Archive for December, 2017

Political Leaders Engineered State Control of Oakland Public Schools

OUSD was required to borrow $100 million when they only needed $37 million

Assemblymember Sandré Swanson pressured state schools’ Supt. Jack O’Connell for 3 years, resulting in return of local control

(Clockwise from top): Sheila Jordan, Randolph Ward, Don Perata, Jerry Brown.

By Ken Epstein

State control of the Oakland Unified School District has changed its form over the years since the takeover in 2003 but remains a constant presence in determining policy in the public school system.

When the state fired Oakland Schools Supt. Dennis Chaconas and suspended the Board of Education in June 2003, some of the outlines of state control soon became clear: school closures; attempts to sell school property to real estate developers; the rapid growth of charter schools; and the lease of school sites to charter schools.

Jack O’Connell, former State Superintendent of Public Instruction

Always on the defensive, community groups have thwarted some of the school closures and several times prevented the sale of the district headquarters’ property to developers.

Aligned against the district in its fight for local control were East Bay Senator Don Perata, president of pro tem of the State Senate, known for his connections to powerful developers; State Supt. of Public Instruction Jack O’Connell, with ties to billionaire charter school advocate Eli Broad; former governor and then Mayor Jerry Brown, a close Perata ally; Sheila Jordan, Alameda County Superintendent of Schools; and the Fiscal Crisis and Management and Assistance Team (FCMAT), an organization based in Bakersfield that is funded by the state to intervene in school districts but is lacking in state oversight.

FCMAT was led by Tom Henry and Joel Montero. Randolph Ward, a graduate of Eli Broad’s superintendent training program, became the district’s first state administrator.

While the state administrator ultimately was removed in 2009, a state trustee with power to rescind the district’s financial decisions remains in place.

Joel Montero, FCMAT

The takeover was presented as a necessity designed to save the district from bankruptcy, but the reality remains very controversial and raises questions about the role of powerful political and economic interests.

Apparently forgotten was a previous unsuccessful takeover attempt promoted by Senator Perata even before the district uncovered an economic shortfall.

When the district became aware that it had overspent its budget in 2003, the OUSD administration developed a plan to maintain local control, which included borrowing money from funds paid to the district to partially reimburse OUSD for school construction projects.

The district’s plan was to repay the money over time into its construction fund.

“The use of the (reimbursement) money in this way was approved by OUSD’s bond attorneys, who happened to be the bond attorneys for the State of California, and expert in their field,” according to Jesse Douglas Allen-Taylor, writing at the time for the Berkeley Daily Planet.

Rather than approve borrowing and repayment plan, then County Supt. of Schools Jordan asked for an opinion from State Attorney General Bill Lockyer, who declared the plan illegal and blocked OUSD from using the money to balance the budget.

“In a mass community meeting later held at Allen Temple Baptist Church, Ms. Jordan defended her actions by saying that she could not allow the bond transfer because it was illegal,” according to Allen-Taylor.

When Jordan ran for reelection, she was criticized by her opponent Newark Superintendent of Schools John Bernard for her role in the takeover.

Dennis Chaconas

“Other county superintendents allow districts to use (construction reimbursement) money as a loan when the district is going into the red,” Bernard told the press. “The incumbent, Sheila Jordan, did not allow Oakland to use the (construction) bond money, they went into default, and the state took over,” he said.

Once the state had blocked the use of the bond reimbursement money, the debt rolled over into the next school year, becoming over $60 million, and the state rounded its bailout loan up to $100 million for good measure.

Thus, the district was forced to borrow $100 million rather than the $37 million it needed.

Of course, the bailout came in after the state took over, and therefore the state-appointed administrator – in consultation with his bosses- was in charge of how the money was spent.

Many people said that “Mr. Perata was the driving force behind the 2003 state seizure of the Oakland public schools,” wrote Allen-Taylor.

The political maneuvers behind the state takeover were suggested in an Oakland Tribune article written by then Tribune staff writer Robert Gammon, now editor of the East Bay Express.

“(Some) say office and cell phone records obtained by the Oakland Tribune provide evidence the takeover, and the resulting loss of local control of Oakland’s schools, was politically orchestrated,” Gammon wrote.

“The records show top officials from the Bakersfield-based Fiscal Crisis and Management Assistance Team (FCMAT) called Oakland Mayor Jerry Brown, the office of state Sen. Don Perata, D-Oakland, and then-Compton schools chief Randy Ward at least 40 times each in the months before the takeover,” according to Gammon.

Brown and Perata had publically supported a takeover during the preceding year. They voiced support for “placing Ward and FCMAT in charge of the school district,” wrote Gammon.

In the six months prior to the takeover, the records show FCMAT officials did not call Supt. Chaconas or school board President Greg Hodge, according to the Tribune.

“FCMAT (pronounced fick-mat) was supposed to be our fiscal advisers,” Hodge told the Tribune. He and Chaconas said FCMAT officials did not return their calls for months.
“They were supposed to be helping us. But instead they turned this into a political campaign to take over the district,” said Hodge.

