hands cuffed behind back
Michael Q. McShane

Dan Colgan, longtime superintendent of the St. Joseph public schools, has been sentenced to one year and one day in federal prison for his role in improperly awarding himself bonuses and stipends during his time at the helm of the school district. Colgan’s downfall was one result of a broader sweep of the district’s practices that also led to the firing of former superintendent Fred Czerwonka after it was revealed that he had given out 54 $5,000 stipends to administrators without permission from the school board.

All in all, it was a depressing affair. But, as it moves from the present into the past, we do have an opportunity to try and learn from what happened. I can think of two key lessons:

Lesson 1: Audits are essential

Little if any of the malfeasance in this case would have been brought to light had it not been for an audit of the system’s finances by the state auditor. That process uncovered almost $40 million in misspent funds and led investigators to the guilty parties. It’s not difficult to imagine that if comprehensive audits of all of the state’s 520 school districts were conducted, the state could uncover other cases of wink-and-nod arrangements and misspent funds.  What was found in St. Joseph is reason enough to suspect that similar cases might well be out there, and the state should make auditing at least some sample of districts a priority.

Lesson 2: Basing pensions off the last three years of earnings, even if legal, is a bad idea.

Missouri calculates a teacher’s pension based on the average of their final three years of employment. By awarding himself extra compensation during those years, Colgan was not only adding to his present paychecks, but also increasing the amount of money he would receive in retirement. What Colgan did was illegal, but plenty of teachers and superintendents goose their pensions by taking on administrative roles or other positions in their final three years of employment to increase the value of their pensions.  We want the best people for these jobs, not just folks who want more in their retirement checks. By taking a teacher’s entire career into account when calculating their pension, we can avoid such problems.

It’s easy to shrug St. Joseph off as an isolated, ugly case of abuse of power, but we do so at our peril. We will pay for our mistakes in any case; the only question is whether we will learn from them.

About the Author

Michael McShane

Mike McShane is the Director of Education Policy for the Show-Me Institute. He is a former high school teacher and earned his PhD in Education Policy at the University of Arkansas. Before coming to the Show-Me Institute, Mike worked at the American Enterprise Institute as a research fellow.