It may seem absurd that one of California’s worst-performing school districts can kill the state’s finest charter school network. But that is the reality facing the 650 mostly poor and minority, but very high-achieving students enrolled at the American Indian Model charter schools. The Oakland Unified School District voted 4-3 last month to shut down the network after a state audit reported that a lack of financial controls allowed the charter’s former principal and chief executive, Ben Chavis, to improperly enrich himself with millions of dollars of school business.

It is, however, hard to see how the Oakland district could have responded differently. The audit, which was issued in June 2012, concluded that Chavis was able to channel $3.8 million from school accounts to his personal business interests—mostly because the charter’s governing board “failed to maintain and exercise its responsibilities, authority, and control.”

Indeed, the audit showed that a charismatic and assertive school leader had control over American Indian’s governing board instead of the other way around.  Auditors found multiple examples of self-dealing and conflicts of interest in transactions that benefitted Chavis’ consulting, real estate, and construction enterprises—transactions that often put Chavis in the position as landlord to the schools he led. But there were no evidence that the board approved these dealings or ever put them out for competitive bidding. “The lack of due diligence and internal controls by the governing board has effectively granted [Chavis] and his spouse unrestricted access to the assets of the organization and implied authority to enter into a variety of business arrangements for personal gain,” the audit stated.

To be sure, the school district’s decision to revoke American Indian’s charter had less to do with Chavis than with an ineffectual board that remains unrepentant and disinterested in pursuing the reforms the audit and the district recommended nine months ago (Chavis left the charter network in 2011; he has not been charged with a crime and has denied any financial impropriety).

The fact there were three Oakland Unified school board members who voted against revoking the charter is a testament to the academic achievement at the charter schools, not to any confidence that the adult leaders at American Indian can suddenly become responsible stewards. Indeed, the charter network’s own attempt in the last couple of weeks to save itself has been marked by chaos, with stubborn board members refusing to step down amid pleas to do so by parents, teachers, and colleagues. Emergency meetings held over the last several days have ended in indecision and acrimony. The board has yet to appeal the district’s decision to the Alameda County Board of Education, which could reverse the ruling; the charter network has until the end of today to file the appeal.

The school’s success and continued promise ought to transcend the failings of its leadership. Therefore, the American Indian board ought to set aside its pettiness and hubris and appeal the revocation so that the Bay Area’s poorest and most underserved children can have a shot at a school that has stood for years at the top of California’s performance rankings. There, of course, should be assurances that the school will pursue the reforms that the school district demanded, which included hiring a third-party management company to oversee the network’s finances and operation.

But then, and most importantly, each member should promise to step down. If they don’t, then the county or the state should demand their resignations as a condition for the school’s survival.

And make no mistake: the school must survive, even if it will take time to recover its mojo from this damaging affair. State auditors diverged from their scathing assessment of the school’s financial controls and accountability to note that the American Indian network has won two Blue Ribbon awards from the U.S. Department of Education and at one point scored a 988 out of a possible 1,000 on California’s Academic Performance Index, the highest in the state (California’s goal is 800, a benchmark that few traditional schools in the Oakland Unified district have hit).

In Sweating the Small Stuff, a book published by the Fordham Institute in 2009, journalist David Whitman wrote that the American Indian Public Charter School is “one of the great educational turnaround stories in recent history,” noting that the charter and its predominately low-income students even bested the traditional school for Oakland’s “rich kids” in 2006. This year, Jay Mathews of the Washington Post ranked the American Indian Public Charter High School at the top of his list of America’s most challenging high schools.

Ironically, those achievements can be tied to the reforms Chavis put in place when he was hired in 2000 to lead the school, which then had scraped the bottom of the Golden State’s public school rankings. And, to his credit, Chavis put in place administrators and teachers who embraced his no-excuses style of education and went on to start their own successful charter schools with the same model.

But past and current achievements cannot excuse the almost total lack of responsible governance. As I noted in my recent policy brief, Governance in the Charter School Sector: Time for a Reboot, in cases where a manager or a management company effectively “owns” the board they’re supposed to answer to, questions of accountability, incentives, and conflicts of interest often follow, just as they did at the American Indian Model schools.

Even the California Charter Schools Association supported the Oakland school district’s move, but in a March 20 letter, its regional director seemed resigned to the fact that the association must work “to secure alternative education arrangements” for American Indian’s students. It doesn’t have to be that way. The state should retain the formula that has made the schools the most successful in California, but it should show the adults who govern the school the exit sign.

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