BYRON – The Byron Board of Education voted unanimously Wednesday to pay dismissed superintendent Margaret Fostiak approximately $165,000 from the District’s tort fund and approximately $35,000 to be paid by the District’s insurance carrier (for a maximum total one-time payment of $200,000.) The agreement represents considerably less than one year of Fostiak’s compensation package and it ends her $10 million-plus claim against the taxpayers of the Byron School District.

Board members called the settlement a “huge victory” for the community.

“The Byron School District acknowledges no wrong-doing in settling this lawsuit,” School Board President Doug Floski said. “No one likes to be involved in a lawsuit, but settling a $10 million-plus claim for a fraction of that amount is a huge victory for taxpayers. The Board of Education is satisfied with the outcome, and we’re pleased to put this matter to rest.”

In announcing the settlement, Board members emphasized the following:

  • This one-time payment represents the only monies paid to Ms. Fostiak and it settles her entire suit against District taxpayers; there are no other agreements or payments, and no issues are pending.

  • The Byron schools tort fund contains ample monies to cover the payment; no monies will be taken from any other funds.

  • The District is not responsible for any of Fostiak’s legal bills; all of the District’s legal fees are covered by the District’s insurance carrier and by the tort fund.

  • Neither taxes, nor the District’s insurance rates will be raised as a result.

Floski said the exact amounts that will come from the tort fund and from insurance will not be known until all of the District’s legal fees for this case have been calculated. “It might be $170,000 from the tort fund and $30,000 from insurance,” Floski said. “We won’t know for a few days. But the total, by the agreement signed by Marge Fostiak and by all Board members, will not exceed $200,000.”

Board members made it clear that budget reductions currently under consideration in the Byron schools are not connected to this settlement. Reductions under review are necessary to address declining enrollment, increasing employment costs, and a $27 million drop in the equalized assessed value of the Exelon nuclear facility, the District’s largest taxpayer.

Illinois school districts levy for a tort fund to cover lawsuits and other legal matters. (The law allows tort dollars to be transferred to other funds in some school districts; however, the Byron CUSD does not meet the legal criteria – therefore, these monies could not have been used to cover teachers’ salaries or raises, or to pay down construction debt.)

The School District’s attorneys supported the settlement, Floski said, because litigating a case, even a strong one, is not without risk.

“The School District’s attorneys estimate it would have cost $200,000 to try this case in the various courts where Ms. Fostiak filed suit,” Floski said. “What we have agreed to pay her is essentially what we would have paid in legal fees, with no guaranteed outcome. Lawyers call it ‘settling for the cost of litigation.’ It rarely happens but when it does, it’s a victory for the person being sued, in this case, the Byron taxpayer.”

Fostiak was dismissed from her position as superintendent in July of 2011.

To those who might question the settlement, Floski stated the following.

“We know many people did not want Ms. Fostiak to get a penny – we understand that sentiment,” Floski said. “But our job is to do what is best for the students of this District and for the taxpayers who fund their education. We believe that bringing this matter to a close, once and for all, is in the best interest of the District’s students and employees, as well as other members of the community.”

Board member Carol Nauman said the settlement allows the community to move forward.

“This small payment allows our students, staff, parents and volunteers to put this episode behind them,” Nauman said. “Now, we can move forward to a promising future.”


Doug Floski

Office – 815.234.5454

Home – 815.234.2231

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