In a precedent-setting ruling, the Pennsylvania Supreme Court said a school district is not liable for paying pension contributions that a closed charter school failed to make to a state pension fund for teachers.
Ruling in a case brought by the Pocono Mountain school district, the court said that requiring a school district to pay the outstanding retirement debt of a defunct charter school violates the state’s charter school law.
The ruling has important implications for districts statewide because it resolves a conflict within the charter school law regarding what constitutes a “debt” of a charter school, said the Pocono Mountain district’s solicitor, John Freund.
The dispute centered on the former Pocono Mountain Charter School’s failure to deposit $87,700 in pension contributions it owed for its teachers.
The school shut down after the district revoked its charter in June 2014, based on concerns over financial improprieties.
By law, a charter school is responsible for paying in to the pension system.
In this case, the school district had no way to recoup its money because the charter school already was closed. Its request for a refund from the state education department was denied.
