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Auditor Galloway issues report on now-closed Pathway Academy charter school in Kansas City; finds improperly paid bonuses and questionable credit card use

A report on the Pathway Academy Charter School (PACS) released today by State Auditor Nicole Galloway highlights several concerns at the now-closed school in Kansas City, including improperly paid bonuses to employees and questionable disbursements and credit card use. The audit gives PACS a rating of "poor."

The Missouri Charter Public School Commission took over sponsorship of PACS in late 2018. At the time, PACS was on an academic probation placed by its previous sponsor, the University of Missouri - Kansas City. After determining the school did not meet the conditions of the probation and lacked sufficient financial controls, the Commission recommended PACS close at the end of the 2018-2019 school year, which the Board voted to do. In June 2019, Commission representatives contacted the State Auditor's Office with concerns about financial practices at PACS, and the Board voted to request an audit.

"Charter schools need to be operated and overseen in a way that efficiently and effectively serves not only the students who go there and their families, but also the taxpayers who provide the school's funding. The money at Pathway was greatly mismanaged, and that is disappointing," Auditor Galloway said. "My office has turned over the findings of this audit to the Jackson County Prosecuting Attorney and the Missouri Attorney General."

The audit found that PACS paid at least $25,000 in bonuses to employees over a two-year period in violation of state law, as well as more than $3,100 in additional unsupported compensation. The additional compensation, including the bonuses, was not detailed in the annual budgets approved by the Board or approved at Board meetings.

The audit also found $19,779 in questionable and unsupported transactions, including purchases for food, sporting and art functions, and gift cards, as well as disbursements to employees. Significant weaknesses in the PACS accounting controls and procedures also were discussed in the audit, including unauthorized transfers between accounts and lack of supporting documentation. The Board also did not adequately monitoring staff hiring procedures, as required by its charter school contract, and closed meeting minutes were not maintained as required and the Board did not fully document the reasons for closing meetings.

The complete audit report of Pathway Academy Charter School can be found here.