STATEHOUSE – State Representative Mark Messmer (R-Jasper) is pleased to see restitution for Shoals Community Schools from the settlement reached between the State of Indiana and the Indiana State Teachers Association (ISTA) and the National Education Association (NEA).
Secretary of State Connie Lawson announced earlier this week that her office finalized a settlement of a federal securities fraud lawsuit for $14 million, which accused ISTA and NEA of defrauding Hoosier schools out of over $27 million. Shoals Community Schools wills receive $93, 974.48 from the settlement.
“While I am pleased to see our local schools receive a portion of their money back, I am still deeply troubled that the ISTA and NEA are not completely repaying Shoals Community Schools for the money they deliberately mismanaged,” said Rep. Messmer. “Innocent teachers were victimized by these organizations who were more concerned about their own bottom line than the best interests of the educators they serve. Our local schools deserve to be refunded in full.”
ISTA offered teachers and other school employees a medical plan that allowed school corporations to invest their excess claim balances to offset future health care costs. The Secretary of State’s complaint alleges that ISTA did not invest the money as promised, but instead used the money to cover significant shortfalls in their long-term disability plan and to invest for ISTA’s own benefit.
“In the next ten days, school corporations will see a recovery four years in the making. Teachers and administrators alike can finally put this lawsuit behind them,” said Secretary Lawson. “They will receive 50 cents on the dollar for the money ISTA and NEA misappropriated. We strongly believe our case supported full repayment by ISTA and NEA, but we knew they were willing to spare no expense on endless litigation. This settlement gets these school corporations a much needed, immediate financial boost.”
According to the Secretary of State, this litigation was not fought at the taxpayers’ expense. All legal fees were paid with fines collected from violators of Indiana’s securities laws. To maximize the recovery to schools, Secretary Lawson waived the right to levy fines against the ISTA and the NEA and to seek repayment of attorney’s fees.