Schools’ State Debt Is Erased

Gov. Gray Davis has erased a $129-million bill owed by the Los Angeles Unified School District and two other school systems that received extra money after allegedly inflating student attendance figures, state officials said Wednesday.

The debt was racked up by school districts that counted all excused absences as attendance in 1996-1997, the base year used to calculate school funding ever since.

Districts were barred from counting certain excused absences toward attendance after the 1996-97 school year, but they continued to receive funding based on their inflated attendance figures.

Davis decided to forgive the outstanding debt, and to suspend future state audits of excused absences, saying that the oversight program is too costly. The state has spent $3 million a year to audit districts for excused absences since the 1996-97 school year.

“The governor’s thinking was: ‘In this fiscal climate, we shouldn’t fight with the [school districts],’ ” said Sandy Harrison, a spokesman at the state Department of Finance. “Let them keep the money that was awarded in the past.”

In addition to L.A. Unified, West Contra Costa Unified in the Bay Area and Williams Unified north of Sacramento have had their debts forgiven.

L.A. Unified makes up most of the outstanding money--$120 million.

The issue surfaced after state controller’s office audits concluded that the districts had been overpaid for attendance in 1996-97.

Officials from L.A. Unified and the other districts protested that they had counted attendance by the rules, but that those were later changed by the state.

State Controller Kathleen Connell criticized Davis’ decision to suspend further audits of excused absences, saying she will press for new oversight.

“From the viewpoint of accountability, we need to continue to keep pressure on the schools,” Connell said. “I think we have to find a way to maintain accountability on a statewide level.”