Los Angeles Unified School District collected $7.2 billion in revenues in its 2017–18 fiscal year. That translates into $298,000 per teacher, 42 percent more than four years earlier:
Yet spending on teacher salaries rose only 20 percent over that same period, from $72,000 to $87,000 per teacher:
Why are LAUSD’s teachers getting a shrinking share of LAUSD’s revenues?
The principal reason is that retirement costs are getting a much bigger share. In LAUSD’s 2013–14 fiscal year, 9.9 percent of district operating expenses went to pensions and other retirement costs, an amount equal to about one-quarter of district spending on teacher salaries (35.6 percent):
Four years later spending on teacher salaries had grown only five percent while district spending on retirement costs had risen 84 percent, boosting retirements’ share of operating expenses nearly 50 percent to 14.6 percent — nearly half as much as the district spent on teacher salaries:
That squeeze happened despite fast growth in California school revenues:
And record spending per pupil:
Absent reform, teachers’ share of the LAUSD budget will keep shrinking. That’s because, absent reform, retirement costs are a fixed and growing cost while teacher staffing and salaries are variable factors. That shrinkage will be even greater when California schools experience a reduction in revenues as a result of a sell-off in stock and other investment markets.
One-third of LAUSD’s retirement spending is for unnecessary, duplicative or excessive health insurance subsidies provided to retirees entitled to Medicare or ACA coverage. Terminating those subsidies could provide an immediate $10,000 salary increase for LAUSD teachers.
With revenues of nearly $300,000 per teacher LAUSD should be able to field more teachers and provide better salaries for them.