men

EXECUTIVE DOCUMENT SUMMARY AGENCY INFORMATION
State Form 41221 (mom?cs)

 

I4. Name of agency: IS. Requisition Number:

Instructions for completing?eESCnErf ?nIrEac?ocess. Dir: of Management Budget

 

 

16. Address: Of?ce of Management Budget

. . 1 CAPITAL 9TH FLOOR
2. Please type all Information. OCT 2 3 INDIANAPOLIS IN 45204

3. Check all boxes that apply.
4. For amendments renewals, attach original contract.

1. Please read the 'delines on the back of this form.

AGENCY CONTACT INFORMATION

Swaddi?mieeneonraacrs
I7. Name: 18. Telephone it:

 

 

Courtney Schaafsma 3171234?2273

    
 

2. Date prepared:

10t13t2017 Sta"

3. CONTRACTS 81 LEASES

1. EDS Number:


 

l9. E-inail address:
cechaafsmardtduabjnoov

COURIER INFORMATION

     
    
        
 
    

2L ProfessionaltParsonai Services _Contract for procured Services

 

 

   

. 20. Name: 21. Telephone 
- -- Grant _MaIntenance
. Lease License Agreement Courtney Schaafsma 317,234-2273
. Attorney _Amendment# 22. E-mail address:
MOU ?Renewal cschaafsma?lduabinpov
QPA _Other VENDOR INFORMATION

  
   

        
 

 

  
  

 

 

 

 

 

 

FISCAL INFORMATION 23 Vendor ID it 0000350775
24. Nam 25. Telephone 
4. AO?oslilgt Number: 5. NadeIU 't A I OF AMERICA LLC 813.327.4717
'5 r9539 We? oar 26_ Address; GARY SCHOOLS RECOVERY

6. Total amount this action: 7.New contract total: 101 OHIO ST STE 2024

$11,400,00000 11.400.000.00 INDIANAPOLIS. IN 45204
8. Revenue generated this action: 9.Revenue generated total contract:

$0.00 $000 21 E-mail address: ttraviesa@mgtconsulting.com

 

 

 

10.New total amount for each ?scal year:
28. Is the vendor registered with me Secretary of State? {Out of State

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year 2013 53 461 DOD 00
20?? Corporations, must be registered29. Vendor: Vetera 30. Primary Vendor Percentages
Year 2020 $3 one one on Minority: Yes No 100 0
. 0/0
Year 2021 $948 one on Women: Yes x_ No
lN-Veteran Yes No
TIME PERIOD COVERED IN THIS EDS 31. Sub Vendor: MiWBEth-Veteran 32. lives. list the 
Minority: veg, no Minority: 
I I. From (month, day, year): I2. To month. day, year): Women: Yes No Women: 
71?1/2017 12/31t'2017 a
. [bl?Veteran Yes No IN- Veteran 
Method of source selection: Negotiated .
BidJ?Qllotation Emergency . 33. Is there Renewal Language 34. Is there a [?ennlnatlon for
S43331"l Procurement in Convenience" clause in the
X?Othcr (spacing) 17'1? Yes No I'Inmlment't Yes No
35. Will the attached document involve data processing or system Yes: IOT or Delegate has signed off on contract
36. Statutory Authority (Cite appiicobte Indiana or Federal Codes):
IC 
Description of work and justification for spending motley. (Mensa give a brief description ofitte scope ofn'ork included in this agreement.)
It: 6-1.1- 20 3- 6. designated Gary Community School Corporation as a distressed political subdivision PerlC 6 1- 20. 3- 5, the Distrased Unit 1] Board Is
required to appoint an emergency manager for the School Corporation. The emergency manager has all of the authority and power traditionally Eiperi
the school board for both academic and ?scal matters of the School Corporation. I I 
33. Justi?cation of vendor selection and determination of price reasonableness: UL I 2 5 2017

DUAB went through an RFI process in May through July 20] MGT Consulting GrouptGary Schools Recovery. I I provided the most responsive proposal to the RFI The

amount of work required, along with the experienced team being provided, made the price reasonable in the eyes of DUAB. 


 

39. If this contract is submitted late, please explain why: (Required ifrnore than 30 days late.)

40. Agency ?scal olTicer or representative appro 4 I. Date Approved 42. Bu ency a 43. Date,Appi'0ved


?Anomth/y 45. Date Approved 46. Agency lgy?sentatU Ie ceiving from AG 47- Date 
5? g? 
I 1-5/ 00(/

107435-000

 

 



 

 

 

 

 

 

PROFESSIONAL SERVICES CONTRACT
EDS 

This Contract (?this Contract?), entered into by and between the Distressed Unit Appeal Board
(the ?State?) and Gary Schools Recovery, LLC (the ?Emergency Manager?), is executed
pursuant to the terms and conditions set forth herein. In consideration of those mutual undertakings and
covenants, the parties agree as follows:

1. Duties of Emergency Manager. The Emergency Manager shall provide the services relative to this
Contract that are more particularly described and set out in Attachment A.

The scope of the Emergency Manager?s work under this Contract consists of many functions including
Financial Assessment and Development of Policies and Controls; Facility Assessment, Preparation,
Security, and Planning; Education Assessment, Organization and Resource Planning; and Management,
Communications and Community Engagement (collectively, the ?Functions of the Emergency
Manager?). The parties recognize that the solution offered by the Emergency Manager to address the
needs of the Gary Community School Corporation (?School Corporation?) pursuant to this Contract is an
integrated one, and, as such, those Functions are interdependent and will operate most effectively to
achieve such solution when combined, and less effectively when separated into individual ones. The
parties further recognize that due to this integrated nature of these Functions, if any one of them is
severed from the Emergency Manager?s scope of work under this Contract, the Emergency Manager?s
ability to achieve success in reliance on the remaining Functions could be detrimentally impaired.

2. Consideration.

A. Base Pay and Performance Incentives Year 1. Year 1 of the Contract begins on August 1, 2017
and continues until July 31, 2018 (?Year Remuneration under this Contract for Year 1 of the Contract
Term, for professional services, reasonable and necessary travel expenses and other expenses arising from
the performance of the duties set forth in Attachment A shall not exceed a base amount of $3,25 0,000. In
addition to the base amount, the Emergency Manager may receive performance incentives as follows:

1. The Emergency Manager will deliver a viable structural deficit (annual expense versus aimual
revenues) reduction plan within six (6) months of taking over as Emergency Manager, i.e. not
later than January 31, 2018, for DUAB review and approval. The structural de?cit reduction plan
shall identify the steps required to eliminate the School Corporation?s deficit over a reasonable
period of time through a combination of strategies, including cost-reduction, debt?restructuring
and revenue enhancement, while providing for the on? going operations of the School
Corporation. Ifthe plan the Emergency Manager delivers is a viable plan for reducing the School
Corporation?s structural de?cit, approval of such plan shall not be unreasonably
withheld. Upon DUAB approval of such plan (the ?Approved Structural De?cit Reduction
Plan?), the Emergency Manager shall receive a $25 0,000 performance incentive.

2. The School Corporation had a smooth start to the 2017?201 8 school year. ?Smooth start? means
there were no major impediments to teaching and learning at the resumption of the school year.
Achieving a ?smooth start? included the following considerations:

0 The School Corporation opened as previously designated by the School Corporation?s
Board of Trustees for the 2017?2018 school year.

0 The necessary school buildings were open and met basic environmental criteria,
including the majority of bathrooms were in working order, the maintenance of the

Page 1 of 31
07/16

07/ 16

grounds was provided for and students and employees were provided basic supplies such
as toilet paper and soap.
0 Bus transportation was provided for students with minimal issues.

The achievement date for this performance incentive was the start of the 2017?2018 school year
and not later than September 1, 2017. Because the School Corporation achieved a ?smooth sta 
to the 2017?2018 school year, as de?ned in this Section, the Emergency Manager shall be paid a
$100,000 performance incentive.
Ifthe School Corporation sees average student achievement growth in the 2017?2018 school year
compared to the 2016?2017 school year by 10% in grades 3 through 8 throughout the School
Corporation district, based on State administered tests, the Emergency Manager shall receive a
$100,000 performance incentive. The achievement date for this performance incentive shall be
the date of the last State administered test at the School Corporation during the 2017?201 8 school
year. The performance incentive cannot be claimed until the School Corporation receives the
of?cial results of the State administered tests in the fall of 2018. DUAB, in consultation with the
Indiana Department of Education shall review the results of the State administered tests
for the 2017?2018 school year. Upon the School Corporation?s receipt of results ofthe State
administered tests which re?ect the appropriate student achievement growth and review
of the results, the Emergency Manager shall receive the performance incentive.
The School Corporation will reduce by 50% the operating irregularities being out of
compliance with federal and State authorities) of the School Corporation as identi?ed in the 2014
Indiana State Board of Accounts audit report. The speci?c 2014 SBOA audit report
operating irregularities the Emergency Manager will eliminate are the findings entitled below;

i. Preparation of the Schedule of Expenditures of Federal Awards
ii. Allowable Costs/Cost Principles
Allowable Costs/Cost Principles, Cash Management, Period of Availability,
Reporting .
iv. Cash Management and Reporting
v. Equipment
vi. Period of Availability
vii. Special Tests and Provisions - Graduation (Cohort) Rate
Special Tests and Provisions Comparability
ix. Intemal Controls Over Title 1 Grants to Local Educational Agencies
x. Special Tests and Provisions Participation of Private School Children (collectively,
the ?Operating Irregularities?).

No later than September 30, 2018, the Emergency Manager shall provide DUAB with a letter
documenting the steps the Emergency Manager took to eliminate the Operating Irregularities.
DUAB, in consultation with the SBOA, shall review the progress made by the Emergency
Manager in eliminating the Operating Irregularities. The achievement date for this performance
incentive shall be the earlier of the end of Year 1 of the Contract Term or the date on which the
Emergency Manager submits the letter required herein. The performance incentive cannot be
claimed until DUAB has reviewed and accepted the documentation provided as sufficient proof
of the elimination of the Operating Irregularities. Upon review and acceptance of the
documentation, the Emergency Manager shall receive a $100,000 performance incentive.

The Emergency Manager will develop and adopt internal controls of the major ?nancial systems
of the School Corporation by December 31, 2017. The Emergency Manager shall provide DUAB
with a letter documenting the policies and procedures for internal controls of the School
Corporation?s major ?nancial systems. DUAB, in consultation with the SBOA, shall review the

policies and procedures for internal controls for sufficiency and compliance with requirements of

SBOA. The achievement date for this performance incentive shall be the date on which the

Page 2 of 31

Emergency Manager submits the letter required herein. The performance incentive cannot be
claimed until DUAB has reviewed and accepted the letter and policies and procedures provided
as suf?cient proof of the implementation of appropriate internal controls of the School
Corporation?s major ?nancial systems. Upon review and acceptance of the letter and
policies and procedures,, the Emergency Manager shall receive a $100,000 performance
incentive.

These performance incentives shall not exceed $650,000.

B. Base Pay and Performance Incentives Year 2. Year 2 of the Contract begins on August 1, 2018
and continues until July 31, 2019 (?Year Remuneration under this Contract for Year 2 of the Contract
Term, for professional services, reasonable and necessary travel expenses and other expenses arising from
the performance of the duties set forth in Attachment A shall not exceed a base amount of $3,000,000. In
addition to the base amount, the Emergency Manager may receive performance incentives as follows:

1.

