The Hawaii State Public Charter School Commission voted unanimously Monday to revoke the charter of a school on the Big Island after finding 22 contract violations that included allegations of financial mismanagement and enrollment irregularities.

Ka’u Learning Academy is only the second charter school in the state to have its charter revoked. It opened its doors in 2015 in the rural area of Naalehu on Big Island, serving grades 3 to 7. It had a projected 93 students enrolled for the 2018-19 school year.

Parents who planned to enroll their kids there this coming school year will get help finding a new school, said Sione Thompson, executive director of the commission.

“A primary duty of the process is to assist families to transition to a school of their choice,” he told Civil Beat by email. “The Commission will be communicating with the families of Ka’u the decision and next steps.”

The revocation of KLA’s charter comes several months after the commission sent the Big Island school a notice of prospect of revocation outlining alleged violations.

Those violations included use of school funds and debit cards for employees’ personal expenses; irregular accounting; failure to comply with collective bargaining agreements; enrollment of students outside designated grade levels that resulted in overpayment of funds to the school; a failure to properly maintain student records; and failure to conduct criminal history background checks.

Additionally, KLA came under investigation by the Hawaii Department of Education for possible testing fraud, including excluding low-performing students from participating in state assessments and using unauthorized personnel to administer those tests. As a result, the school’s 2017 test scores “cannot be considered valid or trustworthy or relied upon and will be invalidated,” the commission outlined in a report.

The school has the option to file an appeal to the state Board of Education, which would then have 60 days to issue a final decision.

Douglas Flaherty, the chair of the school’s governing board as of April, told Civil Beat on Tuesday the board is still weighing whether to move forward with an appeal.

As to the commission’s vote, he said he was “very disappointed.”

“We worked hard (to address the issues),” he said. “(The school’s new executive director) established positive relationships with all of the parties involved and basically turned things around. Unfortunately, that wasn’t enough.”

The development comes after a rocky period for the Big Island charter school, including a shakeup of its governing board and removal of its principal. It installed a new director in January.

The only other charter school in Hawaii to see its charter revoked was Halau Lokahi Public Charter School in 2015, due to financial struggles.

Including KLA, there are 36 charter schools in Hawaii. They are tuition-free and receive their own per-pupil funding from the state DOE, but are run independently by nonprofit governing boards, which execute contracts with the commission.

A charter school contract can be revoked at any point if a school is found to be in violation of terms or standards or fail to make sufficient progress toward performance goals or “generally accepted standards of fiscal management,” according to the commission.

At Monday’s special revocation hearing at DOE headquarters, Flaherty, KLA’s governing board chair, testified that the school was working to improve its irregularities. He said the school hired a new day-to-day business manager and human resources administrator and developed new policies and procedures.

“The school is a business, and it wasn’t being run very well,” he told the commission. He said since new leadership came on board, the school has “a very different level of energy.”

“I know we’ve had to do some very difficult things, and we’ve done them,” he said.

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