Year after G-C audit, probe of overpayments continues

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GREENFIELD — While it’s been well over a year since a state audit concluded three Greenfield-Central schools administrators had been overpaid hundreds of thousands of dollars, no resolution of the matter is in sight.

The three officials were overpaid by more than $650,000 over some 200-plus paychecks from 2010 to 2018. An audit by the Indiana State Board of Accounts found they had been paid too much for health insurance and had under-withheld premiums during that time. The issue had never stood out in the books until Superintendent Harold Olin spotted an anomaly during a routine look at the district’s accounts.

The audit, which came out in October 2019 — a full year after Olin’s startling discovery — ordered that the money be repaid. But as of this week, Olin said, the school corporation has not received anything from the three former administrators: business manager Tony Zurwell; assistant superintendent Christy Hilton; and associate superintendent Ann Vail.

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“We did receive approximately $100,000 from our insurance company,” Olin said in an email. “We have not received anything else at this time.”

Olin noted the payment from the insurance company was because some of the employees associated in the matter were bonded, entitling the district to a certain amount of money each year the material loss occurred.

G-C’s business manager, Nathanial Day, said the total was $105,000. It was paid originally by the insurance company, Liberty Mutual, to the state attorney general’s office. The state sent the money to the school district in February.

Greenfield-Central leaders have chosen not to pursue additional repayment from Zurwell, Hilton and Vail because they are still awaiting a decision from the Hancock County prosecutor’s office on possible criminal charges.

Prosecutor Brent Eaton said the Indiana State Police continues to investigate the case. He acknowledged that unraveling evidence in cases like this is difficult.

“Anytime we have an active case that could be a criminal investigation, the only thing I can say is, we’ve got an active investigation,” Eaton said.

Eaton said he talked to investigators as recently as Monday, Dec. 14.

“We’ll look at the facts of the case and the law and either we’ll have a case or we won’t,” Eaton said. “We want to be fair, complete and accurate… that’s our guiding principle as we approach this.”

The inquiry began in late August 2018 when corporation officials were wrapping up collective bargaining issues with teachers and Olin was looking at administrator salaries.

After Olin noticed the anomaly in the compensation of three of his top leaders, he brought them in individually to ask them about the discrepancies.

When there wasn’t what officials considered a reasonable explanation, the three administrators were put on administrative leave. Zurwell, who had been with G-C for 13 years, abruptly retired. Vail retired and Hilton resigned in 2019; both had worked more than 20 years for the corporation.

Olin ordered an independent review by a third-party school business official and reported the issue to the State Board of Accounts.

The State Board of Accounts took a year to review the figures. Its audit concluded the three had been overpaid by a total of $651,832. It also ordered that the money be repaid and appended a charge of $33,765 for special investigations costs.

According to the audit, the discrepancy in compensation was due to how health insurance had been calculated into each administrator’s salary since 2010. Administrators received an amount of money each year to purchase medical insurance, and the audit found that Zurwell, Hilton and Vail had systematically been paid too much.

The audit revealed that each administrator, from 2010 to 2018, received an additional $116,607 in pay. Zurwell, who oversaw the corporation’s finances as the business manager, also under-withheld $95,031, and Hilton and Vail each under-withheld $103,489.

Some issues with contract language were partially blamed for the problem. But the audit said there had been “no effective oversight or review of the compensation calculated … by Zurwell. … There was no documentation indicating that anyone had reviewed the calculations to ensure that the correct amounts were being paid and withheld.”

Olin said the district has since taken steps to prevent such problems from happening again.