The following words and terms, when used in this subchapter, shall
have the following meanings, unless the context clearly indicates otherwise.
(1) Severance payment--Any amount paid by the board of trustees
of an independent school district to or in behalf of a superintendent on early
termination of the superintendent's contract that exceeds the amount earned
by the superintendent under the contract as of the date of termination, including
any amount that exceeds the amount of earned standard salary and benefits
that is paid as a condition of termination of the contract. Payments to a
former superintendent who remains employed by a school district in another
capacity or contracts with a school district for services may be severance
payments in whole or in part, if the payments are compensation for the early
termination of a prior employment agreement.
(2) Superintendent--The educational leader and chief executive
officer of an independent school district. "Departing superintendent" means
an individual no longer acting as superintendent and includes a former superintendent
who is employed by or contracts with the same school district in any other
(3) Settlement--A payment made to an employee to settle actual
or threatened litigation, or to resolve an actual or disputed claim the employee
may have against the employer. A settlement does not include payments for
the early termination of a contract. Damages for early termination of an employment
contract, including loss of benefits, are severance payments regardless of
whether litigation has commenced or the form of the settlement. For a written
agreement entered into on or after September 1, 2001, a severance payment
includes any payment for actual or threatened litigation involving or related
to the employment contract.
(4) Foundation School Program (FSP) reduction amount--The portion
of a severance payment to a superintendent that is deducted from an independent
school district's FSP funds, which is calculated in accordance with provisions
in §105.1022(a)(3) of this title (relating to Severance Payments to Superintendents)
for payments made on or after September 1, 2001, or §105.1022(b)(3)(A)
of this title for payments made prior to September 1, 2001, consistent with
an independent school district's election to apply provisions of §105.1022(a)
or (b) of this title.