Caston considers litigation

By Jennifer Tangeman
Pharos-Tribune staff writer

November 12, 2009 10:22 pm

— The Caston School Corp. may be following suit by filing suit within the next few weeks.
At least four Hoosier school districts have signed onto a class-action lawsuit, seeking millions of dollars in health insurance credits owed to them by the Indiana State Teachers Union Insurance Trust, according to the Indianapolis Star last week.
“We would prefer not to get involved in an issue like this, but it is the lack of relaying information with us,” Caston superintendent Dan Foster said. “We basically have a lot of money sitting there.
“Within the next week or so we’re going to have to make some decisions and see what happens.”
Foster said the corporation’s employees have accumulated an estimated $1 million in credits built up when their claims did not add up to the premiums they paid into the health insurance program.
“We’re a small school,” the superintendent said. “So, that’s a lot of money for us.”
Foster said the school corporation has not received any official information regarding the trust since August 2008. He has sent letters to the state and the district’s attorney has contacted the state but Foster said the corporation is not receiving any feedback.
Scheduled meetings with Indiana State Teachers Association representatives have continuously been canceled for about three months, Foster said.
The National Education Association took over ISTA earlier this year when state regulators learned its insurance trust was facing a potential $67 million deficit.
The trust paid for long-term disability benefits to 650 teachers in nearly one-third of the state’s corporations and health insurance in 30 districts.
“There are quite a few schools in the same position. Delphi is in the exact same boat we are,” he said. “We’ve got some money there that belongs to the corporation and our employees.”
Delphi superintendent Ralph Walker told the Lafayette Journal Courier his corporation has about $500,000 in the trust. He is helping lead the potential class action lawsuit against ISTA through Noblesville attorney David Day of Church, Church Hittle & Antrim.
The Caston school board gave Foster and Day permission at its last regular meeting to pursue the issue as they see fit.
Caston had scheduled a month free of premium payments for its employees in September, but could not access the information or money from the reserve to do so.
ISTA is suing the trust’s former executive director and other officials, alleging they mismanaged investments.
Ed Sullivan, an NEA trustee appointed to take over ISTA, said the association plans to work to resolve issues with each individual corporation.
• Jennifer Tangeman is a reporter for the Pharos-Tribune. She can be reached at 574-732-5148 or jennifer.tangeman@pharostribune.com.