L.A. School Board Gets Mixed Financial Forecast

The Los Angeles Board of Education received a good news / bad news fiscal forecast Monday, one that advocated cautious spending through the end of the century.

On the positive side, the nation’s second-largest school district faces three years of rapidly growing revenues thanks largely to the state’s continued economic recovery.

But coupled with that rise will be unprecedented enrollment gains atop the record 667,000 reached last fall--about 34,000 more students by 2000--straining the district’s finances.

Supt. Sid Thompson described the first-ever long-term forecast as cautiously optimistic, advocating fiscal prudence to avoid the fat times / lean times cycle that forced radical reductions in the late 1980s and early 1990s--when enrollment dropped, causing revenues to plunge as well.

“Obviously, this is not the message we’d prefer to hear,” said Thompson, who is leaving the post June 30. “We’d all like to have enough money to fully implement class-size reduction, to reinstitute programs decreased or eliminated in past years, and to provide to our employees a much-needed and much-deserved salary increase of major proportions.”

The district expects to have its general fund revenues increase from $3.8 billion in 1997-98 to $4 billion in 1999-2000. During the same period, however, costs are expected to rise at an even faster pace.

Those estimates do not include additional money that comes to the district earmarked for such uses as special education. Nor does it include the additional costs of extending a statewide effort to cut the size of classes to 20 students beyond first and second grades.

Furthermore, it does not provide for additional classrooms--through portable buildings, additions or new schools--to house the burgeoning student body.

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School board discussion of the financial forecast slipped into a mini-commercial for the district’s $2.4-billion school construction bond, which will appear on the April ballot after a narrow miss in November.

“Should we not pass that bond, our children will really be in bad shape,” said board member Barbara Boudreaux, mentioning the $600 million in backlogged maintenance that would not be paid for under the current budget forecast.

In other business, the board:

* Agreed to create a special audits branch to help protect the district against fraud such as that perpetuated by the Institute for Successful Living. The ISL scam, which cost the district more than $70,000, ended with the sentencing of the program’s director last week. The unit would cost about $348,000 a year, but board President Jeff Horton said that would be a small price to pay to send a clear message that “we will find fraud and weed it out.”

* Applied to the state for funding to convert the former Otis College of Art and Design near downtown into an elementary school, which will cost about $2.7 million.