LA Unified Faces $1 Billion in Payouts for Sexual Abuse Claims
Los Angeles Unified School District (LAUSD) has approved an additional $250 million in bonds to settle sexual abuse claims, bringing the total authorized for payouts to $750 million in less than a year. The combined cost of both bond issues, including financing, is projected to exceed $1 billion, impacting the district’s general fund over the next decade.
Background: Assembly Bill 218 and Rising Claims
The surge in claims stems from California’s Assembly Bill 218, passed in 2019. This legislation opened a legal window allowing adults to sue over childhood sexual abuse dating back decades, concluding at the end of 2022. The law similarly established a continuing deadline for filing claims related to childhood sexual assault, setting the limit at age 40 or within five years of when victims reasonably understood the harm done to them – whichever is later. EdSource and The Los Angeles Times both reported on the recent bond approval.
Financial Implications for LAUSD
LAUSD Superintendent Alberto Carvalho explained the necessity of the bonds, stating the district is “exhausting funds available to us to satisfy sex and molestation cases.” He emphasized that many cases date back decades and the district is unable to successfully defend them. The bonds, termed “judgment obligation bonds,” function as a loan from investors, allowing the district to draw funds as needed to cover settlements.
The annual payment for the initial $500 million bond authority could reach $50 million. The cost of financing the new $250 million bond issue is estimated at nearly $383 million, according to district documents. This financial strain comes as LAUSD also approved job reductions – eliminating 657 positions – to achieve $150 million in annual savings.
Broader Trends in California
LAUSD is not alone in facing these challenges. A 2025 investigation by The New York Times revealed that school districts across California are grappling with significant financial liabilities due to these lawsuits. The New York Times reported that statewide school district liability had reached $3 billion.
While approximately 70% of California school districts have not faced sexual abuse litigation, over 1,100 victims have filed claims, with the majority concentrated in Southern California. Los Angeles County previously paid out $121.5 million in a judgment related to abuse in county-run facilities.
Legislative Response and Transparency Concerns
State legislators are considering potential changes to AB 218, as critics argue it is pushing local governments towards bankruptcy. LAUSD is also lobbying for legislative relief.
Transparency surrounding settlements has been an issue. LAUSD has included confidentiality clauses in at least seven sexual misconduct settlements since 2000, barring plaintiffs and their attorneys from discussing the terms of the agreement or criticizing the district. One settlement agreement stipulated that the plaintiff’s lawyer could only state, “they have voluntarily and fully resolved their claims against the Los Angeles Unified School District.”
Claim Statistics for LAUSD
Between January 1, 2020, and mid-2025, LAUSD received approximately 370 child abuse claims under AB 218. Around 76 claimants allege abuse from the 1940s through the 1970s, while 45 to 50 allege abuse in the 1980s. As of mid-2025, over 275 claims remained active.