Charter schools
project deficits

DOE figures show
at least 5 schools operated
at a loss for last school year

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By Treena Shapiro
tshapiro@starbulletin.com

At least five of the state's 22 charter schools ended the last school year with projected deficits ranging from $34,295 to $323,382, Department of Education figures show.

State Board of Education officials said they will try to do a better job of monitoring how charter schools spend their money.

The board's Committee on New Century Charter Schools met yesterday to discuss the charter school expenditures and a draft policy to monitor deficit spending.

Committee Chairwoman Donna Ikeda said the expenditure report is meant "to give schools notice that they are dangerously close to running into a deficit, to make adjustments, raise money, cut back on expenditures or do whatever they have to do in order to not end up in a deficit by the end of the year."

Schools that go into the next school year at a deficit face a one-year probation, the first step in revoking the school's charters.

Ten schools showed projected surpluses ranging from $1,077 at Hawaii Academy of Arts & Science to $323,120 at Waialae Elementary.

But board member Meyer Ueoka was alarmed at the projected deficits.

"That's only for one year. If it continues next year ... wow!"

The DOE report shows Lanikai Elementary School operating at a deficit, but Principal Donna Estomato argued that the school did not have a deficit when several factors are taken into account.

One of them is the school's practice of paying for July and August payroll out of the current year's budget cycle, which began July 1. Most of the other charter schools were expected to meet the payroll out of the previous year's budget. "This does not accurately reflect how we've done business," she said.

But Ikeda cited the Waters of Life case in which a Big Island charter school ran a deficit of $171,000 in the 2000-01 school year and a projected deficit of $271,876 this year. Waters of Life was put on probation last month after the state failed in an attempt to shut it down.

Ikeda warned Estomato: "I do have some problems with the way you're utilizing money for the next year before you've gotten it.

"It's awfully dangerous to forecast based on assumptions."

Sean Murakami, an administrative assistant with the public charter schools program office, gave the board the expenditure report and a draft of the guidelines to monitor the fiscal status of charter schools.

The draft will be presented at an ad hoc committee on charter schools meeting tomorrow.

In the red The following charter schools showed projected deficits for the 2001-02 school year, according to the state Department of Education: >> Connections >> Kanu O Ka Aina New Century >> Lanikai Elementary School >> Voyager >> Waters of Life