Highlands Community Charter School hired staff convicted of violent felonies and used public money to educate students ineligible for services and to pay the legal fees and car repairs of employees, among a laundry list of other questionable practices, according to a recently released state report.
The state Fiscal Crisis and Management Assistance Team found no intentional fraud, but several potentially unlawful practices.
"Its findings should be of great concern and require immediate intervention to limit the risk of fraud and/or misappropriation of assets in the future," stated Sacramento County schools chief David Gordon in a letter to Highlands board president Ernie Daniels.
As a result, the Del Paso Heights independent charter school, which opened in 2014 to help students older than 22 earn high school diplomas, could lose state funding or face sanctions from Twin Rivers Unified, the school district that authorized it.
Highlands Executive Director Murdock Smith said the school has made changes to correct some of the irregularities pointed out in the 62-page report, but disagrees with a number of its conclusions.
The adult charter, which opened with 161 students, now serves 1,700 students at 25 locations. Along with high school completion courses, it offers classes for English learners and U.S. citizenship classes, as well as job training in cosmetology, child development, truck driving, small business ownership, information technology and office administration.
The state report blames some of the troubles at the school on a staff so motivated to help students reach their goals that rules were bent and laws misinterpreted. Examples included awarding a diploma to a student who never completed a course at the school, a student with an eighth-grade reading level who completed 134 credits in one year and a student who passed algebra although he failed the GED with an exceptionally low score, according to FCMAT.
The Sacramento County Office of Education began investigating the charter school in February of last year, after the California Department of Education raised red flags about its reimbursement practices. The school had accepted state funding for students in one program who did not attend the required number of days, and served students under the required age of 22 as well as some who had already earned a diploma. according to the report.
Investigators found that 51 students younger than 22 and another 29 students who already had high school diplomas had been admitted to the school. Although the school did not accept state funding specifically for those students, school funds - 99.9 percent from state and federal sources - were used to educate them, according to the report.
Highlands staff removed the students from the school after they learned there was a problem, Smith said.
The school also has terminated one employee who had been convicted of manslaughter and another who had pistol whipped someone in another state.
"I made a mistake," Smith said of those hires. "Those people were graduates of Highlands and they were doing a fantastic job, but I thought they were exempt from the law because all of our students are adults."
Because Highlands receives funding based on average-daily attendance instead of adult education funding, it must follow the same rules as K-12 schools, including not employing people who have been convicted of serious felonies, Smith said.
The two employees were put on administrative leave as soon as the school was alerted to the problem and later terminated, Smith said. The school helped them find new jobs.
Smith stands behind the decision to pay for repairs to an employee's BMW and another's legal fees. He said the woman with the BMW damaged it by hauling furniture to various school sites because the school didn't have a truck. He also says the board had the right to pay $14,979 in attorney fees for Linda Fowler, a Twin Rivers Unified board member and employee of the charter school, because the legal issue was related to her employment.
Investigators from FCMAT also questioned the school's relationship with Fowler, who has been a trustee on the charter board, a consultant and now is the site administrator at the school's Mather: Volunteers of America site.
Fowler said she had not seen the report and therefore could not comment on it.
This isn't the first time that the charter school has been scrutinized for its relationship with Fowler, who helped to found the school. The Fair Political Practices Commission opened an investigation in July of 2015 to determine whether Fowler violated California Conflict of Interest laws by accepting consulting fees from the charter school while sitting on the Twin Rivers board. Highlands paid Fowler's consulting firm $13,000 in October before canceling the contract when the school principal questioned its propriety.
The case is still open.
The report also criticized the board's decision to accept via email Fowler as a charter school board member, saying it was a violation of the state's open meeting law and could be invalid. Fowler had been appointed to the board seat by Twin Rivers Unified.
The investigation also found:
- The school may have violated California Conflict of Interest laws by approving consulting contracts with other employees who also were board members.
- The school incorrectly awarded credits toward high school graduation based on high school equivalency test results.
- There have been Inconsistent practices in evaluating student skill attainment and other testing anomalies.
Smith disputes the charge that students were given high school credit based on high school equivalency test results, because they took coursework in preparation. Students take prep classes for as long as needed to pass the test, although no specific number of hours are required, Smith said.
Other practices including paying board members for contract work, inconsistent testing practices and not having the board approve curriculum have been changed, Smith said.
The school's partnership with the Greater Sacramento Urban League, required by its charter and necessary to qualify it for a Workforce Innovation and Quality Act exemption, also is questioned in the report. The partnership agreement and exemption allows the school to collect state funding for students older than 22 who have not earned a high school diploma.
The requirement that the Urban League offer various services in exchange for $10 per student was not fulfilled, according to the report. Charter school staff told investigators that the Urban League provided Highland students only with CalJOBS and CalWORKS numbers, but did not provide any services between 2014 and 2017. The agreement was only on paper, according to one person interviewed by investigators.
Both Highland's Smith and leadership at the Greater Sacramento Urban League disputed these claims, saying the charter operates Higher Heights Adult School at the non-profit's headquarters in Del Paso Heights and that the Urban League offers services to Highlands students at its job center.
"We are connecting people to jobs and high school diplomas," said Cassandra Jennings, president and CEO of the Greater Sacramento Urban League. "I'm sort of disappointed that we worked so hard in the community and a report comes out that really doesn’t reflect the work that we are doing and/or the people that we serve."
She said that state investigators did not interview anyone at the Urban League. "We probably could have answered a lot of questions," she said.
The report acknowledged that Highlands charter operated a school at the Urban League's headquarters, but said because the charter school paid rent for the space and provided the teachers, the non-profit wasn't offering services.
Smith said the charter school also has workforce agreements with the Sacramento Employment and Training Agency, Asian Resources and La Familia Counseling Center.
Twin Rivers staff have been helping the charter school resolve issues around fingerprinting, sexual harassment and other things that fall under the oversight of the district as it has been made aware of findings during the 21-month investigation, said Deputy Superintendent Bill McGuire.
"What we have seen with Highland Community Charter and work we are doing with them, they have a genuine desire to resolve any issues and make sure they are a high-quality, high-functioning school providing great services to adults in our community," he said.
On July 10 the Twin Rivers Unified school board will hear a presentation from the charter school explaining how it will resolve outstanding problems outlined in the report.
Once the board and charter agree on a plan of action, the school district will monitor its progress. If the school does not resolve its issues there is a possibility that it could have its charter revoked or not renewed when it comes up again in 2019, McGuire said. He sees this as a worse-case scenario, however, and expects the school will fix things and move forward.