Hiring would skirt rules

Anne Arundel County schools superintendent seeks to bring back 2 retirees

July 24, 2006|By ANICA BUTLER | ANICA BUTLER,SUN REPORTER

The new Anne Arundel County schools superintendent wants to rehire two recently retired administrators through a third-party contractor - an arrangement that would get around state retirement rules on how much they can be paid while collecting a state pension. But some school board members are questioning the cost and the propriety of the two-year deal.

Superintendent Kevin M. Maxwell recently asked the board to approve a $1.4 million contract with Human Resources Inc., a Crofton company. The proposal included hiring Nancy Mann, who served as interim superintendent until June 30, Ken Nichols, a former deputy superintendent, and four others, according to school system staff.

State law limits the amount of money a retired school employee can earn from the school district while collecting a state pension. But retirees can bypass those restrictions if they are hired through a third party. The board received no information on what Mann and Nichols would earn or what work they would do.

Board members put off voting on the contract until their Aug. 2 meeting.

"I have grave concerns," said Tricia Johnson, school board president. "We want to find out what the rules are and make sure that if we approve it [we're] following the laws and the rules and what's right."

Human Resources Inc., which has an existing contract with the school system, functions like a temp agency. The school system pays a contracted amount to the company, and the company hires people to work for the system.

The individuals, called "leased employees," receive salaries and benefits through the company, and the company receives a commission - an amount equal to 26.5 percent of the salary for administrative positions or 30.5 percent of the salary of skilled workers, according to the company's proposal.

It's an arrangement not uncommon among Baltimore-area school systems. Officials in Howard and Carroll counties said they also use temp agency-type companies to fill special education-related positions or school nurse slots, for instance.

State education officials said they do not keep track of instances when a school system might use a third party to hire retired school administrators and don't know if the practice is widespread.

Currently, four people perform work for Anne Arundel County schools through Human Resources Inc., with salaries ranging from around $40,000 to $80,000 a year, according to a list provided by the school system. The school system will pay the company $233,500 for salaries in the fiscal year that began July 1 and another $61,500 in fees. Mann and Nichols are not included on that list.

Though the school system has a long-standing relationship with Human Resources Inc., this is the first time the board has been asked to vote on the contract because of a change in school board policy.

"I had no idea they were being hired by a third party and not directly by school system," said board member Konrad Wayson. Wayson said that he and other board members were not told how much the individuals hired through Human Resources Inc. would be paid, nor were they told how many people would be hired or for what positions.

"I bet there's no teachers being hired under this. And if not, why not?" Wayson said. "My concern is that this is just for executive management and not for everyone."

Debbie Groat, the school system's supervisor of purchasing, said she is unaware of previous instances of the arrangement being used for the hiring of executive staff. She also said she did not know how many of the individuals hired through Human Resources were retirees.

Maxwell was unavailable for comment, according to a school system spokesman.

Tim Schaffer, president of Human Resources Inc., also could not be reached late last week, nor could Nichols.

Mann said that such contracts with Human Resources have been used at least since the tenure of Carol S. Parham, who was superintendent from 1994 until 2002. Such contracts long have been a way to rehire retired employees who have reached the maximum salary allowed by state law, she said.

Current rules limit the amount that retirees can earn to the difference between their highest salary when they were working and their pension, said J. Howard Pleines, the director of legislation and research for the state pension system.

Mann, who is collecting a state pension, already has earned as much as she is allowed from the school system this calendar year. Under her contract as interim superintendent, Mann was paid $60,000 this calendar year by the school system.

Mann retired from the school system in June 2005, after 35 years of service. She returned as interim schools superintendent on Nov. 24, replacing Eric J. Smith, who resigned amid strained relations with the school board. Mann earned $108,500 for her term as interim superintendent before stepping down at the end of June.

She said this week that she has no plans to return to the school system full time. "If they have a project for me, I would certainly entertain that," she said.

Anne Arundel school officials explained that Human Resources Inc., which has an existing contract with the school system, primarily has been retained in hiring for hard-to-fill positions, such as speech pathologists and physical therapists, said Assistant Superintendent Greg Nourse.

"A lot stems from having salaries that aren't competitive," Nourse said, adding that by using a third party, "they can be paid more money. They don't have to follow the salary scales. ... Through the temp agency they will hire people at a salary that's more competitive."

anica.butler@baltsun.com

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