The Los Angeles Unified School District board has signed off on another $250 million in judgment‑obligation bonds to cover sexual‑misconduct settlements, on top of roughly $500 million approved less than a year ago. That pushes LAUSD’s authorized borrowing for these cases to about $750 million, and district projections show that once financing costs and interest are added, taxpayers will be on the hook for more than $1 billion. The fresh debt comes as the district faces a surge of historical abuse claims fueled by recent state law changes.
The board’s unanimous vote allows administrators to issue judgment‑obligation bonds, a kind of long‑term debt LAUSD can tap as settlement checks come due, according to the Los Angeles Times. Superintendent Alberto Carvalho told the paper the district is “exhausting funds available to us to satisfy sex and molestation cases” and argued that stretching the payouts over many years is the only realistic option. The Times also noted that the board approved the borrowing authority with minimal public discussion.
AB 218 and the surge of claims
The onslaught of lawsuits traces largely back to Assembly Bill 218, a 2019 law that extended how long adults have to sue over childhood sexual abuse and briefly reopened a window for filing decades‑old claims. Since Jan. 1, 2020, roughly 370 claims have been filed against LAUSD, and statewide estimates put potential liabilities for school districts in the billions, EdSource reported. Fiscal analysts quoted by EdSource say the combination of AB 218, rising jury awards, and a strained insurance market has created a severe funding challenge for large districts like LAUSD.
High‑profile payouts and precedent
LAUSD has been writing large checks in these cases for years. A review by the Times found that from 2012 through 2024, the district paid more than $372 million in sexual‑misconduct judgments and settlements. That total includes headline‑grabbing agreements, such as a $19.9 million settlement involving former aide Lino Cabrera, which highlight both the size of the district’s exposure and why officials say they need long‑term borrowing tools to handle the cash flow, according to the Los Angeles Times.
How the district is financing the bills
Judgment‑obligation bonds do not need voter approval and are repaid out of LAUSD’s general fund instead of through property‑tax bond measures. The new $250 million authorization follows last year’s authorization of up to $500 million, bringing total capacity to about $750 million. District estimates reported by the California Globe indicate that once interest and financing charges are included, the combined cost could exceed $1 billion over the life of the bonds. Critics warn that even spread out over time, those payments will compete with classroom spending and other day‑to‑day priorities.
What experts and advocates say
Advocates and fiscal watchdogs broadly agree that survivors are entitled to compensation, but they also warn about the pressure this puts on local taxpayers and school budgets. Analyses cited by EdSource and FCMAT float ideas such as creating a statewide victim compensation fund and considering legislative changes that would limit some retroactive liabilities, while other groups push for tighter rules on very old claims. Experts quoted in those reports say any lasting solution will have to come from Sacramento and will require a difficult conversation about how to balance justice for survivors with financial stability for schools.
What comes next
LAUSD can draw down the newly authorized bonds as settlements and judgments are finalized, so the true price tag will only emerge as cases are resolved. Local coverage noted that the latest borrowing authority passed with relatively little debate in open session, and parents, along with watchdog groups, say they want more clarity about which claims are being paid and on what timetable, according to ABC7. District leaders say they are trying to balance fair compensation for survivors with protecting programs for current students, a tension that is likely to shape LAUSD’s finances for years to come.
