The story came out in today’s paper. One thing I hated hedging on was an exact amount of total overpayment. It stands to reason that if ADA dropped below 25,000 in 1990, we’re talking 20 years. But I couldn’t assume that the board was making $750 back in 1990 and there wasn’t some kind of raise since then, hence the minimum calculated from Paul Frumkin’s first paystub.
District is looking into how far back the stipend records go; hopefully we can deduce a grand total from those records.
Also, there’s some discrepancy, depending on who you talk to, regarding how this came to light. District and some board members say it was after trustee Jesus Armas proposed a cut to board pay in line with reductions going on elsewhere as an act of good faith, and when staff looked into doing it they discovered the error. Shortly after Armas made his request, board candidate Audie Bock distributed a letter saying his request didn’t go far enough because they have been overpaid in violation of the ed code for some time. Bock and trustee Luis Reynoso say that’s what got it noticed, although Bock added that she finds it hard to believe that nobody on the board or in the district knew how much they were supposed to be paid before all that.
After the jump is more information on the matter that I received from Superintendent Janis Duran
Overpayment of $350/month/board member is an annual overpayment of $21,000. Because the statue of limitation is for three years, the maximum that could be recovered would be approximately $63,000.
Q: Do you know if this has happened before in any other district, and if there is any known protocol for repayment?
A: We don’t know.
Q: Is there a statute of limitations on such a thing?
A: Three years.
Q: Bottom line: Will the district try to recoup the overpaid funds, and if not, why not?
A: Only the Board can determine to expend funds to pursue recovery of the funds. All Board members have a conflict of interest. Therefore, if it were to be placed on the agenda, the minimum needed to make a decision (three) would be selected by lottery to make the decision.
The Superintendent and the District’s Fiscal Advisor will determine whether or not to make a recommendation to the Board for recovery for these funds. The overpayment is a staff error. None of the current Board Members were in office at the time the error was made and all were unaware of this error. In fact, the reason this error came to light was because of the efforts of the current Board to “clean up” and “trim” the District’s costs. The Board appropriately relied on staff to set the rates appropriately according to District student levels and statutory requirements. If the District were to make a claim against current and former Board members, the Board members could conceivably counterclaim against the District for negligence (and indemnification based on the negligence of the District). The District could conceivably win the underlying action for recovery but lose the counterclaim because of its negligence and end up having to indemnify the Board members against whom they just successfully sued. The only winners in such an action may be the lawyers.
Because of this, coupled with the three year statute of limitations and the cost of legal counsel to pursue these claims, the potential recovery may not be beneficial to the District from a purely cost-benefit stand point.
The District, however, should be advised to make protocol changes on a going forward basis to make sure these policies are reviewed by staff on an annual basis and that this problem does not recur in the future.