Oakland Seeks Record Bailout for Schools

Without the bailout, the beleaguered Oakland school district is only assured of having enough money to meet its payroll through April, officials said.

Perata blamed the debacle on a series of ill-advised financial moves. Among other things, Oakland officials grossly overestimated state per-pupil revenues despite declining student enrollment and covertly borrowed from bond funds to cover the shortfall.

"It was really inexcusable mismanagement of the highest order," he said. "The district ended up looking like it was running a Ponzi scheme, using one credit card to pay off another."

Perata said Alameda County education officials will conduct an audit to determine how the financial problems developed. "School officials will look to see if any crimes were committed," Perata said. "If so, the district attorney will take over."

Oakland Mayor Jerry Brown said there is plenty of blame to go around: "The district had a lot of problems they didn't want to face up to. Now somebody else has to clean up their mess. I think they need some discipline over there, some fiscal and academic talent to get them out of this."

The Oakland school collapse is the latest crisis to confront the city. Over the last year, Oakland has grappled with near double-digit unemployment and a spiraling homicide rate.

In recent years, the school district has also been a center of controversy because of its academic policies. In 1996, a district task force created a furor by declaring that speech patterns of some African American students comprised a separate "genetically based" language called "Ebonics," one it said deserved to be preserved in classrooms.

Months later, the same task force backed off from suggestions that teachers be trained to speak black English and that the district consider applying for federal bilingual education funds for black students.

The takeover request, however, focuses on the district's finances.