City Auditor Says Mayor Schaaf Misused City Money and Resources to Fund Oakland Promise

Investigation reveals nonprofit received free office space and over $700,000 in city funds to pay staffer’s salary

Oakland Mayor Libby Schaaf

By Ken Epstein

Mayor Libby Schaaf directed the city administration to make “inappropriate contributions” to her favored nonprofit organization, The Oakland Promise, bypassing the Oakland Municipal code and paying the director of Oakland Promise over $700,000 without authorization, according to the findings  of an investigation released this week by the Oakland Office of the City Auditor.

The office of the City Auditor Courtney Ruby conducted the investigation in response to multiple “whistleblower allegations” and questions raised by the City Council in June 2019.

The Oakland Promise, a nonprofit “multi-agency partnership” that includes the Mayor’s Office, the Oakland Unified School District, the East Bay College Fund and the Oakland Public Education Fund, raises money to provide scholarships and other educational opportunities for Oakland youth. The organization began in 2014, and in 2015, the Mayor’s Office joined the partnership “and assumed a leadership role in collaborating with these organizations,” according to the auditor’s report on the investigation.

In June 2019, the East Bay College Fund changed its name to Oakland Promise, which became a registered nonprofit organization.

The auditor’s investigation concluded:

  • “The Mayor’s Office directed the City Administration to provide workspace to Oakland Promise without following Municipal code requirements.” Without proper authorization, starting in 2016, the city provided three workstations, phones, computers and internet for up to five Oakland Promise employees for two years on the 11th floor of City Hall. “This arrangement … contrasts with other third-party organizations that have used city-owned real property,” the report said. “Other third-party entities using city-owned real property have formal agreements and were charged rents (and) have provided verification of insurance coverage.)”
  • “For 16 months (from July 2015 – Nov. 2016),  the Mayor’s office allowed an Oakland Education Fund employee to lead Oakland Promise as the “Mayor’s Director of Education” without executing an agreement to ensure the City’s interests were promoted and protected.”
  • Since fiscal year 2017-2018, the city has funded the Mayor’s Director of Education, who continued to work for Oakland Promise, “without authorization from the City Council as an in-kind contribution to Oakland Promise, at a cost to the city exceeding $700,000.”

The Mayor’s Director of Education, David Silver, was not mentioned by name in the auditor’s report.  “City financial records show that (David Silver) has accounted for $704,374 in direct personnel-related costs from the city’s General Purpose fund between July 1, 2017 and Nov. 7, 2019.

In August 2015, Mayor Schaaf submitted a Memorandum of Understanding (MOU) to the City Council to implement Oakland Promise, approving it herself while the council was on summer recess. A memo from the mayor stated that the “MOU has no cost implications to the City of Oakland.”

According to the auditor’s findings,“It wasn’t until June 2019 that a republic report summarized the city’s financial and in-kind contribution to Oakland Promise.”

In total, the city has contributed $4,372,428 to Oakland Promise, including authorized and unauthorized expenditures and excluding the cost of in-kind donation of office space and equipment, which is unknown.

Among its recommendations, the City Auditor suggested that the city administration “should comply with the Municipal Code in providing space to other others” and suggested that the City Council request a yearly report on leases and other arrangements with organizations that use city facilities. The auditor also suggested that the City Council develop a policy that requires in-kind contributions to be “formally authorized in advance.”

The Mayor’s Office agrees with all of the recommendations, said Justin Berton, the mayor’s director of communications.

“The Office of the Mayor is grateful for the City Auditor’s detailed report that concludes every contribution to the Oakland Promise is being used to send more kids to, and through college,” he said. “We regret, however, that in the eagerness to launch a generation-changing education initiative, we unintentionally failed to properly document the legal use of City Hall office space and a grant to support an employee’s salary. We wholeheartedly support all of the City Auditor’s recommendations that will bring clarity to this process in the future.”

Published November 22, 2019, courtesy of the Oakland Post

 

Community and Developers Ask: Why Is There so Little Money in the City’s Affordable Housing Fund?

 

Affordable housing protest at Oakland City Hall

By Ken Epstein

Where have the city’s funds for affordable housing gone?

That’s a question City Council President Rebecca Kaplan and council members want to answer as they look at why there is so little money in the city’s affordable housing trust fund at a time when booming high end construction in Oakland should be generating many millions of dollars in “impact fees” that housing developers are required to pay to avoid building a certain percentage of affordable units on a project.

Since 2016 when impact fees went into effect, the fund has only collected $8.8 million, according to a city report. Of this money, the city has committed $4.9 million to three affordable housing developments, totaling 162 units that not yet completed.

However, the city since 2016 has issued about 10,000 building permits that are moving ahead and are expected to build more than 17,000 new units by 2024, which means that  city officials could have collected an estimated $25 million in impact fees in the past four years and, as much as $50 million as the projects move toward completion.

Impact fees can cost developers between $5,000 to $24,000 for each market rate unit they build, depending on the location of the project and when the permits were issued.

In response to questions raised by Council members Kaplan, Nikki Fortunato-Bas and others, the city administration has hired an independent analyst to audit the fund and improve procedures for collecting the money.