07/16

The Emergency Manager will substantially conform to the Approved Structural De?cit Reduction
Plan. No later than September 30, 2019, the Emergency Manager shall provide DUAB with a
letter documenting the measures the Emergency Manager has taken to achieve substantial
conformance to the Approved Structural Deficit Reduction Plan during Year 2 of the Contract
Term. DUAB shall review the measures taken by the Emergency Manager in relation to the
Approved Structural Deficit Reduction Plan and determine if substantial conformance has been
met. The achievement date for this performance incentive shall be the end of Year 2 of the
Contract Term. The performance incentive cannot be claimed until DUAB has determined that
the Emergency Manager was in substantial conformance with the Approved Structural Deficit
Reduction Plan during Year 2 of the Contract Term. Upon review and determination of
substantial conformance, the Emergency Manager shall receive a $150,000 performance
incentive.

The Emergency Manager will provide for a sum of money in an amount equal to at least
$400,000 to pay toward the accrued liabilities of the School Corporation. This sum of money
shall be documented in the Approved Structural De?cit Reduction Plan. The provision of this
sum of money shall be in substantial conformance with the Approved Structural De?cit
Reduction Plan and shall provide for the on?going operations of the School Corporation. The
achievement date for this performance incentive shall be the end of Year 2 of the Contract Term.
The performance incentive cannot be claimed until DUAB has veri?ed that the Emergency
Manager has provided the required sum of money to pay toward the accrued liabilities of the
School Corporation, in substantial conformance with the Approved Structural De?cit Reduction
Plan and the amount identi?ed therein, during Year 2 of the Contract Term. Upon 
review and verification of the required sum of money, the Emergency Manager shall receive a
$100,000 performance incentive. Notwithstanding the foregoing, if the Emergency Manager
provides any sum of money in an amount less than $400,000 to pay toward the accrued liabilities
of the School Corporation, the Emergency Manager shall receive a performance incentive equal
to twenty??ve percent of such payment.

If the School Corporation sees average student achievement growth in the 2018-2019 school year
compared to the 2017?2018 school year by 10% in grades 3 through 8 and 10 throughout the

School Corporation, based on State administered tests, the Emergency Manager shall receive a

$150,000 performance incentive. If the Emergency Manager achieves a 20% average
improvement, the Emergency Manager shall receive a $250,000 performance incentive. If the
Emergency Manager achieves a 30% or greater improvement, the Emergency Manager shall
receive a $3 50,000 performance incentive. The achievement date for this performance incentive
shall be the date of the last State administered test at the School Corporation during the 2018?
2019 school year. The performance incentive cannot be claimed until the School Corporation

Page 3 of 31

receives the official results of the State administered tests in the fall of 2019. DUAB, in
consultation with the DOE, shall review the results of the State administered tests for the 2018?
2019 school year. Upon the School Corporation?s receipt of results of the State administered tests
which re?ect the appropriate student achievement growth and review of the results, the
Emergency Manager shall receive the applicable performance incentive.

Not later than the fast quarter of the 2018n2019 school year, the Emergency Manager will
complete the development of a master plan for facilities, seeking community input, providing for
improved facility utilization and education suitability. The Emergency Manager shall submit the
master plan to DUAB for review and approval. Upon DUAB approval, the Emergency Manager
shall receive a $100,000 performance incentive.

If the School Corporation see an increase in the number of students attending the School
Corporation by 5% in the 2018?2019 school year compared to the 2017?201 8 school year, the
Emergency Manager shall receive a $100,000 performance incentive. The achievement date for
this performance incentive shall be the date of the official student count for the 201 8-20 19 school
year as determined by DOE. The performance incentive cannot be claimed until the School
Corporation receives the of?cial certi?cation of the student count for the 2018?2019 school year
from DOE. DUAB, in consultation with the DOE, shall review the student count for the 2018?
2019 school year. Upon the School Corporation?s receipt of its of?cial student count for the
2018?2019 school year which re?ect the appropriate student count growth and review of
the count data, the Emergency Manager shall receive the performance incentive.

These perfonnance incentives shall not exceed $800,000.

C. Base Pay and Performance Incentives Year 3. Year 3 of the Contract begins on August 1, 2019
and continues until July 31, 2020 (?Year The Contract may only be continued in Year 3 if the Indiana
General Assembly appropriates suf?cient funds, as determined by the State Budget Director, to cover the
cost of this Contract plus the other expenses and obligations of DUAB. If the State Budget Director
determines that the Indiana General Assembly has not appropriated suf?cient funds, the State may
terminate the Contract. Remuneration under this Contract for Year 3 of the Contract Tenn, for
professional services, reasonable and necessary travel expenses and other expenses arising from the
performance of the duties set forth in Attachment A shall not exceed a base amount of $2,750,000. In
addition to the base amount, the Emergency Manager may receive performance incentives as follows:

1.

07/16

lfthe School Corporation sees average student achievement growth in the 2019?2020 school year
compared to the 2018-2019 school year by 10% in grades 1 through 8 and 10 throughout the
School Corporation, based on State administered tests, the Emergency Manager shall receive a
$300,000 performance incentive. Ifthe Emergency Manager achieves a 20% average
improvement, the Emergency Manager shall receive a $400,000 performance incentive. If the
Emergency Manager achieves a 3 0% or greater improvement, the Emergency Manager shall
receive a $500,000 performance incentive. The achievement date for this performance incentive
shall be the date of the last State administered test at the School Corporation during the 2019-
2020 school year. The performance incentive cannot be claimed until the School Corporation
receives the results of the State administered tests in the fall of 2020. DUAB, in consultation with
the DOE, shall review the results of the State administered tests for the 2019?2020 school year.
Upon the School Corporation?s receipt of results of the State administered tests which reflect the
appropriate student achievement growth and review of the results, the Emergency
Manager shall receive the applicable performance incentive.

The Emergency Manager will provide for a sum of money in an amount equal to at least
$500,000 to pay toward the accrued liabilities of the School Corporation. The targeted minimum
amount for this increased sum of money shall be documented in the Approved Structural Deficit
Reduction Plan. The provision of this sum of money shall be in substantial conformance with the

Page 4 of 31

Approved Structural De?cit Reduction Plan and shall provide for the ongoing operations of the
School Corporation. The achievement date for this performance incentive shall be the end of Year
3 of the Contract Term. The performance incentive cannot be claimed until DUAB has veri?ed
that the Emergency Manager has provided the required sum of money to pay toward the accrued
liabilities of the School Corporation, in substantial conformance with the Approved Structural
De?cit Reduction Plan and the amount identi?ed therein, during Year 3 of the Contract Tenn.
Upon review and veri?cation of the required sum of money, the Emergency Manager
shall receive a $100,000 performance incentive. Notwithstanding the foregoing, if the Emergency
Manager provides any sum of money in an amount less than $500,000 to pay toward the accrued
liabilities of the School Corporation, the Emergency Manager shall receive a performance
incentive equal to twenty percent of such payment.

3. The Emergency Manager will substantially conform to the Approved Structural De?cit Reduction
Plan. No later than September 3 0, 2020, the Emergency Manager shall provide DUAB with a
letter documenting the measures the Emergency Manager has taken to achieve substantial
conformance to the Approved Structural De?cit Reduction Plan during Year 3 of the Contract
Term. DUAB shall review the measures taken by the Emergency Manager in relation to the
Approved Structural Deficit Reduction Plan and determine if substantial conformance has been
met. The achievement date for this performance incentive shall be the end of Year 3 of the
Contract Term. The performance incentive cannot be claimed until DUAB has determined that
the Emergency Manager was in substantial conformance with the Approved Structural Deficit
Reduction Plan during Year 3 of the Contract Term. Upon review and determination of
substantial conformance, the Emergency Manager shall receive a $100,000 performance
incentive.

4. If the School Corporation sees an increase in the number of students attending the School
Corporation by 5% in the 2019?2020 school year compared to the 2018?2019 school year, the
Emergency Manager shall receive a $250,000 performance incentive. The achievement date for
this performance incentive shall be the date of the official student count for the 2019?2020 school
year as determined by DOE. The performance incentive cannot be claimed until the School
Corporation receives the official certi?cation of the student count for the 20192020 school year
from DOE. DUAB, in consultation with the DOE, shall review the student count for the 2019-
2020 school year. Upon the School Corporation?s receipt of its of?cial student count for the
2019-2020 school year which re?ect the appropriate student count growth and review of
the count data, the Emergency Manager shall receive the peiformance incentive.

These performance incentives shall not exceed $950,000.
D. Base Pay Payment Schedule. Until this Contract is terminated or canceled, in whole or in part, in
accordance with the terms hereof, the Emergency Manager shall be paid the base amount, payable in

arrears for the preceding payment period, as follows:

Year 1 Payment Schedule

Invoice Date Invoice Amount
September 18, 2017 789,375
September 30, 2017 337,041
October 31, 2017 241,584
November 30, 2017 197,000
December 31, 2017 226,000
January 31, 2018 190,000
February 28, 2018 211,000
March 31, 2018 228,000
Page 5 of 31

07/16

April 30, 2018 194,000

May 31, 2018 194,000
June 30, 2018 203,000
July 31, 2018 239,000
Year 2 Payment Schedule

Invoice Date Invoice Amount
August 31, 2018 375,000
September 30, 2018 295,000
October 31, 2018 282,000
November 30, 2018 214,000
December 31, 2018 207,000
Ianua1y31, 2019 216,000
February 28, 2019 225,000
March 31, 2019 263,000
April 30, 2019 221,000
May31,2019 221,000
June 30, 2019 230,000
July31, 2019 251,000
Year 3 Payment Schedule

Invoice Date Invoice Amount
August 31, 2019 296,000
September 30, 2019 222,000
October 31, 2019 220,000
November 30, 2019 - 214,000
December 31, 2019 202,000
January 31, 2020 198,000
February 28, 2020 225,000
March 31, 2020 261,000
April 30, 2020 219,000
May 31, 2020 219,000
June 30, 2020 228,000
July 31, 2020 246,000

In the event the Contract is terminated or canceled, no further payments or incentives shall be paid after
the date of termination or cancellation except as otherwise provided in this Contract.

The Emergency Manager shall submit a invoice in the amounts identi?ed above. The 
report that is required to be submitted to DUAB under Attachment A of this Contract will be used to
document work completed in the prior period. The Emergency Manager will provide the number of hours
worked by Functions of the Emergency Manager in the period covered by the invoice.

E. Incentive Payments Satisfactory Proof and DUAB Approval. The Emergency Manager shall
submit the necessary documentation as outlined in Section 2A., 2.13. and 2.C. for each incentive payment
it deems to have achieved. Upon receipt, DUAB shall take action as outlined in Section 2.A., 2B. and
2.C. based on the performance incentive determined to have been achieved. DUAB shall complete its
review within thirty (30) days of receipt of the necessary documentation. If DUAB does not complete its
review within thirty (3 0) days of receipt of the necessary documentation, the incentive shall be deemed to

Page 6 of 31
07/16

have been achieved. After completion of its review or thirty (30) days after receipt of the
necessary documentation, whichever is later, the Emergency Manager shall be permitted to submit an
invoice and receive payment for the applicable incentive payment. Notwithstanding this paragraph, with
respect to the incentive payment under Section the Emergency Manager shall submit an invoice
to DUAB at the time this Contract is executed for the $100,000 incentive payment due thereunder, as a
result of achieving a ?smooth start? to the 2017?2018 school year, as de?ned therein.

For purposes of this Section and Sections 2.A., 2.B., and 2.C., DUAB shall conduct a reasonable review
of the deliverable or other documentation provided by the Emergency Manager for purposes of achieving
an incentive payment. right to object to, or disprove of, such deliverable or other documentation
shall not be um'easonably exercised, and DUAB ?s approval of such deliverable or documentation shall not
be unreasonably withheld, delayed or conditioned.

In addition to the base pay or incentive payments otherwise due to the Emergency Manager under this
Section, the Emergency Manager may be reimbursed for services rendered by subcontractors and other
consultants only with the prior approval of the DUAB Chairman or the executive director of DUAB
Executive Director?) and as determined by agreement of the parties pursuant to Attachment A.

F. Remuneration In Event of Petition Filed Under IC 

1. In the event a petition appealing a decision by the Emergency Manager is ?led with DUAB
pursuant to IC and, after considering the petition, DUAB shall pay all reasonable
expenses and attorney?s fees incurred by the Emergency Manager to defend its decision in
connection with such petition, or consolidated petitions, as determined by DUAB in connection
with its consideration of more than one petition. The total amount of reasonable expenses and
attorney?s fees that DUAB shall be obligated to pay in any given Contract year shall not exceed
$3 0,000. In addition, the amount of reasonable expenses and attorney?s fees that DUAB shall be
obligated to pay for any petition shall not exceed $7,500, whether a hearing includes one petition
or multiple consolidated petitions.

2. In the event the ?ling of such petition delays the Emergency Manager?s ability to achieve an
incentive by the achievement date listed in this Section 2, the Emergency Manager shall be
permitted an extension, equal to the period from the ?ling of such petition to the date of
resolution, to achieve such incentive and receive the corresponding incentive payment.

G. Liability for Failure to Pay Withholding Tax. The Emergency Manager shall take all actions, within
its reasonable control, to ensure that all federal, state, or local taxes owed by the School Corporation are
timely paid, in accordance with all applicable federal, state, and local laws. Pursuant to IC 
the Emergency Manager may direct the chief ?nancial of?cer for the School Corporation to pay any or all
federal, state, or local taxes pursuant to this section, but the chief ?nancial of?cer shall report to the

Emergency Manager at all times.

In the event the Internal Revenue Service asserts a trust fund recovery penalty against
the Emergency Manager, an employee of the Emergency Manager, an employee of the School
Corporation, or any other person acting on behalf of the School Corporation, the Emergency Manager
may reimburse the person?s legal fees from the School Corporation?s funds if it is finally determined by
the IRS or by a court of competent jurisdiction that the person is not liable for the TRFP. This section
does not preclude the Attorney General from representing the Emergency Manager or an employee of the
Emergency Manager in a proceeding related to a TRFP.

Page 7 of 31
07/16

H. Survival of Payment Obligations. Notwithstanding anything in this Contract to the contrary, any
obligation owed to the Emergency Manager pursuant to this Contract shall survive the termination,
cancellation or expiration of this Contract.

3. Term. This Contract shall be effective for a period of three (3) years except that Year 3 of the
Contract shall be subject to appropriations made by the Indiana General Assembly as set forth in Section
2.C. It shall commence on August 1, 2017 and shall remain in effect through July 31, 2020.

4. Access to Records. The Emergency Manager and its subcontractors, if any, shall maintain all books,
documents, papers, accounting records, and other evidence pertaining to all costs incurred under this
Contract. They shall make such materials available at their respective of?ces at all reasonable times
during this Contract, and for three (3) years from the date of final payment under this Contract, for
inspection by the State or its authorized designees. Copies shall be furnished at no cost to the State if
requested.

5. Assignment; Successors. The Emergency Manager binds its successors and assignees to all the terms
and conditions of this Contract. The Emergency Manager shall not assign or subcontract the whole or any
part of this Contract without the State?s prior written consent. The State?s consent under this Section shall
not be unreasonably withheld. The Emergency Manager may assign its right to receive payments to such
third parties as the Emergency Manager may desire without the prior written consent of the State,
provided that the Emergency Manager gives written notice (including evidence of such assignment) to the
State thirty (30) days In advance of any payment so assigned. The assignment shall cover all unpaid
amounts undei this Contract and shall not be made to more than one party.

6. Assignment of Antitrust Claims. As part of the consideration for the award of this Contract, the
Emergency Manager assigns to the State all right, title and interest in and to any claims the Emergency
Manager now has, or may acquire, under state or federal antitrust laws relating to the products or services
which are the subject of this Contract.

7. Audits. The Emergency Manager acknowledges that it may be required to submit to an audit of funds
paid through this Contract. Any such audit shall be conducted in accordance with IC ?5~l 1?1, et seq, and
audit guidelines speci?ed by the State.

8. Authority to Bind Emergency Manager. The signatory for the Emergency Manager represents that
he/ she has been duly authorized to execute this Contract on behalf of the Emergency Manager and has
obtained all necessary or applicable approvals to make this Contract fully binding upon the Emergency
Manager when his/her signature is af?xed, and accepted by the State.

9. Changes in Work. The Emergency Manager shall not commence any additional work or change the
scope of the work until authorized in writing by the State. The Emergency Manager shall make no claim
for additional compensation in the absence of a prior written approval and amendment executed by all
signatories hereto. This Contract may only be amended, supplemented or modi?ed by a written document
executed in the same manner as this Contract.

10. Compliance with Laws.

A. The Emergency Manager shall comply with all applicable .federal, state, and local laws, rules,
regulations, and ordinances, and all provisions required thereby to be included herein are hereby
incorporated by reference. The enactment or modi?cation of any applicable state or federal statute or the
promulgation of rules or regulations thereunder after execution of this Contract shall be reviewed by the
State and the Emergency Manager to determine whether the provisions of this Contract require formal

Page 8 of 31
07/16

modi?cation. The enactment or modi?cation of any applicable state 01' federal statutes after execution of
this Contract affecting the Emergency Manager?s authority, duties, or scope of work as set forth in this
Contract and Attachment A are hereby incorporated into this Contract by reference, and the parties shall
formally modify the Contract to conform to any such enactments or modi?cations.

B. The Emergency Manager and its agents shall abide by all ethical requirements that apply to persons
who have a business relationship with the State as set forth in IC et seq, IC et seq. and the
regulations promulgated thereunder. If the Emergency Manager has knowledge, or would have
acquired knowledge with reasonable inquiry, that a state of?cer, employee, or special state
appointee, as those terms are de?ned in IC 4-2-6-1, has a ?nancial interest in the Contract, the
Emergency Manager shall ensure compliance with the disclosure requirements in IC 4-2-6-10.5
prior to the execution of this contract. Ifthe Emergency Manager is not familiar with these ethical
requirements, the Emergency Manager should refer any questions to the Indiana State Ethics
Commission, or visit the Inspector General?s website at Ifthe Emergency Manager
or its agents violate any applicable ethical standards, the State may, in its sole discretion, terminate this
Contract immediately upon notice to the Emergency Manager. In addition, the Emergency Manager may
be subject to penalties under IC 3544, 1?14, and under any other applicable laws.

C. The Emergency Manager certi?es by entering into this Contract that neither it nor its principal(s) is
presently in arrears in payment of taxes, permit fees or other statutory, regulatory or judicially required
payments to the State of hidiana. The Emergency Manager agrees that any payments currently due to the
State of Indiana may be withheld from payments due to the Emergency Manager. Additionally, further
work or payments may be withheld, delayed, or denied and/or this Contract suspended until the
Emergency Manager is current in its payments and has submitted proof of such payment to the State.

D. The Emergency Manager warrants that it has no current, pending or outstanding criminal, civil, or
enforcement actions initiated by the State, and agrees that it will immediately notify the State of any such
actions. During the term of such actions, the Emergency Manager agrees that the State may delay,
withhold, or deny work under any supplement, amendment, change order or other contractual device
issued pursuant to this Contract.

E. If a valid dispute exists as to the Emergency Manager?s liability or guilt in any action initiated by the
State or its agencies, and the State decides to delay, withhold, or deny work to the Emergency Manager,
the Emergency Manager may request that it be allowed to continue, or receive work, without delay. The
Emergency Manager must submit, in writing, a request for review to the Indiana Department of
Administration following the procedures for disputes outlined herein. A determination by IDOA
shall be binding on the parties. Any payments that the State may delay, withhold, deny, or apply under
this section shall not be subject to penalty or interest, except as permitted by IC ?5?l7?5.

F. The Emergency Manager warrants that the Emergency Manager and its subcontractors, if any, shall
obtain and maintain all required permits, licenses, registrations, and approvals, and shall comply with all
health, safety, and enviromnental statutes, rules, or regulations in the performance of work activities for
the State. Failure to do so may be deemed a material breach of this Contract and grounds for immediate
termination and denial of further work with the State.

G. The Emergency Manager af?rms that, if it is an entity described in IC Title 23, it is properly
registered and owes no outstanding reports to the Indiana Secretary of State.

H. As required by IC 
1) The Emergency Manager and any principals of the Emergency Manager certify that:

Page 9 of31
07/16

(A) the Emergency Manager, except for de minimis and violations,
has not violated the terms of:

IC ?24?4.7 [Telephone Solicitation Of Consumers];

(ii) 10 ?24~5~12 [Telephone Solicitations]; or

IC [Regulation of Automatic Dialing Machines];
in the previous three hundred sixty?five (365) days, even if IC ?24?4.7 is preempted
by federal law; and

(B) the Emergency Manager will not violate the terms of IC ?24-4.7 for the duration
of the Contract, even if IC ?24~4.7 is preempted by federal law.

(2) The Emergency Manager and any principals of the Emergency Manager certify that an
af?liate or principal of the Emergency Manager and any agent acting on behalf of the
Emergency Manager or on behalf of an affiliate or principal of the Emergency Manager,
except for de minimis and violations,

(A) has not violated the terms of IC ?24-4.7 in the previous three hundred sixty-?ve
(3 65) days, even if IC ?24?4.7 is preempted by federal law; and

(B) will not violate the terms of IC ?24-4.7 for the duration of the Contract, even if
?24-4.7 is preempted by federal law.

11. Condition of Payment. All services provided by the Emergency Manager under this Contract must
be performed to the State?s reasonable satisfaction, as determined at the discretion of the undersigned

State representative and in accordance with all applicable federal, state, local laws, ordinances, rules and
regulations. The State shall not be required to pay for work found to be unsatisfactory, inconsistent with
this Contract or performed in violation of any federal, state or local statute, ordinance, rule or regulation.

12. Con?dentiality of State Information. The Emergency Manager understands and agrees that data,
materials, and information disclosed to the Emergency Manager may contain con?dential and protected
information. The Emergency Manager covenants that data, material, and information gathered, based
upon or disclosed to the Emergency Manager for the purpose of this Contract will not be disclosed to or
discussed with third parties Without the prior written consent of the State.

The parties acknowledge that the services to be performed by Emergency Manager for the State under this
Contract may require or allow access to data, materials, and information containing Social Security
numbers maintained by the State in its computer system or other records. In addition to the covenant
made above in this section and pursuant to 10 IAC the Emergency Manager and the State agree
to comply with the provisions of IC {54?1?10 and IC ?4?1?ll. If any Social Security number(s) is/are
disclosed by Emergency Manager, Emergency Manager agrees to pay the cost of the notice of disclosure
of a breach of the security of the system in addition to any other claims and expenses for which it is liable
under the terms of this contract.

13. Continuity of Services.

A. The Emergency Manager recognizes that the service(s) to be performed under this Contract are vital
to the State and must be continued without interruption and that, upon Contract expiration, a successor,
either the State or another emergency manager, may continue them. At the direction of DUAB, the

Emergency Manager agrees to:
l. Furnish phase?in training, and
2. Exercise its best efforts and cooperation to effect an orderly and efficient transition to a
successor.

