UPPER SAUCON TWP., Pa. — A veteran Southern Lehigh School Board member is ringing the alarm about what she said is an error in the ex-superintendent’s separation agreement and the attorney she said is responsible for the ordeal.
Director Emily German said the amount paid to former Chief of Schools Michael Mahon was less than the amount listed in his separation agreement as a result of a calculation error the district’s solicitor didn’t fix in time.
As a result, she said the district technically could owe the ex-superintendent more than $3,700.
Others said Gehman, who has served on the board for a decade, is overstepping with her comments and angling to regain power after having been ousted as board president.
At the August school board meeting, school directors and administrators revealed Mahon had been paid $89,899.04 instead of the $93,644.83 payout amount listed in his agreement.
Calculation error
That adjustment was made, they said, to fix a calculation error.
The initial sum listed in the agreement wasn’t updated before Mahon signed it and the board approved it in July to account for an additional paycheck Mahon was slated to receive.
The amount of $93,644.83 was meant to “represent an amount equal to one-half the remaining salary payments” due to Mahon through the end of his contract in accordance with section 1073 of the Pennsylvania Public School Code.
His contract was set to expire June 30, 2026.
Section 1073 applies to negotiated severance agreements for superintendents that take effect less than two years before the end of the administrator’s contract.
Their payout, including noncash benefits, can’t exceed half their total compensation for the remainder of the term.
Gehman, who voted against the separation agreement and raised concerns about Mahon’s payout over the past several weeks, reiterated her concerns to LehighValleyNews.com in a recent statement:
“Five board members voted to pay Mahon $93k salary benefit, 56 days vacation benefit, and full healthcare benefit until age 65," she wrote.
"After I raised the issue that each of these payouts compensate Mahon for more than half the value of his remaining contract, and are therefore in violation of 1073, Director of Business Lou Pepe, paid Mahon $89k instead of $93k without any additional vote or board discussion.”
‘We flat-out owed him’
Gehman previously said the board should have held another vote to approve the $89,899.04 payment.
When an expense has cost less than initially anticipated in past scenarios, Gehman said the board has held an additional vote to approve the new amount.
Gehman also raised concerns the district would be on the hook to pay Mahon the difference between the two amounts — $3,745.79 — because the separation agreement didn’t include language for an “actuarial caveat,” which would have allowed the school district to adjust the payment if there were errors in calculations, she said.
“Therefore we flat-out owed him that,” Gehman said at the August school board meeting.
Mahon and his attorney declined to comment for this article.
John Freund, the district's attorney, said he is currently working to see how much of Mahon’s payout will be covered by insurance and reimbursed to the district.
‘A specious notion’
Freund also pushed back against Gehman’s arguments.
“This whole idea that you can't adjust an authorized payment downward based on the actual wording in the contract is actually a specious notion,” Freund told LehighValleyNews.com.
Freund said the purpose of the reduction was to be in compliance with section 1073, and he noted the agreement included language making clear the payout amount was to equal half of what were Mahon’s remaining salary payments at the time of its approval.
At the August school board meeting, Gehman blamed Freund for not adjusting the amount listed in the agreement before Mahon signed it and the board approved it.
“It seems like people looked into it, and I’d like to believe [Mahon’s] getting the proper amount.”Timothy Kearney, Southern Lehigh school director
Freund said he didn’t receive the adjusted amount from the district until after Mahon’s signature was added.
But the district’s business director said he sent the updated amount to Freund's law firm before it was signed by Mahon on July 25.
Gehman also questioned why the business director didn’t speak up about the error when she publicly raised the issue at the July 29 board meeting. The business director said he already was working on the issue behind the scenes.
LehighValleyNews.com reached out to the other eight school directors for comment on the agreement error and payout adjustment.
Except for directors Timothy Kearney and Christopher Wayock, the remaining board members did not respond to requests for comment, declined to comment or directed a reporter to the district’s solicitor.
Kearney said, “It seems like people looked into it, and I’d like to believe [Mahon’s] getting the proper amount.”
Wayock said he trusts the actions of the district’s attorney, and he doesn’t believe Mahon will push to receive the additional funds.
