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Former Dayton Superintendent Gets 24 Months in Prison for Embezzlement

Former Dayton Independent Schools superintendent Gary Rye will spend two years in a federal prison for embezzling money from the school district.

"I think it's important in cases like this to send the appropriate message that this type of behavior will not be tolerated," Judge David Bunning told Rye in a federal courtroom in Covington on Tuesday morning. Bunning had the option of a recommended sentence of between eighteen and twenty-four months, or could exercise his right to lower or lengthen that recommendation. Because Rye has paid full restitution, Bunning said he decided to keep the sentencing parameters within the 18-24 month range and went with the higher sentence because Rye's theft was at the high-end of the sentencing threshold of $200,000.

Rye pleaded guilty in December. In November, Kentucky Auditor Adam Edelen, whose office examined Rye's tenure and explained a history of theft, said that the school district and Rye had reached an agreement that the former superintendent would repay $473,000.

In the courtroom on Tuesday it was noted that Rye repaid more than $193,000, the full criminal restitution, but he will still be on the hook for the outstanding balance.

Judge Bunning noted that Rye still faces a civil suit.

It was more than a year ago that Rye was revealed as having stolen from the district, a traditionally low-performing and poverty-stricken small school system, through reimbursement of personal retirement contributions and service credit card purchases, benefits not authorized in his contract. He was paid more than $47,000 for sick days, leave that was not approved by the Board of Education. The audit also found more than $20,000 in unauthorized travel reimbursements.

"Your actions had a profound impact on the school system for a number of years," Bunning said.

In fact, Dayton Schools' suffered from severe budget cuts under Rye as he lined his own pockets. At the time of the announcement of the audit last year, current Superintendent Jay Brewer, whose own digging led to the examination by Edelen, said the district was still being forced to make cuts, at that time around $300,000.

Federal prosecutor Laura Vorhees read multiple letters to the court asking for the longest sentence possible, including one from former Dayton superintendent and current Southbank Partners president Jack Moreland. The letter detailed how teachers were forced to spend their own money for supplies, a librarian and music teacher were cut, and field trips eliminated.

Since Brewer took over for the district, there have been financial and educational improvements. "The situation has improved dramatically since you were replaced," Bunning said. "Is that a coincidence? I don't think so."

Rye's attorneys asked for leniency since he met the restitution requirement but Bunning said Rye was a man of means, discounting the obligation. Rye will report to a federal prison in either Montgomery, Alabama or Pensacola, Florida, per a request by Bunning, though the penal system will have final say on where he goes. Following the sentence, Rye will have three years of supervised probation.

He is to report to prison on June 2.

"Today was a powerful demonstration that there are consequences for stealing from children," Auditor Edelen said via Twitter. "I am pleased justice was served as a result of our work last year and our partnership with the new leadership at the school district. Education is the most important moral obligation we have as a Commonwealth and the largest investment taxpayers make. I will continue to be present in education, making sure school systems run for the benefit of children and taxpayers."

Written by Michael Monks, editor & publisher of The River City News

Photo: Federal courthouse in Covington/RCN