“These are steps in the right direction, but if we are to truly meet our goal of 4,760 affordable homes by 2024 (we are at 751), we must most aggressively enact policies and procedures that accelerate affordable housing creation and funding,” said Kaplan in a letter to the council and the public.

Speaking at Wednesday evenings council meeting, Assistant City Administrator Marasheshia Smith said the full report on impact fees would be available in the spring.

“We don’t think there are missing funds,” she said, pointing out that her department is short staffed and that most of current staff members, including herself, are new. “We are trying to understand what processes were put in place to account for the funds…We would like an audit because we’d like to see some process improvement.”

Jeffrey Levin of East Bay Housing Organizations (EBHO), speaking at last week’s Community and Economic Development (CED) Committee meeting, said impact fees were supposed to be a way for the city to get private developers to help pay for affordable housing.

“It is shameful that the city cannot explain how it is in an unprecedented building boom (that) we have so little money to show for it,” Levin said. “Something is just not adding up, We don’t know what’s wrong, but nobody can explain it either, and we wait and we wait, and that waiting is not without consequence.”

“We raised this issue in January, we raised it again in May, (and) we were assured that in a couple of months an accounting would be done … Now we’re being told it will be March, April or April or May (2020) before we can see the numbers. That is just not good enough…There is no accountability and no transparency,” said Levin.

Representing developers, Greg McConnell of the Oakland Jobs and Housing Coalition said that affordable housing advocates are not the only ones who want to know what has happened to the funds.

“Developers are pretty interested in this too,” he said.

McConnell added that developers served on the Mayor’s Housing Cabinet, served on commissions and boards and helped develop the impact fee ordinance. “Little did we know it would be years down the road trying to figure where the money went. It’s a cause of great concern,” he said. “(Developers) who helped put all these cranes up that you see they have put money into the city, and the money hasn’t been spent, and the housing crisis goes unabated.”

Stevi Dawson of EBHO thanked Council President Kaplan for pushing the city to produce a report on the fees. “If she hadn’t intervened, we’d still be asking for this staff report. We need more transparency. We do not need to spend a year and a half asking for something that should be published (every year). There should be a yearly accounting.”

Published November 20, 2019, courtesy of the Oakland Post

Parents, Teachers Shut Down School Board Meeting, Protesting School Closures, Arrests

Protest at school board Wednesday evening. Photo by Ken Epstein.

By Ken Epstein

In ongoing protests, parents and teachers, including members of the Oakland Not for Sale (ONFS) coalition, shut down the school board meeting Wednesday, Nov. 14 . At one point over 200 people in the audience stood and turned their backs to the school board chanting, “No school closures, Oakland is not for sale.” Unable to continue its business, the school board moved the meeting to a private room elsewhere in the building.

A number of Oaklanders had come to the meeting in solidarity with the parents and teachers who were arrested and injured by school police at the Oct. 23 school board meeting. Before Wednesday meeting began, the Black Organizing Project (BOP) held a rally calling for defunding and dissolving the school district’s in-house police department.

Speakers at rally and school board meeting on Wednesday, November 13:

  • www.facebook.com/oaklandnotforsale/videos/576221736447010/
  • www.facebook.com/OaklandEA/videos/828526894231337/
  • www.facebook.com/OaklandEA/videos/953670491686847/

Teachers’ Union Says School District Not Honoring Labor Agreement Reached in Strike

School closures, health care coverage, student support staff are key issues

Oakland teachers went on strike against the Oakland Unified School District for seven days in February. Photo by Ken Epstein

By Ken Epstein

The Oakland teachers’ union, the Oakland Education Association (OEA) , is calling on Oakland Unified School District (OUSD) Supt. Kyla Johnson-Trammell “to immediately reverse decisions” that violate terms of the school district’s contract with teachers,  including provisions that were ratified as part of the settlement of the seven-day teachers’ strike earlier this year.

“Rank and file members are concerned that they’re not respecting our contract,” said Brian Crowell, teacher and secretary of the OEA Grievance Committee.

Brian Crowell

“We’re not talking about a grievance here or there,” he said. “We’re talking about broad violations of the contract, our fundamental collective bargaining agreement.”

Crowell said that union members are now facing “retaliation and bullying by administrators,” which he believes reflects the district’s disrespect for educators.

Although the strike is over, Crowell said that the union is continuing to organize, fighting for its members and in the interests of the community. “Our loyalty is to the students and the community. That is our primary concern,” said Crowell, adding that another major union concern is school closures.

“That was a big issue during the strike and has not been resolved. There is a disputed question whether that is a (legitimate) area of bargaining, but it is something that has a huge impact on working conditions.”

The school board has voted to close or merge several schools in 2019 and is expected to close more school sites from a list of 24 over next several years.

“School closures disproportionately harm Black and Brown students,” said the OEA in a petition it is circulating to union members. “OUSD has shown no evidence that (closures) improve learning or save money…Reinvest in our public schools, (don’t) close them,” the petition said.

The document also claims that the district withheld “$9 million from the employee healthcare fund, despite a signed settlement agreement reached in September 2018.”

The petition warned that without these payments, the fund will become “insolvent within a year” and force employees to begin to make “dramatic out-of-pocket” payments for their individual health plans.

