Insurance May Only Pay School District Fraction Of Misspent $3.1M

Seattle Public Schools’ attorney says the district will likely only get a $280,000 insurance settlement after the $3.1 million financial scandal involving former district official Silas Potter.

Potter led the district’s Regional Small Business Development Program and the Small Works Roster Program. Audits released last year and this year found that as head of those programs, he authorized about $2.8 million in sketchy contracts to small businesses, construction companies and community organizations.

Potter and two associates were charged with first-degree theft for allegedly funneling another $280,000 to themselves. District General Counsel Ron English says that $280,000 is the only money the district expects to receive from insurance, because it’s classified as a “loss.” The other $2.8 million is just considered “misspent,” so English says it can’t be recovered through insurance. English told the School Board Executive Committee that more money could potentially be recovered through restitution.

Potter’s felony theft trial is scheduled for February. He’s scheduled to appear alongside co-defendant David A. Johnson, who allegedly benefited from fraudulent contracts Potter authorized. A second co-defendant, Lorrie Kay Sorenson, pleaded guilty to first-degree theft in June.