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Report of the Independent Financial Review Panel Los Angeles Unified School District Report of the Independent Financial Review Panel November 10, 2015 Prepared By: Maria Anguiano Delaine Eastin Michael Fine Bill Lockyer Darline Robles Miguel Santana Darrell Steinberg Peter Taylor Kent Wong Los Angeles Unified School District Report of the Independent Financial Review Panel November 10, 2015 Table of Contents Executive Summary ....................................................................................................................................... 4 Purpose and Scope .................................................................................................................................... 4 Overview of Findings of the Panel ............................................................................................................ 4 Defining the Challenge .............................................................................................................................. 6 Areas of Exploration .................................................................................................................................. 8 Revenues ................................................................................................................................................... 8 Recommendations .............................................................................................................................. 10 Expenditures ........................................................................................................................................... 12 Staffing and Benefits ........................................................................................................................... 12 Pensions .............................................................................................................................................. 15 Business Operations ............................................................................................................................ 15 Payroll ................................................................................................................................................. 16 Workers’ Compensation ..................................................................................................................... 16 Food Services ...................................................................................................................................... 17 Warehouse and Logistics .................................................................................................................... 18 Technology .......................................................................................................................................... 19 Programmatic Expenditures ................................................................................................................... 19 Recommendations .................................................................................................................................. 20 Staffing and Benefits ........................................................................................................................... 20 Business Operations ............................................................................................................................ 21 Programmatic Expenditures ............................................................................................................... 22 Summary of Significant Findings and Recommendations ....................................................................... 23 Issues for Immediate Action ............................................................................................................... 23 Issues to which the District Must Adapt or Accommodate ................................................................ 23 Issues for Further Study ...................................................................................................................... 23 Report of the Independent Financial Review Panel ................................................................................... 25 Scope of the Report ................................................................................................................................ 25 Methodology ........................................................................................................................................... 26 i Los Angeles Unified School District Report of the Independent Financial Review Panel November 10, 2015 Focus Area 1: Revenues .............................................................................................................................. 26 Areas Chosen for Exploration ................................................................................................................. 27 Student Attendance and Graduation Rates ........................................................................................ 27 Declining Enrollment ........................................................................................................................... 27 Graduation and Dropout Rates ........................................................................................................... 31 Findings and Recommendations ............................................................................................................. 32 Focus Area 2: Expenditures ......................................................................................................................... 34 Areas Chosen for Exploration ................................................................................................................. 35 Staffing and Benefits ............................................................................................................................... 35 Classified Staffing ................................................................................................................................ 36 Certificated Staffing ............................................................................................................................ 39 Certificated Salaries ............................................................................................................................ 42 Pensions .............................................................................................................................................. 43 Other Postemployment Benefits (OPEB) ............................................................................................ 44 Business Operations ................................................................................................................................ 45 Payroll ................................................................................................................................................. 45 Workers’ Compensation ..................................................................................................................... 49 Food Service Program ......................................................................................................................... 52 Transportation .................................................................................................................................... 53 Technology .......................................................................................................................................... 54 Programmatic Expenditures ................................................................................................................... 55 Findings and Recommendations ............................................................................................................. 56 Staffing and Benefits ........................................................................................................................... 56 Business Operations ............................................................................................................................ 57 Programmatic Expenditures ............................................................................................................... 58 Conclusion ............................................................................................................................................... 58 Issues for Immediate Action ............................................................................................................... 58 Issues to which the District Must Adapt or Accommodate ................................................................ 59 Issues for Further Study ...................................................................................................................... 59 Appendix A—Meeting Agendas .................................................................................................................. 60 ii Los Angeles Unified School District Report of the Independent Financial Review Panel November 10, 2015 Appendix B—KPI Benchmarks ..................................................................................................................... 63 Appendix C—Panel Participants ................................................................................................................. 71 iii Los Angeles Unified School District Report of the Independent Financial Review Panel November 10, 2015 Executive Summary Purpose and Scope This review was requested and this panel was commissioned
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