A Los Angeles School Board Scandal Could Upend Plans By Charter Backers to Take Over Public Schools

The district attorney of Los Angeles County filed criminal charges this month against Ref Rodriguez, the school board president of the nation’s second-largest public school district. Accused of laundering money into his 2015 political campaign with the help of his cousin, Rodriguez faces three felony charges and 25 misdemeanors.

It’s not your typical money-laundering case. In fact, it’s one that veteran campaign consultants and money-in-politics watchdogs have been calling the most bizarre they’ve ever seen. And it was part of a successful multimillion dollar, multi-cycle campaign by pro-charter school advocates to seize control of the board.

Run-of-the-mill campaign money laundering involves donors funneling cash in through business associates, family, or friends. In this instance, Rodriguez allegedly funneled more than $24,000 of his own money into his campaign, despite facing no contribution limits himself. According to the 14-page complaint filed on September 13, Rodriguez reimbursed 25 friends and relatives, who each contributed between $750 and $1,100 – and signed a form under penalty of perjury that they had all been legitimate campaign donors.

Following his 2015 victory, Rodriguez became the first charter school operator to join the Los Angeles school board. He was backed by the well-heeled charter school movement, which spent more than $2 million to help elect him. This past spring, education reform advocates won three more seats, giving the board a slim pro-charter majority for the first time ever. Rodriguez was then elected board president in July.

In response to the felony charges, Rodriguez announced that he would step down as president, but remain on the seven-person school board, thus preserving the charter faction’s grip on power. United Teachers Los Angeles, the district’s teachers union, is now calling on Rodriguez to resign entirely, while some Rodriguez allies say the whole thing is being blown way out of proportion.

The struggle over the school board, and consequently for public education in Los Angeles, reflects larger proxy battles playing out in school systems across the United States. These fights typically pit so-called education reform advocates against backers of traditional public schools and teachers unions. Messy money-in-politics scandals have come to be defining features of these fights, as corporate money and funds from stratospherically wealthy activists flood in to what was once the sleepy politics of public education. How this all plays out in California will almost surely affect education politics elsewhere.

Ref Rodriguez’s announcement to step down as board president posted on Twitter.

When asked in February 2015 about the generous donations he had received from his former employees, Rodriguez stressed that the contributions had not been coerced and would not be reimbursed. “I know for many of them, this is a tremendous sacrifice,” he said at the time. “It’s just been sort of an outpouring of folks’ belief in me and what we are trying to do for the city.”

There are only two real explanations floating around for why Rodriguez would launder his own money. One is that he somehow missed the memo that candidates can donate as much as they want to their own campaign — which is unlikely. (Rodriguez has not explicitly denied the district attorney’s allegations.)

The more credible rationale is that early into his weeks-long campaign, he wanted to project an image of having more popular grassroots support than he actually had. And, by misrepresenting his donors, he could cast himself as more financially competitive than he actually was.

Harvey Englander, a longtime Los Angeles political consultant, says there’s a lot of pressure on candidates, especially first-time candidates, to show they’ve raised a lot of money by the time the first campaign finance reports are released. These reports are often treated as rough proxies for candidate viability, and when a candidate puts their own money into the race, it’s hard to know if that money will ever be spent, or if it’s just being used to create the illusion of a well-financed bid. But if there are dozens of people writing four-figure checks, well, that looks like a serious campaign.

“The only reason I could think of is that whoever advised Ref suggested he go find family members and others to contribute to his campaign because it would look very real, it would show a lot of community support, and you’d assume that money could be spent,” Englander tells The Intercept. “I understand the reason for doing it, but it’s just so unusual. It’s really out of the ordinary.”

Even with that pressure, it still doesn’t make sense why he would have felt compelled to exaggerate his early-stage fundraising. It was well-known before his first campaign finance disclosure deadline that he was likely to receive significant backing from the charter school movement. Rodriguez had served as a board member for the California Charter Schools Association from 2005-2009.

The Intercept reached out to the California Charter Schools Association for comment on the theory that Rodriguez may have embellished his grassroots backing to secure more funding from their organization. Steven Baratte, the Southern California managing communications director, wrote back that his group will only comment to say that Rodriguez made the right choice to step down as president, so that the school board can focus on students while allowing Rodriguez time to address the charges. “We recognize the seriousness of these charges and await all of the necessary facts coming to light,” he said. “We appreciate that Ref has spent his career working to improve educational opportunity for thousands of Los Angeles students. We fully expect proceedings related to this matter to be thorough, efficient and fair.”

A Los Angeles Unified School District bus arrives at a school in Los Angeles on Dec. 16, 2015.

L.A. is the last of the big-city school districts to hold local school board elections, and over the last five years, Los Angeles school board races have been flooded by unprecedented sums of money. This past year, L.A. held the most expensive school board election in American history, by more than 50 percent. Though charter supporters have been significantly outspending union-backed groups, both sides have been kicking in millions of dollars for contests that just a few years ago were modest political battles.

The CCSA has recently emerged as a particularly powerful player in both Los Angeles politics and across the state. Nationally, charter advocates often justify their reliance on the deep pockets of billionaire supporters as necessary to compete with the formidable spending of local teachers unions. But as EdSource, a California education news site, reported in May, “In past years, the teachers union far outspent the [charter] association on campaign contributions. Not anymore.”

