“While students in OUSD seem to pay a heavy price for this poor governance, experts tell the Grand Jury that those responsible, the board and the district’s decision-makers, seem to pay little or no price for their actions or inactions.”- Alameda Grand Jury Report 2018
The Alameda County Grand Jury’s Annual Report drove another nail into the coffin of Oakland Unified this week, tearing into the district’s fiscal practices and controls, the failures of the board to make big decisions while micromanaging and pushing individual mandates, as well as a culture of “No accountability, lack of trust, and high teacher and administration turnover.”
They, like many others see this failure to act is leading the District to another state takeover, and they have solutions.
More Bad News
This is on the heels of similarly critical FCMAT report, the districts own numbers showing deficits last year, this, year and astronomical deficits 2 to 3 years out, as well as strong signals from the State that they will not support OUSD with a bailout.
If this doesn’t get the board to get serious I don’t know what will.
But let me cut to the report.
A “Sea of Red Ink” and Lack of Budgetary Controls
The Grand Jury started by reciting the district’s long history of fiscal issues and then listed some of the latest, ahem, challenges.
For more than a decade, numerous experts and outside reviewers, including the grand juries in 2013-2014 and 2015-2016, have highlighted the fiscal deficits plaguing OUSD. In fiscal year 2017-2018, like so many previous years, OUSD operated in the red. Its initial budget was $762.8 million, $15.1 million more than it had to cover expenses. At a board meeting last fall, the superintendent recommended cutting $15 million. Later, the amount to be cut dropped to
$9.1 million ($4.25 million to come from school sites, and $4.85 million to come from central office functions). But, due to prior contractual obligations, the proposed cuts were not fully implemented, further exacerbating the district’s financial woes.
They also identified major drivers in the deficit last year, and going forward
- Errors in enrollment estimates reduced district revenue by $3.9 million.
- Failure to reduce teacher overstaffing to match actual enrollment cost another $3.2 million.
- The Board of Education used the self-insurance fund to help the district stay afloat, underfunding it by $30 million.
- Ever-growing pension costs and the skyrocketing cost of special education’s unfunded mandates overwhelmed the district.
To be fair, some costs like pensions and special education are somewhat outside the district’s control, however many other districts plan for those increases or provide more efficient services, and will not go bankrupt as those costs escalate. OUSD will go bankrupt and has no budget plan to address the crisis.
The Grand Jury also recognized that the current superintendent has tried to move in the right direction, doing Blueprint work and promising to address, best she can, the problems. However given the failure of the Board to make hard decisions while also overstepping their authority with staff, it will be an uphill battle for our superintendent.
An Equally Scathing Educational Critique
There are several depressing charts included, but let me just quote the Grand Jury
Student performance has long been recognized to be a measure of the quality of the educational services provided. It is no coincidence that well-run districts have high student achievement. Unfortunately, OUSD’s test scores mirror its governance issues. While some innovative programs, especially those directed toward English learners, have shown progress, student performance at too many schools has been described by witnesses as miserable…
For instance, the Grand Jury heard testimony that seven in ten African American students in the district read below grade average. Overall, since 2014, nearly half of the students in OUSD (46% -48%) failed to meet the lowest level of English language arts and literacy achievement and just over half (52%) failed the lowest level in math… In 2016, only a third of OUSD high school seniors were prepared to go to college. And in five of the seven major performance indicators used by the state – English language progress, college and career readiness, chronic absence rates, English, and mathematics skills – OUSD scored in the average or lowest category.
So the bleak financial picture is mirrored by the bleak educational outcomes.
How did We Get Here
The OUSD budgeting and oversight system is mess. Schools were approved without being budgeted for, board members would harass staff to spend on pet projects and would win, undermining the superintendents authority, over 60 off the book positons were created, teachers were hired where principals didn’t even know, and efforts to contain spending actually backfired.
I have to share this because it typifies both the dysfunction and how hard it will be to remedy,
Last year, to address a significant budget shortfall, the superintendent gave schools 24-hours’ notice of an impending spending freeze. Many OUSD school officials spent what remained in their annual allotments the next day. The result was millions in lost savings and pointed criticism of the district from FCMAT for “allowing school sites and departments to ignore and override board policies.”
All these issues are made worse by high staff and program turnover, and the churn that makes it hard to actually implement change. Further complicating working towards solutions is a lack of transparency and trust, where in some cases history taught you to be mistrustful.
As described by the Grand Jury,
in some cases, finance officers were instructed to withhold “bad news” from the board and other decision makers. Witnesses confirmed that the previous superintendent and other leadership instructed staff not to tell the board that the system could be as much as $30 million over budget.
In addition, witnesses described to the Grand Jury various ways that officials hide money off the budget to fund special projects and take personnel actions.
Structural Problems and a Call for Answers
The Grand Jury cited the “too many schools” issue agreeing with anyone who has ever studied OUSD, and more critiqued the Board for not doing anything about it,
Over the last 15 years, student enrollment in OUSD-operated schools has fallen from nearly 54,000 to approximately 37,000. Yet, witnesses say, OUSD operates as if there has been no decline in enrollment…
In the Grand Jury’s investigation it became clear that schools need to be consolidated if the district is to survive. To do so, the board must begin by explaining to the public the financial and educational consequences of operating too many schools. Ultimately, the board needs to consolidate schools even if opposition remains strong.
And the Grand Jury also recommended a truce in the public school wars between the district and charters, and to look for collaborative opportunities. Interestingly they seemed to argue for the “system of schools” type approach that the Board is supposed to address at the Board meeting on 6/27.
While charter and district run schools operate independently, the Grand Jury learned that opportunities exist where collaboration between the schools at these shared campuses can help ease financial burdens on both organizations and, more importantly, improve the educational experience for children… Charter schools and traditional public schools need to learn to coexist and must take advantage of opportunities to improve relations and better serve students.
OUSD is a district on the brink, the Grand Jury report confirmed this and raised even more fundamental questions. Ultimately it will take hard decisions on policy by the board, a sustained commitment from the superintendent and and a deep change in culture in the way the district operates. We can work on this ourselves or believe me someone will be sent in to work on it themselves.
Please read the report, the findings and the solutions, and push the Board to change.