On Wednesday, the Seattle School Board approved an insurance settlement of $275,000 to cover a part of what the district lost through problems with its former small business contracting program, run by Silas Potter Jr.
The board also voted to accept a separate payment of $900,000 to cover most of the costs of fixing air quality problems at South Shore School in 2010.
On the small business program: The board decided to accept a much lower settlement than the $3 million that the district allegedly lost, according to two reports by the Washington state auditor’s office. That’s because the auditor’s office identified questionable expenses as well as losses, and all but $280,000 was in the questionable-expense category. The Washington Schools Risk Management Pool said it covers only losses, not questioned costs. The district will receive $275,000 after it pays a $5,000 deductible.
The district still can try to recover more funds through a civil lawsuit against Potter, the other defendants or other responsible parties.
Potter faces about three dozen criminal theft charges, and is scheduled to stand trial in February along with David A. Johnson, who allegedly conspired with Potter to steal money from the school district. A third defendant, Lorrie Kay Sorensen, has pleaded guilty.
On South Shore School: The district had to close the brand-new building for two months in 2010 after students and staff complained of odors and illness. To solve the problem and move the students to a temporary building, the district spent $1.3 million. The district has reached an agreement under which Graham Contracting, the project’s general contractor, will pay $900,000 of that amount. On Wednesday, the district’s general counsel recommended that the board accept the $900,000 rather than risk going to court to try to recover more.