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Charter school accused of misspending millions is seeking to open under new name

A state audit found Highlands charter school in Sacramento allegedly misspent $180 million.

Silicon Valley and Bay Area real estate
Curated News BriefBased on original reporting by CalMatters Housing (September 23, 2026). The summary below is the Journal’s; the local analysis is original commentary by Omar Murillo.

Look, I want to walk you through something that's been making headlines in California's charter school space, and it's pretty significant for how we think about oversight in education funding. According to CalMatters Housing and their reporting on this situation, a Sacramento-based charter school called Highlands Community Charter and Technical Schools got hit with some serious findings in a state audit. The auditors found the school had allegedly mishandled roughly $180 million, and the list of concerns is pretty extensive – we're talking questionable spending on things like luxury hotel bills and international travel, attendance reporting that wasn't accurate, and hiring practices that raised red flags.

Now here's where it gets interesting from a regional perspective. After getting hit with all this scrutiny, Highlands is trying to relocate and rebrand itself. The school operates adult education programs across Sacramento, serving immigrants and folks working toward their high school diploma, but they've decided to approach Yuba City Unified School District in Sutter County about getting a new charter under a new name – California Learning Academy. The Yuba City board unanimously rejected the petition in July, citing the school's track record of low academic performance, financial management concerns, and issues with teacher qualifications. Highlands is now appealing that decision to the Sutter County Board of Education.

The school's current leadership – which includes a completely new board and executive director after the previous ones stepped down – is pushing back on some of the audit's findings. They're disputing that $180 million figure and appealing it to the state's Education Audit Appeals Panel. The executive director says they've fixed eighteen of the identified issues and brought on qualified teachers, but the California Department of Education has already demanded repayment of those funds, which would essentially bankrupt the operation.

According to the reporting, opposition to Highlands' relocation attempt is coming from local school employees and union officials in Sutter County who are concerned about students being shortchanged and about the school's actual spending priorities. They're also pointing out that Highlands has recently had compliance issues with its current charter, including a failure to produce proper financial audits. There's real skepticism about whether the changes the school claims to have made are substantial enough.

What I'm seeing in situations like this is a fundamental tension in how we oversee educational institutions, especially those serving vulnerable populations like immigrants and low-income adults. Highlands is trying to serve a real need in communities that have been underserved, but the audit findings are serious and the school's inability to be transparent about finances is a major problem. When something like this happens, it affects how communities view charter schools generally and how they evaluate whether educational organizations are truly putting resources toward students.