Highlands Community Charter School is under investigation for allegedly enrolling adult students in primary grades, double-charging the state and claiming a full year of funding for students who attended for a shorter period of time.
The Sacramento County Office of Education began investigating the Del Paso Heights school after the California Department of Education raised red flags about Highlands’ reimbursement practices.
The adult charter school serves about 1,500 students from a variety of backgrounds, according to Executive Director Murdock Smith. Highlands offers high school completion, English classes, citizenship courses and vocational training. The school opened in 2014 to initially focus on ex-offenders.
The county’s investigation became public after Sacramento County schools chief David Gordon distributed a memo to local school districts recommending the audit.
Gordon said he hired the state’s Fiscal Crisis Management and Assistance Team because of its experience with audits. “They have done hundreds of them and have access to an audit-type staff,” he said. “We don’t have an audit staff in-house.”
Smith was adamant that his school’s business practices were above board. “Ninety-nine percent of the memo is just crazy,” he said.
He confirmed that his school sought state reimbursement at transitional kindergarten through high school levels for adult students. But he defended that practice.
“How can an 80-year-old be a kindergartener?” Students at the school are put into grade levels based on ability, he said.
“Nowhere in the Ed Code links age to grade level,” he added.
State reimbursement for students in K-12 is higher than the money available for adult education programs, which are now funded by regional consortium programs, Gordon said.
The state Education Code allows schools to receive a K-12 level of reimbursement for adults who have not been continuously enrolled in school, said Natasha Collins, a senior fiscal and policy analyst at the Legislative Analyst’s Office. To qualify, schools need to work with Workforce Innovation and Opportunity Act agencies and other federal programs geared toward educating adults.
Highlands Community Charter School has partnerships with the Sacramento Employment and Training Agency, which is authorized by the Workforce Innovation and Opportunity Act.
More than a dozen adult charter schools enroll their students in K-12 grades and receive state funding for those grade levels, said Laura Kerr, managing regional director of the California Charter Schools Association, which advocates for charter schools.
The Sacramento County Office of Education launched its investigation after reviewing a 2015 school audit, the Highlands website and recruitment materials, according to a memo written by SCOE Assistant Superintendent Tamara Sanchez.
The county office is responsible for providing oversight of school finances and took action after the state Department of Education inquired about potential improprieties. State officials questioned why Highlands only had students enrolled in grades not subject to standardized testing, according to the memo.
In a letter emailed to Gordon, Smith said the school chooses grade levels carefully in an attempt to preserve the accuracy of state standardized test results.
“We believe that if our students took the standard K-12 standardized tests, it would bias the state data by including adults, which is not a group that makes sense to have in the state statistics,” he wrote.
The state has authorized Highlands to use exams other than state standardized tests, Smith stated.
He also disputed the allegation that the school charged the state twice for students who attended morning and afternoon sessions.
“We don’t double dip,” he said. “That is a bunch of baloney.”
The SCOE memo questioned whether Highlands intentionally avoids serving students with disabilities. The school does not receive special education funding, though it serves two students with severe disabilities, Smith said. “We make reasonable accommodations, but we don’t get paid for that.”
In his letter, Smith also refuted the notion that Highlands allows students to take fewer than the state-required annual instructional minutes for K-12 students. He contends that, as a charter, it is not required to schedule its students a minimum number of minutes per day.
The hired investigators will be paid by SCOE, which might seek reimbursement from Highlands Community Charter if the audit comes out unfavorably for the school.
In 2015, the Fair Political Practices Commission began investigating whether Twin Rivers Unified School District trustee Linda Fowler violated conflict-of-interest rules by accepting consulting fees from Highlands, which received its charter from the district board. At the time, Fowler sat on both the district board and the Highlands board. The investigation is ongoing.
Fowler, now vice president of the Twin Rivers Unified School District board, no longer sits on the Highlands board. But she is paid approximately $23 per hour to be a site administrator for the charter school, Smith said.
Gordon said that officials at the charter school have called him to talk about the memo and to try to meet with him to discuss why the investigation is necessary.
“The audit will speak for itself,” he said.