News Story

ISD Denies Special Ed Services to Northern Michigan School District

District tells federal court that it could provide special ed services for just 17 percent of what the intermediate school district is charging taxpayers

Atlanta Community Schools (ACS) superintendent Teresa Stauffer insists that her district could obtain equal or better education services for less cost. She and her school district have been feuding with the local ISD over that and other issues for three years. Now the ISD is withholding special education services and the battle is headed to court.

In a lawsuit filed late Monday with the U.S. Eastern District Court in Bay City, ACS is asking the court to order the ISD (Alpena-Montmorency-Alcona Educational Service District) to provide special education services. However, it is also suggesting to the court that the dispute could be resolved if the ISD was ordered to release special education dollars directly to ACS and let the district purchase the services on its own.

“We (the school district) could provide special education for just 17 percent of the two mils for special education our county residents send to the ISD,” Stauffer said. “We could hire the same people to do the job for less. The residents of our district hold us accountable for what we do. All we want is to be more effective for our kids.”

In Michigan, special education funding from local, state and national sources are distributed to the ISDs. But ACS contends that the funding is actually intended for the individual students who qualify for special education programs.

Atlanta is located in the Northeastern portion of Michigan's Lower Peninsula. According to Stauffer, roughly three years ago she started questioning ISD officials about the way the ISD was operating. Although her questions and complaints weren't made public at the time, she says the ISD turned against her.

“Three years ago, when I started asking questions, they (the ISD) took an attitude of retaliation,” Stauffer said. “Then when I started openly questioning their actions and decisions, they started retaliating with attacks against our teachers and staff. Now they're making attacks on our data and students.”

She said the Arenac ISD keeps the ACS student database through an arrangement made prior to her becoming ACS superintendent four years ago. But the data is ultimately sent to the local ISD, which Stauffer said has manipulated it to the determent of ACS and its students.

“I've considered hiring a CPA to do the data,” Stauffer said. “But even then it would have to be sent to them (the ISD).”

Tensions between the ISD and the school district were heightened just prior to the 2009-'10 school-year. That was when the ISD moved to change its agreement (called the “Plan”) with ACS and the other school districts in the area. This required the schools to sign an authorization contract.

Robert Lusk, attorney for ACS, said the authorization contract the ISD is pressing for would usurp the Atlanta district's authority in several key areas.

  •  It would authorize the ISD to represent the school district on the planning team that determines what programs and classes the student would participate in.
  •  It would authorize the ISD to replace the regular school districts’ role in making decisions regarding individual students in the district's infant home program for preschoolers.
  •  It would completely cut out the hearing impaired programs that were part of the original agreement between the ISD and ACS.               

But it would leave the regular school district on the hook for potential costs emanating from due process hearings in which parents dispute school decisions and actions. These costs would be borne by the regular school district even if the costs were the result of ISD decisions from which the regular school district had been excluded.

ACS signed the authorization contract initially but refused to extend it for this year.

“If we had been satisfied with the service we were receiving from the ISD we would have signed,” Stauffer said. “Some ISDs are better than others. I've dealt with a very good ISDs in the past. But this one is the worst I've ever seen.”

According to Stauffer, the ISD claims that when ACS refused to extend the authorization, it abandoned its right to receive the ISD's special education services. However, ACS argues that any changes to the agreement between the school district and the ISD should be negotiated, not forced upon ACS in a take-it or leave-it fashion.

Brian Wilmot, superintendent of Alpena-Montmorency-Alcona Educational Service District (the ISD), declined to comment on the situation. Wilmot said he wanted to wait until ISD officials have had a chance to study the details of the complaint ACS filed.

In its lawsuit ACS asserts that its original agreement with the ISD is still intact and the ISD has no legal right to withhold the special education services. ACS refutes the idea that the ISD has the right to insist that ACS either sign the authorization contract or lose services. In addition, the lawsuit alleges that the ISD's denial of special education services was at least partly in retaliation for Stauffer's public statements criticizing the ISD.

Stauffer first went public with her questions and complaints about the ISD on Sept. 8, 2010, at an ISD board meeting. The initial draft of the ACS complaint includes a summary of Stauffer's remarks.  It reads as follows:

Among other things, Ms.Stauffer informed the [ISD] board that there were occasions when [ISD] personnel had:

  • Been untruthful in dealings with ACS personnel;
  • Taken actions that were not consistent with the [ISD] mission statement;
  • Not communicated with the public in an honest and ethical way;
  • Been unwilling to cooperate with ACS staff;
  • Failed to provide special education and related and supplemental services in a cost-effective manner;
  • Failed to maintain a safe and healthy learning environment; and
  • Not taken into account the needs of ACS students.

Nearly a year later, on Aug. 1, 2011, the ISD letter informing ACS of its decision not to provide special education services to the district included references to Stauffer's Sept. 10, 2010, remarks. ACS is referring to that letter in its lawsuit as evidence that the ISD is retaliating for Stauffer's public statements.

More specifically, the lawsuit alleges that the ISD “has coerced, intimidated and threatened” the Atlanta School District and Stauffer for her advocacy.  It also alleges the ISD “retaliated against the parent and student plaintiffs based on the advocacy” of the Atlanta School District and Stauffer.

Part of Stauffer's advocacy includes the stance that school districts should be allowed to shop for the best deals they can get, either from alternate ISDs or through privatization.

“I've spoken to some state lawmakers about allowing ISDs to compete,” Stauffer said. “I think that could potentially provide a lot of cost saving opportunities for school districts.”

The lawsuit was filed in U.S. District Court, Eastern Division of Michigan, Northern Division. The judge is Thomas Ludington. The lawsuit was taken to federal court because ACS claims the ISD is in violation of the federal Individuals with Disabilities Education Act (IDEA), the Americans with Disabilities Act of 1990, the Rehabilitation Act of 1973 and the U.S. Constitution.

ACS claims the ISD is also in violation of Michigan laws. The lawsuit includes Stauffer as a plaintiff, along with three sets of parent and student plaintiffs: Eric and Regina DeRouchie and their minor son T.C., Cynthia Portillo and her minor daughter E.P., and Jason and Jennifer Pryor and their minor daughter K.P.


See also:

Are Intermediate School Districts Bloated?

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.