Thursday, May 23, 2024
Hawai'i Free Press

Current Articles | Archives

Wednesday, December 2, 2015
Auditor: More Charter Schools Could Face Financial Collapse
By Hawaii State Auditor @ 1:57 AM :: 4613 Views :: Education K-12

Report No. 15-14, Study of Public Charter Schools’ Governing Boards

The financial data schools currently submit to the State Public Charter School Commission are sufficient to provide indication of possible financial stress. However, human error and inexperienced commission staff contributed to the commission’s inability to recognize and interpret the data early enough to help avert the financial collapse of Hālau Lōkahi New Century Public Charter School earlier this year.

Summary or Full Report

Statewide Public Charter School Expenses, SY2013-2014

  *   *   *   *   *

Study of Public Charter Schools’ Governing Boards

Charter school accountability system remains a work in progress

Report No. 15-14, December 2015

Collected financial data only effective if properly analyzed

In March 2015, Hālau Lōkahi New Century Public Charter School became only the second school in Hawai‘i to have its charter revoked. Using the case of Hālau Lōkahi as a guide, we found that the financial data schools must currently submit to the State Public Charter School Commission do provide indications of possible financial stress. However, human error and inexperience among commission staff contributed to their inability to recognize and interpret the information early enough to help avert Hālau Lōkahi’s financial collapse. We also examined a number of active charter schools whose financial data were similar to Hālau Lōkahi’s. For instance, we found declining student enrollment at Kualapu‘u Public Conversion Charter School, an active line of credit at Ka Waihona o ka Na‘auao Public Charter School, and large, unpaid expenses at Hawai‘i Technology Academy. Although these schools face financial risks and challenges, we did not find anything to indicate they are in immediate financial peril. However, we recommend that commission staff continue to monitor these schools in particular.

Charter contract reporting requirements should be clarified to ensure schools meet expectations

We found the charter contract is unclear in a number of areas and requires some clarification in order to ensure schools fully understand what the commission and its staff expect of them. For instance, the language of the contract does not make clear that school personnel policies, such as licensed teachers, principal and teacher evaluation systems, and employee criminal history checks, must be posted on school websites. As a result, we found the majority of schools did not post these policies. In addition, the commission staff relies on self-reporting to ensure schools comply with statutory requirements. We found they neither independently verify whether criminal history background checks on prospective school employees have been completed nor document the results of those checks.

Agency responses

The commission generally agreed with our findings and recommendations. It also solicited responses from governing boards of the charter schools discussed in the report. Governing boards for Kualapu‘u Public Charter School, Myron B. Thompson Academy, and Ka Waihona o ka Na‘auao Public Charter School generally agreed with our findings and recommendations.

The governing board for Hawai‘i Technology Academy (HTA) generally agreed with our findings and recommendations but expressed reservations about how the report portrays the school’s financial status during the period HTA was managed by K12 Inc. Based on a review of the quarterly financial reports submitted to the commission by HTA in FY2012–2013 and FY2013–2014, the school reported its accounts payable totals exceeded its available cash by a considerable amount. As a result, we performed an on-site visit to HTA to determine the cause for the accounts payable totals and found they stem from costs associated with the K12 contract. The report does not make any conclusions about HTA’s past or current financial status.

  *   *   *   *   *

SA: Charter school’s demise could have been foreseen, report finds

CB: Auditor Spotlights Financial And Oversight Problems At Charter Schools

HNN: Audit: State could have done more to prevent charter school from closing


TEXT "follow HawaiiFreePress" to 40404

Register to Vote


Aloha Pregnancy Care Center


Antonio Gramsci Reading List

A Place for Women in Waipio

Ballotpedia Hawaii

Broken Trust

Build More Hawaiian Homes Working Group

Christian Homeschoolers of Hawaii

Cliff Slater's Second Opinion

DVids Hawaii


Fix Oahu!

Frontline: The Fixers

Genetic Literacy Project

Grassroot Institute

Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii ConCon Info

Hawaii Debt Clock

Hawaii Defense Foundation

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federation of Republican Women

Hawaii History Blog

Hawaii Jihadi Trial

Hawaii Legal News

Hawaii Legal Short-Term Rental Alliance

Hawaii Matters

Hawaii Military History

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Shippers Council

Hawaii Together


Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Navy League

Honolulu Traffic

House Minority Blog

Imua TMT

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

July 4 in Hawaii

Land and Power in Hawaii

Lessons in Firearm Education

Lingle Years

Managed Care Matters -- Hawaii

Missile Defense Advocacy

MIS Veterans Hawaii

NAMI Hawaii

National Parents Org Hawaii

NFIB Hawaii News

NRA-ILA Hawaii


OHA Lies

Opt Out Today

Patients Rights Council Hawaii

Practical Policy Institute of Hawaii

Pritchett Cartoons

Pro-GMO Hawaii

Rental by Owner Awareness Assn

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

School Choice in Hawaii

Talking Tax

Tax Foundation of Hawaii

The Real Hanabusa

Time Out Honolulu

Trustee Akina KWO Columns

West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii