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LAUSD lost almost $10 million due to inefficient inventory system, audit finds

The report says thousands of textbooks are not bar-coded or returned by students and poor communication between schools has led to unnecessary purchases.

July 25, 2010|By Howard Blume, Los Angeles Times

An audit of textbooks at 21 local high schools has found that lost books and excessive purchases at these campuses cost the Los Angeles Unified School District nearly $10 million.

Such problems are pervasive across the system of more than 1,000 schools, auditors concluded, exponentially increasing the potential losses and unnecessary spending.

"The district does not manage or control the textbook inventory process effectively, efficiently or economically," auditors wrote in a June 30 report, which is posted online.

Textbooks represent a huge annual cost for the nation's second-largest school district: $83.3 million last year for texts in required academic courses. Among a sample of reviewed titles, the cost of each book averaged $109.31.

Misused resources stand out in a school system that in the past two years cut $1.5 billion from a general fund that will total $5.4 billion next year. The results have been pay cuts, a shorter school year, larger classes and thousands of layoffs — and the postponement of $60 million in textbook purchases.

To manage a textbook inventory worth more than $256 million, L.A. Unified "relied on an outdated, substandard" system at secondary schools, auditors said. The elementary schools have no inventory system.

Senior district officials insist that a fix already was in the works when auditors began their review, which covered the period from July 1, 2008 to February 5, 2010. But a comprehensive online tracking system won't be up and running for several months at least. First, staff members have to enter every textbook storage room in the sprawling system and find out what they have and what has been lost.

Three of the 21 high schools randomly sampled lacked sufficient records to enable a thorough audit. At the other 18 campuses, investigators selected and counted the stock of 10 titles.

Among the findings:

* 87,332 copies of the 10 texts were supposed to be on the shelves, but only 42,374 copies were found.

* Two schools each exceeded $600,000 worth of missing inventory.

* In one year, two schools lost 2,036 of 13,274 copies of the 10 texts, which would cost $222,555 to replace.

Regarding excess book purchases, the findings were no better. The total value of extra, unused books at one school exceeded $600,000; at another, the figure was $550,000.

Twelve schools accounted for 5,203 stored and unused copies of "Integrated Coordinated Science." Despite these extra copies, two other schools purchased an additional 750 copies for $67,846.

The inspector general's office began its probe after receiving tips regarding both shortages and surpluses. It found two pallets of new texts — worth $500,000 — that had gathered dust, unused, in a district warehouse for several years.

The office is also investigating reports that some schools have been selling unneeded books to a vendor who then marks up the price and resells them to other district campuses.

Top officials have publicly contested the inspector general's office over some recent audits. And the Board of Education recently declined to renew the contract of Inspector General Jerry Thornton, in part, district insiders have said, over the embarrassment caused by some audit findings.

But L.A. Unified Supt. Ramon C. Cortines praised this review.

"It puts the spotlight on the problem," said Cortines, who admitted to a case of deja vu.

In 2000, he served for six months as interim superintendent and launched a "books and bathrooms" agenda to address textbook shortages along with dirty, vandalized restrooms.

Shortages are now rare, according to district data, and typically result from poor coordination. But issues of losses and excess texts never were resolved.

"A lot of things [from] 10 years ago … they've returned to haunt us," said Cortines, who rejoined the school system in 2008 and recently announced his plans to retire next spring.

Auditors also warned of safety violations, which they illustrated with photographs. Rows of unopened boxes, stacked back-to-back and taller than any teacher, filled the aisle of a storage room at Cleveland High School in Reseda. At nearby Reseda High School, unused books piled up within inches of the ceiling — a fire-code violation. At John C. Fremont High School, a mountain of book boxes, some tilted at precarious angles, covered a back wall.

Many school districts have had problems managing textbooks because coordinated online tracking has become available only in recent years, said Esther Sinofsky, the district's director of instructional media services.

But other school districts addressed the problem sooner, including the Long Beach and San Diego unified school districts. In Los Angeles, money is not an issue: A new integrated system will cost $3 million to $5 million, dollars already set aside as part of voter-approved school-construction bonds, Sinofsky said.

howard.blume@latimes.com

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