Schools Have More Money So Why the Financial Distress?

David Crane
Lecturer and Research Scholar at Stanford University and President of Govern for California

Spending on California schools is nearing $100 billion per year, more than $16,000 per student. School revenues have never been higher. Yet some school districts are making cuts. Imagine you are the parent of a child in the Oakland Unified School District, which serves nearly 50,000 children. Your child is attending a school:

  • On a state list of schools at risk of not meeting financial obligations;
  • Making cuts despite record revenues; and
  • Charged with manipulating financial records.

Every parent knows that denying a quality education to a child is a form of abuse. Surely every state legislator, governor and school board member knows it too. But where is their outrage? These problems are fixable if addressed by elected officials who care about students.

OUSD will get much worse. School budgets in California are supposed to be extra healthy during bull markets, when tax revenues swell from capital gains. But the other side of that coin is that California schools are expected to suffer financial distress during bear markets when capital gains decline. If OUSD is in trouble in the ninth year of a bull market and after the stock market has nearly quadrupled since 2009 and California enacted a 30 percent income tax increase in 2012, just imagine its finances during the next bear market.

Those are not the only problems. Under current law California school boards are prevented by the state legislature and governor from offering disproportionate pay to employees willing to work in high-poverty zones, cutting pension spending, altering tenure rules or granting principals the power to fire poorly performing employees. Those are also addressable by elected officials who care about children.

These are the times when every California governor, legislator and school board member should be required to send their child, niece or nephew to a distressed urban public school district. But they are not. So at a minimum, every political donor and voter should act as if their child is attending OUSD.

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