Sheila Jordan in an interview with the Post disputed those who said the takeover was political.

The district wanted to borrow from its school construction funds to pay off the shortfall, she said. “Many districts do that understanding that because those funds were passed by the voters to update and build schools, districts by law must establish their ability to repay what is a short-term loan.”

“Oakland did not have anywhere near the revenues to repay the loan. The hole in their budget was $27 million,” Jordan said.

“The investigation discovered a plug in the budget. It rolled over into the following year and resulted in close to a $65 million deficit,” she said. “I never did understand why the loan was $100 million.”

The analysis of the district’s finances was conducted by School Services of California, the Fiscal Crisis Management and Assistance Team (FCMAT) and Alameda County Office of Education “working together at the table,” she said.

“The Trib(une) reporting at that time was upholding a theory of action that was wholly discredited by the facts produced by the fiscal experts,” said Jordan.

Disagreeing with Jordan was Lewis Cohen, who served as an assistant superintendent in Dennis Chaconas’ administration at the time of the takeover.

“The 2003 state take-over was a largely political process. The $100-million-dollar loan was concocted by then County Superintendent Jordan’s experts and put into legislation by Senator Perata, as she seems to have conveniently forgotten,” he said.

Sandré Swanson

“We lobbied against this legislation at the time, but Perata and his allies forced the loan on the school board by blocking the legal use of construction funds reimbursed by the state,” said Cohen.

“These were not bond funds and carried no legal restrictions at all, much less that the loan needed to be short-term,” Cohen added.

Direct state control of the school district was ended in 2009, due in part to the efforts of Assemblyman Sandre Swanson, wrote reporter Allen-Taylor at the time.

“Without Mr. Swanson’s dogged persistence on the Oakland school issue (for) three years, it is probable that local control would still be years away,” he wrote.

“(State Supt. of Public Instruction) O’Connell gave every indication that unless he was forced to do so under pressure, he would hold onto the Oakland schools.”

Published December 23, 2017, courtesy of the Oakland Post

State “Culpable” for School District’s Financial Crisis, Says Former County Schools’ Superintendent

By Ken Epstein

The State of California, which is legally responsible for overseeing the Oakland Unified School District (OUSD) budget, is “culpable” for the ongoing financial crisis caused by lack of fiscal controls and

Sheila Jordan, former Alameda County Superintendent of Schools

overspending that came to light at the end of the administration of former Superintendent Antwan Wilson, according to Sheila Jordan, who served as Alameda County Superintendent of Schools for four terms.

Jordan, county superintendent for 16 years from 1999- 2014, told the Oakland Post that she feels compelled to speak out.

“People call me,” she said. “They stop me in the street and ask, ‘What is going on? How is it possible that Oakland is in financial trouble again?’”

She said that the state, acting through a trustee, had one role to play in Oakland – fiscal oversight – and it did not do it.

“They’re culpable,” said Jordan.

“With all the additional spending that was going on, the overspending was extremely visible,” she said.” I believe the state has a great deal of culpability in this current situation.”

When the district went into receivership and was forced to take a $100 million state loan in 2003, then State Superintendent of Instruction Jack O’Connell dissolved the board and appointed a state administrator to operate the district, with a focus on stabilizing the budget.

Until that loan is paid off, the trustee – paid by the district – comes in a couple of days a week to review the local budget and decisions that have financial implications.

The trustee, who reports directly to the state superintendent of instruction, has the power to “stay and rescind,” which means he or she can block district decisions before they are approved by the ad- ministration or board or undo the decisions after they are approved.

In a situation where the trustee has so much power, a recommendation or a few words of advice can carry a lot of weight.

The way it works, she said, is that “the trustee speaks to the board and superintendent and says you can’t do that.”

“They are paying a trustee from the state to have that oversight,” Jordan continued. “It’s not the district’s choice, but rather the state imposes the trustee. It is the trustee’s responsibility is to let the board and superintendent know if there is a problem.”

“To my knowledge, the trustee never contacted the county to say there was a problem or report to the Board of

Education to let the board know there was a problem. There are no reports of the trustee talking to the board.”

Jack O’Connell, former State Superintendent of Public Instruction

The former state trustee, Carlene Naylor, retired soon after the district’s financial crisis became public. She was formerly associate superintendent of business services at the Alameda County Office of Education.

“If expenditures being made were so dangerous to the financial health to the district, why didn’t the state step in? asked Jordan.

The overall fiscal problems resulted from a “lack of leadership.” The district’s responsibility is to ensure that expenditures do not exceed revenue, she said.

In the business office, she said, there is not sufficient staff and expertise, and the school board “has a certain culpability, too, because they needed to tell the superintendent they would not approve the budget.”

OUSD’s current fiscal condition can be traced to the highly contentious state take- over of the district in 2003, according to a number of former district employees and long- time observers who spoke to the Oakland Post.

