Plan May Transform Schools

California education secretary Richard Riordan and a close group of advisors are formulating plans to radically alter the way the state’s 8,000 public schools are funded and managed.

Riordan’s team wants to increase the power of individual campuses, with state money following students to schools, rather than being allocated by school districts’ central administrations.

Principals would act as entrepreneurs, exerting significant new control over their budgets and staffing, while students would be free to attend the public schools of their choice.

Riordan and his advisors also want to rewrite the state’s complicated school-funding formulas so that an adequate amount of money flows to campuses with large numbers of needy students, such as those from low-income families or those still learning English.

The new system would not increase overall state spending on education, but the Republican education secretary said his goal is to help “inner city schools” close the academic achievement gap between rich and poor.

“I am doing what Gov. Schwarzenegger promised during his campaign by putting the power down at the schools, with the principal, the parents and the teachers,” Riordan said in an interview. The former Los Angeles mayor added that sending more money to schools in low-income areas was a matter of “moral fairness.”

Schwarzenegger spokeswoman Ashley Snee said her boss, like Riordan, wants to return power to schools. But the governor has yet to take a position on Riordan’s proposals.

Riordan’s ideas would require legislative approval, and many of the details, particularly on the funding formulas, have yet to be established. But the general outlines have gained support among some key Democratic leaders in the state Legislature who share Riordan’s views that the current funding system is overly complex, wasteful and inequitable.

However, Riordan’s plans could face opposition from teachers unions and elected school boards. Both groups worry that their members would lose influence, even though Riordan insists that newly empowered principals would be expected to work hand in hand with teachers, parents and district administrators.

And the plans could trigger an outcry from suburban parents, who could see their schools’ funding cut.

“This would turn the current system completely upside down,” said Kevin Gordon, executive director of the California Assn. of School Business Officials. “I don’t know that the governor himself is going to embrace this thing carte blanche.”

Riordan’s plan would depart from a nearly decade-long trend toward standardization in California’s public schools. He said he didn’t want to fiddle with the state’s new academic subject standards, which are credited with helping boost test scores, and hadn’t decided about whether schools or district administrators should choose curricula for individual campuses. But he said he was sure the current school-funding system must change.

The state now sends districts about $4,700 for each student to pay for teachers’ salaries, school maintenance and other expenses. (In all, districts will receive nearly $30 billion this year in these general funds.)

The state also gives districts extra money (about $12 billion this year) to pay for more than 100 “categorical programs,” which support low-income students, special education classes, integration programs, smaller classes in kindergarten through third grade, and other specific needs.

Riordan called the system so “complicated and screwed up” that it was impossible to know precisely how much actually flowed to students. He and his advisors want state money to go more directly to schools, in the hope of reducing bureaucratic expenses and freeing more dollars for teachers’ salaries and classroom expenses.

Under the “weighted student formula” approach envisioned by Riordan, each of California’s 6 million public school students would generate a basic -- and yet-to-be-determined -- amount of money for the student’s campus. Students with greater needs, such as English learners or those from low-income families, would bring an also-undetermined extra amount. Campuses with fewer needy students, presumably including those in affluent suburbs, could lose funds, officials say.

Teachers union leaders said Riordan’s plans could clash with contracts that set salary guidelines and guarantee workplace rights and a hand in some spending decisions.

“The only way a system ... is fair is if teachers and the community have an equal partnership,” said Barbara Kerr, president of the California Teachers Assn. and one of several people advising Riordan. “I’m not going to abrogate the rights of teachers. This is definitely a work in progress.”

Other educators, doubting that principals have the expertise to oversee multimillion-dollar budgets, said the state could create fiscal chaos.

In a few months, a new state commission created by the Legislature will begin studying how much money it takes to provide students with an adequate education. The commission is expected to take a hard look at Riordan’s ideas.

Although other efforts to simplify education funding have failed in the past, some key Democratic members of the Legislature believe Riordan’s proposals may offer a fresh solution.

“Everyone is looking for a way to achieve equity in schools so that all kids get a quality education,” said state Sen. Dede Alpert (D-Coronado), who is very influential on education and believes Riordan’s ideas have merit. “Changing something for 6 million kids is not easy, but I think we should try.”

State Sen. John Vasconcellos (D-Santa Clara), chairman of the Senate Education Committee, agreed. “The ideas are interesting. They could be valuable,” he said. “The issue is whether they can be designed with protections to ensure they will work.”

He and Assemblywoman Jackie Goldberg (D-Los Angeles) plan to introduce legislation next month that would start fleshing out the details of such changes.

Goldberg said: “If you craft this correctly, you unleash a lot of creative forces at individual schools by empowering a principal to work with his or her education community in trying to close that gap between low-income kids and higher-income kids.”

Riordan and others in the Schwarzenegger administration also believe that the new approach could help resolve a 4-year-old lawsuit by the American Civil Liberties Union. The suit alleges that the state denies tens of thousands of minority and low-income students an equal education by keeping them in substandard schools that lack textbooks and trained teachers.

Former Gov. Gray Davis fought the suit, and his administration racked up nearly $20 million in legal fees.

Riordan and others affiliated with Schwarzenegger have expressed a desire to settle. Riordan’s advisors have involved one of the plaintiff’s lead attorneys -- ACLU’s Southern California legal director, Mark Rosenbaum -- in their meetings to develop the new funding models.

“Fresh air is coming from Sacramento,” Rosenbaum said. “I think Secretary Riordan is genuinely committed to identifying the inequities wherever they exist and correcting them for the most disadvantaged students in the state.”

To formulate his proposals, Riordan has relied mostly on a group of longtime confidants referred to as the “shadow government” by some Sacramento officials. Among these advisors are Occidental College President Theodore Mitchell, Los Angeles philanthropist Eli Broad and UCLA management professor William G. Ouchi, who served a stint as Riordan’s mayoral chief of staff.

The group also has tapped superintendents from some of the state’s largest school systems, including Alan Bersin of the San Diego Unified School District and Dave Gordon of the Elk Grove Unified School District in the Sacramento area.

Much of the plan relies on the research and ideas of Ouchi, who recently published a new book, “Making Schools Work,” in which he argues that successful school districts give principals more freedom and let schools control their budgets.

Ouchi did not return phone calls seeking an interview. But in his book, he singled out several districts that he said use these practices with success, including those in Houston, Seattle and Edmonton, Canada.

Edmonton’s superintendent, Angus McBeath, offered words of warning for California: Improving schools is far more complicated than altering funding formulas and empowering principals. Schools also need to train principals and teachers better and must regularly measure student progress.

“There are no silver bullets and no shortcuts,” McBeath said. “The more skill and knowledge you have, the better you do the work. The more accountability, the better you do the work.”

Riordan, who visited Edmonton with Ouchi and a handful of California education officials recently, said he hoped that the state would take a page from the Canadian district. With such a reorganization, “you’ll need less bureaucracy,” Riordan said. “So there will be more efficiency. And there will be more money.”