CORRECTION: This story was updated Thursday night to make it clear that the contract amendment means Grier can deposit payments into his account tax-free but must pay taxes on the funds when he draws money out of the account.

The head of Houston’s public schools will not have to pay tax -- possibly for years to come -- on payments for his unused sick days, vacation days and personal days after school board members approved an amendment to his contract Thursday.

According to the amended contract, Houston Independent School District Superintendent Terry Grier has 30 days of vacation, 30 days of sick leave and five personal days available each year. If he does not use all of the 65 days-off a year, they will be moved to a savings plan where he receive the money tax-free. The amount paid to Grier’s plan cannot exceed the maximum amount allowed by law.

Grier won't have to pay taxes on the money put into the saving plan until he draws money out of that account, whenever that might be, HISD officials said.

In Grier’s previous contract, payments from unused time off were to be paid directly to the superintendent in a “lump sum,” where it could be taxed.

The new contract for Grier resolved “a tax issue in which he would have had to pay tax on money he had not received yet,” HISD spokesman Norm Uhl said in an e-mail Thursday. It does not include any increases in bonus pay, and the length of the contract was not extended, HISD said.

Each unused day off, is worth more than $1,100, based on Grier’s annual salary of $300,000 and the “254-day work year” referenced in his contract.

The amendment to the contract was discussed Thursday by school board members in closed session then unanimously approved with no discussion. HISD school board members not present for the vote were Mike Lunceford and Anna Eastman.

See anything interesting in Grier’s contract? Contact Lynn Walsh.

Contact Lynn Walsh at 713-228-2850 or lynn@texaswatchdog.org or on Twitter at @LWalsh or @texaswatchdog.

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Photo of Internal Revenue Service by flickr user saturnism, used via a Creative Commons license.