Posted on: Friday, January 21, 2005

Puna charter school responds to audit

By Kevin Dayton
Advertiser Big Island Bureau

HILO, Hawai'i — The head of the Na Wai Ola Waters of Life charter school said she is confident the school will continue on despite a highly critical audit released earlier this week.

Local mismanagement and lax oversight by the state Board of Education have led to problems so serious that they are "placing the school's viability in question," according to the first state audit of a public charter school.

The report, released by the state auditor, also lays blame with the state law that created charter schools, charging that defects in the law hobbled the ability of the state Board of Education to oversee Waters of Life and other charter schools.

The audit portrays a school that is burdened by financial management problems, failed to take legally required precautions in hiring staff, and repeatedly failed to file required financial and other reports as the school spent $2.6 million in state and federal funds over more than four years.

Katheryn Crayton-Shay, who took over as Waters of Life school director four months ago, said the school has undergone sweeping management changes in the past six months. Those changes include a new director, an entirely new local school board for the school, and a new school administrative services assistant to handle its business affairs.

Crayton-Shay blamed many of the Puna school's problems on what she called a "premature birth" when Waters of Life was founded in 2000, and said she is confident the school will remain open.

"I would hope that parents will welcome it (the audit) as an opportunity ... to become more pro-active," she said. She said she hopes parents will rally to offer the school their expertise to help it solve its problems, or will recruit others in the community who have the expertise to help.

In a written response to the audit, Water of Life local school board Chairman Paul Wheeless said he instructed Crayton-Shay and the school staff "to 'clean up the old mess' as quickly and fairly as possible."

The school has an enrollment of more than 130, and holds classes for elementary students at the Ainaloa Longhouse; for middle-school students at the City of Joy Christian Fellowship sanctuary; and for high school students at the Girl Scout Council of Hawai'i center in Kea'au.

The Board of Education approved the charter for Waters of Life in 2000 based on an "unsound" business plan, and the school's founders lacked the expertise to set up adequate management systems, policies and procedures, according to the audit.

Since the school was founded in 2000, it never submitted annual financial audits and self-evaluation reports that are required by its own charter and by the charter school law, the audit found.

That meant the Board of Education had no basis for assessing the school's financial accounting, its viability or the education it has offered its students, according to the audit.

The report found that problem was common among charter schools, with 13 of 26 that existed in October 2003 failing to submit legally required accountability reports at that time.

Waters of Life is still without written policies and procedures governing procurement, personnel and financial management, according to the audit. That led to apparent failures to perform legally required criminal record and health checks for newly hired staff, including checks for tuberculosis, according to the report.

In one case students "were transported, during a brief employment, by a driver with an extensive criminal record, including felony convictions in the first degree involving a minor."

Crayton-Shay said that driver was a substitute who drove for the school five days while another driver was undergoing training, and the staff that hired the driver temporarily believed a background check had already been done.

The school caught the problem during a later background check when the driver applied for a permanent job. The school has a new transportation coordinator today.

The report also faulted the school for failing to document that its teachers met the requirements of its charter, and found only two of the nine teachers had a Hawaii State Teacher's license. In a response to the audit the school disputed this, reporting that three teachers were licensed, and eight of the nine teachers were in compliance with the teaching requirements in the school charter.

Reach Kevin Dayton at kdayton@honoluluadvertiser.com or (808) 935-3916.