Updated: 5/17/2008
Early stipend still debated
Minutes from closed sessions add to questions on contract
By Julian Emerson
Leader-Telegram staff
Sometime last fall, when Eau Claire school board members first heard rumors about former Superintendant Bill Klaus receiving his retirement stipend earlier than called for in his contract, they were in disbelief.
Annual stipend payments to Klaus totaling $225,000 over five years couldn't start until Klaus retired, as outlined in his contract, which the board had approved the previous February. The board simply wouldn't have given Klaus the early payment benefit not available to any other district employee, a school board member told the Leader-Telegram in October.
But the rumors persisted, prompting an Oct. 22 closed session at which board members discovered a document signed and backdated by former board President Carol Olson during the summer authorizing that Klaus' early retirement payments begin Aug. 1, 2007.
The document was dated Feb. 5, 2007, the same date the board had approved changes to Klaus' contract allowing him to transition from his job as superintendent to become principal of Northstar Middle School the following July. Board members were surprised at the revelation and subsequently denied the early retirement payments while adding a contract provision that would allow Klaus' heirs to receive that money in case he died before retiring.
The contract alteration generated concern among board members, according to minutes of closed-session school board meetings obtained by the Leader-Telegram as part of an Open Records request filed with the school district. Board members discussed the contract at four closed-session meetings in October, November and December, and at times disagreed about the issue, minutes show.
But since learning of the problems surrounding the contract seven months ago, board members have said little about the issue publicly despite repeated attempts by the Leader-Telegram to obtain information.
Now, as the board conducts an investigation into Klaus' contract change and possible cover-up efforts on the part of district employees, its role in keeping the issue from the public is being questioned.
Eau Claire residents are asking why board members hadn't been more forthcoming. Board members have discussed the issue to a degree. Most have expressed surprise at learning Klaus' contract had been changed and frustration at having to conduct an investigation into the matter, a development they acknowledge has seriously hampered plans for a future school referendum.
However, those revelations didn't come until after an April 19 Leader-Telegram story detailing the signing and backdating of the memo by Olson. For months prior to that, board members refused comment on the matter, and former board President Mike O'Brien - who left the board last month after deciding not to seek re-election - told the Leader-Telegram the closed-session about the contract prevented its public discussion.
District employees say O'Brien advised them against releasing documents related to Klaus' contract because they were discussed in closed session, he said.
Kirk Strang, a lawyer with the Davis and Kuelthau law firm of Madison who is representing the district in the Klaus matter, has subsequently informed district officials that those records, including minutes of closed-session board meeting, are public and must be released.
Since the April 19 article, board members have revealed few details surrounding the issue, in part because of the ongoing board inquiry and a police investigation into the matter.
Board President Carol Craig conceded that questions about the topic "certainly are legitimate" and "no (board of education) member has been told to be silent on these matters." But discussion of those topics via the media "would be counterproductive" to the continued investigation of Klaus' contract changes, she said.
The investigation is scheduled to continue on Monday.
Like board members, district employees also have been reluctant to speak on the record about events surrounding Klaus' contract.
But school board closed-session meeting minutes indicate Deputy Superintendent Gregg Butler's involvement in the issue.
Butler's name had not previously surfaced as part of the board's investigation, which has included interviews with district employees, including Klaus.
Oct. 22 meeting minutes state that Butler discussed early retirement stipend payments with Klaus. In a May 9 letter to interim Superintendent James Leary, Klaus questioned why the board minutes didn't more accurately reflect Butler's role regarding the issue.
Missing from those minutes, Klaus writes, "is any indication as to who authorized Dr. Butler to discuss this matter with me. It appears that no minutes were provided for the closed session board meetings wherein Dr. Butler's involvement was discussed, or that the matter was addressed with Dr. Butler outside the confines of the board."
Butler said he met with Klaus to discuss the issue while visiting Northstar on Oct. 16. At that meeting, Klaus said he wanted the early stipend money to ensure it went to his family in the event of his death, Butler said.
"Literally, this was a five-minute-or-less meeting with (Klaus)," Butler said.
Butler subsequently told the board on Oct. 22 of Klaus' reason for seeking the early stipend. Butler said that was the extent of his involvement with the issue.
Craig did not comment on Butler's involvement in the Klaus contract situation but said the board could expand the scope of its investigation to interview other employees as new information comes to light.
"We want to leave that option open," she said.
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7 comments:
The following story from the Altoona Star provides a little more background on the ealry retirement stipend situation. It seem that in the school community the stipend for adminstrators is considered a way of getting and keeping adminstrators and administrative staff and not as the case was for teachers of replacing higher pay positions with lower pay. This helps me to understand the Kalus situation a little better- to understand it that is, not to condone the back dating. I think there are still some early stipend payments being made in Altoona as although
the practice was stopped, there may still be people in the pipe line.
OFFICIALS DISCUSS FORMER STIPEND PROGRAM
May 16th, 2008 by Bridget Kurtenbach
Early retirement stipends have been a hot topic in the Chippewa Valley lately, so it may come as a surprise that the Altoona School District halted the practice 18 years ago.
