ISTA, Indiana settle lawsuit for $14 million

Indiana Secretary of State Connie Lawson announces the ISTA settlement. (Scott Elliott)

A four-year legal and financial struggle that has saddled Indiana’s largest teachers union may be coming to an end, but not without a heavy cost.

Secretary of State Connie Lawson announced today a $14 million settlement has been finalized between the state and the Indiana State Teachers Association. The deal settles the state’s lawsuit charging ISTA defrauded its members by mishandling funds in an insurance fund. The union admitted no guilt as part of the deal.

The state originally sued for $27 million, but settled for roughly 50 cents on the dollar. Lawson said the suit cost the state $1.5 million in public dollars and the settlement came because: “We knew they were willing to spare no expense on endless litigation.”

In a statement ISTA said all of the settlement money comes from its own lawsuits in the case, and that no member dues will be used to pay the state. ISTA officials blasted Lawson, saying she played politics for criticizing ISTA during the press conference.

“It is important to note that, contrary to what the secretary of state’s press release might suggest, there never was any allegation in the lawsuit that any funds received from school districts had been used by ISTA or NEA for their own benefit,” said Teresa Meredith, ISTA president, said in the statement.

The state sued ISTA, which is affiliated with the National Education Association, after an insurance trust it managed went bust in 2009.

The fund’s failure left ISTA with $57 million in liabilities ballooned by a combination of poor investments and underfunding of a disability plan offered to its educator members across Indiana.

That debt is still being paid off and will be for another 14 years.

ISTA’s annual revenue is about equal to $27 million and it reported a deficit of more than $4 million in its most recent annual financial report.

Lawson, calling the trust a “Ponzi scheme,” said savings that was supposed to be set aside each year in investments to fund future health care costs was instead co-mingled with other ISTA funds and school districts were sent statements that misled them about their account balances.

“ISTA took money from one fund to pay claims and cover deficiencies of another, then issued falsified statements to clients to create the illusion of funds,” Lawson said.

The trust’s failure had other huge consequences for ISTA and how it is managed. It sued its former executive director, charging mismanagement, and NEA stepped in to run the state affiliate, transferring ownership of its office building across form the Indiana Statehouse to the national union.

Indiana sued ISTA and NEA in federal court on behalf of those who bought insurance through the trust in 27 school districts, charging ISTA was guilty of fraud, and breach of contract. Today’s settlement resolves that case. ISTA has 10 days to deliver the money to Lawson.

Lawson said the districts have wide latitude for how to use the money, including for defraying health care costs for employees or even pay raises.

Two Indianapolis-area districts will receive a portion of the settlement: Washington Township ($978,000) and Center Grove ($597,000).

What's Your Education Story?

As the 2018 school year begins, join us for storytelling from Indianapolis educators

PHOTO: Dylan Peers McCoy/Chalkbeat
Sarah TeKolste, right, and Lori Jenkins at a Teacher Story Slam, in April.

In partnership with Teachers Lounge Indy, Chalkbeat is hosting another teacher story slam this fall featuring educators from across the city.

Over the past couple of years, Chalkbeat has brought readers personal stories from teachers and students through the events. Some of our favorites touched on how a teacher won the trust of her most skeptical student, why another teacher decided to come out to his students, and one educator’s call to ramp up the number of students pursuing a college education.

The event, 5:30 p.m. Thursday, Sept. 13, is free and open to the public — please RSVP here.

Event details:

5:30 p.m. to 7:30 p.m.
Thursday, Sept. 13, 2018
Tube Factory artspace
1125 Cruft St., Indianapolis, IN 46203
Get tickets here and find more on Facebook

School safety

Hiring more security officers in Memphis after school shootings could have unintended consequences

PHOTO: Jahi Chikwendiu/The Washington Post/Getty Images

Tennessee’s largest district, Shelby County Schools, is slated to add more school resource officers under the proposed budget for next school year.

Superintendent Dorsey Hopson earmarked $2 million to hire 30 school resource officers in addition to the 98 already in some of its 150-plus schools. The school board is scheduled to vote on the budget Tuesday.

But an increase in law enforcement officers could have unintended consequences.

A new state law that bans local governments from refusing to cooperate with federal immigration officials could put school resource officers in an awkward position.

Tennessee Education Commissioner Candice McQueen recently reminded school personnel they are not obligated to release student information regarding immigration status. School resource officers employed by police or sheriff’s departments, however, do not answer to school districts. Shelby County Schools is still reviewing the law, but school board members have previously gone on the record emphasizing their commitment to protecting undocumented students.

“Right now we are just trying to get a better understanding of the law and the impact that it may have,” said Natalia Powers, a district spokeswoman.

Also, incidents of excessive force and racial bias toward black students have cropped up in recent years. Two white Memphis officers were fired in 2013 after hitting a black student and wrestling her to the ground because she was “yelling and cussing” on school grounds. And mothers of four elementary school students recently filed a lawsuit against a Murfreesboro officer who arrested them at school in 2016 for failing to break up a fight that occurred off-campus.

Just how common those incidents are in Memphis is unclear. In response to Chalkbeat’s query for the number and type of complaints in the last two school years, Shelby County Schools said it “does not have any documents responsive to this request.”

Currently, 38 school resource officers are sheriff’s deputies, and the rest are security officers hired by Shelby County Schools. The officers respond and work to prevent criminal activity in all high schools and middle schools, Hopson said. The 30 additional officers would augment staffing at some schools and for the first time, branch out to some elementary schools. Hopson said those decisions will be based on crime rates in surrounding neighborhoods and school incidents.

Hopson’s initial recommendation for more school resource officers was in response to the school shooting in Parkland, Florida, that killed 17 people and sparked a wave of student activism on school safety, including in Memphis.

Gov. Bill Haslam’s recent $30 million budget boost would allow school districts across Tennessee to hire more law enforcement officers or improve building security. Measures to arm some teachers with guns or outlaw certain types of guns have fallen flat.

For more on the role and history of school resource officers in Tennessee, read our five things to know.

Sheriff’s deputies and district security officers meet weekly, said Capt. Dallas Lavergne of the Shelby County Sheriff’s Office. When the Memphis Police Department pulled their officers out of school buildings following the merger of city and county school systems, the county Sheriff’s Office replaced them with deputies.

All deputy recruits go through school resource officer training, and those who are assigned to schools get additional annual training. In a 2013 review of police academies across the nation, Tennessee was cited as the only state that had specific training for officers deployed to schools.