Rodriguez unseated one-term incumbent Bennett Kayser, the union-backed candidate. Kayser, a retired public school teacher, told The Intercept that he encountered far more negative campaigning during his 2015 election than his 2011 one. According to campaign finance data from the Los Angeles City Ethics Commission, an independent expenditure committee sponsored by the CCSA spent $1,558,913.71 in support of Rodriguez, and $600,723.46 attacking Kayser. One example of a negative flyer they released in 2015 read, “BENNETT KAYSER TRIED TO STOP LATINO CHILDREN FROM ATTENDING SCHOOLS IN WHITE NEIGHBORHOODS.”

Kayser describes the attacks unleashed against him as “frustratingly untrue and exaggerated,” but “he had no funds available to put out a response.” Los Angeles is such a big school district that in terms of printing and postage, Kayser says it can cost $7,000 to $10,000 to put out just one mailing.

Just like the other school board members and the general public, Kayser had no idea that Rodriguez was under investigation all this time. He first learned about the felony charges when a local reporter called him earlier this month asking for comment. Though his campaign had flagged suspicious campaign finance disclosures at the time, they couldn’t prove it, and they lacked the time and resources to launch a real investigation. “It took the district attorney and the ethics commission two years to get to this point,” he says. “I’m just glad things are progressing as they are.”

Last week, seven days after the charges were filed, UTLA officers issued a statement calling for Rodriguez’s immediate resignation from the school board, not just the presidency. The union, which represents 35,000 teachers and educators across the Los Angeles Unified School District, said they lacked confidence in Rodriguez’s ability to lead, and that his behavior sets a bad example for students.

“While we believe in due process rights, choosing to stay on as a board member means he will continue to make long-lasting policy decisions, including who becomes the next board president,” the UTLA said. “We question his willingness to be held accountable. The charges he faces are more than, in his words, ‘a distraction’ from the work that needs to be done.”

Kayser echoed the UTLA’s call for Rodriguez’s immediate resignation. “If the DA had not announced that there was going to be an arraignment, we still wouldn’t know. He’s basically been lying for two years,” he says. “It’s just wrong to set that example to the kids of Los Angeles, who are being taught to be honest and ethical, and learning about voting and democracy.”

A spokesperson for the district attorney’s office said that if he were convicted, Rodriguez would not automatically be disqualified from holding office.

Still, Bob Stern, co-author of California’s landmark Political Reform Act and the first general counsel of California’s Fair Political Practices Commission, thinks a felony conviction would create “tremendous pressure” for Rodriguez to step down. The maximum sentence he faces if he were convicted on the felony counts would be four years and four months in jail.

Stern tells The Intercept that he thinks money laundering is the worst kind of disclosure violation, since an individual is knowingly reporting that money came from one place when it came from another. He says that throughout the many decades he’s worked on campaign finance issues, he’s never seen a candidate launder his own money.

Los Angeles Unified School District Superintendent Ramon Cortines, left, and Board of Education president Mónica García, right, agree with board members who decided to delay a vote on layoffs at their headquarters in Los Angeles on Tuesday, March 31, 2009. García will likely be appointed board president again.

Peter Cunningham, executive director of Education Post, an education reform communications firm, penned an Los Angeles Times op-ed last week in defense of Rodriguez, saying he can’t understand how “these minor violations” of campaign finance law triggered criminal charges. Cunningham finds Rodriguez “humble, sincere, and polite” and says and that if the allegations are true, Rodriguez simply made a “rookie mistake” and should pay his fines. “If [Rodriguez] is forced to step down from the board, his prosecution could seriously undermine the reform agenda demanded by the voters of Los Angeles,” Cunningham argues. “It’s hard to avoid the conclusion that he got the book thrown at him simply because he was elected board president.”

The Intercept followed up with Cunningham to ask what he meant by this claim. “Because others have done the same thing and paid fines,” he responded. “In fact, I don’t know if there are any cases of someone going to jail for what he’s accused of. That doesn’t make it right, but let’s keep it in proportion.”

A spokesperson for the district attorney’s office declined to comment on Cunningham’s op-ed.

Rodriguez’s chief of staff, Aixle Aman, told The Intercept that Rodriguez would not be taking any interviews. Daniel Nixon, Rodriguez’s lawyer, did not return a request for comment. “This is a harsh and draconian response to a minor alleged transgression,” the attorney representing Rodriguez’s cousin told the L.A. Times. The cousin who allegedly aided Rodriguez, Elizabeth Tinajero Melendrez, faces a felony count and 25 misdemeanor charges.

It is unusual for a district attorney to bring criminal charges in campaign finance cases, and Stern says the fact that the DA is pursuing these charges “suggests there may be much more to [the story].”

For now, the Los Angeles school board retains its pro-charter majority. The board plans to appoint a new president this week, and it’s likely to be board member Mónica García, who has previously served as president. If Rodriguez does ultimately step down or is forced out, the board can either call a special election or appoint his replacement.

Rodriguez and his cousin are scheduled to be arraigned on October 24.

Top photo: Ref Rodriguez, member of the Los Angeles Board of Education during a Los Angeles Unified School District meeting in the LAUSD board room, in Los Angeles, Calif, Jan. 12, 2015.