School District Faces Hostile Takeover by State Overseers

By Ken Epstein

Oakland Unified School District officials were caught by surprise recently when they heard from the Alameda County Office of Education (ACOE), which previously was working closely with OUSD, that the county had taken a dramatic step seemingly out of the blue, invoking an official “Lack of going concern” ruing on the district.

The ACOE told OUSD that they must cut the budget by $90 million and threatened – if the district does not take sufficient steps by the end of January – to withhold the salaries of the school board and Superintendent Kyla Johnson-Trammell and place the district under direct control of the state’s Bakersfield-based nonprofit agency, the Fiscal Crisis Management and Assistance Team (FCMAT), according to a November 8 letter to the district from ACOE Supt. L. Karen Monroe.

Some school board members and school advocates see this threat of takeover by ACOE and FCMAT as retaliation and possibly an attempt to reverse a recent action by the board and Trammell-Johnson passing a resolution with wide community support to reject state pressure to close neighborhood schools.

With only five days to challenge the county’s ruling, school board members – with the backing of the superintendent and top administrators – voted unanimously at a special meeting on Saturday, November 13 to appeal the ‘lack of going concern’ determination to State Supt. of Public Instruction Tony Thurmond, who this week announced he has sided with the county.

The danger of direct state control — now operating through FCMAT and ACOE — serving as the agents of the state, rather than through the dictatorial power of a state receiver — seems like a modified replay of the state takeover of OUSD in 2003, nearly 19 years ago.

At that time, the state placed a receiver and FCMAT in charge of OUSD and forced the district to accept a $100 million loan it did not need, and proceeded to unilaterally spend the windfall on their pet projects. OUSD is still paying off that loan. Also, the superintendent was fired, and the authority of the school board suspended.

Under state guidance, the district has closed about 20 schools, mostly in Black and Latinx flatland schools, with the direct encouragement of FCMAT, even though FCMAT has recognized that closing schools does not save money.

Under the leadership of FCMAT and the county since 2003, the district has faced almost continual budget cuts, has stayed in debt and has relied on a revolving door of privatizing administrators and consultants, many who appear to pass through Oakland as a career steppingstone.

According to Monroe’s letter, which has been challenged by the district, OUSD was doing fine this year, and its budget for 2021-2022 was approved. “However, due to the significant level of budgetary reliance on one-time revenue sources and the lack of adequate assurances that fiscal solvency is certain in future years, it has been determined that the district is a Lack of Going Concern with its budget approval.”

Monroe’s letter said the district must “implement $90 million in required reductions within a timely manner.” She also said the county will “withhold compensation of the members of the governing of the school district and the school district superintendent for failure to provide requested financial information,” though the district says it has worked closely with the county and has withheld no information.

Following FCMAT’s “recommendations” would not be optional. “The school district shall follow the recommendations of the (FCMAT) team, unless the school district shows good cause for failure to do so,” the letter said.

The district’s relationship with its overlords at the ACOE and FCMAT seemed to have gone south soon after the school board and administration decided on October 27 that it would no longer give in to state pressure to close more schools in coming years. Before the decision, the state trustee threatened to reverse the board decision if it passed but did nothing when they passed it anyway.

“Karen Monroe for five years has had oversight over every budget, and she approved the budgets,” Boardmember Mike Hutchinson told the Oakland Post. “She is the one who has had oversight. Whose responsibility is this?” He asked.

The district has been working closely with the county and is in better fiscal shape than it has been in years, said Hutchinson “What is new, besides the district’s decision not to close more schools?”

President of the Oakland teachers’ union Keith Brown told the Oakland Post, “We’re opposed to (Supt.) Monroe’s actions. We feel that imposing FCMAT on Oakland would be damaging to our community and our schools.”

While many school advocates strongly criticize the district for its bureaucratic, top-down management and lack of accountability in making budget decisions, they oppose this threatened takeover for a variety of reasons:

• The imposition of FCMAT on OUSD constitutes the suspension of voters’ right to choose their representatives and is a violation of Oakland residents’ democratic rights of self-government.
• The county is demanding $90 million in budget reductions. How did this happen under the county’s watch? How can $90 million be cut and still have a school district that exists in any recognizable form?
• The county says school enrollment has declined but failed to acknowledge the pandemic has anything to do with it. The county complains the district has relied on one-time spending, but isn’t that what federal pandemic funds were for?
• FCMAT and the county have been working closely with OUSD for years, but now they say they failed. Why is the solution to turn total control over to them?
• There is at least the appearance that the threat to withhold leaders’ salaries and impose FCMAT is in part retaliation for the district decision to stop closing more schools, which is the democratic right of local representatives.

Responding to Oakland Post questions, Monroe said, “Decision-making in Oakland Unified lies with the members of the Board of Education that have been elected by the Oakland community, so I am perplexed by any reference to a violation of the democratic rights of Oakland voters.

“The work to be done by FCMAT does not constitute any replacement of OUSD’s governance structure and is spelled out clearly in Education Code. It is limited in scope and does not usurp or compromise the Board’s local control,” she said. More of her responses will be printed in the next Oakland Post edition.

L. Karen Monroe’s letter to OUSD is available at:

https://ousd.legistar.com/View.ashx?M=F&ID=9962661&GUID=ADEF97D5-0DD4-44CF-99E2-C31AF83C734E

OUSD’ appeal letter to Tony Thurmond is available at

https://ousd.legistar.com/View.ashx?M=F&ID=9963018&GUID=7E877777-AF0C-4211-ABE3-D38E9F2FB20E

Boardmember Hutchinson urged people to call Tony Thurmond and Supt. Monroe and to sign a petition available online at https://bit.ly/3xJRc6K