Luther Burbank School District Established in 1906 Fernando R. Elizondo, Ed.D. Interim Superintendent

Boards of Trustees approve generous benefits to themselves which include the following: • Fully paid health benefits for trustees and their families (often exceeding those of teachers and/or with no payment ceiling • Excessivetravel and conference costs • Pension contribution District response: The Luther Burbank School District disagrees with the finding. It isdifficult for a school district to attract competent and dedicated candidates for the challenging role of a trustee. Since trustee stipends are and will remain low, benefits and pension contributions are among the only avenues available to attract and keep qualified candidates. Most Board members provide countless volunteer hours beyond the time dedicated to Board meetings and Office events. Our District will continue to scrutinize all travel and conference costs, and strive to incur such costs only when there are significant benefits to the district.

Boards of Trustees are approving overly generous benefits to Superintendents and Chancellors, including the following: • Auto allowances (auto leases/purchases, insurance, maintenance, etc.) to superintendents • Housing allowances • Million dollar housing loans at zero or below market interest rates • Guaranteed annual step and/or longevity increases • Signing bonuses • Contract buyouts • Excessive performance bonuses • Per diem payments when out of the district • Personal technology allowances • Professional memberships and subscription allowances • Excessivetravel and entertainment expenses • Salary increases automatically triggered by increase in teacher's salaries which are in addition to other guaranteed salary increases • Pension allowances (in addition to regular STRS/PERScontributions) • Advanced degree stipends • Lifetime medical insurance benefits • Annual physicals District response: The Luther Burbank School District disagrees with the finding. In our district, top leadership costs represent lessthan one-sixth of one percent ofthe office's total annual budget of $5 million. Additionally, the Superintendent/Principal position will be responsible for and oversees district and school operations. Our district faced a considerable challenge in attracting and maintaining qualified Superintendent applicants. The high cost of living in the area, coupled with extreme demands and pressures of the position, have created a market in which compensation packages offering certain benefits are viewed asa necessity. In the vast majority of cases,the benefits are not "overly generous" but in line with the realities of market supply and demand. Compare the average superintendent total compensation aslisted in the Grand Jury report (Table I, pA) of $207,900 to the average pay for CEOsin Silicon Valley. According to the 2 Mercury News (June 5, 2009), the average pay for CEOslast year was $2.2 million-just over 10 times asmuch asthe amount paid to public school superintendents. Actually, the average bonus ($242,000) paid to the CEOsexceeded the average salary paid to the superintendents. A comparison of apples to apples-or superintendents to superintendents-similarly refutes the idea the notion of "generous administrative expenses." Looking at the average salaries of superintendents in the FarWest region of the United States, a study entitled "Salaries and Wages in California Public Schools 2008-2009 (by ACSA/Foundation for Educational Administration and Educational Research Service, Table B3) found the average salary was $172,646-about $20,000 lessthan the average salary in Santa Clara County of $192,368. Given the extreme cost-of-living disparity of Silicon Valley ascompared to the average of the rest of the FarWest region, an additional $20,000 here, combined with an attractive set of benefits, would not seem "overly generous."

Superintendent salaries and increases appear to bear no relationship to the number of schools, students, and employees they oversee, nor their district's academic improvement. District response: The Luther Burbank School District disagrees with the findings. School districts leaders oversee income of over $3.5 billion tax dollars annually, and nearly 25,000 employees and 260,000 students in over 367 schools. The school districts annual budget isover 5 million. Superintendent salaries often are related to the sizeof the district-but that isonly one of a myriad of factors that determine compensation. Also, many superintendent evaluations do typically take students academic performances into consideration and will be considered when hiring a new superintendent.

Boards of Trustees hire costly search firms to recruit successors for retiring or dismissed SuperintendentsfCh ancellors. District response: The Luther Burbank School District disagrees with the finding. Many districts do conduct their own searches. One recent example isour district, for which the SCCOE provided assistance. While some districts do hire search firms, describing the expenditure as "costly" seems to ignore the realities of the market for these positions. The position iscrucial to school success, and therefore it iscrucial to find the right person for the job. The price of hiring a search firm, weighed against the benefit of bringing in an assortment of qualified candidate, does not seem "costly." A more costly approach would beto undertake anything lessthan an intensive search for the right candidate. 4 - --. -. - _•••• -0--- -•••••

Boards of Trustees approve the hiring of multiple private attorneys, in some casesat a tremendous expense: District response: The Luther Burbank School District partially agrees with the finding. Our Board has hired private attorneys. We are involved in complex legal issuesthat require legal expertise in sub-sections of the Education Code, requiring considerable specialized legal capacity, time and energy.