TSA & Annexation – Legal Update

TSA

In 2009, the DeKalb County School District stopped payment on TSA, a supplemental retirement fund for district employees. (Note: The TSA is separate and apart from the TRS) Plaintiffs claim this was in direct violation of the contract the district agreed to and resulted in the loss of millions of dollars for district employees.
In 2017, Judge Gregory Adams of the Superior Court of DeKalb County dismissed the employees’ lawsuit entirely and withheld ruling on class certification. Plaintiffs appealed.
Last week on June 1, 2018, the Georgia Court of Appeals issued an Opinion that
1) overturned the dismissal of Plaintiffs’ claims;
2) determined that the District is liable as a matter of law for breaching its legal duty to the employees;
3) ruled the Plaintiffs were entitled to judgment on liability in their favor, with only issues of damages calculations remaining for trial by jury; and
4) ruled that the trial court must reconsider class certification in light of the Gold III Opinion.
RELATED POSTS AND DOCS

TSA – 2017 Summary Judgement
July 11, 2017 – In 2009, the DeKalb County School District stopped payment on TSA, a supplemental retirement fund for district employees. DeKalb teacher Elaine Gold and school psychologist Amy Shaye filed suit against the district in June 2011. In the 2016-17 school year alone, DeKalb Schools spent in excess of $2.5 million on this case.


Emory & CDC Annexation

DeKalb Schools sues city of Atlanta over Emory, CDC annexation
By: Marlon Walker (AJC)
The DeKalb County School District is taking legal action against the city of Atlanta over what district officials call an “11th-hour change” to the annexation of Emory University and the Centers for Disease Control.
The annexation — 744 acres, the largest by Atlanta since Buckhead was annexed 65 years ago — was approved by the Atlanta City Council on Dec. 4. The area became part of Atlanta in January. The students affected will become part of the Atlanta Public Schools system on July 1.
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24 responses to “TSA & Annexation – Legal Update

  1. Stan,
    Thanks so much for posting, especially the reversal in the TSA case. Wow. Couldn’t this have a catastrophic budget impact if the former teachers win?
    The $2.5 million in legal fees that DCSD spent in 2016-17 on the TSA case is about the same amount of money that Dr. Green says DCSD will lose each year if the Emory annexation isn’t overturned. Oh, the irony.
    And I’m guessing that DCSD legal fees will increase even more, as the TSA case resumes and for the Emory annexation lawsuit.

  2. DSW2Contributor

    Stan, will the TSA judgement impact our bond-rating? Does the school district have to notify Moody’s (or whoever it is that does the ratings?)

  3. Stan Jester

    Moving forward, I suspect the school district will appeal this decision. I would be surprised if this doesn’t make it to the Georgia Supreme Court. Damages calculations were yet to be determined. If all teachers are paid to get caught up to today for TSA, it would cost over $200 million.
    I don’t know how this could affect the bond ratings.

  4. 1. It is ridiculous that the DCSD did not honor its obligation to teachers to pay into the TSA that was set up as the legal option to Social Security contributions for employees. It was an illegal and u ethical decision to stop payments to this fund without reinstating payments to Sicial Security. The money spent fighting this case could have been given to all the employees who were affected. The Board if Education should insist upon rectifying this decision.
    2. How was the DCSD under the impression that an annexation of Emory i to Atlanta would not affect its revenue? It is futile to fight this now. Instead money should be spent to fight more extensive annexation which would include school buildings and property. Does anyone believe APS won’t work for the City iof Atlanta annexation of the Fernbank ES, Fernbank Science Center, Briar Vista ES properties along with property at at N Druid Hills Rd and Briarcliff Rd? Of course they will. The Superintendent t has already said it.

  5. Hello and thank you for the information concerning the TSA and the annexation. I have a concern – are the TSA funds pre-2009 safely out of the hands of the Dekalb County School System? I know that TRS is protected, but would a change in bond rating, or a potential Dekalb County School System default affect previously (or presently) contributed retirement funds (some of us are now contributing to a retirement plan offered through the county)?

  6. Stan Jester

    DeKalb Schools does not manage the TSA funds.

  7. escappe from dekalb

    I wonder how this will affect those who have retired at a money loss since 2009– and how will it afect those mulling retirement right now? And the cost to defend this is climbing.

  8. Dear Mr. Jester
    I also want to thank you for posting this information. All school systems want to recruit and retain strong educators. It is very upsetting to see DeKalb fighting so hard to not do the right thing and honor their agreement. We can find money for two more regions. We can find money for an expanded HR Department. We can find money for a pep rally.
    I know that neither of these expenditures would be enough to cover what the system owes its current and former staff members. But remember that DCSS staff members did not pay into Social Security for many years. Then the TSA was stopped. This will have an impact on their income in retirement. An important message not to be missed is that the DCSS does not honor its word.
    I won’t explain why but I was actually at the meeting when Dr. Lewis, promised to start paying back into TSA at the beginning of 2nd semester. He announced this to administrators on the last day of the summer leadership conference. It seems like a storm was brewing outside that day. But no one realized that the real storm was inside that room. The hot air had already started blowing on us. We just didn’t realize how long the storm would last.

