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Judge won’t intervene in money dispute between Catholic Church and LA Unified

The Catholic Church says LA Unified intentionally withheld millions of dollars in federal assistance from Catholic schools.

LOS ANGELES (CN) — Lawyers for the Roman Catholic Archbishop of Los Angeles and the LA Unified School District appeared in court for a hearing on Wednesday, in their dispute over millions of dollars in federal funding. But LA County Superior Court Judge Douglas Stern said the case has probably reached a dead end.

"My tentative thought is this is still involved in administrative process," Stern said, adding that the dispute is "not ripe for this court."

Later in the day, he issued a ruling sustaining the district's demurrer, effectively blocking the suit.

The Catholic Church operates 112 private schools with LAUSD's boundaries, serving more than 12,000 students whose parents pay tuition. But according to the petition filed by the Archbishop of Los Angeles this past December, every student under the Archbishop's jurisdiction receives "some form of tuition assistance," and "the per-pupil cost to educate" one of their students "is higher than the tuition paid."

The deficit, they say, used to be made up in part with money from the federal government through Title I funds earmarked for school districts serving a high proportion of low-income students. The church says that during the 2017-18 school year, LA Catholic schools received more than $9 million in Title I funding — not in cash, but in services such as "counseling, one-on-one tutoring, and intervention services."

The following year, according to the church, that funding began to drop precipitously — first to $7.4 million in 2018-19, then to $1.7 million in 2019-20 and finally to less than $800,000 in 2020-21. The school district justified the change through an ever-evolving methodology of counting low-income students. Every year, fewer Catholic schools qualified.

In their petition, the church wrote that LAUSD has "openly and consistently acted to prevent federally funded services from reaching eligible, lower-income [Catholic Church] students, and has been indeed quite frank about its understanding of federal education programs as a zero-sum game and about its intent to increase its own share of federal education monies by artificially reducing [the church's] schools’ share of services funded by such monies."

In 2019, the Catholic Church filed a complaint with the California Department of Education. After an investigation, the state issued a 58-page ruling in favor the church, writing, "LAUSD failed to meet its statutory duty... to accurately count the number of children from low-income families in 113" church-run schools. The school district ignored data provided by the church and refused to consult with the church before reaching its decisions. The ruling labeled some of the district's actions "intimidation tactics" and "the antithesis of a good faith effort to reach agreement regarding the provision of equitable services."

The school district appealed the decision to the U.S. Department of Education. That appeal is still pending, as it has been for more than eight months.

In the meantime, the church filed a complaint in LA Superior Court, both as a sort of back-up plan and in anticipation that the federal government will rule in their favor but the district will continue to refuse dispensing funds. But Judge Stern decided not to intervene Wednesday.

"How can I jump in?" he asked. "It’s up on appeal."

He asked: "You presuppose that LAUSD won’t comply with whatever that ruling is?"

Kevin Troy, the archbishop's attorney, said there had been a similar case brought about by a consortium of Jewish schools that had followed the same administrative pathway, and that those schools were still waiting on LAUSD to comply with the law.

But Judge Stern rejected the line of reasoning, "You’re not entitled to a placeholder lawsuit," he said, calling the move "a kind of prophylactic lawsuit in anticipation of a lawsuit."

After the hearing, Troy said he disagreed with the judge "on the law," but knew there was a "risk" that he would see it that way.

School districts in California receive funding from the state depending on how many students they enroll. The student population at LAUSD has been declining for more than a decade, thanks to a shrinking birth rate and families choosing to enroll their kids in charter and private schools. The enrollment decline means LAUSD's future financial outlook is in grave peril.

As to why the district cut funding to his client's schools so abruptly, Troy said, "We have some indication that they called them 'rich kids.'" He added: "They treat private schools as a threat to their money. They called it 'a wolf at their door.'"

He added: "We’re not talking about Harvard Westlake here," referring to an elite private school in Los Angeles with an annual tuition of more than $44,000. "It’s not the districts place to second-guess the way poor families spend their money."

An LAUSD spokesperson said the district does not comment on pending litigation.

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