For many years, healthcare coverage has been provided 100 percent as part of the union contract, but according to Crowell the agreement signed by the union and the district last year said that effective July 1, the district would pay $2.25 million annually until the final payment is made by June 30, 2024.

“July 1 came, and the district didn’t do it,” he said, pointing out that this issue not only effects teachers but also other school employee unions, including United Administrators of Oakland Schools (UAOS), SEIU 1021, AFSCME Local 257, as well as teamsters, building trades and others.

The OEA petition also focuses on the district’s failure to hire staff to support student learning – including newcomer teachers, speech pathologists and school psychologists – which was part of the agreement that ended the teachers’ strike in February.

In addition, the petition claims that OUSD “refused to honor our personal leave contact language.” Under the contract, teachers are entitled to five days a year of personal leave, which automatically converts to sick leave if unused. When an employee retires, accumulated sick leaves can be added to total length of service to increase pension benefits.

The district is failing to convert unused personal leave to sick leave, Crowell said.

In response to questions from the Oakland Post, district spokesperson John Sasaki said, “First and foremost, no fund is going insolvent (or even could go insolvent). This isn’t possible as the District pays its share of healthcare costs from the General Fund. Pursuant to existing agreements, we are working with all of our union partners to resolve outstanding issues related to potential healthcare set-asides by the District. We are committed to honoring our labor agreements, and addressing any concerns with interpretation, audit findings or hiring by working with OEA.”

Speaking to the school board Wednesday evening about the teachers’ union concerns, OEA President Keith Brown said, “The district is not respecting the agreement you made to hire more psychologists. You’re not respecting the agreement you made with us to hire more speech therapists (and) more newcomer staff. You are not respecting the agreement you made with us regarding our health care.

“I can’t believe what you say because I see what you do.”

Published November 15, 2019, courtesy of the Oakland Post

School Board Moves Meetings to Private Room, Excluding Public

After six parents and teachers were arrested by school police, opponents of school closures continue meeting in the boardroom. The school board had moved its meeting upstairs to a private room, Oct. 23, 2019. Photo by Alan Pursell/Facebook.

By Ken Epstein

The Oakland Unified School District (OUSD), responding to ongoing parent and teacher protests against school closings at school board meetings , moved this week’s Board of Education meeting to a private “committee room” and plan to continue to meet in private at future meetings.

“Only individuals who are presenting on specific agenda items and members of the media, except those participating in a disruption, shall be allowed to be present in the Committee Room,” according to a statement that was part of the official agenda for the Wednesday, Nov. 6 board meeting. “Members of the public will be able to make public comment and observe the meeting in the Great Room (at 1050 Second Ave.) via two-way video and audio communication,” the statement said.

In response to questions from the Oakland Post, district spokesman John Sasaki said that future board meetings will continue to be held in private.

“We hope to get back to the normal functioning of our Board meetings as soon as possible. The meetings are being evaluated on a case by case basis,” he said.

Several former board members reacted in dismay at the board’s decision to remove the public from official deliberations, which they consider a violation of the state’s open meeting law, the Brown Act.

Sylvester Hodges, who served 12 years on the board including serving as Board President, said, “That’s not a public meeting. The Brown Act doesn’t allow that. That’s a private meeting because they’re restricting people from being in the room where they are deliberating. Their action says they don’t want to see the public and hear their reactions; they want to do what they want to do without hearing from the people.

Civil Rights Attorney Dan Siegel, who served on the school board and at a different time worked as the school district legal counsel, also accused the board of violating stating law.

“It’s not even close to legal. It’s absurd. This school board is out of  control. They’re completely clueless about what is going on in OUSD. They’re presiding over the destruction  of the district, and nobody (in charge)  seems to give a damn.”

Siegel, who is representing the parents and teachers who were arrested and injured at a recent school board meeting, says he has been involved in the schools since the 1980s. Although there have been many protests over the years, he has never seen anything like the actions of the current school board, including the use of school police and security guards to arrest and injure parents at a recent board meeting

“I’ve never seen cops beat up people at a school board meeting before. This is a new thing,” he said.

Explaining the district’s rationale for closing board meetings, Sasaki said the district is acting in “accordance” with the Brown Act.

“The protestors have said they plan to try shutting down our meetings going forward,” Sasaki said. “They did that at three successive meetings and one joint City/OUSD meeting. At the last meeting which they tried to shut down, they were openly talking about doing the same thing at the next meeting. The bottom line is our Board of Education needs to meet in order to conduct the District’s business, and we can’t have that process disrupted.”

Published November 8, 2019, courtesy of the Oakland Post

Post Salon Backs Call on State Officials to Investigate and Remove FCMAT

Panelists at the Sunday, Nov. 3 Post Salon were former Roots Academy teacher Quinn Ranahan, Kaiser Elementary Parent Cherise Gash, Howard Elementary teacher Yael Friedman, Oakland teachers’ union Executive Boardmember Kampala Taiz-Rancifer, former school Boardmember Sylvester Hodges and Post reporter Ken Epstein.

By Ken Epstein

The Oakland Post Community Assembly, along with parents and teachers in the Oakland Not For Sale (ONFS) coalition, hosted a community discussion last Sunday aimed at opposing the school closures, austerity, and privatization that are threatening the future of Oakland public schools.

