Business as Usual Won't Work in the School District, Task Force Warns

By Teresa Rochester

Business in the school district can't continue as usual.

That was the message the superintendent's hand-picked Financial Task Force delivered to its Advisory Council Wednesday afternoon in the form of a draft report. The report outlined 18 immediate and long-term problems, four goals and 21 points of action the district should take.

"Business cannot continue as usual," task force member Neil Carrey told Advisory Council members. "There needs to be change on many levels, on the board level, on the district level and on the public level."

"This is extremely hard-hitting," Advisory Council member Michael Rich, the executive vice president of RAND, said of the report.

The draft report -- the culmination of six months of research into district spending, budgeting habits and possible revenue streams - points out 10 immediate problems task force members say the district needs to tackle in a six-month period and eight long-term problems that need to be addressed.

Topping the list were problems such as the district's "slowness in recognizing and dealing with damage to credibility," and "resistance to accepting the need for major change in finance-related matters and financial reporting."

Other immediate problems included the following:

l Rising labor costs.

lUncontrolled growth in special education costs.

lLower than planned attendance resulting in reduced revenues.

lThe district's controversial practice of having the Board of Education participate in salary negotiations.

lThe district's small budget reserve during fiscally volatile times.

lThe district's limited capacity for research and proper development before implementing actions with fiscal impact and its handling of modernization of sites and construction.

lThe Board of Education's aversion to making difficult choices during the budget process.

Long-term problems included the lack of a coherent process for developing district-wide priorities for services and the unending desires for additional and enhanced educational services.

The task force also concluded that the district lacks an effective strategy for dealing with the rising costs of labor and special education. The report also notes the district will no longer be able to count as much on rising enrollment to boost revenue.

"You can't just keep adding students," said task force member Anita Landecker, adding that facilities will reach their maximum capacity soon. "It's just not a tool to be relied on for revenue issues."

In their report, task force members called for the district to aim for four goals:

lImproving district credibility.

lStructuring and managing the district in a more business-like manner.

lStrengthening relationships with the cities of Santa Monica and Malibu.

lDeveloping more revenue.

The task force's report also suggested ways to improve district budget planning, raising money for the district and improving the structure and management of district practices.

Advisory Council members - made up of some of the city's most influential civic leaders - called for the report to contain more background information on problems and solutions, create measures for success and include more public comment on the report.

"I think the summary form doesn't reveal the analysis," said Rich, "and the final report should show the connection between the analysis and the problems."

"What we don't have is an open dialogue between the public and the district," attorney Chris Harding said. "One of the frustrations is that historically there has not been that dialogue."

Harding also suggested that the district should look at ways to secure "reliable long-term funding from the city."

"I don't think the district should rely on one-time ad hoc money from the city," Harding said.

While this meeting was supposed to be the last before task force members present the final report to the board of education, the advisory council may meet with the task force one more time to review changes based on their suggestions and to hear public comment.

City Council members said that because they had only received a copy of the draft report at the start of the meeting they needed more time to review it.

Councilman Paul Rosenstein, who has requested more oversight of the district's operations -- said he was impressed with what the task force had accomplished.

"The problems the district faces are being identified," Rosenstein said. "And this analysis will set the foundation for the district finding the solution, which will be the next challenge and a big challenge."

Community members interested in commenting on the draft report can send e-mail to Barbara Inatsugu at inatsugu@smmusd.org. The meeting will also be aired on City TV.