Schools Lose Appeal Over Teacher Pay : Education: An appellate court refuses to overturn a ruling that temporarily halted a deep salary cut. District will dip into emergency fund to issue paychecks.

The Los Angeles school district lost its appeal Monday of a temporary court order that blocked deep teacher salary cuts and now must pay out $20 million this month from its emergency fund, pushing the district another step closer to insolvency.

Saying that the district did not show it would suffer “irreparable harm” by having to issue supplemental paychecks to 38,000 teachers, the state Court of Appeal refused to overturn a lower court ruling that temporarily halted a cumulative 12% pay cut for teachers.

The ruling does not affect the status of a Los Angeles Superior Court hearing scheduled Nov. 25, when a judge is expected to decide whether the higher salaries should prevail for the rest of the school year.

In a four-paragraph ruling issued late Monday, Justices Mildred Lillie and Fred Woods denied the district’s request for an emergency stay of the lower court’s ruling and denied another request that the appellate panel take over the case, saying such action would be premature in view of the Nov. 25 proceedings.

The ruling said the denial of the appeal “in no way indicates any views of this court” on the legal issues raised.

Los Angeles Supt. Sid Thompson said he was disappointed, but not surprised, by the swift decision from the court. The district had filed its appeal Friday, arguing that making even one payment to teachers would push the district into insolvency because “there is not budget support available.”

Dick Fisher, an attorney with O’Melveny & Myers and the district’s chief labor union negotiator, said “it is difficult to get the Court of Appeal to hear a case that is still pending in trial court. . . . We were really asking for extraordinary relief.”

Thompson said that although the district could take the issue to the Supreme Court, officials will “probably wait until the Nov. 25 ruling” before launching another appeal.

The checks will be issued on or before the Nov. 24 court-imposed deadline, Thompson said. The money will be drawn from a $31-million pool of emergency funds, bringing that account far below the state-required minimum of 1% of the district’s $3.9-billion budget.

If the district loses in court Nov. 25, Thompson said, the “second payment begins a very ugly process” because the budget will be out of balance. Under state law, the county’s Department of Education has the authority to take over the district’s financial decision-making when the budget is deeply troubled.

United Teachers-Los Angeles President Helen Bernstein, who sharply criticized the district’s contention that one month’s payments would lead to bankruptcy, was reluctant to call the ruling a victory for teachers.

“This is representative of how the district handles things, though,” she said. “They exaggerate things to the point that people don’t believe them. How could they say they are going to go bankrupt in one month.”

The union went to court two weeks ago in a last-ditch attempt to forestall the Nov. 6 pay cuts. To make up for an unprecedented $400-million budget shortfall, the school board in October imposed the cuts, ranging from 6.5% to 11.5% on all district employees, on top of a 3% cut last year.

School board President Leticia Quezada is pessimistic that the district will win at the upcoming hearing before Judge Stephen E. O’Neil. She said school officials are researching what would happen if the district becomes insolvent.

“It’s my contention we are going to lose on the 25th,” she said. “There is no reason for changing his (the judge’s) opinion.”

The unexpected temporary ruling injected a strong dose of confusion into the district’s negotiations with the teachers union.

Bernstein and Thompson met Monday morning for another round of talks. Their strategy has been to work on a new offer that can be quickly put up for a vote of union membership if the union loses in court.

Bernstein described the most recent negotiations with Thompson as amicable, but said the board appears unwilling to make difficult decisions that will lead to a new offer. The union is pushing for a guarantee that salaries will not be cut next year.

School board member Warren Furutani described the negotiations as “getting really productive.” He said he would agree to the guarantee, but is the sole board member to take that position.