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$1.4 million in retirement funds reallocated in schools

Halifax County School Board members find themselves embroiled in a lawsuit over termination of the Local Optional Retirement Plan, a program that had allowed recent retirees to earn 20 percent of their salary at the time of retirement in return for filling in for work at the schools on a part-time or temporary basis. 

The program was designed to pay benefits over seven years.

By eliminating the county schools’ Local Optional Retirement Plan, Superintendent Dr. Merle Herndon said the school system realized a savings of $1.4 million in the 2012-13 school year.

During last month’s school board meeting, ED-8 trustee Walter Potts questioned where that savings was spent asking the superintendent to provide a written breakdown of how that money was reallocated.

Prior to Monday night’s school board meeting, Herndon distributed a handout that detailed how $1,436,646.45 was spent in the current school year including:

$174,763.34 for sick leave, personal leave and vacation leave payoff not included in the budget;

 $7,350 for Thinkgate

 $14,550 for Virtual School

 $4,861 in attorney fees 

 $39,267.11 to hire two new bus drivers

 $70,000 to pay for Local Optional Retirement Plan insurance not in budget

 $17,000 to pay a part-time textbook bookkeeper

 $25,000 to pay a part-time transportation mechanic

 $39,025 to fund a substitute librarian at the high school

 $28,368 to pay a special education aide at Cluster Springs Elementary

 $55,459 to pay a general education teacher at the high school

 $55,655 to pay a general education teacher at Sinai Elementary

 $44,084 to pay a general education teacher at Halifax County Middle 

 $30,116 to pay a special education aide at Scottsburg Elementary 

 $50,175 to pay a general education teacher at Halifax County High 

 $89,187 to pay Sinai Elementary principal

 $75,139 to pay Scottsburg Elementary principal

 $58,239 to pay a general education teacher at Sinai Elementary

 $49,292 to pay a maintenance employee

 $27,711 to pay part-time band teacher at Halifax County High 

 $56,691 to hire a food services coordinator

 $50,575 to hire a new general education middle school teacher

 $23,805 to hire a new special education aide at South Boston Elementary

 $51,245 to pay a new special education teacher at Halifax County Middle 

 $44,085 to pay a new special education teacher at Halifax County Middle 

 $50,175 to pay a new special education teacher at Halifax County Middle 

 $26,765 to hire a new special education aide at Clays Mill Elementary 

 $44,085 to hire a new kindergarten teacher at Scottsburg Elementary

 $44,085 to pay for a new kindergarten teacher at Sinai Elementary

A lawsuit stemming from the termination of former employees’ Local Optional Retirement Plan was officially filed in January in Halifax County Circuit Court against the Halifax County School Board.

A total of 105 former Halifax County Public School employees and Local Optional Retirement Plan retirees filed the complaint for declaratory judgment against members of the Halifax County School Board.

The legal papers were served to former Chairman Karen Hopkins.

After months of frustration and constantly seeking answers, Local Optional Retirement Plan retirees sought legal counsel last October hiring Blackburn, Conte, Schilling and Click, P.C.

Speaking on behalf of all the retirees participating in the suit, former Sinai Elementary School Principal Michael Wilborne said in January, “The Halifax County School Board has chosen not to honor their financial obligations…therefore, our attorneys have filed a complaint for declaratory judgment.” 

Bottom line, the retirees want the retirement program reinstated, he said.

According to court documents filed, the school board’s purpose in adopting LORP was to encourage early retirement as a budget-cutting and cost-saving measure.

The suit referred to the school board’s bylaws in effect at the time each of the plaintiffs contracted with the school board for the LORP benefits.

 “The school board reserves the right to amend or terminate the program when it appears it is in the best interest of the board to do so. Participants already in the program will not be affected by the amendment or termination of the program,” the legal papers stated.

On June 28, school board members deleted the language that “participants already in the program will not be affected by the amendment or termination of the program,” and on July 24 school board members immediately terminated the program by a 7 to 0 vote with ED-8 trustee Walter Potts absent.

The complaint accused the school board of “deliberately, willfully, arbitrarily and capriciously breaching its contract with each plaintiff by voting to terminate the LORP for plaintiffs, effective immediately.”

It further stated, “That an actual justiciable controversy ripe for adjudication exists between the parties, as plaintiffs, each having relied to her/her detriment on the contractual promises and obligations of defendant, Halifax County School Board, have been permanently and severely financially and monetarily damaged by the school board’s aforesaid breach.”

In the months that followed the termination, LORP retirees attended school board meetings and voiced their concerns, shared figures on how the plan saved the school system money and made board members aware of their “feelings of betrayal.”

The complaint concluded LORP retirees are asking the court for a declaratory judgment confirming the school board’s contractual obligation to the retirees under LORP and ordering the school board to reinstate the program.

It also asked the school board to perform all its contractual obligations, to reimburse the retirees for their attorney’s fee and costs incurred and for such other relief as the court may deem fit.

Representing the retirees are Benjamin Rand and Stephen C. Conte.

Craig Wood serves as the school board’s attorney.