At the time, State Schools’ Supt. O’Connell and influential State Senator Don Perata were instrumental in putting together a deal requiring the district to accept a $100 million loan, even though it was only $37 million in debt.

Don Perata, former East Bay state senator

OUSD had adequate money on hand in a construction fund that could have temporarily paid off the shortfall, but the state would not allow Oakland to tap into that fund, though the practice was allowed in other districts.

The loan from the state was spent by the state – with no outside oversight. The state administrator, a trainee of the Broad Foundation, spent the money as he saw fit.

No audits were conducted for six years.

A number of Broad interns and trainees have held central office positions ever since the takeover, including former Supt. Antwan Wilson

The Broad (rhymes with load) Foundation and the Broad Academy for training superintendents are central players in school privatization and corporate charter school growth in the U.S., as well in Oakland Unified.

Under state receivership, the district closed 14 schools, and charter schools flourished – now numbering over 40, including a number that are located or co-located at district campuses.

A state-sponsored attempt to turn over the OUSD head- quarters property at 1025 Second Ave. to private real estate developers was quashed, thanks to a public outcry and the efforts of then Mayor Ron Dellums.

The Oakland Post was not able to reach the former trustee for comment.

In reply to the Oakland Post’s questions, a spokesman for the California Department of Education (CDE) wrote:

“The CDE is working with the trustee and the Alameda County Office of Education, which is also responsible for fiscal oversight, to monitor the situation in Oakland very carefully.

“(The) trustee, whose authority is limited solely to monitoring and reviewing the operation of the school district…may stay or rescind an action of the governing board of the school district that, in the judgment of the trustee, may affect the financial condition of the school district.”

Published December 14, 2017, courtesy of the Oakland Post

 

Stopping the Stadium Mega-Development Was an Important Victory, But This Fight Is Far from Over

Oakland Coliseum

By Alvina Wong

After four months of organizing by Laney students, faculty, and staff, Chinatown and Eastlake residents, and Lake Merritt environmentalists, the Peralta Board of Trustees decided to end talks with the Oakland A’s about constructing a stadium mega-development next to Laney College.

Alvina Wong

Their decision is a testament to our communities’ power to fight for a future where we can stay and thrive.  We also know that this fight is far from over.

Since 2014 when BART and City officials completed the Lake Merritt Station Area Plan, Chinatown and Eastlake have been bombarded with a wave of luxury condo developments, soaring rents, and mass displacement of longtime residents.

At the time, many of our organizations demanded that we be included in the city-led ‘community-engagement process’.  We advocated for affordable housing and storefronts, parks and open space, and resources for working class immigrant and refugee communities.

Despite countless meetings, letters, and petitions to city officials, none of our communities’ needs were reflected in the plan.

Instead, we got a plan that incentivized high-density market-rate development by rezoning the neighborhood to allow developers to build up to 275 feet in some areas, without a conditional use permit.

Our vision for a neighborhood where new immigrants and refugees could stay and thrive was noted, but no policies were put in place to help realize this vision.

The Lake Merritt Station Area plan, like the West Oakland BART plan and many others, has paved the way for developers to turn Chinatown and Eastlake into playgrounds for the wealthy, with 20 and 30 story luxury apartment buildings that literally cast shadows over our communities.

So, when the Oakland A’s decided to build a stadium with upscale stores and hotels next to Laney College, our communities quickly decided that we needed to oppose it.  Chinatown and Eastlake groups joined with Laney students, faculty, and staff who were fighting to protect Laney as a public resource.

Groups that had been working for years to restore Lake Merritt and its saltwater channel also joined the fight.  We went door-to-door and classroom-to-classroom.  Despite the A’s aggressive PR campaign, we found that people overwhelmingly opposed the stadium at Laney.

While we were successful in stopping the A’s stadium mega-development at Laney, we know that there are more developers that want to use this public land for their own profits.

Many of us have been part of building community, culture, and resources in neighborhoods that formed as a result of racist housing covenants, suffered from disinvestment after white flight, and are now threatened with mass displacement.  In these times, we’ve learned that our public land is one of the last remaining places where we can build the resources our communities need.

For us, this decision to say no to a stadium at Laney opens the door for our communities to say yes to stewarding this land to serve the public good.

It helps us transition away from looking at land as a commodity that exists to maximize profits for the wealthy, and toward looking at how this land can help sustain our lives and communities for generations to come.

As for big corporations like the A’s that benefit from Oakland’s public infrastructure and diverse communities, they should have been giving back all along – whether that means supporting public education institutions like Laney College, affordable housing and good jobs for local residents, or growing in ways that take leadership from working class people of color who want to stay and thrive.

We hope the Oakland A’s will stay the right way.  Oakland has already invested millions of public dollars in the Coliseum.  Now it’s the A’s turn to invest in East Oakland’s communities.

Alvina Wong works with the Stay the Right Way Coalition and is employed by the Asian Pacific Environmental Network (APEN).

Published December 13, 2017, courtesy of the Oakland Post