WPCNR SCHOOL DAYS. By John F. Bailey. February 28, 2007 UPDATED 1:01 PM EST. UPDATED 1:44 PM EST WITH BOARD OF EDUCATION AGENDA: The City School District has just issued the agenda for Thursday evening's meeting, confirming that they will approve settlement of the Travelers Casualty suit Thursday evening, making the $2.8 Million payment March 2.

The $2.8 Million settlement the School District agreed to after losing their suit with Travelers Casualty and Surety Company, raises the anticipated tax levy on the 2007-2008 school budget to a projected 7.97%, not 9.67% as first believed. This misconception occurred because it was not made clear to the Board of Education or the media in attendance Monday evening in discussions of the budget that the projected tax levy of 7.97% included the cost of the Travelers Casualty settlement.

In that budget discussion, one member of the Board even referred to the possibility of paying the settlement as more reason to cut more costs. To date the cost of the settlement or the existence of the suit  has not been acknowledged publicly by the school district in any meetings open to the public that this reporter has attended. 

 Superintendent of Schools Timothy Connors, speaking to WPCNR this afternoon said, "I believe this case is over," indicating by inference, it would not be appealed.

Connors also said the Board of Education would meet Thursday night to authorize payment of the settlement. Connors said the cost of the settlement is included in the present projected tax levy of 7.97%. As far as other contractors being owed money that was denied in Judge Charles Brieant's decision, Connors statement "I believe this case is over," was how he answered that query.

The $2.8 Million is the maximum amount of money the district will have to pay to end finally the tortured 1999-2003 high school renovation project.

Two thirds of the settlement ($2 Million) will be paid with the surplus, resulting in an additional 1.5% increase in taxes said by the Superintendent to be included in the 7.97% increase currently projected by the district, (barring further cuts by the district).

The other $800,000 will come out of be paid out of available funds leftover from the high school project. The School District business office also reports preliminary indications from the City Assessor Office indicate the city Tax Roll is down from last year, which will further escalate the tax levy. Two months ago the tax roll was down approximately $2 Million, according to City of White Plains up-to-date Assessment roll at the time.

(Mr. Connors said the district would not know until tomorrow what the final Assessment Roll total would be. )

According to Assistant Superintendent for Business of the School District, Fred Seiler, the $2.8 Million will be paid from the $800,000 left in the high school renovation project fund, and the $2,005,000 surplus in this year’s school budget. It is interesting to note that in budget discussion Monday, the surplus appeared to be being counted as an asset for the 2007-2008 budget, because it was not made clear by Seiler that the surplus would not exist to augment 2007-2008 revenue. The surplus was put up in a chart indicating 2006-2007 as having a surplus of $2,008,000, with no mention that the school district was going to pay this out to pay their bill to Travelers Casulty and Surety Company.

Seiler said the surplus was accumulated through savings the district was able to make during the year, and is usually dedicated to soften the impact of the next year’s budget. It will soon be gone. Seiler said the surplus would be used to pay the settlement.

Judge Brieant, in his decision, denied White Plains claims for $7 Million in damages from Travelers, which would have been paid to two other contractors,

Seiler reports that to his knowledge the other contractors had agreed to abide by the results of the suit and not to demand payment in the event the damages were not awarded.

F. A Burchetta, the electrical contractor was owed $2,015,966.31, and Richards Conditioning was owed $2,015,966.31, according to the court papers, which was included in the $7,295,564.31 in damages sought by White Plains from Travelers, which Judge Brieant denied.

Asked if the district would owe any more as a result of losing the suit, in the decision handed down by Judge Charles Brieant of the United States District Court Southern Division January 25, Seiler said he believed Burchetta and Richards, and the architect on the high school project, Kaeyer, Garment & Davidson (currently the architects on the just begun $69.6 Million Capital Project, including new football stadia, a new Post Road School, a renovated Mamaroneck Avenue School, and infrastructure improvements) had agreed to eat the loss if White Plains lost the suit.

Judge Charles Brieant based his decision on the Kaeyer Garment  & Davidson role in the high school project, writing in his decision of January 25: The existence of the Architect’s October 9, 2002 agreement to support Defendant in any legal action or claim including this case, and its contingent fee interest in the outcome of this litigation bears heavily on the credibility of the Architect, and is certainly relevant circumstantial evidence of an incentive or possible bias in favor Defendant as early as October 2002, and of a constructive fraud in declining to earlier issue a certificate of substantial completion.

WPCNR attempted to confirm that the district had finally put the project to bed  ($2 Million over the $28 Million budget) and would not owe any more money yesterday with the Superintendent’s office, and await his call. The Superintendent indicates by his statement "I believe this case is over," that there will be no more multi-million dollar surprises. 

Mr. Connors confirmed that the Board of Education would meet Thursday evening to authorize the settlement.  

The agenda just released to WPCNR reads: