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Settlement May Provide $750 Million to LA Schools

In an action that could mean up to $750 million to Los Angeles schools, a state agency agreed Wednesday to settle a lawsuit challenging its allocation of school construction funds.

After hammering out an agreement behind closed doors, the State Allocation Board voted unanimously to adopt new rules that would make it easier for Los Angeles to compete for rapidly dwindling state bond money.

Elated officials of the Los Angeles Unified School District said they believe the changes will ensure that at least $500 million will be available to the district if it can keep its massive school building program on track.

"What this means is that every application we get to the board by June 2002 will be funded," said Michael J. Strumwasser, an attorney for the district, which joined the lawsuit. Los Angeles schools could claim as much as $750 million by pushing up the schedule for several projects to meet that date, officials said.

The suit, filed in March by Los Angeles civil rights law firms and community groups, alleged that the agency's rules discriminate against large urban school districts. Because apportionment was on a first-come, first-served basis, the system favored small districts that could prepare applications quickly while big districts struggled to acquire and clean up urban land, the suit alleged.

Superintendents of smaller school districts blasted the new regulations, which could take hundreds of millions away from projects they're planning.

Paula Lupcho, board president for the 1,200-student Mammoth Unified School District, said the board was decreeing that "an unhoused student in a small district is less needy than an unhoused student in a large district."

Mammoth is one of scores of districts whose applications for construction projects will now have to compete with Los Angeles under a priority point system.

Officials for the Mammoth district said they now doubt they can get funding to replace two schools that consist entirely of portable buildings.

But a Los Angeles judge agreed with the plaintiffs in August and ordered that the state create a priority system taking account of need.

At its September meeting, the board withheld funding from all pending applications and said it intended to start parceling out the remaining $1.3 billion at a much slower pace, subject to priority points.

The board adopted the new priority point system Wednesday.

Starting in January, only about $128 million will be awarded each quarter. There are applications on file for about $540 million, meaning that less than a third of them will obtain funding. The rest must compete the following quarter with all new applications.

Under the new system, about $450 million will be retained for applications filed as late as June 2002, when L.A. Unified is expected to have most of its projects in line.

The final piece of the agreement involved a change in the rules allowing Los Angeles to calculate its eligibility across the district, rather than by high school attendance areas. Attorneys for the district said that change will give all of its projects more points than any other district can accumulate.

Several issues in the lawsuit remained unsettled and will be dealt with in future meetings, Strumwasser said.

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