LAUSD spends $30K per student

On my browser, at least, the spreadsheet is just unreadable.

In fairness to LAUSD, if they passed several recent bonds and spent the money on buildings that particular year, it could make the costs look unusually high.

They should count capital costs, but they should also count them on a reasonable time scale. If I take out a mortgage and buy a house, it would be misleading to say my living expenses were X-hundred thousand dollars that year.

Reply to Bruce Ross comment – Re:”They should count capital costs, but they should also county them on a reasonable time scale.”

Mr Ross: Are you a graduate of the L.A. Unified School District? Apparently Adam Schaeffer of Cato Institute did count the amortized cost of Prop 55. Prop 55 was $12,300,000,000 of which $823,000,000 was annual debt payment, reflecting 6.69% of the total bond.

Sorry, the words “amortize” or “bond” just don’t appear in Schaeffer’s article. He says the real costs include capital costs, but doesn’t say how they were tallied.

It’s Seiler who mentioned the cost of the debt service on Prop. 55. And again, that’s a perfectly sound thing to count. It’s not clear that that is the methodology used in Schaeffer’s report.

On a related note, check out the L.A. Times Op-Ed about charter-school construction costs and LAUSD’s standard construction costs. $580 million for the RFK Community Schools cluster — $140,000 per student seat — just astonishing.

So, LAUSD is spending $73,350 per GRADUATE per year?

Mr. Seiler,

Thank you for sending me the spread sheet Adam Schaeffer used to calculate his LAUSD per student spending figure. I was asked to review Dr. Schaeffer’s original Cato piece by the Education in the Public Interest Center, http://epicpolicy.org/files/TTR-CatoSpendWhat-Altemas.pdf. A condition for writing the review was that I not contact Dr. Schaeffer, so my comments on his methods involved more conjecture than I would have liked.

I have no idea whether the LAUSD spends too much or too little on its students. I do know that Schaeffer’s figures are misleading. In the review I found two major problems. He claimed to count both capital expenditures and debt service. And he apparently used authorized rather than estimated figures.

In his response to readers’ reactions above, Schaeffer addresses the former.

“In order to get a clear picture of the burden on taxpayers, we can either include current bond-funded-capital-expenses+debt interest or no-bond-funded-captital+principal+interest payments. . . I prefer to include all capital+interest against no-bond+all debt service in order to provide citizens with a picture of the current investment and future debt commitments made on their behalf.”

Schaeffer’s all capital plus interest method does not give a clear picture of the burden on taxpayers because taxpayers do not pay directly for most capital expenditures. Taxpayers pay the interest and principal on bonds or other borrowing. Proceeds generated by the borrowing pay for the immediate cost of the capital expenditures. If you buy a car for $20,000 and take out a $20,000 loan to pay for the car, not many would consider the first year cost to be the $20,000 purchase price plus the first year’s interest on the loan. The impact on you as a consumer, or taxpayer, would be the principal and interest you pay in that year.

He goes further: “But this is an inaccurate accounting of the total resources needed to run a district in any given year, which would include all bond revenue and total debt service . . .” He follows with a tortured analogy that would make no distinction between running up credit card debt on a trip to Las Vegas and borrowing to purchases a home. Any reputable form of accounting makes a distinction between current operating expenditures and capital expenditures. In Schaeffer’s model, the entire cost of building a school to serve generations of students would be placed on students enrolled in the year the project was authorized. Then the cost of debt service would show up each year until the debt was repaid.

The only reason I can imagine for Schaeffer’s use of authorized rather than estimated expenditures is that the authorized amount says something about future obligations. Authorized expenditures are the amount a district is approved to spend. Estimated expenditures are the amount it expects to spend in a given year. One of the many differences between capital and current expenditures is that funding for capital expenditures, and for related borrowing, is often authorized for several years at a time. My guess is that the LAUSD authorized capital expenditures that were not intended to be made in the estimated year. Even if you accept Schaeffer’s process, it seems to me that dividing estimated expenditures by a student count would produce a number, still plagued by double counting, closer to what he claims to want.

Schaeffer is correct that capital expenditures and debt service need to be accounted for. In the LAUSD they are. He finds them. But it is misleading to include expenditures designed to provide value over time in a single year cost per student figure. It is worse than useless. Suppose all districts in California followed Schaeffer’s advice. It may be that LAUSD is large enough that it has a relatively stable amount of new capital expenditures every year. But the per pupil costs of smaller districts will explode in the years when they undertake capital construction. One of the most reliable ways available to voters for deciding whether district education spending is reasonable is comparison of spending per student with similar districts. Such comparisons become impossible if in any given year the per pupil figure may include expenditures on a new capital project.

I appreciate your efforts to understand a complicated subject and hope you will take it further.

Best of luck in your endeavor.

What about all the stolen money? They have J.O.C. contracts with contractors and they easily manipulate the prices. They sandblasted Kester Elementary school. It had lead material in it. They didn’t have any containment! 40 PRESCHOOLERS EXPOSED!!! WELL DOCUMENTED EVENT!! nothing happened. Contractors still doing work there and the parents weren’t notified. The proof is there but they have their own Inspector General, so they keep stealing.

Hello,
My son goes to elementary school in Los Angeles(LAUNSD.) Every time something goes wrong, like a tussle in the yard or slow performance or an art project that doesn’t meet the teachers approval it is automatically the nine year olds fault. One source, CalWatchDog, says LAUSD spends $29, 780 on every student and even the district owns up to $11,000 per student per year. That’s a lot of money in a class with 25 students. Yet its always my kids fault when things go wrong. Where is the accountability?