The New Majority

The total she received is by far the most business has ever contributed to
an L.A. school board candidate and marks only the second time that
businesses have gotten significantly involved in an L.A. Unified board race.
The first time was eight years ago, when they backed a slate of candidates
recruited by then-Mayor Richard Riordan.

What pushed business-oriented donors was the widespread perception that the
L.A. school district is mired in a failed approach to education, with
dropout rates in many schools exceeding 30 percent and test scores that,
while rising, remain among the lowest in the state.

"This district is broken and will suck us down the drain if we don't fix
it," said John Kilroy, who is founder, chairman and chief executive of Los
Angeles-based Kilroy Realty Corp., a real estate investment trust.

He also is head of the Los Angeles chapter of the moderate Republican,
pro-business New Majority political group. And last month, Kilroy convinced
his fellow New Majority board members - most of whom are current or former
business executives - to pony up more than $200,000 for Galatzan, the first
time the group has weighed in on behalf of a school board candidate.

The New Majority wasn't the only business group that raised money for
Galatzan. The Los Angeles Area Chamber of Commerce's political action
committee put in $170,000, some of which included the contributions from the
New Majority. It was the chamber's first contribution towards a school board
race.

"The business community determined we can no longer sit back and watch the
LAUSD continue to operate the way it has. The status quo was no longer
acceptable," chamber president and chief executive Gary Toebben said.

While current board members and district officials vehemently deny this
assessment of the school district, it has nonetheless been stoked by L.A.
Mayor Antonio Villaraigosa in his unsuccessful bid to assume partial control
of the district.

Last year, Villaraigosa pushed through the state Legislature a bill giving
him direct control of several district schools and majority control on a new
Council of Mayors that would govern the district. But the district sued and
prevailed in two courts, blocking that law from taking effect.

Stymied, Villaraigosa turned to the other prong of his strategy to reform
the district: changing the makeup of the school board. To that end, he
formed a committee, the Partnership for Better Schools, and enlisted the
support of former L.A. Mayor Richard Riordan and billionaire
businessman-turned philanthropist Eli Broad. He then sought to support
candidates he thought would bring change to the district.

Villaraigosa's committee supported three candidates: children's advocate
Yolie Flores Aguilar, who won outright in March; prosecutor Galatzan and
career school administrator Richard Vladovic. Both Galatzan and Vladovic
placed first in the March primary, but failed to reach 50 percent, forcing
the May runoffs. (Villaraigosa already had the support of current board
member Monica Garcia; the Galatzan and Vladovic runoff victories gave him a
working majority of allies on the board.)

Galatzan and Vladovic both had the support of business groups, but since
Vladovic faced an opponent with meager funds, the major fundraising effort
went to Galatzan. In all, between the heavily business-backed Partnership
for Better Schools and other direct business contributions, Galatzan secured
$2.3 million, giving her the necessary resources to trounce Lauritzen by a
60-40 margin.

Most of the big business dollars in the May runoff went to the
Villaraigosa-controlled Partnership for Better Schools committee. (Unlike
L.A. City Council races or state legislative races, there are no
contribution limits for Los Angeles Unified School District board
candidates.)

Among the major corporate donors: Zenith National Insurance, the Woodland
Hills-based workers' compensation insurance carrier, with at least $200,000;
Majestic Realty Corp. (at least $100,000); Panda Restaurant Group, which is
headed by Villaraigosa confidant Andrew Cherng ($50,000); prominent law firm
Girardi & Keese LLP ($100,000) and a relative new-comer to the world of
local politics, L.A.-based jeans-maker Forever 21 Inc. ($100,000).

Several business executives also stepped up to the plate in a big way,
including: At least $70,000 from Beny Alagem, the owner of the Beverly
Hilton Hotel who is seeking to build a Waldorf Astoria Hotel and condo tower
on adjacent land; Robert Addison Day Jr., chairman of Trust Company of the
West ($50,000); former Hard Rock Café owner Peter Morton ($50,000); and
Stephen Bollenbach, outgoing chief executive of Hilton Hotels Corp. and now
chairman of KB Home ($30,000).

Of course, many of these businesses or executives also had other possible
motivations for giving so generously. Majestic Realty, for example, has had
several projects in Los Angeles, including playing a key role in developing
the Staples Center.

But the scale of the giving also indicates the extreme degree of frustration
among business owners with the state of the school district.

"In order to attract and retain good business, you must have a skilled and
educated workforce," said Greg Lippe, partner in the Woodland Hills
accounting firm Lippe Hellie Hoffer Allison LLP and first vice chair of the
Valley Industry and Commerce Association, which endorsed and contributed to
Galatzan's campaign. (VICA's president, Brendan Huffman, is Galatzan's
husband.)

"Our feeling was that with the dropout rates as they are now, it's simply
unacceptable. We need new blood on the school board, new people that will
care enough to push for the best education and not have other agendas
pushing them."

Galatzan herself sensed this during her campaign.

"As I talked with businesspeople, their number one concern was the dropout
rate. There was a huge concern that with so many dropouts and poorly
educated graduates, they wouldn't be able to recruit qualified candidates
locally," Galatzan said.

"Many in the business community wanted people on the school board who
understood this and that this is a crisis," she added.

During her campaign, Galatzan promised to push the board to take some money
away from the district's administrative headquarters and redirect the funds
to classrooms and teachers. She also vowed to push for more vocational
education classes throughout the district's high schools.

"We could set up apprenticeship programs where students might get high
school credits while also working part-time," she said.

Vladovic, who received more than $300,000 from the Partnership for Better
Schools, said he, too, favored steering money away from administration and
to the classroom. He also said he wanted to work more closely with the L.A.
Area Chamber and other business organizations, getting them involved more
directly in school programs.

But whether or not Galatzan and Vladovic can deliver on their promises to
the business community is an open question. Eight years ago, after the slate
of candidates backed by Riordan and the business community won election to
the board, the teachers' union fought back. Two years later, they backed
their own candidates and knocked out two members of the Riordan slate,
returning the board to a union-friendly majority.

This time, though, the teachers union is talking a different game. United
Teachers Los Angeles president A.J. Duffy has made the circuit of local
television and radio talk shows saying he supports many of the same goals
that Galatzan and Vladovic have put forward, especially pushing money out of
administrative headquarters and into classrooms.

"We're committed to making an alliance with all elements of the community,
and that includes the business community. We will reach out to all the
school board members, whether we endorsed them or not," UTLA vice president
Joshua Pechthalt said last week.