“The district discontinued the program because it was too costly,” said Altoona School District Administrative Secretary Joyce Orth. “A new board came on and ended the program.”
She said that the program was never offered to teachers of the district, only to administration and administrative staff. In all, seven people actually received early retirement payments.
The entire program ended almost as soon as it began. According to Altoona School District Superintendent Greg Fahrman, the stipend program started in the mid-1980s and ran through 1990.
“People that were recipients of the early retirement stipends all happened before most of us were here,” he said of the current administration and administrative staff. “The people who got the stipends did give up a number of raises over the years to get the stipend.”
He believes the stipends were an incentive to keep good employees in Altoona instead of them making the jump to the Eau Claire Area School District.
The payments to qualifying employees were a way to induce teachers ages 55 and older to retire so new teachers could be hired at a lower pay scale. Another stipulation of the program was that it expired at age 62.
“Many (employees) chose to keep working instead of getting the stipend,” Fahrman added.
In the beginning, Fahrman said, it was a small amount of money, so the program worked. With today’s salaries and insurance costs on the increase, however, it is just too expensive to maintain.
“I give people credit in 1990 in Altoona who decided not to do it anymore,” he said.
Former Altoona School District Superintendent Bob Bredesen, who retired in 1990, worked for the district for 34 years. He said the stipends were negotiated by the school board.
“During those days, during negotiations for salary and fringes, one board member met with teachers (and) one met with principals, and that board member would bring back (information) to the full board for approval,” he said.
Once the board was done negotiating with the teachers and the principals, they would then negotiate with the superintendent. According to Bredesen, he was offered the same stipend package as the principals. In the end, he retired just a year early.
He said what happened in Eau Claire was good for the district and good for the person retiring in the beginning.
“I think what happened over the years is it just got away from them,” he concluded.
my note- an understatement
This school board needs to be recalled now. They are gang-bangers with college degrees. How much more abuse are we going to take from them?
I can't believe that Altoona figured this out 18 years ago, and we are only now realizing that the chickens are coming home to roost.
I am afraid for my kids, and for all of the programs that will need to be cut in order to pay people not to work. Funny, but Altoona has managed to attract quality teachers all these years without the hefty perks.
Time to start looking at open enrolling in a district that can actually afford to pay their bills.
I want to know why Klaus' contract was changed in the first place from superintendent to principal. This seems fishy. In light of the 'stipend naughtiness', I wonder what other illicit activities are being covered up!!
There is a common standard clause in Superintendent and sometimes other administrative contracts that allows the individual to fill another open administrative position after X number of years (15) and at or after a given age (53 here I believe but am not sure) in this case. The individual must have the appropriate license for the position.
Dr. Klaus fit those criteria and a position did come open as principal of Northstar. I don't have the exact date as we are missing a meticulous dateline, but Dr, Klaus did then exercise that option of his contrat.The problem seems to be that he not only wanted or expected the switch in position but the early retirement benefits to start at that time.
The salary was adjusted downward to that of principlal but it was agreed that the ECASD early retirement benefits (not the state retirement payments as they are not controlled by the district- except to the extent that a higher salary for the 3 years before retirement could under one formula option trigger a higher state retirement ) would be based on his salary as superintendent.
If ECASD had (and they didn't) agreed to pay the early retirement payments early and if they had been counted by the state as salary his state retiremnt would increase. There are enough "ifs" here to keep a CPA busy for some time.
It could be that since that Dr. Klaus felt that since the forumla for the early retirement payments were to be based on the Superintendent salary which was no longer active, and since he may have regarded the early reirement stipend as a standard administrator retention benefit rather than a retirement inducement, that
he assumed the time for accesing that benefit had arrived. Some of the above is factual and the rest is speculation on my part.
The problem for the DA is to determine if any of this constitutes fraud, and the problem for the board is to determine if the improper procedures used constituted a mistake or a violation of ECASD procedures so severe as to to warrant some disciplinary action.
The role of the blogger is, I assume., to fire away with caution or guns blazing, whichever one
feels most comfortable with.
Details on the contract change are here.
As to whatever other illicit activities are being covered up I will only say that I believe there are outstanding chickens that have yet to roost. Chickens that have Mike O'Brien's name on them.
I am reminded of a criminal case a number of years ago involving basketball players in a major college program. They were kicked off the team before the trial, and at the trial they were not convicted. Which is the same as being acquitted I suppose, but the circumstances of the case did not reflect well on any of the parties involved. The college president was asked of they would be re-instated to the team and he replied no, the things they had admitted to more than justified removing them from the team.
And so it is with Klaus. I think his lack of integrity and outright dishonesty more than justifies his removal, regardless of what the DA comes up with.
I agree with the last comment, in that I have been in discussions with people who were distinguishing between unethical and illegal behavior. In your employment, your actions don't have to be illegal to warrant losing your job.
And if there are really more things to come regarding the school board, I don't think this community can stand it. The staff is already on shaky ground, parents are suspicious and taxpayers have had it.
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