Union County taxpayers will have to write a check for $512,867 to the state retirement system to help pay the retirement benefits of outgoing Superintendent Mary Ellis.
Ellis is slated to retire on June 1.
She announced her surprise retirement plans in early March, just days after authorities said she was cleared of any criminal wrongdoing. Ellis and two high-ranking school officials were investigated by the State Bureau of Investigation after creating a consulting firm with an employee of Lenovo. The firm has supplied computers to the school district.
The county district attorney said the SBI had found no evidence that Ellis had committed any crimes.
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Union County Public Schools received a letter from the Department of the State Treasurer, which administers the state retirement fund, seeking payment for the unexpectedly high costs of Ellis’ estimated state pension caused by a jump in her salary late in her career.
Such an increase is known as a pension spike, a term used when highly-paid government executives see a spike in their benefits in their final four years of work that raises their annual pension in retirement.
Information supplied by the school district showed Ellis saw a $12,000 salary increase starting with the 2014-15 school year. Her pay jumped from $190,000 to $202,000, the district said.
The North Carolina legislature passed a law in 2014 that required public sector employers to make up the costs incurred by the retirement system related to pension spiking.
Across the state, 34 other public sector employers have received bills from the treasurer’s office for pension spiking.
The only employer who got a higher bill, though, was the Wilkes County School System, who was billed more than $580,000.
Wilkes County has joined with the Johnston County Board of Education in a lawsuit against the retirement system and its administrator challenging the 2014 law requiring the payment.
Johnston County has refused to pay a $435,913 bill associated with the early retirement of its superintendent.
A Union County school district spokeswoman said the district will pay the retirement system’s bill using money from the local employee retirement benefit account within the district’s budget.
The district did not offer an explanation as to why it entered into a contract with Ellis and subjected it to the half-million-dollar payment.
Observer archives contributed to this report