LOS ANGELES — Three Los Angeles school district unions won major victories with deals that bring hefty raises and prompted celebratory messages about a new chapter in local education progress. But the price of union peace will be nearly $1.2 billion in annual contract costs, and questions remain about whether the district can afford it.

Double-digit raises have been promised to union workers by a school system that for months has proclaimed that it is in dire financial straits, trapped in deficit spending and facing potential insolvency in four years. Just two months ago the school board voted to send out 3,200 notices of possible layoffs, a process that was expected to cut about 700 jobs.

Over the last three days, however, officials appear to have made decisions about their actual financial position that is closer to the unions' interpretation: The district is sitting on multibillion-dollar reserves that should be used to pay more to teachers, principals and other essential workers in this high-cost city.

Once the raises go into full effect, the annual cost will be $650 million per year for members of United Teachers Los Angeles, $490 million for Local 99 of Service Employees International Union and $75 million for Associated Administrators of Los Angeles, according to L.A. Unified. In addition, as part of the new agreement, the district agreed to rescind more than 200 layoffs and is being pressed to take back more.

"In Los Angeles, teachers will now earn salaries that better reflect the true cost of living in communities that they serve," said UTLA President Cecily Myart-Cruz. "This victory ensures that educators can afford to ... live closer to their jobs and continue teaching in the schools that they are a part of. This means the resources will begin to be redirected toward our babies and the classrooms that need them the most."

Three dramatic and anxious days, extending to the very morning of the planned strike, supercharged the sudden largesse: The three unions, representing most district employees, were prepared to walk out together unless each union achieved its own tentative agreement. The strike was avoided with hours to spare Tuesday morning.

Funding the contracts is the next challenge

During an upbeat City Hall news conference later in the day, acting Supt. Andres Chait sounded as though he was not entirely certain from where the promised funding would come.

"That's a very good question, obviously," Chait said. "In making these commitments to our labor workforce, we're looking ... to always start internally and looking at where our dollars are going. I know there's been a lot of dialogue around subcontracting, around using internal services. So, of course, we're taking a laser-like focus on what we can do."

District officials have previously described such cost-cutting attempts as potentially meaningful, but only marginally helpful given that employee salaries and benefits make up the vast majority of the district's nearly $19-billion budget.

Chait said district officials joined by L.A. Mayor Karen Bass and union leaders would lobby the state government in Sacramento for more money.

Critics were quick to pounce.

"When the [unions] gang up on an insolvent district to 'force' — using their terminology — agreements of significant pay and benefit increases of a district that has no money to make those deals, that is called extortion," said Lance Christensen, vice president of government affairs and education policy for California Policy Center, a right-leaning think tank. "These deals will only further exacerbate LAUSD's financial problems and do nothing to improve the delivery of education for their declining student base."

Even a district ally expressed concerns.

"My hunch is that the only way the district will be able to come up with the money is to lay off lots of people, unless they have been hiding money, which I don't think is the case," said Pedro Noguera, dean of the USC Rossier School of Education. "They have lost over 200,000 students over the last 15 years and haven't downsized the number of employees or schools. It's unsustainable."

Deals at the eleventh hour

A pact with United Teachers Los Angeles and its 37,000 members arrived first on Sunday morning followed by a deal that evening with Associated Administrators of Los Angeles, whose 3,000 members include principals and vice principals.

More challenging to bring home was the third agreement — with Local 99. Its 30,000 district members include bus drivers, teaching assistants, supervision aides, custodians, gardeners, cafeteria workers and tech support workers.

Local 99 members average about $35,000 per year — and most also receive health benefits for themselves and their immediate families. Their pay scale puts them at the bottom compared to other district employees and, as a result, union leaders insisted they receive a higher percentage raise than the other two unions.

And they got it — an average increase of 24% over the three-year term of the contract. Nearly two of those years are in the past, so much of the increase will be retroactive.

Local 99 Executive Director Max Arias said Tuesday the raise will increase the average pay for members to the range of $42,000 to $45,000 per year. Since the union's first strike in 2023, members' average salary will have increased 54%, Arias said.

Teacher salaries also will significantly increase. The average teacher will earn at least 13.9% more over the life of the three-year contract and the starting pay for teachers will rise to $77,000. Even before the new deal, the average teacher pay was over $100,000 and topping out at $130,000.

The pay scale for administrators is somewhat higher. They will see pay raises totaling about 11.7%.

More than just pay hikes

The raises are not the only large cost item.

The teachers union says the district has agreed to hire 450 new psychologists, psychiatric social workers, attendance counselors and other counselors.

Many Local 99 members are getting increased work hours — which will qualify many more for health benefits, which come with working 20 or more hours per week.

The total district budget for this year is $18.8 billion. Before the three agreements, the district estimated its June ending balance at $3.8 billion, down from $5 billion a year ago. Since the expiration of pandemic aid, the school system has been spending $1 billion to $2 billion a year more than it is taking in, officials said.

If this is accurate, then L.A. Unified can afford its new deals in the short term but will go into the red in perhaps three to four years — potentially resulting in major program cuts and layoffs unless cost-cutting decisions are made before then.

But Chait's bet on a Sacramento-will-pay-for-it scenario could hold promise. As it happens, Gov. Gavin Newsom has so far resisted setting aside for education a multibillion-dollar tranche of funding that California education advocates say is due. If this transfer happens, L.A. Unified could reap more than $400 million in funding per year.

In addition, state tax revenues have been healthy — which bodes well for even more state education funding for school systems statewide. A recession, of course, could reverse this rosy outlook.

"It is a beautiful day. It really is a beautiful day," said school board President Scott Schmerelson. "SEIU 99 received a nice bonus raise, but they deserve it."

"I'm relieved," said school board member Rocio Rivas, "that there is a principled agreement ... ensuring our schools remain open and stable for students and families who depend on them — like I did when I was an LAUSD student... They are the second home of many, many... Our educators, school staff and administrators — everyone — they all are part of the backbone of our school communities."

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