The gathering focused on ways to stop the closing of Oakland schools, carried out by the district under the guidance of a non-elected state-funded agency, the Fiscal Crisis Management and Assistance Team (FCMAT).

Post Salon, Nov. 3, 2019.

Attendees praised the Salon for providing rarely discussed information about the power and operation of FCMAT which began pressing the district to close schools at the time when the State took all power away from local residents in 2003  Then state administrator Randy Ward, working in tandem with FCMAT, asked an aide to find out how much money it would save to close schools. The aide returned a few days later with the information that closing schools does not save money, and Ward responded, “Then go back and find another reason for closing schools.”

The state-appointed FCMAT has continued to dominate school district decisions because of the unnecessarily large debt imposed on the district in 2003. FCMAT has at various times become the overseer to nine school districts. In every case, these districts were disproportionately Black and Latino, compared to the rest of the state.

OUSD has already closed 18 schools since the state took over in 2003, and 14 of those buildings have been taken over by charters. All of those schools served predominantly flatlands students. Other schools have lost classroom space as they have been forced to “co-locate” charters on their campuses.

This past school year, the district closed Roots International Academy and recently decided to close Kaiser Elementary and Oakland SOL. The district has committed to closing more schools over the next four years. There are 24 schools on the list of threatened sites, though OUSD has not revealed how many of them will be actually closed.

“The purpose of this salon is not to have an organized gripe session, a place to vent, but rather to take these concerns and convert them to a plan of action and a commitment to action,” said Oakland Post publisher Paul Cobb, who moderated the panel and the discussion that followed. . “The most important thing is that we need a community response and a political organizing response to put pressure for change,” he said.

Among the proposals raised by various individual participants was running a slate next year of four school board candidates who are committed to fighting for the community.   Others proposed a recall of school board members. And others planned to set up a meeting with Oakland’s state legislators and Superintendent of Public Instruction Tony Thurmond to discuss the unfair aspects of Oakland’s debt and FCMAT’s actions.

Parents and teachers who are members of Oakland Not for Sale asked for the community to attend the next school board meeting to protest school closures and school board violence, Wednesday, Nov. 13, at 4:30 p.m. at La Escuelita Elementary at 1050 Second Ave. This meeting will give the community a chance to show that the community is not intimidated by the district’s use of police.

The first of the six panelists was Cherisse Gash, a parent from Kaiser Elementary, who said she attended Kaiser as a child and chose Kaiser for her child. “Without fail, the school did exactly did what they were supposed to do for my son. They loved him. They made sure he felt encouraged as a student.”

“We are going to fight for our schools,” she said. “We need board members that support students first.”

Another speaker was Roots teacher Quinn Ranahan, who fought to save her school. “It was a really beautiful place. I loved my kids. There was something that was really magical happening there.”

Central office administrators showed up last December to notify the school community that Roots would close in June. Ignoring its own community engagement policies, the board also ignored the hundreds of parents, teachers and students who protested at school board meetings voting on Jan. 28 to close the school.

Many Roots students were moved to schools that are slated to close next year. “Our kids will again be in an unstable environment,” Ranahan said.

Howard Elementary teacher Yael Friedman talked about how Francophone Charter had taken over part of her school.    Under the co-location policy, it was given seven of the 16 classrooms at the school, forcing the Howard to move its reading intervention class to a closet.She said the teachers went to the school board meeting and showed them photos of the class being taught in the closet. “They said ‘Oh my goodness’ but then they said  there was nothing they could do.”

While Howard is told it is losing classrooms because it is under-enrolled, parents report they try to enroll their children at Howard and are told by the district that there is no room, said Friedman.

Representing the Oakland Education Association (OEA) was Executive Board Member Kampala Taiz-Rancifer.

“OUSD has a long legacy of closing schools, primarily in Black and Brown and communities,” she said. “They’ve been intentionally defunding our schools. We’re going to need a new school board, and) we’re trying to figure out right now how to stop these really racist practices.”

Sylvester Hodges was President of the School Board during an earlier era, when the Board prevented State take-over.  He said “You have to follow the money,” to see who will make money off school closures –  the charter schools that want the campuses and the developers property to build upscale condominiums. The attack on public schools was well planned, he said. “They have supplied the district with all the necessary ingredients to ignore us, and do what they want. They have already sold themselves out.”

This reporter spoke about the role of FCMAT, which he observed while a school district employee during the state takeover in 2003 and later as a reporter.

With FCMAT in charge, along with State Receiver Randy Ward, the word around the district was that OUSD would be drastically downsized, “small enough to hold in your hands,” cutting something like 36 schools, compared to the over 90 school sites the district had at the time.

The salon adjourned after unanimously agreeing to work on various actions, including a meeting with state elected officials.

Published November 7, 2019, courtesy of the Oakland Post

State Control Over the Oakland Unified School District, Neoliberalism, Austerity, School Closures and the Fiscal Crisis Management and Assistance Team (FCMAT)

Oakland’s state overseers (L to R): California Deputy Superintendent of Public Instruction Nick Schweizer, Trustee Chris Learned, FCMAT CEO Michael Fine and Alameda County Superintendent of Schools Karen Monroe speak at Board of Education about what the state is demanding from the school district, Oct. 24, 2018. Photo by Alyson Stamos/Oakland North.

