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	<title>teacher union power &#8211; CalWatchdog.com</title>
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		<title>School bond problems go far beyond LAUSD purchase of iPads</title>
		<link>https://calwatchdog.com/2015/02/03/bond-problems-go-far-beyond-lausd-purchase-of-ipads/</link>
		
		<dc:creator><![CDATA[Chris Reed]]></dc:creator>
		<pubDate>Tue, 03 Feb 2015 19:00:41 +0000</pubDate>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Corruption]]></category>
		<category><![CDATA[Education]]></category>
		<category><![CDATA[Inside Government]]></category>
		<category><![CDATA[News Media]]></category>
		<category><![CDATA[Regulations]]></category>
		<category><![CDATA[Taxes]]></category>
		<category><![CDATA[Waste, Fraud, and Abuse]]></category>
		<category><![CDATA[routine maintenance]]></category>
		<category><![CDATA[teacher pay]]></category>
		<category><![CDATA[bond scams]]></category>
		<category><![CDATA[30-year borrowing]]></category>
		<category><![CDATA[capital appreciation bonds]]></category>
		<category><![CDATA[CFT]]></category>
		<category><![CDATA[teacher union power]]></category>
		<category><![CDATA[Chris Reed]]></category>
		<category><![CDATA[John DeBeck]]></category>
		<category><![CDATA[CTA]]></category>
		<category><![CDATA[George Skelton]]></category>
		<category><![CDATA[iPads]]></category>
		<category><![CDATA[LAUSD]]></category>
		<category><![CDATA[Los Angeles Unified]]></category>
		<guid isPermaLink="false">http://calwatchdog.com/?p=73274</guid>

					<description><![CDATA[Gov. Jerry Brown&#8217;s skepticism about state assistance for local school districts&#8217; construction projects appears to be primarily based on an intense disdain for adding more billions to what he likes]]></description>
										<content:encoded><![CDATA[<p><img fetchpriority="high" decoding="async" class="alignnone size-full wp-image-69496" src="http://calwatchdog.com/wp-content/uploads/2014/10/Los-Angeles-Unified-School-District-LAUSD.png" alt="Los Angeles Unified School District, LAUSD" width="300" height="300" align="right" hspace="20" srcset="https://calwatchdog.com/wp-content/uploads/2014/10/Los-Angeles-Unified-School-District-LAUSD.png 300w, https://calwatchdog.com/wp-content/uploads/2014/10/Los-Angeles-Unified-School-District-LAUSD-219x220.png 219w" sizes="(max-width: 300px) 100vw, 300px" />Gov. Jerry Brown&#8217;s skepticism about state assistance for local school districts&#8217; construction projects appears to be primarily based on an intense disdain for adding more billions to what he likes to call the state&#8217;s &#8220;wall of debt.&#8221;</p>
<p>But a counter narrative is emerging that suggests the real problem is that all school districts are being unfairly tarred with skepticism over their bonds because of high-profile problems that Los Angeles Unified has had with its use of $1.3 billion in bond funds to buy iPads and laptops. George Skelton&#8217;s <a href="http://www.latimes.com/local/politics/la-me-cap-school-bonds-20150202-column.html?track=rss" target="_blank" rel="noopener">latest column</a> &#8212; headlined &#8220;Don&#8217;t punish other districts for L.A. Unified&#8217;s problems&#8221; &#8212; makes this case.</p>
<p>However, those who pay attention to education issues (and/or Cal Watchdog) know that there are a wide range of scandals involving school bonds that go far beyond the controversial practice of using borrowed money to purchase short-lived technology. Here&#8217;s a short list:</p>
<p><strong>Capital appreciation bonds</strong></p>
<p>This is from a 2013 L.A. Times story:</p>
<div id="mod-a-body-first-para" class="mod-latarticlesarticletext mod-articletext">
<p><em>Two hundred school districts across California have borrowed billions of dollars using a costly and risky form of financing that has saddled them with staggering debt, according to a Times analysis.</em></p>
<p><em>Schools and community colleges have turned increasingly to so-called capital appreciation bonds in the economic downturn, which depressed property values and made it harder for districts to raise money for new classrooms, auditoriums and sports facilities.</em></p>
<p><em>Unlike conventional shorter-term bonds that require payments to begin immediately, this type of borrowing lets districts postpone the start of payments for decades. Some districts are gambling the economic picture will improve in the decades ahead, with local tax collections increasingly enough to repay the notes.</em></p>
<p><em>CABs, as the bonds are known, allow schools to borrow large sums without violating state or locally imposed caps on property taxes, at least in the short term. But the lengthy delays in repayment increase interest expenses, in some cases to as much as 10 or 20 times the amount borrowed.</em></p>
<p><strong>Shady bond firms</strong></p>
