Thursday, January 20, 2005

Audit rates Puna
charter school worst

HILO » State Auditor Marion Higa has issued a report that is sharply critical of the Big Island's Waters of Life Charter School and of the state's charter school system generally.

"Inadequate fiscal management has caused waste and losses and leaves its leaders without reliable financial information for decision-making."

Marion Higa
State auditor, on Big Island's Waters of Life Charter School

Of some two dozen charter schools in the state, Waters of Life in the Puna district, south of Hilo, has experienced the most problems, including $257,000 in overspending, which it was required to repay to the state during a five-year period beginning in 2002.

That followed an attempt by the state, blocked by a Hilo judge, to shut the school down.

The school has operated at numerous sites and has had a series of officers directing it.

A summary of Higa's audit says the school's academic success is unclear. Its board of directors "has no reliable measures of the school's success in providing children with an education," it says.

But Higa's sharpest words concern management and finances. The school has lacked an adequate business plan, which led to "management failures," the report says.

"The school's inadequate fiscal management has caused waste and losses and leaves its leaders without reliable financial information for decision-making," Higa wrote. "Expenditures, $2.6 million since the school's inception (in 2000), lack justification and documentation."

Paul Wheeless, new board chairman for the school, said in a letter that he had directed staff "to clean up the old mess."

The school has an annual budget of nearly $1 million. However, it also has a mortgage of $380,000 and other problems that "cloud Waters of Life Charter School's viability," Higa wrote.

The mortgage refers to the purchase of a 28-acre farm near Kurtistown, which included former farm administration and warehouse buildings. That was to have become the permanent home for the school, but neighbors objected, starting in 2003, citing health and safety concerns.

Wheeless said the farm business is separate from the school and has new outside ownership.

In the broader picture, Higa said the "defects" in the charter school law and failure of the state Board of Education to conduct proper oversight led to the problems.

"The charter school law lacks clear authority and responsibility assignments, resulting in conflicting roles and uncertainty," Higa wrote.

Breene Harimoto, school board chairman, said in a letter that the Board of Education had not shirked its oversight of charter schools, but had been hampered by the law.

Higa recommended that the Legislature allow the Board of Education to propose revisions to the charter school law, that the board develop clear means of providing oversight and that the school develop written procedures and adhere to existing laws.

Office of the Auditor

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