By Ken Epstein

The following  report is an outline used by the author in a presentation hosted by Oakland Post Community Assembly and parent and teacher organizers on School Closures and the Fiscal Crisis Management and Assistance Team(FCMAT), Sunday, Nov. 3 at Geoffrey’s Inner Circle, 410 14th St. in Oakland.  

I. My Personal Experience with FCMAT

  • I discovered the existence of the Fiscal Crisis Management and Assistance Team (FCMAT) back in 2003 when the state fired Supt. of Schools Dennis Chaconas, suspended the power of the Board of Education and appointed a state receiver, Randolph Ward, to unilaterally run the school district.
  • Over the years, I have come to see FCMAT as a tool for enforcing austerity in California Public Schools, something like a local version of the International Monetary Fund (IMF), whose neoliberal policies recently sparked rebellions in Chile, Ecuador, Haiti and other countries around the world.
  • But back in 2003, I was working in the public information office of the school district. I lasted about a year until I was fired for not working out a viable strategy for convincing families and the public to accept the closing of schools.
  • State Receiver Randy Ward was a trainee of billionaire school privatizer Eli Broad’s superintendent academy, a three-month program designed to create school CEOs who were committed to corporate practices and privatization.
  • Broad, a Democrat with close ties to then State Supt. of Public Instruction Tom Torlakson (2011-2019), was allowed to use Oakland as a guinea pig/pilot program. He sent Oakland numerous “broadies,” Broad trainees or fellows, to staff senior executive positions.
  • What did receivership mean? An indicative example: I remember a school board meeting where Ward and the board were on stage. Each item on the agenda was read aloud, and Ward would say, “passed.” Then the next item was read.
  • In less than an hour, the agenda was completed. At that point, Ward said, “Meeting adjourned” and walked out of the board room and turned out the lights, leaving board members sitting in the dark.
  • Under FCMAT’s leadership, word around the district was the school district would be drastically downsized, “small enough to hold in your hands,” something like 36 schools, compared to the over 90 school sites the district had at the time.
  • Nothing was said about saving money or making the district more efficient. FCMAT’s message was that there was a ratio of the square-footage of classroom space to numbers of students. Under that ratio, the school district should have less than 50 schools, according to FCMAT (that would be 36 less than the 86 schools the district has now).
  • At a cabinet meeting of the district’s top staff, which I attended (as public information officer), Ward asked an accountant (a Broad fellow) to determine how much money would be saved by closing schools. She came back about 3 weeks later, having determined that no money would be saved by closing schools.
  • Ward told her, “Then go back and figure out another reason for closing schools.” They didn’t come up with anything but continued to say that closing schools would save money.

 

 

Some of the officials involved in the 2003 takeover of Oakland schools:(Clockwise from top): Sheila Jordan, Randolph Ward, Don Perata, Jerry Brown.

II Background of FCMAT

  • It is a QUANGO, a Quasi-Autonomous Non-Governmental Organization, which Wikipedia defines as “arm-length bodies funded by government departments but not run by them. … (pointing out that) “If they fail, the fault is theirs, rather than the government departments.”  A QUANGO is A neo-liberal form of organization that has grown a lot since the 1980s and is fairly common in the UK and Ireland.
  • FCMAT was created by Assembly Bill (AB) 1200 in 1991. The Kern County Superintendent of Schools office was selected as the administrative and fiscal agent for FCMAT. In other words, FCMAT is based in Kern County, an area of the state that is notoriously known for police violence and racism.
  • State appropriation for FCMAT in 2018-19 was about $6.3 million, plus the fees school districts are required to pay for the “aid” provided by FCMAT staff. This past school year, the district paid FCMAT and the county $1.4 million to oversee OUSD.

Striking teachers take over the ground floor of the State Building in Oakland, Thursday, Feb . 28. Photo courtesy of https://boingboing.net

III FCMAT/State Control in Oakland

  • FCMAT was riding high in OUSD during state receivership (2003-2009). In 2009, the receiver was withdrawn (partly due to pressure from then Mayor Ron Dellums and then state Assemblymember Sandré Swanson). Butthe district was left with a state trustee, with the power to nullify any district decision with budget implications. The trustees and receivers were paid out of the OUSD budget. The district has never been free from state control since 2003.
  • According to the district on its website, “(Since 2008) OUSD began operating with two governing boards responsible for policy – the state Department of Education and the locally elected Oakland Board of Education.”
  • Rather than serving as independent outside evaluators, FCMAT and the state forced Oakland to accept a $100 million bailout loan (on about a $37 million debt). The district loan payments are $6 million a year until 2026. The $100 million loan was spent unilaterally by the state Receiver Ward with no input from the community.
  • The state trustee was in place when pro-charter school and pro-privatization Supt. Antwan Wilson (2014-2017), another Broad Academy trainee, went on a wild spending spree, exhausting the district’s reserves and depleting its financial resources. Neither the trustee, FCMAT or the County Office of Education intervened, tried to halt the misspending or even said a word of criticism of the misspending after the fact.
  • As the district entered a new financial crisis in 2018 after the departure of Antwan Wilson, the state passed AB 1840, which gives FCMAT, along with the Alameda County Office of Education, the power to require the district to close and sell or lease school property and to cut as much as $30 million or more from the district’s operating budget.
  • It is important to note that AB 1840, which was backed by then Gov. Jerry Brown and state legislators who represent Oakland, was written in part of FCMAT.

IV. What they said in their own words

  • In October 2018, there was a rare joint public appearance at a local school board meeting the officials who are now in charge of the Oakland schools, including: FCMAT CEO Michael Fine, OUSD’s state-appointed Trustee Chris Learned and Alameda County Supt. of Schools Karen Monroe.
  • Speaking bluntly, FCMAT CEO Fine told the district it has no choice but to make budget cuts and close schools.
  • “If you failed at this, the county superintendent would come in and govern the district. The county superintendent already has the authority to do that, if you don’t do what’s right, to impose a functioning budget on you.”
  • We do this every day, guide districts through this every day. It is ultimately less painful to make your decisions early as possible. Cutting three dollars today rather than a dollar today, a dollar tomorrow and a dollar (later) …allows the district to get to its new norm much quicker,” he said
  • Fine said the school district has “struggled for many years” to close schools, based on a formula for the appropriate number of students for the square footage of classroom space. (While the district has already closed 18 schools, 14 of which have become charters, there are many more to close, according to Fine).
  • He pointed to Fresno as a positive example, which has similar number of students and has 50 schools.
  • He spoke about AB 1840, a law that gives the state and FCMAT more power over OUSD, and gives the district a little money in exchange for closing schools and cutting programs.
  • “That is one of the specific conditions in AB 1840,” he said. “1840 says that we are going to partner with you so that you can implement these plans in a timely fashion and buy a little bit of time, and it’s just a little bit to time, so you can incorporate good decisions.”
  • According to a FCMAT report issued in March, AB1840 provides for activities that “may include but are not limited to … adoption and implementation of necessary budgetary solutions, including the consolidation of school sites …and sale or lease of surplus property.”
  • According to FCMAT, “AB 1840 shifts the former state-centric system (of control) . Several duties formerly assigned to the State Supt of Public Instruction are now assigned to the county superintendent with the concurrence of the State Supt. and the president of the State Board of Education.”
  • While saying the district’s sole responsibility is to “close the gap” and end its “deficit,” Fine admitted closing schools does not save. money “When everything is said and done the actual dollar savings are relatively small – you don’t see the savings.”
  • Fine said that over the course of 27 years he has had a lot of experience closing schools. “I’ve had to close some…lease some… sell some and exchange some for other properties. It’s a long and difficult process,” he said.
  • He also emphasized the importance of budget cuts. “You’ve made a very public commitment to a set of reduction that total about $30 million. If you stop at $15 million, you do not achieve the benchmark … It is your job to figure out the details.”
  • The recent FCMAT report looks favorably on the district’s “Citywide Plan,” saying “the first strategy under the plan is to implement the Blueprint for Quality Schools action plan to identify four cohorts of schools changes….As a part of this plan the district will identify on a citywide map the school sites that will be closing or merging with a nearby site.”

V. Nine districts that have been taken over by the state since 1990, mostly majority Black and Latino students

  • West Contra Costa Unified School District (formerly Richmond Unified). Taken over in 1990 and paid off its loan in 2012.
  • Coachella Valley Unified, taken over in 1993 and paid off its loan in 2011.
  • Compton Unified, taken over in 1993, paid off loan in 2003.
  • The Emery Unified School District, taken over in 2001 and paid off loan in 2011.
  •   West Fresno Elementary School District, taken over in 2003,  paid off loan in 2010.
  • Oakland Unified taken over in 2003. Final payoff is scheduled for June 2026.
  • Vallejo Unified taken over in 2004, and payoff date is scheduled for 2024.
  • South Monterey County Joint Union High School district taken over in 2009 and payoff is scheduled for 2028.
  • Inglewood Unified was taken over in 2012. Payoff is scheduled for 2033.

VI Bibliography/Further Reading

Oakland teachers on strike February 2019. Photo by Ken Epstein .

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bernie Sanders Stands With Oakland City Workers

Presidential candidate Bernie Sanders meets with members of the unions fighting for a new contract with the City of Oakland, August 201. Photo courtesy of IFPTE Local 21.

By Post Staff

 

Presidential candidate Senator Bernie Sanders tweeted his support for City of Oakland workers last weekend, supporting union negotiations and calling on Oakland City administration to fill over 600 unfilled city jobs.

Senator Sanders met with some Oakland city workers in late August to learn about their efforts to improve public services amidst an under-staffing crisis.

Mayor Created Oakland Promise by Approving Resolution While City Council Was on Summer Break

City Attorney memorandum says city rules “prohibit the mayor from approving ordinances during council’s annual recess”

Oakland Mayor Libby Schaaf

By Ken Epstein

Local residents who follow city government might well wonder why Oakland City Council members allowed Mayor Libby Schaaf to set up her signature multi-million dollar college scholarship program, Oakland Promise, placing complete control of the program in the hands of the mayor with a minimum of oversight or transparency.

The short answer: they didn’t.

