Beleaguered charter school board members resign

KAILUA-KONA — The State Public Charter School Commission at its general meeting in Honolulu on Tuesday voted to accept the resignation of all of Kona Pacific Public Charter School’s governing board members and establish a new seven-member board.

The decision comes as an alternative to revoking the Kealakekua school’s charter contract, a process the commission voted to initiate in March. This latest move, said commission executive director Sione Thompson, halts that revocation process saying also that it’s very doubtful the school will close.

“The intention is for us to continue a school there, to get a new governing board in as soon as possible in order to operate and look at the sustainability of the school moving forward,” he said on Friday.

Cecilia Royale, the former president of the school’s governing board, said she personally believes, however, that many of the allegations the commission has raised against the school “are at the very least exaggerated and at the very best taken out of context and made with full disregard for the facts.”

The commission voted in March to start the process for revoking the school’s charter contract via a notice of prospect of revocation, grounding its decision in evidence it said suggests the school violated aspects of the law and the state public charter school contract.

Those included allegations that the school commingled funds with the nonprofit that owns the land on which the school is located, overpaid lease rent and that the nonprofit was driving the governing board’s financial decisions.

Royale said the board opted for reconstitution as an alternative to seeing the school’s doors close, but she noted that no governing board members had been in place for more than six months, and none were present for the actions on which the notice of prospect for revocation was based.

“However, in keeping with what we believed was in the best interest of the school, we agreed to and proposed a full reconstitution of the governing board,” she said, “because our understanding was that it would take revocation of the charter off of the table.”

Royale also pointed to a letter from Carbonaro CPAs and Management Group addressed to the school’s governing board and filed with the commission. That letter stated that “at no time” were the school’s funds held in the nonprofit’s bank account or vice versa.

The firm also addressed the concern about lease overpayment by referring to the school’s practice of prepaying rent, which it said was “exceedingly common in general practice” and correctly accounted for on both the school’s and nonprofit’s respective books.

Thompson said the vote to accept board members’ resignations and reconstitute the board doesn’t reflect a final determination of wrongdoing — that’s still under review, he said — but instead a loss of confidence in the board’s ability to run the school and manage public funds that come to it.

“There’s a lot of things that we’re continuing to look into,” he said. “By no means does having a new board mean that everything’s good, and it’s all over. We’re going to continue to work towards sustainability and a successful school.”

Thompson said major concerns about the school came to the commission’s attention after the school nearly failed to make payroll last July, which pushed the commission to take a closer look. And as the commission dug deeper, he said, more concerns arose, bringing with them even more questions.

He said they will continue to evaluate the severity of the issues before them and make decisions within their authority, but he said they’re still looking at the documentation. The commission’s action, he added, also isn’t a reflection on the school’s teachers, students or parents.

“Right now we’re really looking at governance and systems and the finances,” he said.

Royale said the commission’s decision leaves many issues unresolved that can’t move forward without a board in place, such as teacher contracts as well as budgeting and programs for next year.

“If the school is to survive this, it will absolutely be an uphill battle,” she said.

The commission at this week’s meeting also voted to create a new seven-member governing board and has started the process of seeking applications for potential new board members.

In the meantime, commission staff will work with school administrators to manage funds and make sure operations at the school aren’t affected while the new board is formed.

Board applications are being accepted until May 14 at noon. Those applications will be reviewed and seven candidates will be recommended at the commission’s meeting on May 23.

Applications are available at the commission’s website at www.chartercommission.hawaii.gov.