Greenfield-Central slowly recoups funds from former administrators

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Tony Zurwell, left, Christy Hilton and Ann Vail are being asked to repay the funds they were overpaid. Greenfield-Central officials say they have received just over $48,000 from the Attorney General’s office.

GREENFIELD — Officials from the Attorney Generals office say they continue to work on retrieving more than $651,000 from three former Greenfield-Central administrators who were overpaid over a nine-year period starting in 2010.

A spokesperson from the office of Attorney General Todd Rokita told the Daily Reporter late last week, “The OAG is diligently pursuing this matter and will work to recover the full amount owed to the entity. We have been able to recover a portion of the amount owed but anticipate that much more will be recovered.”

Greenfield-Central Superintendent Harold Olin said the district received $48,744 from the Attorney General’s office on May 11 but noted there were no other details provided with the money transfer.

Officials from the AG’s office told the Daily Reporter back in Oct. 2021 they had been given an audit report issued by Indiana State Board of Accounts (SBOA) on the matter and were actively working to collect the amounts due to district.

“We look forward to making Greenfield taxpayers whole again,” officials said at the time.

Olin noted the material loss was also reported to their insurance carrier, and G-C school district received $105,000 from Cincinnati Insurance on Feb. 14, 2020. To date, the district has received $153,744 of the $651,832 overpaid.

Olin told the Daily Reporter in an email that the payroll errors that were uncovered in the fall of 2018 were a catalyst to a number of changes in Greenfield-Central. By the spring semester of 2019, they had more financial oversight in place, and their staffing model clearly changed.

“Our school corporation has fully cooperated with all agencies that investigated the matter, and over the last few years … we have simply moved on,” Olin said. “We believe we have done all that we can do.”

Since the conclusion of the investigation, Olin noted they have refocused their energy on meeting the needs of students and staff.

“And we have also worked diligently to rebuild trust with our community partners,” Olin said.

From 2010 to 2018, three former Greenfield-Central administrators were overpaid more than $651,000 combined, according to an audit filed by the SBOA.

The three administrators — all of whom have either retired or have resigned — are Tony Zurwell, former business manager; Christy Hilton, former assistant superintendent; and Ann Vail, former associate superintendent. Each of them was placed on a two-week paid leave in September 2018 when the district conducted an internal investigation on the matter.

The school board and Olin did not reveal at the time why the top administrators were on leave. Zurwell then abruptly retired.

According to the SBOA’s audit, Zurwell, Hilton and Vail had been overpaid for health insurance benefits from 2010 to 2018. In addition, insurance premiums for each employee were under-withheld. The state agency attributes those calculations to Zurwell, who had unsupervised control over such adjustments.

Over those nine years, each administrator received an additional $116,607 in compensation. Zurwell also under-withheld $95,031, and Hilton and Vail each under-withheld $103,489.

That adds up to $651,832 in additional compensation that the state board has requested Zurwell, Hilton and Vail pay back. They also owe the state $33,765 for special investigations costs.

The SBOA, which spent a year on an investigation that also involved the Indiana State Police, forwarded its findings to Hancock County Prosecutor Brent Eaton and the Indiana Attorney General’s office. Eaton told the Daily Reporter in Oct. 2021 the AG’s office was officially handling the case.

The inquiry began in late August 2018 when Olin “became suspicious and discovered an improper allocation of funds,” according to statements released at the time by Greenfield-Central. Olin ordered an immediate and independent review by “an experienced school business official” and reported the issue to the SBOA.

According to the audit, the discrepancy in compensation was due to how health insurance had been calculated into each of the administrator’s salaries since 2010. Greenfield-Central administrators receive an “insurance credit” added to their bi-weekly pay for health insurance. They then use that credit to pay for their health insurance. The credit was calculated to be “equal to ‘all but $4,000 of the highest annual premium rate’ as additional compensation,” the audit states.

Zurwell, Hilton and Vail also had separate contracts that stated they “receive an amount equal to the annual cost of the family health insurance plan minus $4,000 … to purchase medical insurance offered by the Corporation.”

Each of the three contracts also had a provision that stated, “(the administrator) shall be entitled to receive the benefit established by the Board for all administrative/certificated employees of the Board. To the extent that benefits for other certificated employees duplicate a benefit provided pursuant to this Contract, the benefit provided by this Contract shall be the benefit provided to (the administrator).”

The audit stated that “beginning in November 2010, Zurwell made calculations for compensation, which not only added the cost of the family health insurance plan minus the $4,000, but also included the amount given to other administrators bi-weekly as an insurance credit. This, in effect, added insurance amounts as additional compensation twice (for Zurwell, Hilton and Vail).”

For example, in 2017, Zurwell’s salary amount in his contract was set at $154,378, but he was paid $176,236 — an over-payment of $21,858. From 2010 to 2018, Zurwell, Hilton and Vail were overpaid the same amount each year even though each person had a different base salary, the audit found.

Contracts for Zurwell, Hilton and Vail also stated that the “amount equal to the annual cost of the family health insurance plan minus $4,000” was meant to “purchase medical insurance.” Zurwell’s 2017 payroll deduction for his insurance coverage should have been $19,023, the audit found, but the actual deduction was only $4,000.

While Vail and Hilton each owe the district $103,489 for under-withholding insurance premiums, Zurwell only owes $95,031. That’s due to a smaller amount under-withheld in 2018 than the two others. Zurwell retired in late September 2018, the same day the Greenfield-Central School Board approved his paid leave. He had worked for the corporation for 13 years, overseeing finances, bank accounts and food services.

The Daily Reporter asked officials from the AG’s office if anymore funds would be collected or possible charges filed and were told to check back in the coming weeks.