Ward's Fiscal Recovery Plan Based on Illusions

Ward's Fiscal Recovery Plan Based on Illusions

By Dan Siegel

State Administrator’s Randolph Ward’s “Multi-Year Fiscal Recovery Plan” represents both good and bad news for the Oakland schools. The good news is that he finally got it done – almost two years late. According to Senate Bill 39, the Don Perata sponsored legislation that authorized the takeover of the Oakland public schools, the “improvement plan” was due by July 1, 2003.

The late presentation of the plan is not all Ward’s fault. Section 7 of SB 39 assigns responsibility for preparing the plan to the “County Office Fiscal Crisis and Management Assistance Team” (FCMAT), in other words County Superintendent of Schools Sheila Jordan and her advisors. Jordan – the person who first proposed replacing Oakland Superintendent Dennis Chaconas with Ward – and FCMAT dumped their responsibility on Ward. The plan is necessary under SB 39 because State control over the schools is supposed to continue until Ward decides to “notify” State Superintendent Jack O’Connell that “future compliance” with the plan is “probable” and both FCMAT and O’Connell agree. (SB 39, sec. 5[e])

Now here is the bad news. What Ward’s “improvement plan” actually proves is that there is not enough money to run Oakland’s schools with current State and local funding. So it will be next to impossible for Ward or anyone else to comply with the plan. So Ward, his $250,000 salary, and his $80,000 security team could be with us for a long time.

The improvement plan is based on several very questionable assumptions. It assumes that the salaries of district employees will be maintained at their current levels without any increases other than possible State cost of living increases. (p. 42) However, underpaid district employees rightfully assume that their salaries will increase as the cost of living and inflation rise, whether or not State funding increases. Even without negotiated salary increases, employee salaries rise on the basis of longevity at a rate of approximately 2.5 percent yearly.

Second, the plan assumes that the cost of health care premiums and other benefits will remain steady in the 2005-06 and 2006-07 fiscal years. (p. 42) Health care premiums have risen at about 15 percent annually for several years, and most experts believe that this trend will continue. The plan will require district employees, whose salaries may be frozen or even cut, to agree to pay for increases in health care premiums that could cost several hundred dollars per month within a few years.

The third major assumption built into the plan is that the district’s declining enrollment will be slowed. Oakland’s average daily attendance has declined steadily since 1999-2000 and dropped by 5,000 in the last two years. However, the recovery plan optimistically predicts that the decline in enrollment will slow dramatically to about 3,000 in the next two years. (p. 44)

Other key provisions of the plan:

(1) The district needs a $7.0 million upgrade in its financial information system in order to keep track of its budget, but the plan does not include funding for the upgrade. (pp. 47-48)

(2) The plan assumes that the district will not have to repay any of the $33.4 million assessed by the State Controller for inadequate record keeping and other rules violations found in his 2002-03 audit. (p. 9)

(3) The plan reduces funding for School Safety Officers from $4.3 million to $1.3 millions and shifts the burden from general to restricted funding. (p. 35)

(4) The plan includes spending reductions of $5.7 million in 2005-06 and $3.5 million in 2006-07, but does not indicate where the cuts will be made. (p. 43)

(5) The plan includes an $11.6 million Student Information System needed to improve academic achievement, but only $6.3 million to pay for it. (pp. 50-52)

(6) The plan includes no assurance that the district will maintain its adult education program.

The bottom line here is that the Fiscal Recovery Plan, at best, will create an under-funded, bare bones school district unable to provide the kind of education needed by Oakland’s children. Qualified teachers and other staff will leave a district unable to pay competitive salaries or to maintain their health benefits, and those parents with options will look elsewhere for their children’s education. Enrollment will continue to decline, feeding a continuous cycle of budget reductions.

This is not all Ward’s fault. But he can be blamed for being the hatchet man for State leaders with little commitment to public education, especially for low income children of color. California ranks almost last in spending for public education, and the dismal academic performance of its children proves that money does matter. Yet Governor Schwarzenegger and his allies continue to starve the education budget. Their austerity plan for public education will destroy an already inadequate system, replacing it with a network of charters and voucher-supported private schools.

The premise of this plan is that the destruction of the unions representing teachers and other employees will allow schools to operate more cheaply. Whether those schools will provide good education to all children does not appear to be a significant concern.

Many forget that the principle of providing a free public education to all children is a relatively recent development in American history. Today we witness a dangerous retreat from this principle, and a powerful defense is necessary.

Posted April 28, 2005