LAUSD moves to settle lawsuit over its spending on high-needs students

Los Angeles Unified officials have reached an “agreement in principle” to settle a two-year-old lawsuit that accuses district officials of misspending millions of dollars in new state funding intended to help low-income students, English learners and foster youth.

In closed session Thursday, school board members unanimously voted to authorize L.A. Unified lawyers to formalize a settlement agreement with the plaintiffs — L.A. Unified parent Reyna Frias and the Community Coalition of South L.A., who are represented by attorneys at the ACLU and the non-profit law firm Public Advocates.

Details of the settlement have not yet been released. But “the main thrust of the settlement,” the district's general counsel David Holmquist said, “is going to be that it’s going to put more funds out at school sites to benefit the most needy schools in the district."

Holmquist did not specify how much additional funding would be involved, saying that would be involved in settlement negotiations.

In 2013, Gov. Jerry Brown and California lawmakers enacted a new K-12 statewide funding formula, promising to pump more money into schools and more flexibility for districts in how they decide to spend that money — so long as that additional funding helped three groups of needy children: low-income kids, English learners and foster youth.

L.A. Unified has received more than $3.8 billion in additional funding under that new formula. But plaintiffs charge, every year, the district has been unfairly counting $450 million it spends on a fourth high-need group — special education students — as money it’s spending on low-income kids, English learners and foster youth. (The state and federal governments fund special education separately; many advocates argue special ed has long been underfunded, particularly at the federal level.)

District officials have argued the way L.A. Unified accounted for this funding was fair — 79 percent of the students who receive special education services also fall into at least one of the three high-need groups.

But the effect, plaintiffs have said, is that L.A. Unified has shortchanged low-income students, English learners and foster youth in order to meet its special education obligations. That, plaintiffs have argued, violates both the spirit and letter of the law.

California Department of Education officials haven’t exactly endorsed the plaintiffs’ position. In June 2016, however, the state did hand plaintiffs a victory when they ruled L.A. Unified had to re-calculate how much it was spending on these three high-needs groups. After months of back-and-forth with the state, L.A. Unified incorporated a “realignment exercise” into the budget school board members passed last month.

Attorneys for the plaintiffs released a statement saying they were "pleased" that the board authorized the settlement in principle.

"We confirm," the statement read, "that it is an agreement to give money over three years to certain schools to provide additional services to high-need students, which has been our goal all along. This is in addition to the relief ordered by the California Department of Education."

Ref Rodriguez, after presiding over his first meeting as L.A. Unified board president Thursday, said he voted to authorize the settlement in order to help the district move on from the contentious litigation.

“We want to start a new day,” Rodriguez said. "We want to move in a direction that helps us all focus on the important things we have on our agenda.”

This post has been updated to include the statement from the plaintiffs' attorneys.