LAUSD ordered to turn over documents in long-running funding dispute with archdiocese

Despite a promise made two years ago by Superintendent Alberto Carvalho to resolve the conflict, Los Angeles Unified continues to refuse millions of dollars in federal aid that the Archdiocese of Los Angeles says it is owed for continued services to low-income students in Catholic schools. The archdiocese maintains the district uses the money to strengthen funding for its students.

Both the California and U.S. departments of education have penalized the district for violating federal laws in its dealings with the archdiocese. Now, a Los Angeles County Superior Court judge has ordered the district to turn over documents and data it had withheld.

The information, which should shed light on the decisions of district authorities, could either restart stalled talks or prompt the archdiocese to ask a court to order a settlement after seven years of litigation.

“We do not believe that further litigation is necessary and we can provide equity for nonpublic school students,” said Paul Escala, superintendent of schools for the archdiocese. “However, we will take all measures to ensure that all students receive the services they deserve.”

Title I Rules for Private Schools

Congress requires that low-income students in private and public schools receive equivalent Title I funds to cover the costs of counseling, tutoring, teacher aides and learning specialists. The dispute with LAUSD is over how much money should be allocated to the archdiocese’s schools and how to ensure the funds reach students.

Under congressional law, private and religious schools do not receive Title I funds directly. Instead, districts determine the eligibility of private and religious schools within their boundaries, administer the funds, and provide services directly or through vendors in consultation with the schools. Los Angeles Unified has until recently hired Title I workers and placed them on the payroll (see California Department of Education FAQs).

The system has been amicable for years. Districts can choose from several ways to determine Title I eligibility, and L.A. Unified chose the fairest and most efficient method for the more than 100 schools in the archdiocese with low-income students, Escala said. The district used census data to determine the number of Title I-eligible students in a given area, then awarded a proportional share of the money to archdiocesan schools. Long Beach Unified uses the same method.

More paperwork, more confusion, less money

Then in 2018-19 and the following year, coinciding with the new administration of Superintendent Austin Beutner, the district chose a different option for calculating private school eligibility — student registrations in the federal school lunch program. Not only did that method require significantly more time, paperwork and verification by schools, but the district changed its reporting rules several times with little notice and failed to “engage in timely and meaningful consultation,” the California Department of Education concluded in a 58-page report released in June 2021 in response to the archdiocese’s formal complaint.

The Los Angeles Unified Office of Inspector General revoked privileges for hundreds of students after reviewing parent forms for school lunches at two dozen schools selected for audit and did not include any students from other schools that were not audited.

As a result, Title I funding for the archdiocese has been cut by more than 92%, from about $9.5 million for services in 2017-18 for 102 schools to $767,000 for fewer than two dozen schools, according to Escala. In 2023-24, funding has increased to about $2 million for 43 schools. The district has lowered its overall share allocated to private schools from 2% to 2.6% from about $291 million to 0.5%, according to the California Department of Education.

“Completely unreasonable” demands

The state Department of Education has slammed the district. The timing of the records request was “completely unreasonable” and the district “made arbitrary, unilateral decisions” and failed to explain its decisions to the archdiocese, the report said.

By ignoring the archdiocese’s requests for documentation justifying the cuts under the Freedom of Records Act, the district adopted a “hiding the ball approach that violates both the spirit and the letter” of the law, the report said.

Escala said the spirit of Title I, as stated in the preamble to the bill, is to maximize participation. The intent of other options, such as surveys and free lunch verification, is for schools to prove they have a higher percentage of low-income families than neighboring schools, he said.

LAUSD is doing the opposite, Escala said.

“The district is using these other methods as a way to filter, sift and limit participation,” he said. “You’re pulling kids out who you know are eligible simply because they didn’t dot the t’s or the i’s. That’s not open to any criticism because they (LAUSD officials) don’t apply the same standards to their schools.”

