News Story

Charter School Profiteering? Don’t Turn That Lens On Larger, Richer District Schools

The really big money is in conventional school districts and all their intermediaries

Democrats, unions, progressive blogs and the mainstream media use the political label “for-profit charter school” to imply that public charter schools are somehow uniquely vulnerable to individuals “profiteering” at the expense of taxpayers and students.

For some reason, this same lens is never turned on the conventional public school establishment.

Over the years, Michigan Capitol Confidential has reported a number of seemingly lucrative public school compensation, benefit and financial management arrangements. What follows is a survey of some of the practices that might be included on an updated list of these.

ANNUAL SALARIES

The top paid K-12 employee in Michigan was Nikolai Vitti, who made $306,346 in 2018-19 as the superintendent of the Detroit Public Schools Community District.

The next-highest pay went to Lisa Hagel, who made $300,470 as the superintendent of the Genesee County Intermediate School District.

ANNUAL PENSION PAYOUTS

Sherman Ostrander, former superintendent of Edwardsburg Public Schools, receives an annual pension of $167,460.

Ostrander’s annual pension is more than three times the average salary of a teacher in his former district ($55,088).

Ostrander worked 31 years in the district and collected a $257,531 salary in 2017-18, his last year overseeing the district of 2,700 students.

Top executives for the state’s largest teachers union are cashing on the conventional public school system.

The three previous MEA presidents were former school employees who arranged special pension deals when they left their one-time school districts to work for the union. Those deals allowed these eventual union CEOs to accrue years of public school pension credits worth tens and even hundreds of thousands of dollars in annual benefits.

That’s because the former districts allowed them to use their six-figure MEA salaries when calculating their public school pensions upon retirement. The result was six-figure pensions from the state’s underfunded school employee pension system.

Former MEA president Steven Cook received a pension payout of $109,420 last year.

His predecessor as MEA president, Iris Salters, received an annual pension of $186,108 a year.

The third teachers union president earning a lucrative state pension is Luigi Battaglieri, who retired in 2006. As of 2019 he was collecting a state pension of $114,712 per year.

TRADE GROUPS

Donald Wotruba, executive director of Michigan Association of School Boards, made $191,287 in 2017-18, according to financial records submitted by the nonprofit to the federal government.

Chris Wigent, executive director of the Michigan Association of Superintendents & Administrators, made $228,441 in 2017-18.

Those organizations’ revenues come from public school districts in the form of annual membership dues, and fees they pay to send their employees to annual conferences put on by the organizations, which also lobby for their members in Lansing.

For example, Utica Community Schools in Macomb County paid $9,327 for association dues to the Michigan Association of School Boards in 2018-19, and another $2,595 to the Michigan Association of Superintendents & Administrators.

The Michigan Association of School Boards, for example, collects about $5 million a year in annual revenue.