Page 10 of 31
07/16

B. The Emergency Manager shall, upon the State?s written notice and at the direction of DUAB:

l. Furnish phase?in, phase?out services for up to sixty (60) days after this Contract expires, is
terminated pursuant to Sections 45otherwise terminated under this
Contract; and

2. Negotiate in good faith a plan with a successor to determine the nature and extent of phase
in, phase?out services required. The plan shall specify a training program and a date for
transferring responsibilities for each division of work described in the plan, and shall be
subject to the State's approval. The Emergency Manager shall provide sufficient
experienced personnel during the phaseuin, phase?out period to ensure that the services
called for by this Contract are maintained at the required level of proficiency.

C. The Emergency Manager shall allow as many personnel as practicable to remain on the job to help the
successor maintain the continuity and consistency of the services required by this Contract.

D. The Emergency Manager shall be reimbursed for all reasonable phase?in, phase?out costs costs
incurred within the agreed period after contract expiration that result from phaseuin, phase?out
operations).

14. Debarment and Suspension.

A. The Emergency Manager certi?es by entering into this Contract that neither it nor its principals nor
any of its subcontractors are presently debarred, suspended, proposed for debarment, declared ineligible
or voluntarily excluded from entering into this Contract by any federal agency or by any department,
agency or political subdivision of the State of Indiana. The tenn ?principal? for purposes of this Contract
means an of?cer, director, owner, partner, key employee or other person with primary management or
supervisory responsibilities, or a person who has a critical in?uence on or substantive control over the
operations of the Emergency Manager.

B. The Emergency Manager certi?es that it has veri?ed the state and federal suspension and debarment
status for all subcontractors receiving funds under this Contract and shall be solely responsible for any
recoupment, penalties or costs that might arise from use of a suspended 01' debarred subcontractor. The
Emergency Manager shall immediately notify the State if any subcontractor becomes debarred or
suspended, and shall, at the State?s request, take all steps required by the State to terminate its contractual
relationship with the subcontractor for work to be performed under this Contract.

15. Default by State. If the State, sixty (60) days after receipt of written notice, fails to correct or cure
any material breach of this Contract, the Emergency Manager may cancel and terminate this Contract and
institute measures to collect monies due up to and including the date of termination. The State agrees to
hold the Emergency Manager harmless for errors or omissions on any Materials (as de?ned in Section 36
hereof) that are incomplete as a result of any cancellation or termination under this Section.

16. Disputes. 

A. Should any disputes arise with respect to this Contract, the Emergency Manager and the State agree to
act mnnediately to resolve such disputes. Time is of the essence in the resolution of disputes.

B. The Emergency Manager agrees that, the existence of a dispute notwithstanding, it will continue
without delay to carry out all of its responsibilities under this Contract that are not affected by the dispute.
Should the Emergency Managen fail to continue to perform its responsibilities regarding all non?disputed
work, without delay, any additional costs incurred by the State or the Emergency Manager as a result of

Page 11 of 31
07/16

such failure to proceed shall be borne by the Emergency Manager, and the Emergency Manager shall
make no claim against the State for such costs. Notwithstanding this subsection, if the Emergency
Manager is required to continue to carry out non?disputed work for a period of sixty (60) days or more,
the Emergency Manager may terminate this Contract by delivering a Termination Notice to the State at
least thirty (30) days before the effective date set forth in such Notice. The State agrees to hold the
Emergency Manager harmless for error or omissions in any Materials that are incomplete as a result of
any such termination.

C. If the parties are unable to resolve a contract dispute between them after good faith attempts to do so, a
dissatis?ed party shall submit the dispute to the Cormnissioner of the Indiana Department of
Administration for resolution. The dissatis?ed party shall give written notice to the Commissioner and
the other party. The notice shall include: (1) a description of the disputed issues, (2) the efforts made to
resolve the dispute, and (3) a proposed resolution. The Commissioner shall issue a Notice
setting out documents and materials to be submitted to the Commissioner in order to resolve the dispute;
the Notice may also afford the parties the opportunity to make presentations and enter into further
negotiations. Within thirty (30) business days of the conclusion of the ?nal presentations, the
Commissioner shall issue a written decision and furnish it to both parties. The Commissioner?s decision
shall be the ?nal and conclusive administrative decision unless either party serves on the Commissioner
and the other party, within ten (10) business days after receipt of the Commissioner?s decision, a written
request for reconsideration and modification of the written decision. If the Commissioner does not modify
the written decision within thirty (30) business days, either party may take such other action helpful to
resolving the dispute, including submitting the dispute to an Indiana court of competent jurisdiction. If the
parties accept the Commissioner?s decision, it may be memorialized as a written Amendment to this
Contract if appropriate.

D. The State may withhold payments on disputed items pending resolution of the dispute. The
unintentional nonpayment by the State to the Emergency Manager of one or more invoices not in dispute
in accordance with the terms of this Contract will not be cause for the Emergency Manager to terminate
this Contract, and the Emergency Manager may bring suit to collect these amounts without following the
diSputes procedure contained herein.

E. With the written approval of the Commissioner of the Indiana Department of Administration, the
parties may agree to forego the process described in subdivision C. relating to submission of the dispute
to the Commissioner.

F. This paragraph shall not be construed to abrogate provisions of Ind. Code 4?6?2?11 in situations where
dispute resolution efforts lead to a compromise of claims in favor of the State as described in that

statute. In particular, releases or settlement agreements involving releases of legal claims or potential
legal claims of the state should be processed consistent with Ind. Code 4?6?2?1 l, which requires approval
of the Governor and Attorney General.

17. Drug?Free Workplace Certification. For purposes of this Section, ?Workplace? shall mean the
offices of the Emergency Manager located at 101 West Ohio Street, Suite 2017 ABC, Indianapolis,
Indiana. For purposes of this Section, ?Employee? shall mean a person directly employed by the
Emergency Manager, and does not include an employee of the School Corporation, a subcontractor or any
other person. As required by Executive Order No. 90?5 dated April 12, 1990, issued by the Governor of
Indiana, the Emergency Manager hereby covenants and agrees to make a good faith effort to provide and
maintain a drug?free workplace. The Emergency Manager will give written notice to the State within ten
(10) days after receiving actual notice that the Emergency Manager, or an employee of the Emergency
Manager in the State of Indiana, has been convicted of a criminal drug violation occurring in the
workplace. False certi?cation or violation of this certi?cation may result in sanctions including, but not

Page 12 of 31
O7X16

limited to, suspension of contract payments, termination of this Contract and/or debarment of contracting
opportunities with the State for up to three (3) years.

In addition to the provisions of the above paragraph, if the total amount set forth in this Contract is in
excess of $25,000.00, the Emergency Manager certifies and agrees that it will provide a drug-free
workplace by:

A. Publishing and providing to all of its employees a statement notifying them that the unlawful
manufacture, distribution, dispensing, possession or use of a controlled substance is prohibited in the
Emergency Manager?s workplace, and specifying the actions that will be taken against employees for
violations of such prohibition;

B. Establishing a drug?free awareness program to inform its employees of: the dangers of drug abuse
in the workplace; (2) the Emergency Manager?s policy of maintaining a drug?free workplace; (3) any
available drug counseling, rehabilitation and employee assistance programs; and (4) the penalties that
may be imposed upon an employee for drug abuse violations occurring in the workplace;

C. Notifying all employees in the statement required by subparagraph (A) above that as a condition of
continued employment, the employee will: (1) abide by the terms of the statement; and (2) notify the
Emergency Manager of any criminal drug statute conviction for a violation occurring in the
workplace no later than ?ve (5) days after such conviction;

D. Notifying the State in writing within ten (10) days after receiving notice from an employee under
subdivision above, or otherwise receiving actual notice of such conviction;

E. Within thirty (30) days after receiving notice under subdivision above of a conviction,
imposing the following sanctions or remedial measures on any employee who is convicted of drug
abuse violations occurring in the workplace: (1) taking appropriate personnel action against the
employee, up to and including termination; or (2) requiring such employee to satisfactorily participate
in a drug abuse assistance or rehabilitation program approved for such purposes by a federal, state or
local health, law enforcement, or other appropriate agency; and

F. Making a good faith effort to maintain a drug?free workplace through the implementation of
subparagraphs (A) through (E) above.

18. Employment Eligibility Veri?cation. As required by IC ?22?5?l.7, the Emergency Manager swears
or af?rms under the penalties of perjury that the Emergency Manager does not knowingly employ an
unauthorized alien. The Emergency Manager further agrees that:

A. The Emergency Manager shall enroll in and verify the work eligibility status of all his/her/its newly
hired employees ?irough the E?Verify program as defined in TC ?22?5?l The Emergency Manager is
not required to participate should the E-Verify program cease to exist. Additionally, the Emergency
Manager is not required to participate if the Emergency Manager is self?employed and does not employ
any employees. 

B. The Emergency Manager shall not knowingly employ or contract with an unauthorized alien. The
Emergency Manager shall not retain an employee or contract with a person that the Emergency Manager
subsequently learns is an unauthorized alien.

C. The Emergency Manager shall require his/her/its subcontractors, who perform work under this
Contract, to certify to the Emergency Manager that the subcontractor does not knowingly employ or

Page 13 of 31
07/16

contract with an unauthorized alien and that the subcontractor has enrolled and is participating in the 
Verify program. The Emergency Manager agrees to maintain this certification throughout the duration of
the term of a contract with a subcontractor.

The State may terminate for default if the Emergency Manager fails to cure a breach of this provision no
later than thirty (30) days after being notified by the State.

19. Employment Option. Removed by agreement of the parties.

20. Force Majeure. In the event that either paity is unable to perform any of its obligations under this
Contract or to enjoy any of its bene?ts because of natural disaster or decrees of governmental bodies not
the fault of the affected party (hereinafter referred to as a ?Force Maj cure Event?), the party who has been
so affected shall immediately or as soon as is reasonably possible under the circumstances give
notice to the other party and shall do everything possible to resume performance. Upon receipt of such
notice, all obligations under this Contract shall be immediately suspended. If the period of
nonperformance exceeds thirty (3 0) days from the receipt of notice of the Force Maj eure Event, the party
whose ability to perform has not been so affected may, by giving written notice, terminate this Contract.

21. Funding Cancellation. When the Director of the State Budget Agency makes a written
determination that funds are not appropriated or otherwise available to support continuation of
performance of this Contract, this Contract shall be canceled. A determination by the Director of State
Budget Agency that funds are not appropriated or otherwise available to support continuation of
performance shall be ?nal and conclusive. The State agrees to hold the Emergency Manager harmless for
errors or omissions in any Materials that are incomplete as a result of any such cancellation under this
Section.

22. Governing Law. This Contract shall be governed, construed, and enforced in accordance with the
laws of the State of Indiana, without regard to its conflict of laws rules. Suit, if any, must be brought in
the State of Indiana.

23. HJPAA Compliance. Ifthis Contract involves services, activities or products subject to the Health
Insurance Portability and Accountability Act of 1996 (HIPAA), the Emergency Manager covenants that it
will appropriately safeguard Protected Health Information (defmed in 45 CFR 160.103), and agrees that it
is subject to, and shall comply with, the provisions of 45 CFR 164 Subpart regarding use and disclosure
of Protected Health Information.

24. Indemni?cation. The Emergency Manager agrees to indemnify, defend, and hold harmless the
State, its agents, of?cials, and employees from all third party claims and suits including court costs,
attorney?s fees, and other expenses caused by any act or omission of the Emergency Manager and/ or its
subcontractors, if any, in the performance of this Contract. The State shall not provide such
indemnification to the Emergency Manager.

