The New Ulm District 88 School Board on Thursday approved a settlement agreement with a special education teacher accused of malicious punishment of a child. The school board accepted the irrevocable resignation of 51-year-old Kay Audrey Carlson, and agreed to pay the employer’s portion of her health insurance premiums through August of 2012. Carlson will receive her final paycheck from the district next week. She was accused of leaving marks on 3 second-grade girls at Jefferson Elementary after they refused to move to the rear of a line because they had been talking. Carlson allegedly used force to get them to move, but later claimed the students were making up the incident. The settlement is not an admission of liability by either party involved, and a vacancy for the position has now been posted.