A $100 million bailout loan for the Oakland school system has been has been approved by a state Assembly panel. The loan would amount to the largest school rescue operation in state history.
The Assembly Education Committee voted 8-0 yesterday in favor of the emergency loan. The bill now goes to the Assembly Appropriations Committee. The state Senate has already given its OK.
Democratic Senator Don Perata, of Oakland, says the district ran up a flood of red ink because of an antiquated accounting system, a drop in enrollment and soaring costs.
Without the loan, the district says it will be broke by the end of the fiscal year and won´t be able to meet its payroll. If the loan is approved the state will appoint an administrator to run the district until it pays the money back and balances its books.