25. Statutory Limits on Liability. Pursuant to IC 6?1.1?20.3?7.5, the Emergency Manager shall be
immune from civil liability for an act or omission within the scope and arising out of the performance of
its duties prescribed by the State and DUAB under IC 6-l . I "20.3, this Contract and Attachment A to this
Contract, so long as the act or omission does not constitute gross negligence or willful misconduct. As
provided in IC the Attorney General of the State of Indiana (?Attorney General?) may
represent the Emergency Manager and its employees in a legal action arising out of the Emergency
Manager?s exercise of powers granted under IC 64.1?20.3, this Contract and Attachment A to this
Contract, if the Emergency Manager makes a written request to the Attorney General requesting such
representation. In any legal action arising out of the Emergency Manager?s exercise of powers granted

Page 14 of 31
07/16

under IC 6?1.1?20.3, this Contract and Attachment A to this Contract, the Emergency Manager must make
a written request to the Attorney General for representation pursuant to IC 6?1.1?20.3?7.5. For the
purposes of any provisions in this Contract which provide for DUAB or the School Corporation to pay
attorneys? fees or expenses of the Emergency Manager, such fees shall be paid only if the Emergency
Manager has made a written request to the Attorney General for representation and the Attorney General
has denied the Emergency Manager?s request.

26. Independent Entity; Workers? Compensation Insurance. The Emergency Manager is performing
as an independent entity under this Contract. No part of this Contract shall be construed to represent the
creation of an employment, agency, partnership or joint venture agreement between the parties. Neither
party will assume liability for any injury (including death) to any persons, or damage to any property,
arising out of the acts or omissions of the agents, employees or subcontractors of the other party. The
Emergency Manager shall provide all necessary unemployment and workers? compensation insurance for
the Emergency Manager?s employees, and shall provide the State with a Certi?cate of Insurance
evidencing such coverage prior to starting work under this Contract.

27. Information Technology Enterprise Architecture Requirements. Removed by agreement of the
parties.

28. Insurance.

A. The Emergency Manager and their subcontractors (if any) shall secure and keep in force during the
term of this Contract the following insurance coverages (if applicable) covering the Emergency Manager
for any and all claims of any nature which may in any manner arise out of or result from Emergency
Manager?s performance under this Contract:

1. Commercial general liability, including contractual coverage, and products or completed operations
coverage (if applicable), with minimum liability limits not less than $700,000 per person and
$5,000,000 per occurrence unless additional coverage is required by the State. The State is to be
named as an additional insured on a primary, non?contributory basis for any liability arising
directly or indirectly under or in connection with this Contract.

2. Automobile liability for owned, non?owned and hired autos with minimum liability limits of
$700,000 per person and $5,000,000 per occurrence. The State is to be named as an additional
insured on a primary, non-contributory basis.

3. Errors and Omissions liability with minimum liability limits of $1,000,000 per claim and
in the aggregate. Coverage for the bene?t of the State shall continue for a period of two (2) years
after the date of service provided under this Contract.

4. Fiduciary Liability is required if the Emergency Manager is responsible for the management and
oversight of various employee bene?t plans and programs such as pensions, pro?t sharing and
savings, among others. These entities face potential claims for mismanagement brought by plan
member's. Limits should be no less than $700,000 per cause of action and $5,000,000 per
occurrence.

5. Valuable Papers coverage, available under an Inland Marine policy, is required when any plans,
drawings, media, data, records, reports, billings and other documents are produced or used under
this Contract. Insurance must have limits suf?cient to pay for the recreation and reconstruction of
such records.

Page 15 of 31
07/16

6. The Emergency Manager shall secure the appropriate Surety or Fidelity Bond(s) as required by IC
20-26?4?5. 

7. The Emergency Manager shall provide proof of such insurance coverage by tendering to the
undersigned State representative a certi?cate of insurance prior to the commencement of this
Contract and proof of workers? compensation coverage meeting all statutory requirements of IC
?22-3?2. In addition, proof of an ?all states endorsement? covering claims occurring outside the
State is required if any of the services provided under this Contract involve work outside of
Indiana.

B. The Emergency Manager?s insurance coverage must meet the following additional requirements:

1. The insurer must have a certi?cate of authority or other appropriate authorization to operate in the
state in which the policy was issued.

2. Any deductible or self?insured retention amount or other similar obligation under the insurance
policies shall be the sole obligation of the Emergency Manager.

3. The State will be defended, indemnified and held harmless to the full extent of any coverage
actually secured by the Emergency Manager in excess of the minimum requirements set forth
above. The duty to indemnify the State under this Contract shall not be limited by the insurance
required in this Contract.

4. The insurance required in this Contract, through a policy or endorsement(s), shall include a
provision that the policy and endorsements may not be canceled or modi?ed without thirty (30)
days? prior written notice to the undersigned State agency.

5. The Emergency Manager waives and agrees to require their insurer to waive their rights of
subrogation against the State of Indiana.

C. Failure to provide insurance as required in this Contract may be deemed a material breach of contract
entitling the State to immediately terminate this Contract. The Emergency Manager shall furnish a
certi?cate of insurance and all endorsements to the State before the commencement of this Contract.

29. Key Person(s).

A. If both parties have designated that certain individual(s) are essential to the services offered, the
parties agree that should such individual(s) leave their employment during the term of this Contract for
whatever reason, the State shall have the right to terminate this Contract upon thirty (3 0) days? prior
written notice, if the Emergency Manager has not replaced such individual with an individual to the
satisfaction of the State within thirty (3 0) days of the date such individual left the employment of the
Emergency Manager. The State agrees to hold the Emergency Manager harmless for errors or omissions
in any Materials that are incomplete as a result of any termination under this Section.

B. In the event that the Emergency Manager is an individual, that individual shall be considered a key
person and, as such, essential to this Contract. Substitution of another for the Emergency Manager shall
not be permitted without express written consent of the State.

Nothing in sections A and B, above shall be construed to prevent the Emergency Manager ?om using the
services of others to perform tasks ancillary to those tasks which directly require the expertise of the key

Page 16 of 31
07/16

person. Examples of such ancillary tasks include secretarial, clerical, and common labor duties. The
Emergency Manager shall, at all times, remain responsible for the performance of all necessary tasks,
whether performed by a key person or others.

Key person(s) to this Contract are Dr. Peggy I?Iinckley.

30. Licensing Standards. The Emergency Manager, its employees and subcontractors shall comply
with all applicable licensing standards, certi?cation standards, accrediting standards and any other laws,
rules, or regulations governing services to be provided by the Emergency Manager pursuant to this
Contract. The State will not pay the Emergency Manager for any services performed when the Emergency
Manager, its employees or subcontractors are not in compliance with such applicable standards, laws,
rules, or regulations. If any license, certi?cation or accreditation expires or is revoked, or any disciplinary
action is taken against an applicable license, certi?cation, or accreditation, the Emergency Manager shall
notify the State immediately and the State, at its option, may immediately terminate this Contract.

31. Merger Modi?cation. This Contract constitutes the entire agreement between the parties. No
understandings, agreements, or representations, oral or written, not speci?ed within this Contract will be
valid provisions of this Contract. This Contract may not be modi?ed, supplemented, or amended, except
by written agreement signed by all necessary parties.

32. Minority and Women?s Business Enterprises Compliance. Removed by agreement of the parties.

33. Nondiscrimination. Pursuant to the Indiana Civil Rights Law, speci?cally including 1C ?22u9?1?10,
and in keeping with the purposes of the federal Civil Rights Act of 1964, the Age Discrimination in
Employment Act, and the Americans with Disabilities Act, the Emergency Manager covenants that it
shall not discriminate against any employee or applicant for employment relating to this Contract with
respect to the hire, tenure, terms, conditions or privileges of employment or any matter directly or
indirectly related to employment, because of the employee?s 01' applicant?s race, color, national origin,
religion, sex, age, disability, ancestry, status as a veteran, or any other characteristic protected by federal,
state, or local law (?Protected Characteristics?). Emergency Manager certi?es compliance with applicable
federal laws, regulations, and executive orders prohibiting discrimination based on the Protected
Characteristics in the provision of services. Breach of this paragraph may be regarded as a material breach
of this Contract, but nothing in this paragraph shall be construed to imply or establish an employment
relationship between the State and any applicant or employee of the Emergency Manager or any
subcontractor.

The State is a recipient of federal funds, and therefore, where applicable, Emergency Manager and any
subcontractors shall comply with requisite af?rmative action requirements, including reporting, pursuant
to 41 CFR Chapter 60, as amended, and Section 202 of Executive Order 11246 as amended by

Executive Order 13 672.

34. Notice to Parties. Whenever any notice, statement or other communication is required under this
Contract, it shall be sent by ?rst class mail or via an established courier/ delivery service to the following
addresses, unless otherwise speci?cally advised.

A. Notices to the State shall be sent to: (Include contact name and/or title, name of agency address)

Micah Vincent With a copy to: Courtney Schaafsma
Director Executive Director

Of?ce of Management and Budget Distressed Unit Appeal Board

200 West Washington Street, Room 215 One North Capitol Street, Suite 900
Indianapolis, IN 46204 Indianapolis, IN 46204

Page 17 of 31
07/16

B. Notices to the Emergency Manager shall be sent to: (Include contact name and/or title, name of
vendor address)

Gary Schools Recovery, LLC With a copy to: Barnes Thornburg LLP
c/o Trey Traviesa 11 S. Meridian Street

4320 West Kennedy Boulevard Indianapolis, IN 46204

Tampa, 33609 Attn: Lauren Box

As required by TC payments to the Emergency Manager shall be made via electronic funds
transfer in accordance with instructions ?led by the Emergency Manager with the Indiana Auditor of
State.

35. Order of Precedence; Incorporation by Reference. Any inconsistency or ambiguity in this
Contract shall be resolved by giving precedence in the following order: (1) this Contract, (2) attachments
prepared by the State, including Attachment A, (3) RFl#l 7?1 ll, (4) Emergency Manager?s response to
7-1 11 and additional supplemental information provided by the Emergency Manager, and (5)
attachments prepared by the Emergency Manager. All attachments, and all documents referred to in this
paragraph, are hereby incorporated fully by reference.

36. Ownership ofDocuments and Materials.

A. The Emergency Manager grants the State a non-exclusive, non?cancelable, perpetual, worldwide
royalty?free license to use all documents, records, programs, applications, data, algorithms, ?lm, tape,
articles, memoranda, and other materials (the ?Materials?) not developed or licensed by the Emergency
Manager prior to execution of this Contract, but specifically developed under this Contract and to use,
modify, copy and create derivative works of the Materials.

B. During the performance of this Contract, the Emergency Manager shall be responsible for any loss of
or damage to the Materials developed for or supplied by the State and used to develop or assist in the
services provided while the Materials are in the possession of the Emergency Manager. Any loss or
damage thereto shall be restored at the Emergency Manager?s expense. The Emergency Manager shall
provide the State full, immediate, and urn'estricted access to the Materials and to_Emergency Manager?s
work product during the term of this Contract.

37. Payments.

A. All payments shall be paid upon receipt of the invoices, as detailed in Paragraph 2 herein. Payment
shall be made by direct deposit by electronic funds transfer to the ?nancial institution designated by the
Emergency Manager in writing. No payments will be made in advance of receipt of the goods or services
that are the subject of this Contract except as permitted by TC ?4?13?2-20.

B. The State Budget Agency and the Emergency Manager acknowledge that the Emergency Manager
may be paid in advance for the maintenance of equipment and/ or software. Pursuant to IC ?4?l3?2?
20(b)(l4), Emergency Manager agrees that if it fails to perform the maintenance required under this
Contract, upon receipt of written notice from the State, it shall refund the consideration paid,
pro-rated through the date of non?performance.

