Wall Street Journal features PESP report on outsourcing in LAUSD

In April, Los Angeles teachers secured a strong new contract that averted what would have been an historic strike. Just days before the contract win, a PESP report revealed that hundreds of millions of dollars of Los Angeles Unified School District contract commitments for external services were directed to private equity or venture capital-backed companies from January 2022 to June 2025. During that time, LAUSD approved roughly $10 billion in contracts with outside vendors, $2 billion of which went to tech companies. 

Using data obtained by United Teachers Los Angeles (UTLA), the report revealed that $255 million of the $297 million in new digital instruction contract commitments went to private equity or venture capital-backed companies, representing at least 86% of those commitments. 

The Wall Street Journal reported on the contract win as well as concerns among teachers and parents about how the district was spending its money. The Journal noted PESP’s findings in its reporting:

The district has more than doubled its spending on outside vendors and contractors in the past decade, according to a report from the Private Equity Stakeholder Project. Nearly 70% of contracts with companies selling digital-instruction tools in recent years have exceeded the original commitment amount, the report found.