Why two agreements?
Director Gehman also said Mahon was being overpaid under Section 1073 when taking into account both his separation and general release agreements in totality.
Per both agreements, Mahon was granted more than $246,000 — that includes checks to Mahon and a district contribution to his retirement fund based on unused vacation days.
Additionally, his attorneys received $25,000 to cover legal fees.
Based on her calculations, Gehman previously told LehighValleyNews.com, the total value of Mahon’s separation and general release agreements is about $470,000.
That takes into account benefits, such as continued health care coverage.
Gehman said Mahon’s severance package, including all benefits, should only have had a valuation of $143,798.25 — much less than what he’s getting based on the approved agreements.
Gehman said she believes both agreements are subject to section 1073 because they reference each other and were voted on together in one motion.
Attorney Freund again pushed back on Gehman’s claims.
“We absolutely deny that there’s a violation here,” he said.
'Clearer to separate them'
Freund said it was in the best interest of the school district to “achieve finality” because Mahon “may have claims upon which he could conceivably file lawsuits” related to due process issues.
“Just like any other civil lawsuit or potential claim they have value to be settled,” he said.
But Gehman argued the release of claims could have been included in the separation agreement. She said that was the case for the settlement agreement the school board recently approved with former HR director Ethan Ake-Little.
“I think the only reason Freund wrote Mahon’s separation agreement [and] waiver under two document headings was to try to circumvent 1073,” she wrote in a recent statement to LehighValleyNews.com.
Freund said Mahon, unlike Ake-Little, was a commissioned officer who operated under a contract, and that a release agreement was essential to “avoid potential liability” for any claims Mahon might bring against the district, which could have been “expensive” and “divisive.”
Freund also said he and Mahon’s counsel agreed “it would be clearer to separate them” and that “the negotiations were in fact separate.”
“Obviously, there was a concern about 1073, and we couldn’t put it all in one because that would [appear to] be a violation,” he said.
Freund said Gehman was conflating the two agreements.
Gehman criticizes solicitor; Freund pushes back
Gehman has criticized Freund publicly and in statements to LehighValleyNews.com for what she said is a lack of transparency with both board members and the public.
Other school directors have similarly raised concerns about Freund’s transparency and communication with the full board.
Freund said he communicates with the necessary leaders, who include the board president and superintendent.
“It’s easy to pick on the lawyer."John Freund, attorney for Southern Lehigh
Gehman and three other board members voted in June to open a search process for a new solicitor, but that motion failed. Those board members were Vice President Candi Kruse, Eric Boyer and Kearney.
In a statement, Gehman wrote, “I think it is clear to anyone who has watched a recent [Southern Lehigh] board meeting how John Freund is representing the district…”
Freund’s law firm has a contract with Southern Lehigh that expires in November.
Freund said Gehman has been critical of him because she is disappointed she was recently ousted as board president.
“It’s easy to pick on the lawyer,” he said.
In response, Gehman said in a statement, “It is exceedingly rare that a founding member of a law firm seeks to defend himself by publicly disparaging a client.”
Director Wayock defended the district’s solicitor and praised the firm’s work with recent “challenging situations” to help Southern Lehigh make the most "fiscally responsible” decisions.
“We gave them latitude to come to terms so that we can move forward as a district, and they achieved that I think successfully,” he said.
Gehman and Wayock butt heads
Wayock also criticized Gehman for her arguments about the separation agreement, which he said were made to “stir up unnecessary concerns.”
“She thinks she's a lawyer, she thinks she's a superintendent, she thinks she's everything under the sun when it comes to the school district,” he said.
He said Gehman “wants nothing but power and control.”
Gehman, in a statement responding to Wayock’s comments, said he “is known for name-calling and belittling women” and said he made “false inflammatory remarks” about her.
Wayock said Gehman was turning to gender issues “to deflect from [his] efforts to benefit” the district. Wayock is running for re-election in the November election.
Southern Lehigh school directors were scheduled to have their second training with the Pennsylvania School Boards Association last week to learn more about good governance and how to work together as a team.
Southern Lehigh School Board meets next at 6:30 p.m. today in the board room of the district high school.
