L.A. Schools Cut Back Further to Erase $130-Million Deficit

The Los Angeles Unified School District board closed a $130-million gap in this year’s budget Tuesday by approving measures that will nearly empty the district’s emergency reserve account and expand a spending freeze on office and school supplies.

The board approved a package of recommendations to balance the budget by taking more than $28 million from the district’s $31-million emergency reserve account, deferring $87 million in payments to three self-insurance funds and continuing a spending freeze on classroom and office supplies to save $7 million.

The board had until Tuesday to rectify the projected $130-million budget shortfall. The deficit was discovered last month during preparation of an interim financial report required by state law on the district’s expenditures and income through December.

Board member Mark Slavkin, who voted against six of the 15 recommendations, said steps need to be taken to ensure that such budget miscalculations do not occur again.

“The bottom line is we dug a much bigger budget problem for next year,” Slavkin said, referring to the district’s obligation to pay back funds deferred from the insurance accounts. Robert Booker, the district’s chief financial officer, said the district has sufficient funds to pay claims for the current fiscal year. Recommendations will be made to possibly stagger repayment to the workers’ compensation and liability funds over a two- to three-year period, he said.

Booker added that several steps will be taken to better the current budget cross-checking system, including monthly staff reports to him on the district’s financial status.

However, Booker emphasized that the district must offer fiscal projections for the entire year based on current financial information.