Thousands of jobs would be cut over the next three years but a popular program to support Black students would survive under a budget-reduction plan approved by the Los Angeles Board of Education that shows how the district will avoid insolvency.
Under pressure from community and student advocates, the board reversed proposed massive cuts to the distict’s Black Student Achievement Plan.
The original fiscal blueprint would have cut $100 million of $125 million in annual spending on the program, a reduction that would have taken effect on July 1, 2027.
But board members approved two amendments to restore funding. The first amendment, proposed by Kelly Gonez, and approved unanimously, put back in $50 million — reducing next year’s cut in half, to $50 million. That amendment also called for staff to present a plan in August to restore an additional $25 million
Then board member Karla Griego proposed drawing down a retiree health benefit trust fund for another $175 million, which would appear to close the rest of the gap for the three years of the financial plan.
Griego’s amendment passed by a 5-2 vote, as did the revised financial plan. The two opposing votes each time were Nick Melvoin and Tanya Ortiz Franklin.
The status of the funding for the Black Student Achievement Plan was confusing enough that district communications staff on Tuesday night were unable to confirm whether all the funding had been restored.
At least one board member, when contacted, believed that the restoration was complete.
The approved financial plan still cuts $500 million in extra funding for schools identified as having students with the highest needs.
The board’s actions came on the same day that it approved major labor agreements, which narrowly averted a strike in April. The labor deals will add more than $1 billion a year to district costs, providing higher salaries and maintaining health benefits for workers and expanding some services to students.
Acting Supt. Andres Chait said the adoption of a “fiscal stabilization plan” is painful but necessary. He said that, despite the proposed cuts, approval of the labor contracts provides important supports for employees and ultimately for students. As additional funding becomes available — from the state or through local savings in other areas — the cuts would be adjusted, he said.
“These are difficult conversations, because every decision affects people,” Chait said. “The reality is that we must do both: address the district’s fiscal challenges and continue investing in the people and services that directly support students.
Why did the L.A. school board have to do this?
California law requires all school districts to operate within their financial means.
The L.A. County education office enforces the law and requires local school districts to be solvent three years into the future. According to the budgeting rules, Los Angeles Unified isn’t meeting the mark and therefore has to show how it will make cuts to stay out of the red in a “fiscal stabilization plan.”
Separate from the stabilization plan, the district must approve its annual budget, which will incorporate the approved cuts. A vote on the full budget is scheduled for next week.
What are the main elements of the fiscal stabilization plan?
Without the cuts, L.A. Unified projects a deficit of $1.3 billion at the end of next year and $3.6 billion at the end of the following year.
The vast majority of district spending is on salaries and benefits, so extensive cuts would almost certainly include staff reductions and layoffs. The preliminary estimate of the original plan was that it would eliminate 6,000 jobs by the end of the three-year period. The district has about 83,000 employees.
The budget plan also includes seven unpaid furlough days over the three-year period, which would have to be negotiated with the union. Union leaders said Tuesday they would oppose the furlough days.
To eliminate the future deficit, the district focused on discretionary spending.
What caused the most pushback?
Union leaders opposed cuts that would cost jobs; they want the district to focus instead on restricting outside contracting and limiting senior executive pay.
Board member Kelly Gonez proposed alternate cuts: $20 million more in central office positions — which already had been cut significantly already; a cut in school police budget of $3.5 million for next year in 2026-27 and $7 million for the year after.
School police union leader Gil Gamez said the first year’s reduction would likely be managed by closing vacancies and laying off three officers. In the second year, the impact would be the layoff 17 to 35 officers, depending upon how the language of the board action is interpreted.
He said that officers in the field already have been reduced to about 70 for the district’s 900 or schools and 710 square miles.
Also provoking strong opposition is the proposed elimination of $500 million given to schools through the Student Equity Needs Index. SENI is a formula that uses academic, health and community indicators — such as chronic absenteeism, English learner rates and neighborhood conditions — to rank schools according to need
The SENI cuts translate to 4,500 lost jobs, for such services as counseling, mental health support and academic help.
Is the budget picture truly this dire?
The state’s budgeting rules don’t allow the district to include unconfirmed future revenues. So the picture could change.
For example, for the 2026-27 school year, the district will receive a $328 million discretionary block grant. School districts have been getting such funding every year in recent years, but it’s not guaranteed. So, that huge amount of funding cannot be scored as a funding source in the second and third year of the three-year plan.
Nor is there a full accounting for an explosion of state tax revenue related to the increasing wealth of the state’s richest residents and the artificial intelligence boom. Eventually, the state will have to increase its funding for schools because of state law that sets aside a certain percentage of tax revenue for schools. But that money also is not yet scored in the budget calculations.
In a larger sense, if the state economy maintains its current path, schools will receive far more funding. But if there is an economic or stock market crash, the budget projections could be even worse than what is managed through the fiscal stabilization plan.
The big picture also includes ongoing declining enrollment — funding ultimately is linked to enrollment. Over time, declining enrollment will put the district under pressure to reduce the number of employees and close schools.
Was Tuesday’s vote the last word in the cuts?
Not entirely. The lion’s share of the cuts begin to take effect on July 1, 2027. So, there is a year to develop alternative solutions and benefit from increasing state aid — if economic trends remain steady.
But financial reductions of this magnitude cannot be resolved without significant cuts in some key areas
The school board was set to approve the fiscal stability plan this week as a prelude to approving the budget, which is scheduled for next week, with a deadline of acting before the end of June.
The entire project spending plan for next year adds up to $20.6 billion, an increase from $18.8 billion in the current year. The district is spending more than the confirmed revenue to date, which is $18.6 billion.
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