  9. https://www.ajc.com/news/local-education/does-dekalb-schools-need-operate/rnABsGCj3aqHmNBGjOZBOL/
    I copied this quote from an article in the ajc.com today. It was very sad to see that where the money is being spent in the school system. It also makes it even more upsetting that the school system does not want to pay back the money that they took from the TSA account of school system staff members.
    Thank you Stan for asking questions about the way the money is being spent.
    “The proposed budget also includes $53 million more in salary and benefits for the district’s 15,617 staffers, with most going for the 4,353 staffers who don’t work in schoolhouses. The district has added several administrative positions, including 18 roles in two new regional superintendent cabinets, as well as directors for grants, network security and the Early Learning Center. Michael Bell, the district’s chief financial officer, said Friday that a mandated $23.4 million retirement contribution as well as $2 million in insurance for non-schoolhouse employees had significant impact.’

  10. This and That

    This may be off topic but what school is the designated “Early Learning Center”? I did not realize that DeKalb Schools had one. Is that the Coralwood Center (taught there in the 90s so I know it is a Diagnostic and Inclusion center now)? I know that Decatur City Schools have an actual Early Learning Center. Thanks to anyone who can answer!

  11. DSW2Contributor

    The AJC: “Does DeKalb Schools need $1.1B to operate?”
    Dekalb Schools: No, we need $1.1B plus the $2.5M Atlanta stole from us. Duh!

  12. Tongueincheek

    Stan:
    This reply is in response to the budget just submitted and your quote in the AJC article. A bloated budget request with no discernible school’s scores showing improvements. Just more money to waste for superfluous non- classroom positions. I think taxpayers should say No and tell Greene to make do with a lot less. What can be done to stop this profligation from continuing ? I’m glad you’re attempting to hold Greene’s feet to the fire. Wat happens when the county is forced to shell out 200 million if judgment goes against them?

  13. To: This and That
    The Early Learning Center will be new for 2018-2019. It is supposed to be housed at the former Wadsworth now that the Rockbridge ES students are at their new school.

  14. Joy, the article about DCSD’s $1Billion budget is on the front page of today’s print AJC.
    How that money is spent is even more disheartening when we learned at yesterday’s DeKalb BOE meeting that DCSD doesn’t meet the requirement that 65% of funds be spent in the classroom. Thanks to Stan for asking the question.
    Now of course DCSD can thumb its nose at that 65% requirement since it is a Strategic Waiver School System, but I happen to think that many of the “requirements” that DCSD can now waive are pretty sensible guidelines that shouldn’t be ignored.

  15. Thank you @anon. Again thank you Stan for keeping us informed. We spend more money. We add more regions. We don’t get better outcomes for our students. Why do we keep doing the same thing and expecting different results?

  16. @Cathy D: With the City of Brookhaven’s recent annexations, only the Boston Market & Quick Trip stand between the N. Druid Hills Rd property and the City. If the District can convince those owners to agree to annexation, the N. Druid Hills property could be annexed into Brookhaven and would be out of the reach of of the City of Atlanta.

  17. What is the “Early Learning Center” and what group will it serve?

  18. I thought the BOE was charged with educating K-12 which is why there are limited pre-k programs rather than all 4 year olds being expected to attend school. Perhaps the BOE and Dr. Green should perfect educating K-12 before they serve 3-4 yr. olds. I don’t believe the state funds those so those programs rely on funds from the operating budget intended for K-12.

  19. This and That

    Interesting thought! I have taught Preschool Special Education in DeKalb Schools for 24 years. It is the only program with 3 year olds (most come from Babies Can’t Wait program). A couple of years ago my principal was surprised that we had 3 year old in our building. Maybe the 3 year olds will be ones with special needs. The Federal program – Babies Can’t Wait – is for special needs children birth to 3. The day they turn 3 they have to go into the state program (our preschool special ed). Interesting that this is the first we have heard of this program. No chance to transfer to it until January 2019. (I worked at the Coralwood Center when I began with DeKalb.)

  20. Stan,
    Is this new school open for all students? Can students live in any area and attend? Will transportation be provided?

  21. This and That

    The Early Learning Center (Academy) is now on the DCSD website. Apparently it is at the old Terry Mill location (Fayetteville Rd.) They began registering June 21 for 3 year olds – 200! After 200 they are put on a waiting list. All it states is that they have to live in DeKalb County. Interesting!

  22. Stan, what happened to this lawsuit about teachers’ losses when DCSD stopped paying into the TSA the school system set up when they stopped paying into social security for teachers? Thank you!

  23. In 2017, Gregory Adams dismissed the TSA lawsuit. June 1, 2018, the Georgia Court of Appeals issued an Opinion that overturned the dismissal. The school district has appealed the 2018 opinion. It’s in the process of going up the chain.

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