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Retirement officials probe Ennis superintendent contracts

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Posted: Tuesday, July 27, 2010 9:15 am | Updated: 10:41 am, Tue Oct 4, 2011.

The director of the state Teachers' Retirement System says his office has requested contracts from the Ennis School District to investigate whether the district acted properly when they rehired Superintendent Doug Walsh after he retired in 2001.

Last Tuesday, TRS Director David Senn said that on July 8 his office requested all contracts between Walsh and the district since 2001 but has yet to receive a response from the district. Walsh did not immediately return a phone message seeking comment.

Also last Tuesday, School Board Chairman Marc Glines said he was not aware of the request and planned to look into the matter.He later contacted The Madisonian newspaper in Ennisand said the contracts would be sent the TRS.

Back in 2001, about 30 days after Walsh retired as superintendent with the Ennis School District, the school board hired him back under two separate contracts in an arrangement intended to also allow him to collect retirement benefits from the state.

School officials say they were following what other districts had done and believed allowing him to collect retirement benefits would bring his total pay in line with other superintendents.

In May, Walsh signed two new contracts that could be worth around $117,000, including bonuses and incentives.

After he retired in 2001, his superintendent contract called for him to be paid one-third of his "final average salary as reported to the" Teachers' Retirement System.

At the same time, the district gave Walsh a "Consultation Contract" that agreed to pay him "2/3 of final average salary as reported to TRS" for performing "the duties spelled out in the attached document."

State law requires that a person must have received at least one monthly retirement check, which typically requires between 30 and 60 days, before being hired back by the district in a part time position. Additionally, their pay cannot exceed one-third of their final average salary for their highest paid three years in order to also collect retirement benefits, according to Senn.

Senn said he had not seen Walsh's contracts and could not comment further. The TRS requested copies of the contracts to look into whether the arrangement is in compliance with state laws regarding retirement benefits.

Under his last full-time superintendent contract in 2000 Walsh was paid a base salary of $73,600. In subsequent years Walsh has had two separate contracts with the district.

Glines, who has served on the school board for about 16 years, said allowing the superintendent to retire and then come back to the district was a way of bringing his compensation in line with what other superintendents were making around the state.

"We wanted to retain him," Glines said. "We're able to compensate him adequately by him retiring and coming back on."

David Schenk, the current Madison County Sheriff, was chairman of the school board when the contracts were signed in 2001.

"It was a money savings position on the board's part, plus it also helped in his retirement," Schenk said.

The decision was made nearly 10 years ago and Schenk couldn't recall the details of the discussion surrounding it without reviewing the minutes from the school board meetings. However, he said the board was trying to do what was best for the district.

"Everything was open as to what the contract was and there wasn't any hidden agenda," Schenk said. "It was just a way to help our superintendent, who was doing a good job at the time, and also save tax payers dollars. There was a lot to it that we looked at."

In 2001, the district was still designated in Class B, Glines said.According to information provided by the Montana School Boards Association, the average pay for a superintendent in a Class B district in 2009-2010 was $84,293.

The district's designation changed to Class C in 2009-2010, where the average pay for a superintendent is listed as $66,562.

Walsh signed two new contracts with the district in May, as superintendent and bus supervisor, that call for a total base pay of $88,000, with around $29,000 additional in potential benefits and bonus incentives.

In an interview, Walsh estimated his retirement benefits at $28,000 to $30,000.

According to information available through the state Office of Public Instruction, the district has about 340 students.

Both Walsh and Glines say the school board discussed the superintendent coming back to the district before he retired. The school board did some research and contacted other districts that had taken similar actions and also checked on the legality of the dual contracts, Glines said.

Walsh said he had worked 12 to 13 years as a full-time superintendent before he retired and had 30 years in the Montana school system.

"The teachers' retirement is money I'd earned," said Walsh.

Officials with TRS have investigated three cases in the past two years, Senn said. In one no violation was found, Senn said. In a second case, an agreement was reached in which benefits were paid back and the employee was reinstated to active service. The third case is currently being litigated.

Michael Noyes is a news reporter for the Bozeman-based Montana Policy Institute Reach him at mike@montanawatchdog.org, call 219-0510 or visit www.montanapolicy.org.

The Madisonian newspaper contributed to this report.

© 2016 The Belgrade News. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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