Oakland’s Teachers Are On Strike: How Charters Have Contributed to the School District’s Fiscal Crisis

In Oakland, California the school district is broke, and the teachers are on strike.

In a major report published last May, the political economist Gordon Lafer described the fiscal crisis in the Oakland Unified School District (OUSD): “In November 2017, California’s Oakland Unified School District faced a budget deficit of $15 million.  Parents, students, and teachers protested against planned cuts, which targeted everything from books and copy paper to substitute teachers and mental health professionals. ‘These cuts will touch students in every school in the district,’ said one group of parent activists, urging the Board of Education to concentrate cuts in central district offices and spare school-site staff.  Yet cutbacks at the central office also proved painful, which became apparent when the district announced plans to terminate its head librarian.  In the end, OUSD instituted $9 million in cuts, including slashing funds for academic counselors, school supplies, and even toilet paper.”

Last week, for Jacobin Magazine, Eric Blanc explains part of the reason: “The project of free market education reform is so widespread in America that many cities and states insist on claiming the title of ‘ground zero’ of education privatization. Whether or not Oakland can claim that unfortunate title, it’s clear that the privatizers have made huge headway in the city: Oakland is now the city in California with the highest percentage of students in privately run charters, and the city’s school district is aiming to deepen its downsizing project by closing twenty-four of the city’s eighty-seven public schools.” Blanc then publishes a who’s who of billionaires—Gary Rogers, Eli Broad, and Bill Gates—who have funded the pro-charter group, GO Public Schools, which has invested in the political campaigns of pro-charter candidates for the Oakland Board of Education, where today a majority of members support what is known as “portfolio school reform.”

Like Los Angeles, Oakland’s financial crisis is related to California’s embrace of charter schools and the school district’s adoption of a portfolio school reform governance plan by which the district manages traditional public and charter schools as though they are investments in a stock portfolio. The idea is to establish competition—launching new schools all the time and closing low scoring schools and schools that become under-enrolled.  It is imagined that competition will drive school improvement, but that has not been the result anyplace where this scheme has been tried.

To better understand the issues underlying why Oakland’s teachers are on strike, it is worth examining Lafer’s in-depth profile of the Oakland Unified School District.

Lafer’s report explores the Oakland Unified School District as an exemplar of a California-wide and nationwide problem: Uncontrolled charter school expansion undermines the financial viability of the surrounding public schools. “In every case, the revenue that school districts have lost is far greater than the expenses saved by students transferring to charter schools.  The difference—the net loss of revenues that cannot be made up by cutting expenses associated with those students—totals tens of millions of dollars each year, in every district.” “California boasts the largest charter school sector in the United States, with nearly 1,300 charter schools serving 620,000 students, or 10 percent of the state’s total student body.”

“(W)ith a combined district and charter student population of over 52,000 in 2016-17—(Oakland) boasts the highest concentration of charter schools in the state, with 30 percent of pupils attending charter schools.” “By 2016-17, charter schools were costing OUSD a total of $57.3 million per year—a sum several times larger than the entire deficit that shook the system in the fall of 2017.  Put another way, the expansion of charter schools meant that there was $1,500 less funding available per year for each child in a traditional Oakland public school.”

Lafer identifies two problems at the heart of California’s enabling legislation for charter schools. First, a local school board has no control over whether charters can expand in the district: “Even when districts determine that there are already enough schools for all students in the community—or even if a charter operator petitions to open up next door to an existing neighborhood school—it is illegal for the district to deny that school’s application on the grounds that it constitutes a waste of public dollars. By law, as long as charter operators submit the required number of signatures, assurances against discrimination, and descriptions of their plans and program, school districts may only deny charter petitions for one of two substantive reasons: if ‘the charter school presents an unsound educational program,’ or ‘the petitioners are demonstrably unlikely to successfully implement the program set forth in the petition'”

The second problem, Lafer explains, is particularly serious as it impacts Oakland Unified School District: “While charter schools are required by law to accept any student who applies, in reality they exercise recruitment, admission, and expulsion policies that often screen out the students who would be the neediest and most expensive to serve—who then turn to district schools.  As a result, traditional public schools end up with the highest-need students but without the resources to serve them.  In Oakland, this can be seen in the distribution of both special education students and unaccompanied minor children who arrive in the district after entering the U.S. without their families.”

The problem is made worse because California does not allocate state funding based on the number of disabled students who require special services: “Special education funding is apportioned in equal shares for every student attending school, irrespective of the number of enrolled students with disabilities. Even in districts without charter schools, special education is an underfunded mandate, in that the dedicated funding for this purpose is insufficient to meet the needs that school systems are legally required to serve.”

Lafer reports that in 2015-16, Oakland’s charter schools served merely 19 percent of Oakland Unified School District’s students with special education needs: “The imbalance is yet more extreme in the most serious categories of special need.  Of the total number of emotionally disturbed students attending either charter or traditional public schools in Oakland, charter schools served only 15 percent.  They served only eight percent of all autistic students, and just two percent of students with multiple disabilities… Thus, charter schools are funded for a presumed level of need which is higher than the number of students with disabilities they actually enroll, while the district serves the highest-need students without the funding they require.”

And neither the federal government nor the state reimburses Oakland for the special costs of its large number if migrant children: “(I)n recent years the country has seen a spike in the migration of children entering the country without their families.  Oakland is their second most common destination in the state; in 2015-16, the district served over 150 refugee children, nearly 200 asylum seekers, and over 450 unaccompanied minors. Beyond the special costs of caring for these students, the district must hold open spaces in its classrooms in anticipation of students who arrive continuously throughout the year.  Per-pupil funding from the state, however, is not provided until a student is actually present in the school… In 2015-16, over 1,200 newly-arrived students entered OUSD schools including 700 who arrived in October or later.  All told, the cost of ensuring sufficient space and staff for these students amounted to an estimated $4.2 million in district expenses that were uncompensated through state or federal per-pupil funding. No charter school is required to accept refugee children in the middle of the year—but the district is.  As there are no special funds for doing so, the district must draw from its general fund.  Since school districts are uniquely obliged to serve all students, they provide services that no charter schools are required to provide….”

Lafer concludes by describing what the $57 million lost every year from the Oakland Unified School District to charter schools would buy: “If those costs were reimbursed, or had never left the district, OUSD could maintain classrooms at a maximum of 18 students per class in every elementary school… double the number of nurses and counselors in the system, and still have $10 million per year left for additional services.”

Lafer concludes: “If a school district anywhere in the country—in the absence of charter schools—announced that it wanted to create a second system-within-a-system, with a new set of schools whose number, size, specialization, budget, and geographic locations would not be coordinated with the existing school system, we would regard this as the poster child of government inefficiency and a waste of tax dollars.  But this is indeed how the charter school system functions.”

Lafer’s report provides essential background for understanding the financial crisis in Oakland and the reasons teachers are striking today.