State closes records as MCS verdict looms

MUNCIE — State officials are declining to release a new report examining health insurance costs at Muncie Community Schools.

They're also withholding bids offering to purchase school buildings, bids to provide health insurance for the self-insured school district, and a new report analyzing the district's property/casualty insurance costs.

The secrecy is taking place on the eve of the public being invited to comment — Monday, 6 p.m., Northside Middle School —on whether or not the state should take full control of the financially impaired school district.

Also just around the corner are recommendations from the state-appointed emergency managers of MCS, including which academic programs to cut; whether more schools should be closed; and when more teaching positions might have to be eliminated.

Ex-CFO's journal exposes costly MCS health insurance plan

MCS teachers face cuts to 'rich' health insurance plan

A contract the state's Distressed Unit Appeal Board (DUAB) signed last month with emergency management firm Administrator Assistance included $7,500 for a "health insurance audit" and $15,000 for a "property insurance audit" of MCS, both to be performed by subcontractors.

RE Sutton & Associates, a Carmel employee-benefit and insurance brokerage consultant, examined the district's health insurance plan.

The purpose of Sutton's report was to provide information to the school district and the emergency manager for use "during the procurement of a new health insurance plan," which exempts it from the Access to Public Records Act, Daniel Shackle, an attorney representing the Indiana Department of Local Government Finance, told The Star Press.

The document is also being used during current collective-bargaining negotiations between emergency managers and the Muncie Teachers Association, which also exempts it from the open records law, according to Shackle. It's also not disclosable because it is a "deliberative," document, Shackle added.

The Star Press did obtain a brief document that emergency managers submitted to DUAB indicating that the school district could save $2.2 million a year by switching to the state's health insurance plan.

Henriott Group, a risk management firm in Lafayette, examined the district's current property and casualty insurance coverage to help procure new insurance. That report is also legally allowed to be withheld from the public because it is "deliberative," according to Shackle.

Following the recommendation of emergency managers, MCS Superintendent Steve Baule is declining to release the bid submitted by Ball State University to buy one or more school buildings, including Northside Middle School and the deserted Mitchell Elementary School.

The bid is not public, according to emergency managers, because it is related to negotiations that had not yet been completed between the school district and the university.

Bids, aka proposals or quotes, from firms to provide health insurance to MCS are being withheld from the public by emergency managers on grounds that they contain trade secrets and are "deliberative" and include speculative opinions "communicated for the purpose of decision-making."

Luke Britt, the Indiana Public Access Counselor, told The Star Press, "Most bids pursuant to an RFP (request for proposals) are going to be available for production less any redactable information. I’m not aware of any statute that would allow their wholesale withholding … "

But officials are likely justified in withholding the audits of health and property/casualty insurance because "that would likely be deliberative," Britt said.

Steve Wittenauer, co-founder of the emergency management team, said he didn't want to release the health insurance audit in the middle of contract negotiations with the teachers union because that could be viewed as trying to "negotiate in the newspaper."

The negotiations are "going well," he said. An agreement must be reached by Nov. 15 to avoid impasse. The last collective bargaining  between the district and teachers resulted in an impasse that had to be settled by the Indiana Education Employment Relations Board.

While the state-appointed emergency managers of MCS started work on July 1, they didn't sign a contract with the state (worth up to $300,000) until last month. It includes a section on media relations:

"The Emergency Manager shall notify the DUAB Executive Director of any planned media contact, including, but not limited to, press releases, press conferences, and media interviews at least 24 hours in advance of the contact, if possible.

"If 24 hour notice is not possible, the Emergency Manager shall provide notice as soon as possible to the DUAB Excecutive Director. For unplanned media contact, the Emergency Manager shall notify the DUAB Executive Director as soon as possible after the contact, providing a summary of the questions and answers provided, if applicable."

That language, according to Courtney Schaafsma, director of DUAB, "is not designed to prevent them from talking to the media, just to keep us abreast and informed … We're not there in Muncie day in and day out."

She noted that the emergency managers have made multiple public presentations in Muncie to keep the community informed of progress toward achieving financial stability for MCS. 

When the time is appropriate to release information, emergency managers and the school district will continue to make sure it is provided "not just to the media but to all stakeholders," Schaafsma said.

Seth Slabaugh is an education reporter at The Star Press who can be reached at (765) 213-5834 or seths@muncie.gannett.com.