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South Middleton Schools

Big Spring, Carlisle and South Middleton school boards review settlement of decade-old lawsuit

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South Middleton School Board members could vote on an agreement June 21 to settle a 10-year-old lawsuit against the Capital Tax Collection Bureau.

Cumberland County Judge Thomas Placey entered an order April 30 awarding a lump sum payment of $320,673.75 in damages to the school districts of Big Spring, Carlisle and South Middleton.

Execution of the settlement is contingent on all three school boards approving the agreement, said Gareth Pahowka, solicitor for the three districts. “The amount will be divided up among the districts. It’s not an equal split.”

Based on preliminary numbers, the South Middleton share is about $70,000, Pahowka told board members Monday as they reviewed proposed agenda items for the June 21 meeting.

South Middleton School District used to contract with CapTax for the collection of its earned income tax revenue, said Nicole Weber, district director of business and operations.

That arrangement changed in 2008 after the state General Assembly passed legislation requiring school districts to convert to a countywide process for the collection of EIT revenue by 2012, Weber said.

When Big Spring, Carlisle and South Middleton school districts left CapTax, they received no payment for their share of the bureau’s equity. In 2011, Big Spring and Carlisle filed a joint lawsuit to recover their share. South Middleton entered into the lawsuit about two years ago, board member John Greenbaum said Monday.

The lump sum payment represents the total amount of money CapTax has offered to settle the lawsuit, Pahowka said. “CapTax has elected not to appeal. If approved, this would bring the litigation to a close.”

Under the agreement, CapTax agrees to pay the lump sum if the districts agree to file the necessary legal paperwork to discontinue the suit and free the bureau of any further claims.

Big Spring School Board voted unanimously Monday to approve the agreement, Superintendent Richard Fry said. The board was ready for a vote because of annual updates and because several current members were on the board back when the lawsuit was first filed, he said.

Under the agreement, Carlisle will receive about 50% of the settlement or $161,459, Fry said. The share for Big Spring is about 28% or $90,109, while South Middleton will receive about 21.5% or $69,105, Fry said.

Carlisle Area School Board plans to discuss the agreement during a committee meeting this Thursday with a possible vote on June 17, Superintendent Christina Spielbauer said.

In other action, South Middleton School Board members Monday:

  • Awarded a $53,000 contract to First Capital Insulation Inc. of York to remove and dispose of asbestos-containing materials at Boiling Springs High School and a house at 16 Forge Road that the district recently purchased. The material will include about 12,500 square-foot of floor tile adhesive and paper backing from the high school, said Zach Gump, supervisors of buildings and grounds.
  • Approved including the position of school psychologist into the South Middleton Education Association, the local union.
  • Accepted the resignation of Matthew Hurley from the job of supervisor of human resources.
  • Accepted resignations from faculty members Lindsay Frisbie, a family and consumer science teacher at Boiling Springs High School; Carolyn Greene, a fifth-grade teacher at Iron Forge Elementary School; and Seth Eck, an art teacher at Iron Forge.

Email Joseph Cress at jcress@cumberlink.com.

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