38. Penalties/Interest/Attorney?s Fees. The State will in good faith perform its required obligations
hereunder and does not agree to pay any penalties, liquidated damages, interest or attorney?s fees, except
as permitted by Indiana law, in part, IC ?5?l7-5, IC ?34?54?8, lC ?34?l3?1 and IC 34?52?2?3.

Page 18 of 31
07/16

Notwithstanding the provisions contained in IC ?5-17?5, any liability resulting from the State?s failure to
make prompt payment shall be based solely on the amount of funding originating from the State and shall
not be based on funding from federal or other sources.

39. Progress Reports. The Emergency Manager shall submit progress reports to the State upon request.
The report shall be oral, unless the State, upon receipt of the oral report, should deem it necessary to have
it in written form. The progress reports shall serve the purpose of assuring the State that work is
progressing in line with the schedule, and that completion can be reasonably assured on the scheduled
date.

40. Public Record. The Emergency Manager acknowledges that the State will not treat this Contract as
containing con?dential information, and will post this Contract on its website as required by Executive
Order 05?07. Use by the public of the information contained in this Contract shall not be considered an
act of the State.

41. Renewal Option. This Contract may be renewed under the same terms and conditions, subject to the
approval of the Commissioner of the Department of Administration and the State Budget Director in
compliance with IC ?5-22?17?4. The term of the renewed contract may not be longer than the term of the
original Contract.

42. Severability. The invalidity of any section, subsection, clause or provision of this Contract shall not
affect the validity of the remaining sections, subsections, clauses or provisions of this Contract.

43. Substantial Performance. This Contract shall be deemed to be substantially performed only when
fully performed according to its terms and conditions and any written amendments or supplements.

44. Taxes. The State is exempt from most state and local taxes and many federal taxes. The State will
not be responsible for any taxes levied on the Emergency Manager as a result of this Contract.

45. Termination Due to Termination of Distressed Political Subdivision Designation. In the event
that the State, including the Indiana General Assembly and DUAB, terminates the School Corporation?s
status as a distressed political subdivision, this Contract shall be terminated on the same day that the
School Corporation?s status as a distressed political subdivision is terminated. The Emergency Manager
shall provide phase?out and transition services for sixty (60) days following the termination of the
Contract pursuant to this Section if requested by DUAB. In the event that DUAB terminates the School
Corporation?s status as a distressed political subdivision pursuant to IC 6?1.1?203?13, all performance
incentives not yet claimed for the Contract Year in which the termination occurs shall be deemed to be
achieved and the appropriate performance incentives shall be due to the Emergency Manager, unless it is
impossible for such incentives to be achieved. For those performance incentives with varying amounts
based on performance, the highest level of performance shall be deemed to be achieved, unless it is
impossible for the highest level of performance to be achieved.

46. Termination for Convenience. The State may not terminate the Contract pursuant to this Section
before July 1, 2018. This Contract may be terminated, in whole, by the State, which shall include and is
not limited to TDOA and the State Budget Agency whenever, for any reason, the State determines that
such termination is in its best interest after June 30, 2018. Termination of services shall be effected by
delivery to the Emergency Manager of a Termination Notice at least ninety (90) days prior to the
termination effective date, specifying the date on which such termination is to become effective. With
respect to the earning of base pay as outlined in Paragraph 2 herein, the Emergency Manager shall be paid
any payment for the base amount, as outlined in the applicable Payment Schedule provided in Paragraph
2.D., that is due prior to or on the effective date of termination. With respect to the earning of

Page 19 of 31
07/16

performance incentives as outlined in Paragraph 2 herein, the Emergency Manager shall be paid for the
applicable performance incentives, as outlined in Paragraphs 2A., 2.B., or 2.C. herein, achieved, and not
yet paid, during the Contract Year in which the termination for convenience occurs. Except for the
performance incentives outlined in Paragraphs and in the event of a performance
incentive for which the achievement date has not yet occurred as of the date of termination, DUAB shall
pay a pro?rated amount of the performance incentive. The prourated amount shall be determined by
calculating the number of days from the start of the Contract Year to the date of termination and dividing
this number by the number of days from the start of the Contract Year to the achievement date as outlined
in Paragraphs 2A., 2.B., or 2.C and multiplying this ratio by the applicable performance incentive
amount. For the performance incentives outlined in Paragraph and the minimum level of
the performance incentive shall be used in the calculation of the pro-rated amount at the time of
termination, unless it is impossible for the minimum level of performance to be achieved. Once the
achievement date and claim date for the performance incentives in Paragraphs and have
passed, if a higher level of performance was met, DUAB shall pay the Emergency Manager the difference
between the pro?rated amount, as calculated using the formula above, based on the higher level of
performance achieved and the pro?rated amount paid at the time of termination. Whether it is impossible
for an incentive to be achieved shall be determined with reference to the achievement date for the
incentive. The performance incentives outlined in Paragraphs and are not eligible for the
calculation of a pro?rated amount and must be achieved prior to the termination date in order to be paid by
DUAB to the Emergency Manager. Apart from the payment of performance incentives as described
herein, the State will not be liable for services performed after the effective date of termination. The
Emergency Manager shall be compensated for services as described herein, but in no case shall total
payment made to the Emergency Manager exceed the original contract price. For the purposes of this
paragraph, the parties stipulate and agree that IDOA shall be deemed to be a party to this Contract with
authority to terminate the same for convenience when such termination is determined by the
Commissioner of IDOA to be in the best interests of the State.

47. Termination By State for Default By Emergency Manager.

A. With the provision of thirty (30) days? notice to the Emergency Manager, the State may terminate this
Contract in whole or in part if the Emergency Manager fails to:

Correct or cure any breach of this Contract; the time to correct or cure the breach may be
extended beyond thirty (30) days if the State determines progress is being made and the extension
is agreed to by the parties; 

2. Deliver the supplies or perform the services within the time speci?ed in this Contract or any
extension;

3. Make progress so as to endanger performance of this Contract; or

4. Perform any of the other provisions of this Contract.

B. If the State terminates this Contract in whole or in part, it may acquire, under the terms and in the
manner the State considers appropriate, supplies or services similar to those terminated, and the
Emergency Manager will be liable to the State for any excess costs for those supplies or services.
However, the Emergency Manager shall continue the work not terminated.

C. The State shall pay the contract price for completed supplies delivered and services accepted. The
Emergency Manager and the State shall agree on the amount of payment for manufacturing materials
delivered and accepted and for the protection and preservation of the property. Failure to agree will be a
dispute under the Disputes clause. The State may withheld from these amounts any sum the State
determines to be necessary to protect the State against loss because of outstanding liens or claims of
former lien holders.

Page 20 of 31
07/16

D. The rights and remedies of the State in this clause are in addition to any other rights and remedies
provided by law or equity or under this Contract.

E. The State agrees to hold the Emergency Manager harmless for errors or omissions in any that are
incomplete as a result of any termination under this Section.

F. Notwithstanding this Section, if this Contract is terminated in part, the Emergency Manager may
terminate this Contract by delivering a Termination Notice to the State at least thirty (3 0) days before the
effective date set forth in such Notice.

48. Termination by Emergency Manager for Default By State.?

A. The Emergency Manager may terminate this Contract in whole if the Emergency Manager determines
that statut01y changes enacted by the Indiana General Assembly have signi?cantly and materially reduced
the scope of the Emergency Manager?s authority under this Contract as set forth in this Contract or in
Attachment A. The Emergency Manager may only terminate the Contract pursuant to this Section on July
1 or within sixty (60) days of the close of a special session of the Indiana General Assembly in the year in
which the relevant statutory changes are enacted by the Indiana General Assembly, Whichever is later.
The Emergency Manager shall notify the State at least sixty (60) days prior to terminating the Contract
pursuant to this Section. 

B. If at any other time, the Emergency Manager determines that DUAB has taken action that has
signi?cantly and materially reduced the scope of the Emergency Manager?s authority under this Contract
as set forth in this Contract or in Attachment A, the Emergency Manager shall notify DUAB in writing
within thirty (3 0) days of DUAB ?s action reducing the scope of authority. The Emergency Manager may
not terminate this Contract under this Section if it does not provide written notice within thirty (30) days
of action reducing the scope of authority. The notice to DUAB shall describe in detail the
actions of DUAB which the Emergency Manager believes have signi?cantly and materially reduced the
scope of the Emergency Manager?s authority under this Contract and the impact of such reduction on the
ability of the Emergency Manager to ful?ll the requirements of this Contract. DUAB shall have sixty (60)
days from the date it receives notice under this Section to suf?ciently remedy the actions that the
Emergency Manager identi?es in the notice provided under this Section and respond to the Emergency
Manager in writing. If DUAB suf?ciently remedies the actions identi?ed by the Emergency Manager, the
Emergency Manager may not terminate this Contract under this Section. If DUAB does not suf?ciently
remedy the actions identi?ed by the Emergency Manager, the Emergency Manager may terminate this
Contract but only if the Emergency Manager provides notice of such termination to DUAB within thirty
(3 0) days of DUAB ?s determination that DUAB cannot or will not suf?ciently remedy the actions that
have signi?cantly and materially reduced the scope of the Emergency Manager?s authority identi?ed by
the Emergency Manager. Any termination under this Section shall take effect ninety (90) days after the
Emergency Manager noti?es the State that it intends to terminate the Contract under this Section or the
date agreed to by the parties. For purposes of this Section, a ?signi?cant and material reduction in scope?
shall mean a reduction in the scope of the Emergency Manager?s authority under this Contract, which
signi?cantly and materially adversely affects the ability of the Emergency Manager to achieve incentive
payments provided for in this Contract for which the achievement date has not yet passed.

C. In the event of termination under this paragraph, with respect to the earning of base pay as outlined in
Paragraph 2 herein, the Emergency Manager shall be paid any payments for the base amount, as outlined
in the applicable Payment Schedule provided in Paragraph 2.D., that are due prior to or on the effective
date of termination. With respect to the earning of performance incentives as outlined in Paragraph 2
herein, the Emergency Manager shall be paid for the performance incentives available in the Contract
Year in which the termination occurs for which the Emergency Manager?s ability to achieve the incentive

Page 21 of 31
07/16

payments has been significantly and materially adversely affected by a significant and material reduction
in scope, as de?ned herein, unless it is impossible for such incentives to be achieved. Whether it is
impossible for an incentive to be achieved shall be determined with reference to the achievement date for
the incentive. For those performance incentives outlined in Paragraph and the lowest
level of the performance incentive shall be paid by DUAB to the Emergency Manager, unless a higher
level of performance is achieved. Once the achievement date and claim date for the performance
incentives in Paragraphs and have passed, if a higher level of performance was met,
DUAB shall pay the Emergency Manager the difference between the performance incentive based on the
higher level of performance achieved and the amount paid at the time of termination.

D. The State agrees to hold the Emergency Manager harmless for errors or omissions in any that are
incomplete as a result of any termination under this Section.

49. Travel. No expenses for travel will be reimbursed above and beyond the base amount set forth in
Section 2 hereof, unless speci?cally permitted under the scope of services or consideration provisions and
approved in advance by DUAB or the DUAB Executive Director. Such expenditures made by the
Emergency Manager for travel will be reimbursed at the current rate paid by the State and in accordance
with the State Travel Policies and Procedures as specified in the current Financial Management Circular.
Any such out?of?state travel requests must be reviewed by the State for availability of funds and for
appropriateness per Circular guidelines.

