What a state takeover of a school district looks like in the end can vary, but those involved in districts already under state control agree it’s a situation to be avoided.
Assembly Bill 1200 was implemented in 1991 and established the process for the state to take over financially challenged school districts.
California has taken over eight districts since then, including King City Joint Union, Richmond/West Contra Costa, Coachella Valley Unified, Compton Unified, Emery Unified, West Fresno Elementary, Oakland Unified and Vallejo City Unified, according to the California Department of Education.
“Each of them got in it a different way, and each got out a different way. Some were a friendly takeover and some were not so happy. … It’s not easy to be taken over. Nobody wants to be taken over,” state Department of Education Information Officer Tina Jung said. “The state law is really a point of last resort.”
Oakland Unified board President Jody London said her school district was taken over by the state between 2003 and 2009.
“Local preference and priorities, at least in our experience, are not taken into account (during a state takeover),” she said. “You get in there and have no ability to control the fate of your children. It’s very frustrating.”
Losing local authority wasn’t the only negative result of state takeover, she said.
“The main problem that we faced out of receivership, when the state was in control, they didn’t do a very good job of fixing our finances,” she said. “We had a structural deficit of about $49 million, and the state did nothing to fix that during the time they were here.”
London said the district now owes the state close to $100 million and has doubled the rate of students in charter schools. Many schools within the district had to close.
While the district has been the most improved urban district in California for seven years, “that achievement has come at a fairly high price, because we’ve been left with a lot of debt,” she said.
The situation has also restricted the district’s availability to go to the bond market since it’s not adequately staffed for audits, she said.
The district also has to pay a trustee appointed by the state $125,000 a year as long as the district owes the state.
Four school districts in California have outstanding loans from state takeovers, and more than $220 million in emergency apportionment loans have been allocated to school districts in 29 years, said John Hiber, chief operating officer for the office of the state controller.
Three of those four districts with outstanding loans have seen significant drops in enrollment.
Joel Montero, director of the state’s Fiscal Crisis and Management Assistance Team, said, “Impact at the local level can be devastating.”
A lot of the problems resulting from state takeovers are tied to the high debt service that came as part of changes to the state takeover process in the late ’90s, he said.
“This model may not have been really conceived or created for the kind of situations we’ll find ourselves in the next 12-24 months,” Montero said during a California State Assembly informational hearing on state school financial takeovers in August.
The hearing was called “Evaluating State Receivership: What Works, What Doesn’t and How We Can Improve the System.”
Montero said that in his experience, “depending on how effective the analysis, and planning, the creation of the fiscal recovery plan is in that formative situation, that early part of the involvement, the intervention, really is going to dictate how well that district recovers.”
Assemblyman V. Manuel Perez, D-Coachella, wrote in a letter to the Calexico Unified School District board that in the event of a state takeover, he would be willing to author and introduce a bill requesting an emergency loan.
However, he strongly urges the Calexico Unified school board to find a solution to avoid state takeover.
“Bear in mind that there are other school districts in the state that are also struggling financially and would like a loan, but their governing boards and administrations are choosing instead to make tough, unpopular decisions to reduce expenditures, including making cuts, in order to balance their budget,” he wrote in a letter to the Calexico Unified board.
Staff Writer Chelcey Adami can be reached at 760-337-3452 or cadami@ivpressonline.com.
Assembly Bill 1200 was implemented in 1991 and established the process for the state to take over financially challenged school districts.
California has taken over eight districts since then, including King City Joint Union, Richmond/West Contra Costa, Coachella Valley Unified, Compton Unified, Emery Unified, West Fresno Elementary, Oakland Unified and Vallejo City Unified, according to the California Department of Education.
“Each of them got in it a different way, and each got out a different way. Some were a friendly takeover and some were not so happy. … It’s not easy to be taken over. Nobody wants to be taken over,” state Department of Education Information Officer Tina Jung said. “The state law is really a point of last resort.”
Oakland Unified board President Jody London said her school district was taken over by the state between 2003 and 2009.
“Local preference and priorities, at least in our experience, are not taken into account (during a state takeover),” she said. “You get in there and have no ability to control the fate of your children. It’s very frustrating.”
Losing local authority wasn’t the only negative result of state takeover, she said.
“The main problem that we faced out of receivership, when the state was in control, they didn’t do a very good job of fixing our finances,” she said. “We had a structural deficit of about $49 million, and the state did nothing to fix that during the time they were here.”
London said the district now owes the state close to $100 million and has doubled the rate of students in charter schools. Many schools within the district had to close.
While the district has been the most improved urban district in California for seven years, “that achievement has come at a fairly high price, because we’ve been left with a lot of debt,” she said.
The situation has also restricted the district’s availability to go to the bond market since it’s not adequately staffed for audits, she said.
The district also has to pay a trustee appointed by the state $125,000 a year as long as the district owes the state.
Four school districts in California have outstanding loans from state takeovers, and more than $220 million in emergency apportionment loans have been allocated to school districts in 29 years, said John Hiber, chief operating officer for the office of the state controller.
Three of those four districts with outstanding loans have seen significant drops in enrollment.
Joel Montero, director of the state’s Fiscal Crisis and Management Assistance Team, said, “Impact at the local level can be devastating.”
A lot of the problems resulting from state takeovers are tied to the high debt service that came as part of changes to the state takeover process in the late ’90s, he said.
“This model may not have been really conceived or created for the kind of situations we’ll find ourselves in the next 12-24 months,” Montero said during a California State Assembly informational hearing on state school financial takeovers in August.
The hearing was called “Evaluating State Receivership: What Works, What Doesn’t and How We Can Improve the System.”
Montero said that in his experience, “depending on how effective the analysis, and planning, the creation of the fiscal recovery plan is in that formative situation, that early part of the involvement, the intervention, really is going to dictate how well that district recovers.”
Assemblyman V. Manuel Perez, D-Coachella, wrote in a letter to the Calexico Unified School District board that in the event of a state takeover, he would be willing to author and introduce a bill requesting an emergency loan.
However, he strongly urges the Calexico Unified school board to find a solution to avoid state takeover.
“Bear in mind that there are other school districts in the state that are also struggling financially and would like a loan, but their governing boards and administrations are choosing instead to make tough, unpopular decisions to reduce expenditures, including making cuts, in order to balance their budget,” he wrote in a letter to the Calexico Unified board.
Staff Writer Chelcey Adami can be reached at 760-337-3452 or cadami@ivpressonline.com.