<p>The Orange County Register, also in 2013, had a<a href="http://www.ocregister.com/news/bonds-496091-school-bank.html" target="_blank" rel="noopener"> long analysis</a> piece that pointed out how one Missouri firm orchestrated 60 dubious bond deals as a one-stop shop &#8212; coming up with the financial details, then helping market the proposals to voters. The story noted how this practice ignored state &#8220;laws, rules and guidelines&#8221;:</p>
<p><em>•It is illegal for California school officials to hire political consultants with public funds to help pass bond measures. Using the bank&#8217;s political consultants is not a legal way around that law, according to the state Office of Legislative Counsel.</em></p>
<p><em>•Finance experts advise school districts to sell bonds through public auctions to get the lowest interest rate and to employ independent financial advisers to review the details. Placentia-Yorba Linda, like most of Baum&#8217;s California school clients, did neither.</em></p>
<p><em>•State law requires that donated consulting work on an election be reported as an in-kind, or non-cash, political contribution. Baum did not disclose its consulting role on state campaign filings in three elections the Orange County Register reviewed.</em></p>
<p><strong>Use of 30-year borrowing to pay for maintenance</strong></p>
<p>School districts used to face tough rules on use of borrowed funds, including a requirement that school buses paid for with loans had to last at least 20 years. But as I wrote <a href="http://calwatchdog.com/2012/09/24/what-school-bonds-pay-for-from-san-diego-to-burlingame-the-crime-is-whats-legal/" target="_blank">for Cal Watchdog in 2012</a>, it&#8217;s now common for bond dollars to be used for &#8230;</p>
<p><em>&#8230; the most routine maintenance, such as painting and minor repairs. [San Diego Unified&#8217;s] Proposition Z, on the November ballot, also includes repair funds for schools that just opened five years ago.</em></p>
<p><em><img decoding="async" class="alignnone size-full wp-image-73287" src="http://calwatchdog.com/wp-content/uploads/2015/02/debeck.jpg" alt="debeck" width="104" height="117" align="right" hspace="20" />John DeBeck, a San Diego school board member from 1990-2010, told me using bond funds to supplant operating funds has gotten far more brazen in recent years. He said that bonds could easily be written to make the supplanting of general fund spending with bond fund spending impossible, but that such language was increasingly rare. DeBeck also said bond trickery used to be more likely from district staff, but now it was likely to be cooked up by staff in cahoots with trustees.</em></p>
<p><strong>What motivates bond maneuvers?</strong></p>
<p>DeBeck and several education insiders have told me that the bond shenanigans are driven by political pressure to free up operating funds in the general budget &#8212; pressure from teacher unions seeking higher pay.</p>
<p>This theory is disputed by some school district superintendents. They depict their bond decisions as being driven by unpredictable state financing and say iPads are paid off quickly, not over 30 years.</p>
<p>However, the DeBeck theory is in keeping with <a href="http://calwatchdog.com/2015/01/25/lao-report-hints-school-districts-not-even-trying-to-follow-law/" target="_blank">recent attempts</a> in districts around California to divert Local Control Funding Formula dollars from their intended use &#8212; to specifically help English-learner students &#8212; to teacher compensation.</p>
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		<post-id xmlns="com-wordpress:feed-additions:1">73274</post-id>	</item>
		<item>
		<title>Absurd Prop 2 provision shows extent of teacher unions&#8217; clout</title>
		<link>https://calwatchdog.com/2014/09/17/absurd-prop-2-provision-shows-extent-of-teacher-unions-clout/</link>
					<comments>https://calwatchdog.com/2014/09/17/absurd-prop-2-provision-shows-extent-of-teacher-unions-clout/#comments</comments>
		
		<dc:creator><![CDATA[Chris Reed]]></dc:creator>
		<pubDate>Wed, 17 Sep 2014 13:45:41 +0000</pubDate>
				<category><![CDATA[Blog]]></category>
		<category><![CDATA[Inside Government]]></category>
		<category><![CDATA[News Media]]></category>
		<category><![CDATA[Pension Reform]]></category>
		<category><![CDATA[Politics and Elections]]></category>
		<category><![CDATA[Waste, Fraud, and Abuse]]></category>
		<category><![CDATA[Proposition 2]]></category>
		<category><![CDATA[teacher union power]]></category>
		<category><![CDATA[Sacramento Bee Fact Check]]></category>
		<category><![CDATA[worst fact check in world history]]></category>
		<category><![CDATA[CFT]]></category>
		<category><![CDATA[LCFF ploy]]></category>
		<category><![CDATA[Chris Reed]]></category>
		<category><![CDATA[CTA]]></category>
		<category><![CDATA[David Siders]]></category>
		<category><![CDATA[Jerry Brown]]></category>
		<category><![CDATA[Prop. 30]]></category>
		<category><![CDATA[LCFF]]></category>
		<guid isPermaLink="false">http://calwatchdog.com/?p=68119</guid>

					<description><![CDATA[If you want an example of just how powerful the teachers unions are in Sacramento, consider Proposition 2. The measure was placed on the November ballot by the Legislature at]]></description>
