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Retired Munster administrators asked to repay $850,000

William Pfister, left, and Richard Sopko.

INDIANAPOLIS — Two former Munster school administrators may be forced to go to trial, with hundreds of thousands of dollars in supplemental retirement fund contributions at stake, if a recent Indiana Court of Appeals decision also applies to their case.

The Indiana attorney general's office on Monday directed the three-judge appellate panel overseeing the state's repayment demand against retired Munster Superintendents William Pfister and Richard Sopko to a March 29 appeals court decision addressing a similar issue out of Jennings County.

In that case, the Court of Appeals ruled that the time-limit for the attorney general to pursue repayment of public funds diverted for private gain does not begin until after the attorney general receives a final, verified audit report from the State Board of Accounts.

That appears to support the attorney general's contention, in its Munster appeal, that the five-year statute of limitations should have started when it was notified June 8, 2016, of potential malfeasance through a special State Board of Accounts audit of Munster schools.

That audit re-examined the 1999 to 2014 period following a 2015 complaint filed by the school district's attorney, Kathleen Maicher.

As a result, the attorney general argues that the state's demand for repayment was timely filed on May 23, 2017, and its civil lawsuit against the two former Munster school leaders should be restored and be permitted to go to trial.

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Court records show Pfister received $473,976.07 in alleged overpayments and Sopko $387,528.60, due largely to contract provisions allowing for annually compounding retirement annuity contributions that eventually equaled 42 percent of Pfister's salary and 36 percent of Sopko's.

Lake Circuit Judge Marissa McDermott last year ruled that the state waited too long to try to reclaim the payments that began in 2002 when Pfister was Munster's superintendent and Sopko was assistant superintendent.

Pfister and Sopko claim that permitting the State Board of Accounts to delve more than a decade into the past, when its six prior audits of Munster schools during the time period found no malfeasance, would produce "an absurd result" where the statute of limitations essentially is meaningless.

They also argue the Jennings County case can be distinguished from theirs, because it involved public employee theft, while the Munster administrators' contracts and payments all were approved by the Munster school board during public meetings.

There is no definite timeline for a Court of Appeals decision. There are 15 state appellate judges, and it's unlikely the same three-member panel will rule in both the Jennings County and Munster cases.

An adverse decision for either the superintendents or the state can be further appealed to the Indiana Supreme Court.

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