50. Indiana Veteran?s Business Enterprise Compliance. Removed by agreement of the parties.

51. Waiver of Rights. No right conferred on either party under this Contract shall be deemed waived,
and no breach of this Contract excused, unless such waiver is in writing and signed by the party claimed
to have waived such right. Neither the State?s review, approval or acceptance of, nor payment for, the
services required under this Contract shall be construed to operate as a waiver of any rights under this
Contract or of any cause of action arising out of the performance of this Contract, and the Emergency
Manager shall be and remain liable to the State in accordance with applicable law for all damages to the
State caused by the Emergency Manager?s negligent performance of any of the services furnished under
this Contract.

52. Work Standards. The Emergency Manager shall execute its responsibilities by following and
applying at all times the highest professional and technical guidelines and standards. Tfthe State becomes
dissatis?ed with the work product of or the working relationship with those individuals assigned to work
on this Contract, the State may request in writing the replacement of any or all such individuals, and the
Emergency Manager shall grant such request.

53. State Boilerplate Af?rmation Clause. I swear or affirm under the penalties of perjury that I have
not altered, modi?ed, changed or deleted the State?s Boilerplate contract clauses (as contained in the 2016
1DOA Professional Services Contract Manual) in any way except for the following clauses which
are named below: 

l. Duties of the Emergency Manager

2. Consideration

3. Term

5. Assignment; Successors

7. Audits

10. Compliance with Laws

13. Continuity of Services

15. Default by State

16. Disputes

Page 22 of 31
07/16

17.
19.
21.
25.
26.
27.
28.
29.
32.

35.
36.

37.
45.

46.
47.
48.

49.

50.

Drug?Free Workplace Certi?cation

Employment Option

Funding Cancellation

Statutory Limits on Liability

Independent Entity; Worker?s Compensation Insurance
Information Technology Enterprise Architecture Requirements
Insurance

Key Persons

Minority and Women?s Business Enterprise Compliance
Order of Precedence; Incorporation by Reference

Ownership of Documents and Materials

Payments

Termination Due to Termination of Distressed Political Subdivision Designation
Termination for Convenience

Termination by State for Default by Emergency Manager
Termination by Emergency Manager for Default by State
Travel

Indiana Veteran?s Business Enterprise Compliance

Throughout the contract, ?Contractor? has been changed to ?Emergency Manager? to re?ect the actual
business arrangement between the State and the Emergency Manager.

07/16

Page 23 of 31

Non-Collusion and Acceptance

The undersigned attests, subject to the penalties for perjury, that the undersigned is the Emergency
Manager, or that the undersigned is the properly authorized representative, agent, member or of?cer of
the Emergency Manager. Further, to the undersigned?s knowledge, neither the undersigned nor any other
member, employee, representative, agent or of?cer of the Emergency Manager, directly or indirectly, has
entered into or been offered any sum of money or other consideration for the execution of this Contract
other than that which appears upon the face hereof. Furthermore, if the undersigned has knowledge
that a state of?cer, employee, or special state appointee, as those terms are de?ned in IC 4-2-6-1,
has a ?nancial interest in the Contract, the Emergency Manager attests to compliance with the

disclosure requirements in IC 4-2-6-10.5.

In Witness Whereof, Emergency Manager and the State have, through their duly authorized
representatives, entered into this Contract. The parties, having read and understood the foregoing terms
of this Contract, do by their respective signatures dated below agree to the terms thereof.

Gary ls Recovery, LLC

By: I Win/L
Fred Seamon, Manager

Date: 

Approved by:

Indiana Devin of Administration
By: /4?l K477)
Jessica Robertson, Cole?lnf?siqner

- 1
Date: [0/33 
I 
APPROVED as to Form and

Ofy??o

Curtis ?if Hill, Jr.:Attorney Gena]
Date: g?h/WI 7

Approved by:
Indiana Of?ce of Technology

(for)

 

   

(for)

By: Not Required

Distressed Unit Appeal Board


CLHf/?xox

Name and Title, Printed

Date: 

 

 

 

Approved by:

State%t Agency

By: (for)
Jason D. Dddich, Motor

Date: ?0 '20! ?7

Page 24 of 31

ATTACHMENT A

SCOPE OF SERVICES

Pursuant to Senate Enrolled Act 567?2017, the Emergency Manager shall serve as the
emergency manager for Gary Community School Corporation (?School Corporation?). In this role, the
Emergency Manager shall perform any and all actions necessary to fully and completely fulfill the duties
and responsibilities of the emergency manager set forth in SEA 567?2017, including the following
serv1ces:

STATUTORY RESPONSIBILITIES

1.

07/16

The Emergency Manager shall assume and exercise all of the power, authority, and
responsibilities of both the Superintendent (as the School Corporation?s executive) and the School
Corporation?s Board of Trustees (as the School Corporation?s ?scal body) during the time in
which the School Corporation is a distressed political subdivision. The Emergency Manager shall
have full responsibility and authority related to ?nancial and academic matters of the School
Corporation, and the Emergency Manager may act on these ?nancial and academic matters
without the approval of the Fiscal Management Board or the School Corporation?s Board of
Trustees. The School Corporation?s Superintendent, or the Superintendent?s designee, shall work
with the Emergency Manager and serve as a resource in an administrative capacity.
The Emergency Manager may adopt, amend or enforce ordinances and resolutions relating to or
affecting the fiscal stability of the School Corporation.
The Emergency Manager may impose only those taxes or fees that the School Corporation is
authorized by law to impose.
The Emergency Manager shall negotiate and enter into labor contracts and collective bargaining
agreements on behalf of the School Corporation. The Emergency Manager shall review existing
labor contracts and collective bargaining agreements and, if the Emergency Manager considers it
appropriate, the Emergency Manager may attempt to renegotiate such labor contracts and
collective bargaining agreements.
Subject to existing labor contracts and collective bargaining agreements applicable to the School
Corporation, the Emergency Manager may do any of the following:

a. Set the salaries and other compensation of the School Corporation?s employees.

b. Identify and implement labor force reductions.

c. Outsource services performed by employees of the School Corporation.

d. Reduce or suspend salaries of the School Corporation?s employees.
The Emergency Manager shall approve payroll and other claims against the School Corporation
before payment.
The Emergency Manager shall review each contract that is in effect for the School Corporation
and may, if prudent, renegotiate or cancel the contract to the extent permitted by the contract.
The Emergency Manager may make, approve or disapprove the following:

a. A contract.

b. An expenditure.

0. A loan.

d. The creation of any new position.

e. The ?lling of any vacant position.
The Emergency Manager may do any of the following:

a. Enter into agreements with other political subdivisions for the provision of services.

b. Close facilities of the School Corporation.

c. Sell assets, including real property, of the School Corporation.

Page 25 ofl31

i. If the Emergency Manager sells real property, any political subdivision that has
territory where the real property is located and institutions of higher education
with real property located in Indiana shall be given a thirty (30) day first right to
make an offer to purchase the real property. The Emergency Manager shall
determine whether it is appropriate to accept one (1) of these offers and shall
negotiate the terms and conditions of the sale of the real property to the offeror.

ii. The Emergency Manager shall provide written notice to the Mayor of the City of
Gary at least thirty (30) days before selling assets. If the Mayor of the City of
Gary noti?es the Emergency Manager of any concerns or objections regarding
the proposed sale of the assets, the Emergency Manager must confer with the
Mayor regarding those concerns or objections.
Transfer property not needed by the School Corporation.

i. The Emergency Manager shall provide written notice to the Mayor of the City of
Gary at least thirty (30) days before transferring property. If the Mayor of the
City of Gary noti?es the Emergency Manager of any concerns or objections
regarding the proposed transfer of property, the Emergency Manager must confer
with the Mayor regarding those concerns or objections.

Acquire real property that is necessary to achieve the goals expressed in the written
financial plan. Acquisition of real property for school building purposes is subject to
DUAB approval pursuant to IC 

Request technical assistance from DUAB and State agencies to assist in carrying out the
powers and duties of the Emergency Manager as outlined in Indiana Code 
8.5 

Request a waiver ?'om the application of IC regarding the allocation of
protected taxes. To do so, the Emergency Manager must submit, before May 1 of the
year for which the waiver is sought, a written request to DUAB.

10. The Emergency Manager may not approve any of the following actions Without ?rst obtaining

DUAB approval:

a. Acquiring real property.

b. Constructing new buildings or remodeling or renovating existing buildings.

0. Incurring a contractual obligation (except for maintenance contracts or an employment
contract for a new employee whose employment replaces the employment of a former
employee) that requires an expenditure of more than thirty thousand dollars 0,000).

d. Purchasing 01' entering into an agreement to purchase personal property at a cost of more
than thirty thousand dollars 000).

e. Adopting or advertising a budget, tax levy, or tax rate for an ensuing budget year.

11. The Emergency Manager may petition DUAB to terminate the School Corporation?s status as a
distressed political subdivision when the conditions 111 TC are no longer applicable
to the School Corporation and the conditions set in IC are met.

FINANCIAL RESOURCES

1.

07/16

The Emergency Manager may request that DUAB delay or suspend payments of principal and/or
interest on the School Corporation?s loans or advances ??om the Common School Fund. In
making this request, the Emergency Manager shall provide DUAB with an analysis documenting

the reason for the request and the long-term impact of the delay or suspension if approved.

The Emergency Manager may request that DUAB recommend to the State Board of Finance that
the State Board of Finance make an interest free loan from the Common School Fund. In making
this request, the Emergency Manager shall provide DUAB with an analysis documenting the

reason for the request and the longnterm impact of the loan if approved.

Page 26 of 31

10.

11.

The Emergency Managei may provide recommendations to DUAB of appropriate benchmarks of
?nancial improvement for the School Corporation.

the Emergency Manager may request a g1 ant 01 grants to the School Corpor ation from the funds
appropriated to DUAB to assist the school corporation in oveicoming short term ?nancial
problems. DUAB may provide a grant or grants to the School Corporation in amounts determined
by DUAB.

The Emergency Manager may provide DUAB with a debt restructuring plan for the possible
restructuring of advances made to the School Corporation from the Common School Fund,
including possible forgiveness of those advances. The debt restructuring plan shall document the
reason for the plan and the long?term impact of the debt restructuring if approved.

The Eme1 gency Manager may 1 equest a loan from the counter?cyclical revenue and economic
stabilization fund under IC 6?1.1?21.?4 

The Emergency Manager shall leview the School Corporation? 3 budget. The Eme1 gency Manager
shall prepa1e and adopt an annual budget for the School Corporation that dedicates a signi?cant
part of the School Corporation?s budget to eliminating the School Corporation?s outstanding
?nancial obligations. In preparing the budget, the Emergency Manager shall consult with the
School Corporation? 3 Board of Trustees, the Fiscal Management Board, and the Mayor of the
City of Gary. The Emergency Manager shall present the proposed budget to for review
and approval.

The Emergency Manager shall attempt to negotiate with the creditors of the School Corporation
to establish a plan specifying the schedule for paying each creditor. The Emergency Manager
shall submit the plan to DUAB for approval.

In consultation with the Fiscal Management Board, the School Corporation?s Board of Trustees
and the Mayor of the City of Gary, the Emergency Manager shall conduct a ?nancial and
compliance audit of the operations of the School Corporation. The Emergency Manager shall
then develop a written ?nancial plan for the School Corporation, the object of which is to achieve
?nancial stability for the School Corporation. The written ?nancial plan must include provisions
for paying all of the School Corporation?s outstanding obligations and for paying all future
obligations of the School Corporation in a timely manner. This written ?nancial plan shall be
provided to DUAB no later than anuaiy 31, 2018.