										<content:encoded><![CDATA[<p><img decoding="async" class="alignnone size-full wp-image-68126" src="http://calwatchdog.com/wp-content/uploads/2014/09/cta.in_.charge.jpg" alt="cta.in.charge" width="384" height="128" align="right" hspace="20" srcset="https://calwatchdog.com/wp-content/uploads/2014/09/cta.in_.charge.jpg 384w, https://calwatchdog.com/wp-content/uploads/2014/09/cta.in_.charge-300x100.jpg 300w" sizes="(max-width: 384px) 100vw, 384px" />If you want an example of just how powerful the teachers unions are in Sacramento, consider Proposition 2. The measure was placed on the November ballot by the Legislature at the urging of Gov. Jerry Brown, who depicts it with about 70 percent persuasiveness as establishing the sort of rainy-day fund that California has always needed because of the state revenue rollercoaster.</p>
<p>The CTA and CFT would only accept this measure promoting fiscal responsibility and prudence if it included a provision <em>making it more difficult</em> for school districts to act in a fiscally responsible and prudent way! Here&#8217;s the LAO&#8217;s <a href="http://www.lao.ca.gov/ballot/2014/prop-2-110414.aspx" target="_blank" rel="noopener">description</a>:</p>
<p style="padding-left: 30px;"><em>If this proposition passes, a new state law would go into effect that sets a maximum amount of reserves that school districts could keep at the local level. &#8230; For most school districts, the maximum amount of local reserves under this new law would be between 3 percent and 10 percent of their annual budget, depending on their size. &#8230; Unlike the constitutional changes that would go into effect if Proposition 2 passes, this new law on local school district reserves could be changed in the future by the Legislature (without a vote of the people).</em></p>
<p>How hilarious. The CTA and CFT go along with state fiscal reform on the condition that local school districts be handcuffed on their own finances, freeing up more budget money for &#8212; you guessed it. Teacher compensation.</p>
<p>Last November, I outlined here how the Local Control Funding Formula &#8220;reform&#8221; ostensibly directing extra funds to struggling students got adopted <a href="http://calwatchdog.com/2013/11/13/gov-browns-ambitious-school-reform-morphs-into-union-payoff/" target="_blank">so quickly</a>. It was the cleanest possible way to pump up funding to the large urban districts with lots of English-learner students. UTLA didn&#8217;t embrace the LCFF because of social justice, blah blah blah. It was because of economic rewards. It&#8217;s now seeking to claim the bulk of the extra LCFF funds for a<a href="http://calwatchdog.com/2014/08/08/l-a-teachers-union-exposes-truth-about-local-contral-funding-formula/" target="_blank"> 17.6 percent raise</a> for UTLA members.</p>
<p>The lesson of this scam:</p>
<p style="padding-left: 30px;"><em>Like Neo figuring out how life was coded to work in “The Matrix,” everything about California politics is much easier to understand once you realize that by far the top priority of by far the state’s most powerful group is protecting the interests of veteran teachers.  &#8230; The most-ballyhooed education reform in California since Gov. Pete Wilson’s classroom-size reduction program ended up just being an elaborate way for the governor and the Legislature to reward their masters and patrons in the CTA and the CFT.</em></p>
<h3>The worse &#8216;fact check&#8217; in the history of journalism</h3>
<p>Meanwhile, over at the Sac Bee, I hope someone, anyone, is deeply embarrassed by the <a href="http://www.sacbee.com/2014/09/04/6680244/fact-check-is-brown-too-close.html" target="_blank" rel="noopener">&#8220;fact check&#8221;</a> that ran after the Kashkari-Brown debate on whether the governor is too close to teachers unions.</p>
<p>It mentions that Brown&#8217;s sponsoring charter schools while mayor of Oakland annoyed unions.</p>
<p>It <em>doesn&#8217;t mention</em> that the Brown-orchestrated adoption of Prop 30 and the LCFF steers many billions of dollars to teacher pay. Nor does it mention that the teachers&#8217; system pension funding fix adopted this year is going to be paid for with <em>90 percent</em> taxpayer funds and 10 percent teacher <a href="http://calwatchdog.com/2014/07/08/not-done-yet-feeble-calpers-reform-shows-whos-boss-in-legislature/" target="_blank">contributions</a> &#8212; contrary to Brown&#8217;s 2011 view that public employees should split the cost of pensions equally with taxpayers, and far worse for taxpayers then pension funding fixes seen at the local level in California and in other state governments.</p>
<p>This is what&#8217;s known as &#8220;context&#8221; in the news business. It is insane to have an ostensibly serious &#8220;fact check&#8221; on the relationship between the governor and the teachers unions that doesn&#8217;t mention Brown&#8217;s three gigantic favors.</p>
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