work for school districts.

And so to navigate all of these changes and uncertainties in funding, there's some difficult choices ahead for districts like L.A. U.S.D.

And what would some of those hard choices look like?

So the fiscal stabilization plan I talked about earlier has given us a little bit of a preview of what some of those options are.

As far as we know, L.A. U.S.D. is not considering school closures this year, but they are a future possibility as are additional layoffs.

Now, the unions also have their own ideas about how some of these financial challenges can be solved.

One of their demands generally has been that L.A. U.S.D. spend less money on outside contractors.

They also have pointed to the amount of money that the district has historically had left at the end of the year that's called the ending balance.

It's been multiple billions of dollars at the end of last school year. It was about five billion dollars now.

The district says that money is committed to not only the salaries of the employees that are working today, but employees that they will have in the future.

And it really sets the district up to have to make some hard decisions because they are focused on the employees and the students that are in their classrooms today, but also the fact that they have to plan for the future as well.

All of that leaves me just wondering if we'll be back here again in just a couple of years.

If I had a crystal ball, but ultimately there is a lot of uncertainty and also a lot of need.

The district has tens of thousands of employees.

We also live in one of the most expensive regions in the country.

Families really want their children to be safe and to have a good education.

And then district leaders have also had to respond to evolving changes from the state, but not only the federal government.

And LAUSD operates on a huge scale. The second largest district in the country, I feel like we can't emphasize that enough.

So whenever they make a decision, it impacts a lot of people.

And when you are trying to fund education in an environment, we're pretty much everyone agrees that there is not enough public funding for education.

You have to make trade-offs and not everyone is happy with those choices.

Mariana, thank you so much for joining us and for covering all of these dynamics. We appreciate it. You're welcome.

Thanks to K through 12 senior reporter Mariana Dail and thanks to senior education editor Ross Brunemann.

I'm Nidhi Damorino, Anjali Sastry is our senior producer, James Chao produced and sound designed this episode.

Catherine Mailhouse is the executive producer of the show and our director of content development, engineering, mixing and original music by E. Scott Kelly.

In perfect paradise is a production of LAUSD.

This program is made possible in part by the Corporation for Public Broadcasting, a private corporation funded by the American people.

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