Oakland Promise was created and approved by Mayor Schaaf on the Mayor’s Summer Recess Agenda on Aug. 25, 2015. In other words, while the council was on its annual summer recess, the Mayor’s Office single handedly approved a Memorandum of Understanding (MOU) with the East Bay College Fund (EBCF), which went into effect in September 2015, bypassing public input and council approval.

In a legal opinion requested by Council President Rebecca Kaplan, City Attorney Barbara Parker wrote a memorandum last week, saying that the City Council Rules of Procedure 21 “prohibits the mayor from approving ordinances during the council’s annual recess.”

In response to Parker’s opinion, City Council President Kaplan wrote in an email, “There was no funding or urgent need to bring (the MOU) as a recess action. So, it was hidden from the public without a valid reason for doing so. The 2015 recess action clearly contains legislative action, which is prohibited.”

The 2015 MOU authorizes the Mayor’s Office to appoint one voting member of the EBCF Board of Directors and members of the Oakland Promise Advisory Committee. In addition, “The Mayor’s office will provide communication support, marketing collateral, engagement opportunities and support for promotion and collaborate on annual fundraising events for Oakland Promise,” according to the MOU.

The City of Oakland from 2016-2018 gave $1.15 million to Oakland Promise’s Kindergarten to College Program. In addition, Oakland Promise received 11th floor City Hall office space, as well as “desktop computers, phone and internet service for approximately five Oakland Promise staff,” according to an administrative report to the city/school district Education Partnership Committee.

Until recently David Silver, Special Assistant to the Mayor III, served as the head of Oakland Promise. While receiving no salary from Oakland Promise, Silver’s city salary in 2018 was $261,961.45, salary plus benefits.

In her cover memo to the August 2015 M.O.U., Mayor Schaaf wrote that the MOU “has no cost implications to the City of Oakland,” though that does not appear to be the case.

Council President Kaplan, following up on the issue after it was raised by community activist Gene Hazzard, requested an opinion from City Attorney Parker about the legality of the mayor’s decision to approve the MOU without going to the City Council.

The City Attorney on Sept. 11 wrote that Rule 21 of the Council’s Rules of Procedure that the mayor may make decisions “during the annual recess except for those matters specifically set forth herein.”

Restrictions on the mayor’s authority to bypass the City Council:

  • “Rule 21 prohibits the mayor from approving ordinances during the council’s annual recess.”
  • The mayor must “set for reasons in the agenda reports and resolutions why approval cannot be deferred for council approval after the recess.”
  • The Mayor cannot “appropriate funds without prior council authorization and approval.”
  • The Council “is required to approve by ordinance any lease with rent at below fair market value. “

“The (City Attorney’s) legal memo says that anything that requires legislative action —  like renting space in city hall for free or changing how board members get appointed by moving the power out of the hands of the council and into the hands of the mayor — cannot be done by recess action,” Kaplan wrote in an email on Wednesday.

In July, the Oakland Promise appears to have merged with the EBCF. The governing board of the EBCF voted to convert their nonprofit to Oakland Promise, filing with the Secretary of State,  according to newly hired  Oakland Promise CEO Mialisa Bonta, president of the Alameda Unified School Board and wife of Assemblyman Rob Bonta.

“Functionally, that means that Oakland Promise has the EIN (nonprofit tax IRS tax identification number) of the East Bay College Fund,” she said.

Oakland Post Questions to Mayor Schaaf’s office were unanswered by press time.

In reply to an Oakland Post email, the City Attorney’s office said that Parker’s legal memo was written about the rules governing mayoral recess decisions in the current year, not about what Mayor Schaaf did in 2015.

“The City Attorney’s memo was written in response to a Councilmember’s request to explain the current rules of procedure regarding the mayor’s recess authority. It does not address or make a determination regarding whether any particular action was, or was not, in compliance with the rules. We will review the 2015 action and the rules that were in place at the time,” said Alex Katz,  Barbra Parker’s representative.

For Gene Hazzard’s website, including his blog, go to www.cleanoakland.com

Published September 21, 2019, courtesy of the Oakland Post

 

Questions about Oakland Promise: If it wasn’t a nonprofit, what was it? What happened to the money for scholarships for kids?

Photo by Godfrey Lee

By Ken Epstein

Questions continue to surface about the organization and accountability of “The Oakland Promise,” Mayor Libby Schaaf’s signature initiative that has raised millions of dollars since 2015 to help low-income families “to triple the number of high school graduates who …complete college by the year 2024.”

Though the Promise’s s lofty goal is widely popular among Oakland residents, that support has not silenced demands for full transparency about the legal status is of this organization, which has operated out of the Mayor’s Office,  and how it is spending public money and  resources.

Most significantly, Oakland Promise is wide perceived as a nonprofit organization. But that has not been the case, at least until recently.

The organization was not listed as one by Guidestar, a website designed to provide ”the  highest-quality, most complete nonprofit information available.” Nor was Promise registered as a nonprofit with the State Attorney General.

According to an email to the Oakland Post on Aug. 29, 2018, Oakland Promise was described by its backers as a “public-private effort” backed by four organizations: the City of Oakland the Oakland Unified School District, the East Bay College Fund and the Oakland Public Education Fund.

Since July, however, Oakland Promise has become a nonprofit, merging with the East Bay College Fund and taking over its nonprofit status, according to the East Bay Times.  Mialisa Bonta, president of the Alameda Unified School Board and wife of Assemblyman Rob Bonta, has become organization’s CEO, taking over the leadership from David Silver, who is a city staffer in the Mayor’s Office.

