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1. Superintendent of Guideline for the California schools, Jack O'Connell, initiated an audit more than a year back into the financial issues of the Options for Youth and Opportunities for Learning (OYO) car donation concord ca schools. The OYO is a chain of independent study charter schools within the California schools system, which are privately run but funded by the state. The OYO California schools serve trainees who have left of the traditional high schools. They currently have about 15,000 students in 40 storefront places throughout the state. These California schools students do many of their work at home, meeting with instructors twice a week. According to state records, student accomplishment test and high school exit examination ratings are above average, as compared to other alternative high schools within the California schools system. According to a Los Angeles Times short article of August 10th, only 11 percent of OYO trainees graduated during the 2003-2004 academic year. The rest of students that left school that year either dropped out, were expelled, or transferred to other schools. The California schools' audit was carried out by the Fiscal Crisis and Management Support Team, who concluded their analysis and presented their findings in a report that was launched in August 2006. The audit mentions accounting problems, overpayments by the state, conflicts of interest, nepotism, excessive compensation, and mixing private business issues with public schools. The OYO was founded and still operated by John and Joan Hall, previous instructors from Hollywood High School. They have actually totally cooperated with the California schools' audit, but conflict many of the findings. Some examples from the audit report are: • Accounting Defects and Overpayments. The Halls count each of their instructors as 1.92 full-time positions. Their spokesperson, Stevan Allen, stated that this is a typical practice for charter schools in the California schools system and is a legitimate method for compensating school staff for longer days and year-round schedules. California schools superintendent O'Connell thinks instructors need to be counted just as one full-time position each. The auditors disagreed, pointing out that traditional California schools instructors invest much less time working each year than those at OYO. However, the auditors believed the 1.92 amount is inflated. This example, alone, represent over half of the $57 million overpayment. Additionally, the report kept in mind numerous questionable expenses. One example of unrestrained spending, provided by the Times was an $18,000 staff party held at Disneyland. Allen defended that occasion as an effort at relationship structure in between staff members, who are scattered across the state. He kept in mind that the costs was less than $50 per employee. • Conflicts of Interest and Mixing Private Service with Public Schools. Besides the charter schools, the Halls own and run numerous personal businesses that offer products and services to schools. The Times noted that the Options in OYO was the nonprofit part of the setup, with the Opportunities part being for-profit. The audit calls this practice and setup into concern. • Excessive Compensation. The audit also questions the combined wages for the Halls, which is $600,000 each year. The report mentions that it might be extreme for the amount of time the couple in fact works. • Nepotism. The Halls created a separate charity with $10.8 countless the California schools' financing, called Pathways in Education. The charity is run by their daughter, Jamie Hall. Little money has been spent toward education hence far. The Halls compete that they formerly had requested assistance on their operation from the California schools often times, but never ever got any reaction. Therefore, they attempted to follow California schools requirements as finest they could with their understanding of the policies. Even O'Connell yielded that none of the cited

2. practices are illegal. The audit advises the California schools ought to try to recover the $57 million in overpayment from the OYO. O'Connell has actually sent out the report to the state's attorney general's office for evaluation and any needed action.