Golden Lakes Charter School in debt

After just one semester, the Golden Lakes Charter School in Don Pedro filed a first interim budget report that shows a debt of $200,000.

The budget report was presented Monday to the Tuolumne County Board of Education. The Tuolumne County Office of Education, which reports to the county board, is the authorizing agent of the charter but has limited authority.

Superintendent of Schools Joe Silva said he asked charter officials to attend Monday’s meeting to answer questions raised by the “flags” in the budget report.    

Leigh Ann Blessing, assistant superintendent of business services for the Office of Education, said Monday that the charter’s first interim budget showed a different financial picture than projected in the original charter petition approved in October 2010.   

The charter’s first interim budget showed the finances from July through October with an ending deficit of $210,116.    

The charter petition projected a student body of 116 but the school had only 78 students at the first attendance reporting period, known as P-1.    

This created a revenue drop of more than $200,000, according to the budget report.    

The charter’s budget was $300,000 less than what it projected for the end of the first interim reporting period, the report stated.

The budget report also raised flags for Office of Education officials because it projected a 100 percent increase in enrollment for the 2012-13 school year. The charter projects enrollment to be at 158 in the 2012-13 school year and 186 in the 2013-14 school year.    

Blessing noted that most schools nowadays are seeing enrollments drop.   

“It’s pretty ambitious to say it will double,” Blessing told trustees.    

The charter school will have to monitor its finances very closely to get themselves out of the budget situation it is in, Blessing said.    

“Everyone else is declining (in enrollment). What are your explanations?” board member Sharon Mele asked Golden Lakes officials.    

Golden Lakes director Mari Brabbin said the charter had 122 students signed up for the fall semester but, because the school didn’t have a permanent site, they lost 30 students. She said the students want to return this fall now that the school has a permanent building on La Grange Road, near the Lake Don Pedro Hacienda.   

La Grange Elementary School is closing so there will be students from there as well, Brabbin said.   

Brabbin said “realistically,” the charter is expecting to have 130-135 students enrolled in the K-12 program in the 2012-13 school year.    

“It is very ambitious, but we’ve worked hard to do that,” Brabbin said, adding that the charter now has 89 students.  

County board member Joe Von Hermann assured charter officials the board wants to “play the game fairly,” but needs to know the rules.    

He requested a copy of the charter petition and memorandum of understanding between the charter and county schools office.    

Blessing said Tuesday the laws surrounding charters are gray and the role as authorizing agent has little authority, unlike in the fiscal relationship between the Office of Education and public schools in the county.    

 The Office of Education must approve each school district’s budgets and budget projections before they are submitted to the California Department of Education and can tell the districts their projections are unreasonable, using historical statistical data like enrollment, as indicators, Blessing said.    

With charters, “they’re a totally different animal,” and the office can’t render an official opinion on budget reports like public schools and charters budget projections can “say whatever they want,” she said.    

“We just have to assure we’ve done due diligence,” she said.    

The charter’s actual ending revenues and expenditures report, called unaudited actuals, are due in September. The charter will receive its next year’s funding based on its second enrollment reporting period count in mid-April.   

Brabbin further explained to board members the charter school was also short on cash because of deferred payments from the state. The school is also waiting for an additional $225,000 from the state for start-up costs.    

Brabbin explained the costs for the permanent school site were higher than anticipated.    

To remedy the disconnect between the projected budget and what’s come to fruition, the charter made $100,000 in cuts in December by cutting one teacher, two support staff positions, one music class and one fire science class and Brabbin and another staff member took a 10 percent pay cut, Brabbin said.    

“It turned out to be a positive for the campus,” she said of the change and restructuring of the middle school program because of the budget reductions.    

In the short term, the charter has secured independent financing to cover cash flow issues, the budget report said.   

The charter will be up for renewal at the end of the second school year, in 2013, according to an agreement between the county office and charter school.    

The school’s original budget projected $1 million in revenues and $956,000 in expenditures for an $89,000 ending balance. The July to October actuals show $185,440 in revenues, $395,000 in expenditures and a negative $209,000.    

The first interim report projects $841,000, $94,000 in expenditures and a negative $210,000 ending balance.    

Taking into consideration the enrollment assumptions, the charters multiyear projections show estimated revenues of $1.25 million in 2014, with a $52,000 ending balance, closing the budget gap from this budget cycle.    

The school’s second interim report is due in March, Blessing said.    

Brabbin said the school has also been supported by several school board members and others’ volunteerism. For instance, Trustee Elle Duste provides transportation and Trustee Ron Howenstine is janitor, construction manager and transportation provider.   

“Our campus will be complete in the next four weeks. We’re so excited. We’ll have everyone on the same side (of Lake Don Pedro) and it’ll be great,” Brabbin said.   

Golden Lakes Charter School was started on the premise of having a locally controlled school to serve students who straddle the county lines surrounding Lake Don Pedro.    

The charter is also funded, in part, by its sponsoring district, Big Oak Flat-Groveland Unified, whose representatives have repeatedly bemoaned the district’s financial relationship with the charter.    

Golden Lakes’ charter petition was approved for an initial two-year period by the Tuolumne County Board of Education in late October 2010 after it was denied by the Big Oak Flat-Groveland board.