Another question is what has happened to the money that the city gave Oakland Promise to start set up college saving accounts for children. A copy of a Public Records Act request forwarded to the Post  asked for information about the total of $1,150,000 that the city budgeted for Oakland Promise for these savings accounts. But according to the city’s Finance Department on Aug. 16, “The city has not yet made payments on behalf of Oakland Promise from funds earmarked for this program in the adopted budgets for 2016-17, 2017-18 (and) 2018-19. The requested documents (canceled checks) do not exist.”

Council President Rebecca Kaplan in an email explained why she has asked City Auditor Courtney Ruby to audit Oakland Promise.

“Many people have been asking the questions I sent to the auditor – and many members of the public, And even the League of Women Voters, have expressed concern about the Oakland Promise funds. It is perfectly reasonable for anyone to want to know where the money is. This is large amounts of tax-payer funds that were promised to be used to set up college savings accounts for each Oakland kid, as they enter kindergarten.”

“We want to know where the money is – and where the college savings accounts are – that were supposed to be set up each year, starting in 2015,” Kaplan said.  “By now they should have grown a lot  if they had been set up as promised and as funded in the city of Oakland budget, for the Kindergarten to College Program.”

Asked about Council President Rebecca Kaplan request for the City Auditor to conduct an audit of Oakland Promise, the Mayor’s  Office replied, ““Kaplan wants Oakland taxpayers to fund her petty political vendetta masquerading as an audit. And tragically she’s targeting the Oakland Promise – a program started by the City of Oakland to send low-income kids to college with scholarships and mentors. She needs to immediately withdraw this taxpayer funded political score settling – because it hurts taxpayers and kids.”

 

Responding, Kaplan said, “The Mayor’s Office says I’m asking for tax payer money, but that is flatly false. I am not requesting any money.  I have asked our independently elected City Auditor for help getting information about where the college savings accounts they promised for Oakland youth are. The auditor is paid a regular salary.”

The Alameda County League of women Voters(LWVO)  expressed concerns about Oakland Promise when Mayor Schaaf and the Promise organization backed Measure AA last November, which would have created a $198 parcel tax to provide funding for Oakland Promise for 30 years. In its voters’ guide, the League took a neutral position, saying, “We found it unclear how moneys in the Oakland Promise Fund would be spent .”

Measure AA won more than 50 percent of the vote but failed to pass because it needed a two-thirds majority.  That ruling is now being challenged in court, and  according to observers, the case may take three years and end up at the state Supreme Court.

According to its website (Oaklandpromise.org), the organization consists of four programs:

  • Brilliant Babies – “Through participating early childhood programs and pediatric clinics, parents  are offered the opportunity to open a Brilliant Baby college savings account seeded with $500 as an early investment and source of inspiration for their baby’s bright future,” according to Oakland Promise;
  • Kindergarten to College – “Open(s) an early college scholarship seeded with $100 for all Oakland public school kindergarten students;”
  • Future Centers – creates college and career advising center on middle school and high school campuses, replacing services lost by the public schools as a result of cutbacks;
  • College Scholarships and Completion – $1,000 annual scholarships to students going to community colleges and up to $4,000 a year for students attending four-year colleges.

Questions that remain to be answered are how many $500 accounts have been set up through Brilliant Babies; how many $100 scholarships have been established through Kindergarten to College;  how many Future Centers have been set up and how many hours of support they have provided to students; and how many community college and four-year college scholarships have been awarded.

During the years that Oakland Promise was not a nonprofit, the Oakland Public Education Fund served as the organization’s fiscal sponsor and can share budgetary information, including IRS Form 990; audited financial statements; Form 1023 and all correspondence in relation to the production and completion of this document; and a IRS Determination Letter,” according to Maggie Croushore, director, development, of Oakland Promise.

By deadline, the Post had not received  that data nor an answer questions about the cost that Public Education Fund charges to serve as Oakland Promise’s fiscal sponsor and numbers of students and families served by the programs.

Croushore told the Post that during the three years, 2015-16 to 2017-18, the Oakland Promise spent a total of $19.9 million or 94.7 percent of its budget on program costs ($11.3 million) and scholarships and saving accounts ($8.6 million). During that time, the initiative spent $1.1 million or 5.29 percent on administrative expenses. Total revenue during the three years was $33.5 million. However, now that the Oakland Promise has become a nonprofit, costs of administrative overhead could potentially increase if most the organization’s 47 employees  are paid out of the budget instead of being provided  without cost by the City, OUSD and other agencies.

In an email to the Post, Schaaf spokesperson Justin Berton said, “The nature of the Oakland Promise has always been a collaboration with OUSD and community partners to send underrepresented kids from Oakland to college with scholarships, mentors, and the life-skills to end patterns of generational poverty and institutionalized racism. Every Oaklander should be proud their City has come together to send more than 1,400 Oakland kids to college (and counting), seeded more than 500 ‘Brilliant Baby’ scholarships, and worked tirelessly to support Oakland families and their children from cradle-to-career.”

Published September 12, 2019, courtesy of the Oakland Post