Crippling long-term debt isn’t leaving L.A. schools much wiggle room in averting a teacher strike — and may doom the district to takeover

Taylor Swaak:

The looming teacher strike in Los Angeles, no matter how it’s sliced, comes down to money — but not the salary raises and cost of new hires that have kept the district and its teachers union apart during nearly two years of contract negotiations.

The real money problem, experts say, lies with the district’s skyrocketing long-term debt.

Experts warn that for the district to stay out of bankruptcy, it must slash its billions in long-term liabilities, much of it tied to massive retiree health benefit costs.

Their prescriptions ranged from making employees and retirees pay premiums to offering early retirement incentives. Most agreed that a local solution is needed to right the ship as California faces — or could already be in — a recession, meaning state taxpayers may be unable to bail out the district.

But United Teachers Los Angeles has rejected the district’s proposal to shave off costs by adding two years to how long it takes new employees to become eligible for free lifetime health benefits — something other L.A. Unified unions have already accepted. Union officials dispute the district’s claim that it is cash-strapped, and says it is “hoarding” nearly $2 billion in reserves.