Miami Herald: Broward Teachers Union sues to halt insurance hike

Dec 8, 2009

The Miami Herald published this article on December 8, 2009


The Broward Teachers Union said it filed a lawsuit Thursday asking to halt a school district health insurance increase while a School Board member is being investigated for a possible ethics violation.

Stephanie Kraft has drawn scrutiny since revealing that her husband worked for influential board lobbyist Neil Sterling — who also represents Vista Healthplan, the district’s insurance provider.

Kraft chaired an advisory committee that accepted Vista’s rate increases. The union wrote in a statement that the committee’s recommendation is “clouded” by Kraft’s failure to report her husband’s relationship with Sterling.

The union argues that the district should stop the increases pending the outcome of an investigation by the Florida Commission on Ethics.


The injunction petition, filed in Broward Circuit Court, is the latest in a series of teachers union lawsuits filed against the school district. Both sides are in the throes of negotiating a contract for teachers.

 “Each situation generates more questions,” BTU President Pat Santeramo said. “It makes you start to wonder what is really going on behind the scenes and is this a continuation of corruption within the Broward school district.”

The union is asking for an average 4 percent pay increase, which includes advancement for years of service. The district has offered no raise, something other schools employee unions have agreed to, Superintendent Jim Notter has said.

It’s unclear if the district could freeze the increase because the School Board already signed off on the new rates. Notter, who was out of town at an educators’ conference, could not be reached for comment Thursday.

While the district pays for employees’ health insurance, teachers must pay to add family members. A children’s insurance plan will go up by about 45 percent and a PPO plan rate will increase by 35 percent, starting Jan. 1. The rate for the most popular plan, an HMO, will be going up by about 9 percent.

The insurance committee, which included two other board members besides Kraft, negotiated that rate down slightly from almost 10 percent, which Vista had requested.

In October, Coral Springs resident Philip Sweeting, a former Boca Raton deputy police chief, filed a complaint with the state ethics commission asking it to investigate whether the relationship between Kraft’s husband and lobbyist Sterling constitutes a misuse of Kraft’s public position.

State law says elected officials are not allowed to vote on matters that would benefit a relative. They also cannot participate in those matters without first disclosing a conflict of interest.

Mitch Kraft, a lawyer, worked as an independent contractor for a Sterling-owned technology firm for two years. He stopped doing so in October, after a corruption investigation resulted in the September arrest of former board member Beverly Gallagher.

Law enforcement sources familiar with the probe have said they are focusing on Gallagher’s relationship with Sterling, a former School Board member and one of the biggest donors to current members’ campaigns.

Sterling’s technology company, which employed her husband, does not do business with the district, Stephanie Kraft has said.

She has also said her vote for Vista to get the district’s $1.7 billion health insurance contract came after doing research and comparing options, not because of the lobbyist’s influence. In October, she showed The Miami Herald a pages-long chart ranking companies based on dozens of criteria.


Until last year, Broward schools employees could pick between two companies for health insurance — so competing Humana and Vista kept their perks attractive and prices low.

 The district switched to one carrier after Humana proposed raising its yearly rates more than Vista. The contract was put out to bid and Vista was chosen as the sole provider.

Since Gallagher’s arrest and the controversy over the higher insurance premiums, School Board members have taken themselves off the insurance committee.

And the district has changed its policies to require lobbyists to disclose relationships with board members’ families and to impose penalties on lobbyists who violate rules.