The Emergency Manager shall provide DUAB with a comprehensive long?term plan for paying
all of the School Corporation?s outstanding obligations no later than anua1y 31, 2018. This plan
can be combined with the written ?nancial plan documented above.

The Emergency Manager shall update the written fmancial plan at least once eve1y (6) months
after the date of providing the original written ?nancial plan to DUAB or more frequently as
needed in order to allow the written ?nancial plan to re?ect the most current ?nancial status of
the School Corporation.



1.

07/16

The Emergency Manager shall employ a chief ?nancial of?cer for the School Corporation. The
chief ?nancial of?cer is an employee of the School Corporation. The Emergency Manager shall
interview at least one resident of the City of Gary as a candidate for the position. lfthe
Emergency Manager is not able to interview a resident of the City of Gary as a candidate for the
position, the Emergency Manager shall interview at least one resident of Lake County or
northwest Indiana as a candidate for the position. The Emergency Manager shall supervise the
chief ?nancial of?cer, in order to ensure that the chief ?nancial of?cer carries out its duty to
report to the Emergency Manager and assist the Emergency Manager in canying out the day to
day ?nancial operations of the School Corporation. The Emergency Manager shall obtain
approval from DUAB before hiring someone to ?ll this role.

Page 27 of 31

2.

The Emergency Manager shall employ a chief academic of?cer for the School Corporation, after
consultation with the Department of Education. The chief academic of?ce is an employee of the
School Corporation. The Emergency Manager shall interview at least one resident of the City of
Gary as a candidate for the position. If the Emergency Manager is not able to interview a resident
of the City of Gary as a candidate for the position, the Emergency Manager shall interview at
least one resident of Lake County or northwest Indiana as a candidate for the position. The
Emergency Manager shall supervise the chief academic of?cer, in order to ensure that the chief
academic of?cer carries out its duty to report to the Emergency Manager and assist the
Emergency Manager in carrying out the academic matters of the School Corporation. The
Emergency Manager shall obtain approval from DUAB before hiring someone to ?ll this role.

WITH STAKEHOLDERS

l.

2.

The Emergency Manager shall consult with and consider recommendations from the Fiscal
Management Board and the School Corporation?s Board of Trustees.

The Emergency Manager shall supervise the Fiscal Management Board in order to ensure that the
Fiscal Management Board carries out its duty to serve as a liaison to DUAB, the Mayor of the
City of Gary, and the Department of Education in developing a transition plan and providing
information on a regular basis to parents, students, employees of the School Corporation, and the
public.

The Emergency Manager shall have a member of the Emergency Manager?s project team, who
has ?nal decision?making authority suf?cient to ensure the continued and uninterrupted operation
of the School Corporation, on?site at the School Corporation at least 90% of the work week. As
much as possible, the Emergency Manager?s employee ?lling the role of emergency manager
shall be on-site at the School Corporation.

The Emergency Manager shall attend Board of Trustees? meetings and present as needed at such
meetings. The Emergency Manager shall provide the DUAB Executive Director with a copy of
any information to be presented prior to presenting the information in a public meeting, at least
forty?eight (48) hours prior to the start of the public meeting.

The Emergency Manager shall schedule regular meetings with representatives of the School
Corporation?s teachers, principals, administrators and other staff members.

The Emergency Manager shall implement community engagement measures which may include
town hall meetings, electronic messaging, and other means. The Emergency Manager shall notify
the DUAB Executive Director of planned community events at least two days prior to the event.
The Emergency Manager shall meet with key stakeholders at the request of DUAB, including
members of the General Assembly, the Department of Education, State Board of Accounts, the
Department of Local Government Finance, the City of Gary, and other stakeholders as identi?ed
by DUAB.

The Emergency Manager shall notify the DUAB Executive Director of any planned media
contact, including, but not limited to, press releases, press conferences and media interviews at
least twenty?four (24) hours in advance of the contact, if possible. Iftwenty?four (24) hour notice
is not possible, the Emergency Manager shall provide as notice as soon as possible to the DUAB
Executive Director. For unplanned media contact, the Emergency Manager shall notify the
DUAB Executive Director as soon as possible after the contact, providing a summary of the
questions and answers provided, if applicable.

The Emergency Manager shall provide the DUAB Executive Director with a cepy of any
information to be presented at a public meeting prior to presenting the information at least forty?
eight (48) hours prior to start of the public meeting.

10. The Emergency Manager shall attend DUAB meetings and present as requested at such meetings.

07/16

Page 23 of 31

ANALYSIS AND REPORTING

1.

07/16

The Emergency Manager shall evaluate the educational services provided by the School
Corporation, including but not limited to classroom instruction, special education,
career/technical education and student extra-curricular activities, in relation to their impact on the
?nancial status of the School Corporation. The Emergency Manager shall develop a long-term
plan for providing such services, including recommendations for cost savings, revenue generation
or ef?ciencies as possible: This evaluation shall be provided to DUAB by December 31, 2017.
The Emergency Manager shall develop a master plan for the operation of the School

- Corporation?s facilities, including maintenance, repairs, renovations and construction if needed.

The master plan should provide for improved facility utilization and education stability. The
master plan should identify all real property assets of the School Corporation and determine the
best approach for managing or dispensing of these assets when considering the ?nancial impact to
the School Corporation and the impact these assets have on the surrounding neighborhood and the
City of Gary overall. The master plan should also include an analysis of the School
Corporation?s long?term capital plant needs, including consideration for potential increases or
decrease in student enrollment and modi?cations to the services provided by the School
Corporation. The Emergency Manager shall seek community input in the development of the
master plan. This master plan shall be provided to DUAB by May 31, 2018.

The Emergency Manager shall evaluate the non?educational services provided by the School
Corporation, including but not limited to food services, security and safety, custodial services and
building and grounds maintenance, in relation to their impact on the ?nancial status of the School
Corporation. The Emergency Manager shall develop a long?term plan for providing such services,
including recommendations for cost savings, revenue generation or ef?ciencies as possible. This
evaluation shall be provided to DUAB by May 31, 2018.

The Emergency Manager shall provide DUAB with a longuterm plan for providing adequate
personnel and a plan for the compensation of such personnel. The plan should provide scenarios
to account for potential increases or decreases in student enrollment, as well as modi?cation of
the services provided by the School Corporation. This plan shall be provided to DUAB by
December 31, 2017.

The Emergency Manager shall provide DUAB with an analysis of the School Corporation?s
transportation services, including recommendations for cost savings and a long?term plan for
meeting transportation needs, by May 3 l, 2018.

The Emergency Manager shall prepare an analysis and report on the geographic boundaries of the
School Corporation. The report shall include recommendations concerning alternative
boundaries for the School Corporation and an assessment of the potential ?nancial implications
of such alternatives. The report shall be provided to DUAB by May 31, 2018.

The Emergency Manager shall prepare an analysis and report on the governance structure of the
School Corporation. The report shall include recommendations on alternative governance
structures and an evaluation of the ability of such governance structures to ensure the ?nancial
and educational success of the School Corporation. The report shall be provided to DUAB by
May 3 1, 201 8.

The Emergency Manager shall review and evaluate the various processes and systems utilized by
the School Corporation and make recommendations as to improvements that can be made.
Processes and systems include, but are not limited to, ?nancial management software, payroll
processing and records management. The Emergency Manager shall provide such evaluations to
DUAB no later than December 31, 2017. The evaluations can be provided individually as certain
processes and systems are analyzed or may be combined into one report. After DUAB review of
the evaluations and recommendations, the Emergency Manager shall work to implement
approved improvements.

Page 29 of 31

9.

10.

ll.

12.

13.

The Emergency Manager shall submit a written report to DUAB each month by the ?fth day of
the month. The written report shall include the following:
a. Actions taken by the Emergency Manager on behalf of the School Corporation in the
prior month.
b. School Corporation expenditures made by the Emergency Manager.
c. The progress that has been made toward achieving financial stability for the School
Corporation.
The Emergency Manager shall provide copies of the written report to the School Corporation?s
Board of Trustees, the Fiscal Management Board and the Mayor of the City of Gary. On a
quarterly basis, the Emergency Manager shall present these reports at a public meeting of the
Fiscal Management Board.
In addition to the written reports, the Emergency Manager shall provide a weekly status
update to the DUAB Executive Director. Such status updates can be made in written or verbal
form as agreed?upon by the Emergency Manager and the DUAB Executive Director.
The Emergency Manager shall ?rst obtain DUAB approval before commencing any signi?cant
decisions or actions. The Emergency Manager must provide the DUAB Executive Director with
suf?cient notice to enable DUAB to fully review and evaluate the decision or action. At a
minimum, such notice most be provided at least thirty (30) days in advance of the time for
commencing any decisions or actions, unless the DUAB Chairman agrees to a shorter advance
notice. Such decisions or action items include, but are not limited to, the following:
a. Issuance of any debt or incurring of any loan obligations.
b. Any project to be undertaken that is anticipated to have more than $250,000 in expenses
in aggregate, even if structured as individual projects.
0. Closing a school building or a major program operated by the School Corporation.
d. Modi?cations to the operational model utilized at the School Corporation, including any
implementation of innovation networks, transformation zones or charter schools.
The Emergency Manager shall comply with all federal, state, and local reporting requirements
and ensure that all reports are submitted in a timely and thorough manner so as to meet all
program requirements. The Emergency Manager shall provide a copy of submitted reports to the
DUAB Executive Director within ?ve days of submission to the appropriate entity.
The Emergency Manager shall provide DUAB with other information, reports or
recommendations as requested by DUAB or the DUAB Executive Director.

OTHER 

1.

07/16

The Emergency Manager shall comply with the guidelines and statutes for Indiana school
corporations and shall administer all programs, contracts, grants and awards in accordance with
all federal, state, and local laws, regulations, and guidelines. The Emergency Manager, as the
Superintendent and Board of Trustees, shall comply with all federal, state, and local laws, rules,
regulations, and ordinances, and all provisions required thereby just as the School Corporation,
the Superintendent, and Board of Trustees would be required to comply with such laws, rules,
regulations, and ordinances, except to the extent such laws, rules, regulations, and ordinances are
abrogated by SEA 567~2017. Where federal, state, and local laws, rules, regulations, and
ordinances, and all provisions required thereby require separate or complementary actions by the
Superintendent and the Board of Trustees, the Emergency Manager shall, in consultation with the
DUAB, establish alternative procedures suf?cient to ensure similar procedural checks and
balances to the extent feasible.

The Emergency Manager and any member of the Emergency Manager?s team who will be on
School Corporation property or in School Corporation buildings must complete a criminal
background check and any school safety training required of employees of school corporations.
Such must be completed within the time period afforded by law. The Emergency Manager must

Page 30 of 31

07/16

notify the DUAB Executive Director of all members of their team who Will be on School
Corporation property or in School Corporation buildings twenty?four (24) hours before the
employee enters School Corporation property or buildings. The Emergency Manager must
provide a copy of the results of the background check to the DUAB Executive Director within
?ve days of the completion of the background check. DUAB may request additional information
about Emergency Manager employees or bar Emergency Manager employees from the School
Corporation or participation in the engagement.

The Emergency Manager shall obtain surety bonds for any member of the Emergency Manager?s
team that will have authority over or access to public funds of the School Corporation. These
surety bonds shall be obtained in the same manner for which bonds would be required for the
Superintendent, School Corporation Board of Trustees and any other School Corporation
employee for which a surety bond would typically be required. The surety bonds shall be
obtained Within thirty (30) days of the execution of this contract. Documentation of the bonds
shall be provided to the DUAB Executive Director within ?ve (5) days of obtaining the bonds.

Page 31 of 31