LAUSD had an obligation to provide (the archdiocese) with the requested information. LAUSD’s approach of hiding the ball violated both the spirit and the letter of the obligation to consult. — California Department of Education in the June 2021 rulingG

L.A. Unified declined to comment on the state report, and a spokesperson wrote in an email last week that “Los Angeles Unified does not generally comment on pending or active litigation.”

Districts have a financial incentive to minimize private schools’ eligibility for funding. The federal government awards all Title I funding to districts, which determine how much should be spent on services for students at private and religious schools. Lawyers for the archdiocese point out that the less money districts award, the more Title I funding they can spend on their own students.

The district appears to understand that, said Kevin Troy, an attorney for the archdiocese, citing a Jan. 29, 2019, email from the district’s Office of Inspector General’s chief auditor to the archdiocese in which the auditor said the archdiocese “receives over $10 million in Title I funds from LAUSD each year — money that could go toward LAUSD schools.”

“There’s a moral and ethical issue on the table,” Escala said. “You (LA Unified) have children in need and you’re not serving them properly,” he added, referring to students in archdiocesan schools.

Impact on One High School

Mark Johnson, principal of Bishop Mora Salesian High School, has seen the impact of the cuts on students. Before the Title I cuts, he paid for a reading intervention teacher and a part-time paraprofessional who worked with 40 to 50 students a week—about 1 in 8 students at the 400-student all-boys school in the low-income Boyle Heights neighborhood of Los Angeles. Although the teacher was on the district’s payroll, he fit in like any other staff member, building personal relationships with students and collaborating with their teachers.

“She (the teacher) had her own classroom and was just a regular teacher, as far as any of our kids knew,” he said. She worked with the lowest-scoring students on basic reading comprehension skills. “If they were working on a difficult piece of literature, she would help them break it down so they could write an analytical paragraph or an essay.”

The withdrawal of students also reduced the number of students remaining in the classroom, he said. Now there is only enough money for a two-day-a-week coach from a contractor who accepts at most a dozen students a week.

“We serve kids who are way behind grade level and families who are struggling with poverty and all that comes with it,” Johnson said. “So this kind of adversarial relationship that has developed (with the district) ultimately hurts kids.”

The California Department of Education gave the district 60 days from the June 2021 decision to consult with the archdiocese to correct deficiencies identified in the report and then recalibrate the proportion of Title I funding for archdiocesan schools. It ordered the district to begin providing increased services for the 2020-21 school year, the next school year.

Instead, the district appealed the decision to the U.S. Department of Education, which issued its own findings in November 2023. In his decision, Adam Schott, deputy assistant secretary for policy and programs, said the district could justify reducing the eligibility numbers based on an analysis of parent forms. But in doing so, it cut funding for dozens of schools the district did not audit. He credited the district with consulting with the archdiocese to some extent, but said the district’s overall approach to requesting documentation was “inconsistent and confusing.”

Schott also ruled that the district violated federal regulations because it claimed it did not have to provide the archdiocese with data on how much it spent on Title I student services or how much money was left unspent at the end of each year.

In December 2021, the archdiocese sued the district in Los Angeles Superior Court for ignoring multiple requests under the state’s Public Records Act for Title I expense records and other relevant information. The court reserved its ruling pending the completion of the grievance process.

On July 16, Judge Curtis Kin ordered the district to turn over all relevant documents, emails and records to the archdiocese by Aug. 20 and to pay the diocese $82,141 in attorney fees.

Some appeal to Superintendent Carvalho

A few weeks after he started as Los Angeles Unified superintendent in February 2022, Alberto Carvalho told EdSource he had reviewed the case and added, “I intend to resolve this sooner rather than later,” declining to provide details because of the litigation.

“I can tell you,” he added, “that we need more objective and transparent tools by which we can evaluate and fund this poverty-based federal benefit.”

Escala said he remains hopeful. “I believe Superintendent Carvalho has the ability to lead his staff toward this outcome. I have great confidence that when the matter is brought to his attention, it will be handled appropriately.”