District Error Forces Retirees To Pay

By Stephanie Mariel Petrellese

Sixty-seven members of the teaching staff who retired from the Garden City School District after November of 1995 have unknowingly not been paying the full cost of their health insurance premium due to a district coding error. Now the school district is actively going after them for the money, which totals $128,000.

"This is an obligation of the district's to collect," said School Board President Kenneth Monaghan at the July 10th Board of Education meeting. "We really do not have an option. This is not the money of the Board. This is not really the money of anyone in the administration. This is the money of the district's and this is the money of the taxpayers. This is not optional. We will collect these sums."

The error was caught by Albert Chase, assistant superintendent for business and finance, during a review of union contracts during the budget development process earlier this year. In 1995, as a result of teacher collective bargaining negotiations, the district obtained a change in the percentage of health costs paid by that group. Under the terms of the contract, staff members retiring after November 1995 would be required to pay 10 percent of the individual cost of the premium and 25 percent of the family add-on.

Chase reported to Superintendent Dr. Robert Feirsen and the Board of Education that staff members opting for family coverage were not paying the 10 percent that applied to the individual portion. In total, 67 retirees were involved, including staff who retired at the end of the 2006 school year.

Attorneys for the school district informed the district that they were obligated to collect the funds but were limited to a retroactive collection of six years, going back to March 2001. Therefore, approximately $18,000 is not recoverable.

Retirees have received letters from the district and payment plans are available. The obligation of each retiree varies from a few hundred dollars to $3,000. To date, the district has collected a total of $14,000.

"While the process or coding error which caused this problem is 12 years old and didn't occur on the watch of Mr. Chase or his predecessor Mr. Powell, or frankly anyone on the Board or anyone in central administration, it should have been caught earlier," said Monaghan. "This is the type of error that our recently appointed internal auditors will be looking for in their review of processes and procedures."