By Kathryn G. Menu
The contract for Dr. Carl Bonuso, Sag Harbor School District’s interim superintendent, was revised two weeks ago by the Sag Harbor School Board in order for it to comply with current tax code, according to a press release issued by the school district on May 15.
Specifically, the board had to address why payments to Dr. Bonuso’s life insurance and a housing/travel stipend were originally calculated as separate from his salary and paid for through accounts receivable rather than through payroll.
On May 15 at 7:30 a.m. the board met in executive session to discuss the issue before coming into public session and unanimously voting to amend Dr. Bonuso’s employment contracts.
“The impetus for amending the contracts was the discovery that payments made per the 2012-2013 agreement needed to be accounted for differently to comply with the tax code,” read the board statement. “Additionally, although the board consulted with the district’s previous accounting firm when composing the 2013-2014 contract, they have since discovered that some of the guidance regarding this agreement did not comply with tax code. The board has worked with the school district’s attorney — Thomas Volz, and current district auditors — R.S. Abrams & Co., LLP and Nawrocki Smith LLP, to resolve the issues and ensure that both the 2012-2013 and 2013-2014 contracts are now in compliance.”
According to school board president Theresa Samot, the financial cost to the district remains exactly the same in the amended contract.
At the board’s direction, according to the press release, the district’s business office has put a process in place which will evaluate benefits offered in individual contracts to verify that they are being accounted for in accordance with the current tax code.
“As always the Board is committed to ensuring legal compliance in all district operations, with an emphasis on transparency to the public,” said Samot in the release. “We are glad this issue has been resolved and look forward to continue working with Dr. Bonuso.”
According to Samot, the board began reviewing Dr. Bonuso’s contract as it was reviewing all of its contracts. However, according to former board member Gregg Schiavoni — who resigned from the board this March — he began questioning the legality of life insurance not being considered taxable income when the board began reviewing the 2013-2014 contract for Dr. Bonuso in January.
Schiavoni, an insurance advisor, said he was assured the contract met tax code.
Parent and school district resident Laura Avedon also raised the issue with the board, she said. Avedon said she was inspired to look into the situation following Schiavoni’s resignation. She also was concerned about what she called the board’s “quick” decision to extend Dr. Bonuso’s contract another year this past January.
After raising the question with board members, Avedon said she finally paid her own accountant in mid-April to look at whether or not perks like the life insurance payments and the travel/housing allowance should be considered taxable. The accountant agreed with Avedon and she said she forwarded that information to the board of education.
In an interview after the May 15 meeting, Samot said the board agreed to the life insurance premium payment — $1,984.51 per month in the 2012-2013 contract and $1,987.54 in the 2013-2014 contract — and travel allowance not to exceed $800 per month, but in reviewing the contract with their attorney realized it did not meet tax code.
According to Samot, the revised contract for August 12, 2012 to June 30, 2013 places Dr. Bonuso’s salary at $198,400.10 with a 2013-2014 salary of $197,690.08. Additionally, in lieu of the life insurance premium payments or travel/housing allowance, the district will pay Dr. Bonuso $2,787.54 each month towards his retirement or $33,450.48 annually.