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LAUSD Has A $4.9 Billion Reserve. Here’s How That Money Works, And How It Could Go Toward Staff And Teachers

The heads and shoulders of people at a protest. One person wearing a purple beanie holds up a cardboard sign with lettering in black permanent marker that reads "We feed your students. Respect us. Pay us. Cafeteria workers deserve respect and better pay."
Someone holds up a sign at the rally for the last day of the three-day LAUSD strike for SEIU Local 99 and UTLA, the staff and teachers unions, respectively.
(Ashley Balderrama
for LAist)
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UPDATE | March 24, 2023
  • L.A. Unified School District and SEIU have reached a tentative deal to increase salaries by 30% and provide health care to more members. The news Friday evening followed a three-day strike by members of the union that represents support staff, who were joined in solidarity by the district's teachers union. Read more »

The Los Angeles Unified School District does not have a $4.9 billion pot of gold to increase the pay for the workers that drive buses, clean schools, assist teachers, serve lunch and generally make it possible for 422,000 traditional public school students to learn.

What it does have is several billion dollars designated for high-needs schools, paying for inflation-priced supplies, and other initiatives that could be redirected to the salaries of striking workers.

“To say to employees that there's money just waiting, unassigned and undesignated, almost $5 billion, is just not the case,” said Los Angeles Unified School Board President Jackie Goldberg. “It's robbing Peter to pay Paul and we will do that.”

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SEIU Local 99 reports that the average member makes about $17 to $23 an hour, with some people working part-time.

Mayor Karen Bass stepped in on Wednesday to help facilitate discussion between the union and the district. On Friday, the district reached a tentative deal with SEIU.

Here’s how the district’s $4.9 billion in reserves breaks down. The numbers come from a December 2022 report by LAUSD’s chief financial officer.

Stick with us, here — as Goldberg said: “This is not a straight line. This is a ziggy, a ziggy-zaggy.”

The money unlikely to be spent on staff salaries

$1.75 billion “restricted” 

Federal grants, including those for COVID-19 relief, that are only available for a specific amount of time, for a specific purpose.

$43 million “non spendable” 

Money that goes toward multi-year expenses. For example, the licenses for various apps on the district’s classroom management software Schoology.

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$426.8 million “assigned” 

Unspent funding designated for specific schools.

Why haven’t schools spent that money? It varies. Sometimes this money is designated for staff like social workers that schools haven't been able to hire.

Technically, Goldberg said, this money could be redirected.

“We do not wish to do that though, because we're still trying to catch kids up from the losses of learning in the pandemic.”

$238.8 million “reserve for economic uncertainty” 

California school districts are required to set aside a certain amount of money in case of a financial crisis. The average school district in the state has enough money to cover two months of spending, according to the Legislative Analyst’s Office. That money is determined by average daily attendance.

At 2% of its overall budget, LAUSD's reserve is larger than what the state says is necessary, though it's below estimates of the state average (3%).

The money more likely available for redirection

Here is the pool of money Goldberg said the district is most likely to draw from when it comes to funding higher salaries and other benefits.

$2.33 billion “committed” 

Funding for various initiatives and programs, including high needs schools, literacy programs and health benefits for retirees designated by the district’s seven-member board. There is also $244.6 million in anticipation of increased costs from inflation.

The money for high-needs schools is known as the Student Equity Needs Index, or SENI. While advocates spent years pressing for SENI, even board members who have historically supported the fund say it's not off-limits to change.

“These are decisions we have made,” Goldberg said. “Can we change those decisions? Absolutely, we can.”

$139.7 million undesignated

This is funding that could also go toward whatever’s outlined in the union’s new contract.

“This board, 7-0, is committed to doing a great deal more for SEIU than has been done in recent decades,” Goldberg said. She added that some of the committed funding is already dedicated to efforts that would improve conditions for SEIU workers, including air conditioning.

When describing the tentative new deal on Friday evening, Superintendent Carvalho did not provide details about the source of the funding for the “historic” contract, but said that it “puts the district in a solvent position.”

Regardless of the final math, the board will have to decide where the money ultimately comes from.

SEIU Local 99 leader Max Arias said in an interview Monday that these tradeoffs are mischaracterized.

“The narrative is if we give a raise to these folks, then we’re going to have to cut services,” Arias said. “I don’t know what that means because the people that give services are our members.”‘

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Updated March 25, 2023 at 1:05 AM PDT
This story has been updated to reflect details of the tentative deal reached on March 24 between LAUSD and SEIU Local 99.
Corrected March 24, 2023 at 10:16 AM PDT
An earlier version of this story misquoted Los Angeles Unified School Board President Jackie Goldberg. She said, “It's robbing Peter to pay Paul and we will do that.” LAist regrets the error.
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