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Audit accuses NCHSAA official, Chatham schools of fraud

Posted December 8, 2011

Rick Strunk, Associate Commissioner of the NCHSAA
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— An official with the North Carolina High School Athletic Association wrongfully accrued state retirement benefits for a year by having Chatham County Schools list him as an employee, according to a state audit released Thursday.

The audit's findings have been turned over to the State Bureau of Investigation and Chatham County District Attorney Jim Woodall to determine whether criminal charges are warranted.

The NCHSAA was founded by a University of North Carolina at Chapel Hill professor a century ago and remained affiliated with the university until last year, when it became an independent nonprofit. The move meant that association employees were no longer considered state employees and had to end their participation in the state pension system.

Rick Strunk, the associate commissioner for communication at the NCHSAA, had more than 26 years in the pension system at the time, meaning he was less than four years away from full retirement benefits, according to the audit. State officials said there was no way to grandfather him or any other association employee into the pension system to let them continue to accrue benefits.

Association officials wanted to find a way for Strunk to earn his full retirement benefits, so they agreed with Chatham County Schools in June 2010 to list him as a school district employee, making him eligible to continue participating in the pension system, while the NCHSAA paid his salary, the audit states. The arrangement continued until last April, when state auditors began to question it.

Raleigh lawyer Joe Cheshire responded to the audit for Chatham County Schools, saying district officials thought the arrangement was legal. He noted other instances where employees of non-state agencies have been allowed to participate in the pension system, such as the North Carolina League of Municipalities and regional education service agencies.

NCHSAA logo, NC High School Athletic Association NCHSAA, Chatham Schools deny wrongdoing

"Neither the (school) board not its superintendent intended to mislead any person or entity," Cheshire wrote. "As soon as the board learned that the retirement system did not approve the the arrangement ... the board voluntarily corrected the mistake."

Auditors questioned the accuracy of Cheshire's statements, noting that Strunk was an employee of the school district in name only and didn't do any work for the district. Also, the district continued to forward pension contributions from the NCHSAA on behalf of Strunk to the state even after auditors informed Superintendent Robert Logan that the arrangement wasn't legal.

NCHSAA attorney Jim Maxwell said the association never knew the deal with Chatham County Schools was improper until auditors questioned it, so no criminal activity occurred.

Auditors stated that, before approaching Chatham County Schools, the NCHSAA tried craft a deal with Orange County Schools where all association employees would be listed as school district employees and remain eligible for the state pension system. State officials rejected that plan, so the association should have known that a similar deal exclusively for Strunk also would be prohibited, the audit states.

"The athletic association chose not to contact the retirement system for approval after prior arrangements were denied in clear, precise terms regarding affiliation with other school districts," the audit states. "This failure to request approval for the third method indicates a decision to move forward under the philosophy that 'it is better to ask forgiveness rather than permission.'"

Strunk didn't return a phone call Thursday seeking comment. Instead, the NCHSAA and Chatham County Schools issued a joint statement reiterating that they don't believe his employment deal with the school district was wrong.

23 Comments

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  • dbop90 Dec 12, 2011

    In my opinion they need to clean house there in the Chatham County Board of Education administration. Specifically in that finance department. This was not right and those top adminisrators knew they were doing something shady.

  • jayrouse Dec 9, 2011

    Sounds like the NCHSAA was trying to do right by their long term employee. Certainly no attempt to deceive. NCHSAA was paying for all expenses incurred by Chatham Co. So no costs to the county. I think it is admirable that the NCHSAA was trying to do right by their long time employee in the change over.

  • bill25 Dec 9, 2011

    wa4mjf..
    actually I do see quite a bit of football. 30+ years of officiating as a matter of fact. That's why I thought it was strange how he said it --cause the officials are not known as 'judges'...on the whole. he called them 'referees' and 'judges'. what ..no umpire? Anyway -- the poster made no sense and it was a rather odd way of complaining about the calls...especially since the article wasn't about the game.

  • 4YourConsideration Dec 9, 2011

    I find it quite heartening that several posters find little/nothing wrong with the actions taken to give this guy his full pension. See, I got screwed out of a lot of my pension when my employer went bankrupt and dumped the purposely underfunded pension on the Feds. If the company hadn't gone broke, I would have earned a MUCH bigger pension. Every taxpayer in the state should be made to make up the difference. Right?

    So, if you are willing to ignore regulations and ethics to ensure this guy gets his full pension, perhaps you're willing to ante-up some money for me; too? Heck, let's just introduce a "Pension Fairness Act" for everyone! After all, the State has plenty of money; doesn't it?

  • scorekeep Dec 8, 2011

    Chatham schools had to cut how many teachers? This guy is paid for doing nothing????

  • RonnieR Dec 8, 2011

    bill25, the judges are side judge, line judge, back judge and field judge. Don't watch much football, eh?

  • penny for your thoughts Dec 8, 2011

    Taxpayers weren't supporting the NCHSAA even as part of UNC - they were self supporting and part of UNC mostly in name the last several years. This is a shame, but to be realistic, some of the facts are not presented exactly right either. Don't get me wrong though, this is screwed up...

  • Equinox Bandingo Dec 8, 2011

    well, you know it's different when it's the employER doing the terminating... it can come right at christmas, no notice, no bonus... but "it's just business" ...now if YOU quit on THEM... boy you had better not just have taken all your vacation or received your bonus... then you've wronged them... this is not directly related... but the guy should have been given fair retirement.

  • FairPlay Dec 8, 2011

    I live in Chatham and the board is so mixed up with shifts I bet they knew what they were doing. Why pay the guy a pension with our tax dollars if he was gone? Crooked ole NC politics at work again.

  • trekkie13 Dec 8, 2011

    The real question is why was the taxpayers supporting the NCHSAA to begin with?

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