The new governing board of Halau Lokahi Public Charter School will lay off all 18 employees at the financially strapped school at the end of this semester and then quickly rebuild a smaller staff that the school can afford.

"It’s a painful situation, but it’s necessary to keep our school open and functioning until June 30," said Elizabeth Blake, a school improvement consultant retained by the board, which was appointed in July to get the school back on track.

The state Charter School Commission voted unanimously Thursday to accept the plan to rescue the school, which should ensure uninterrupted services to students. Halau Lokahi had run out of money before the end of the last academic year, and stopped paying its rent and staff. It ended the school year with a $502,000 debt.

One of the state’s oldest charters, the Kalihi-based school has 159 students in kindergarten through 12th grade. About 100 of them attend its Kalihi site regularly, while the rest study online, according to the commission.

In June, commissioners required it to replace its governing board and longtime director, Laara Allbrett, and come up with a financial plan that would carry it through the school year, before they allowed it to reopen.

But the campus again faced a financial shortfall, as enrollment fell below projections this fall and Kamehameha Schools decided not to give it $1,500 per pupil, as it usually does for Hawaiian-focused charter schools. That decision came because Halau Lokahi failed to meet the terms of its previous contract, according to M. Waialeale Sarsona, director of Hoolako Like, Kamehameha Schools’ charter school support program.

The new restructuring plan calls for a 50 percent cut in payroll costs before the school reopens Jan. 5. The ultimate size of the staff for next semester has not yet been determined. Some salaries already have been trimmed, according to Kama Hopkins, vice president of the governing board, which is made up of volunteers.

"We’re excited at the opportunity that we have to make some changes," said Hopkins, a veteran educator. "As we go forward, we’re going to try and make sure that we stay as positive as possible."

"We chose layoffs because that gives those that may not have an immediate opportunity for other careers or employment the chance for unemployment services," he added. "Right now it’s hard. For every one of them there’s a passion."

Over the winter break, the board will review all school policies and make sure its finances, governance and staffing meet state and federal requirements, he said.

"State law says that we have to have ‘highly qualified teachers’ for our core subjects," Hopkins noted. "Our intent is to go by position, see what qualifications are needed for that position and if we have someone on staff that can fit it, great." Otherwise, he said, the school will hire new employees.

The Honolulu Star-Advertiser checked faculty listed on the school’s website against the database of licensed teachers maintained by the Hawaii Teacher Standards Board and found that most of Halau Lokahi’s teachers do not appear to be licensed.

The Charter Commission decided Thursday to release only half of the per-pupil funding due from the state at the end of this month, saving the other half for release once the restructuring is completed in December.

Statements supporting the restructuring were submitted on behalf of the staff and the faculty at Thursday’s meeting. The school’s landlord has reduced the rent and also given it more time to repay its debt.

"The school’s community remains steadfast in its belief that this school can become an exemplary model in the future and win back the support of its external funders and attract potential students," the board said in its restructuring plan.