A longtime bus driver for Lincoln Public Schools was arrested Friday and is suspected of touching a 17-year-old student inappropriately.

David Kraegel, 63, of 5420 Enterprise Drive, spent the weekend in jail on suspicion of third-degree sexual assault.

By 2 p.m. Monday, prosecutors had charged him with the misdemeanor that carries as much as a year in jail. He pleaded not guilty.

Kraegel's family sat in the crowded courtroom and watched as deputies brought him in, wearing jail clothes and shackles.

He said he understood the charges and possible penalties explained to him. Then Lancaster County Judge Jean Lovell set a docket call for next week.

She set Kraegel's percentage bond at $10,000, granting the request of his attorney, Stuart Mills, who argued the $25,000 requested by the state was too high.

Mills said a lower bond was appropriate considering Kraegel has no criminal history.

But Lovell did approve the state's request to put a condition on the bond Kraegel not have contact with children younger than 16, with the exception of family.

Kraegel had worked as a bus driver since 2001, said Nancy Biggs, Lincoln Public Schools associate superintendent for human resources. She said he has been fired.

Lincoln Police Officer Katie Flood said the allegation stems from a June 22 incident. A couple in the 5000 block of Northwest Pemberly Lane told police they saw a school bus parked in their neighborhood in the Highlands at about 1 p.m. that day.

When they looked closer, they could see a man and a girl inside, standing close together. They approached out of concern, they said, and the two separated quickly.

When they asked the girl if she was OK, she nodded.

Kraegel said he was cracking the girl's back.

They thought it seemed suspicious and called police, Flood said.

"I'm glad that they did," she said.

The victim told a caregiver the driver had touched her inappropriately, and then told investigators he'd kissed her and touched her breasts, buttocks and crotch over her clothing, according to court documents.

"It's just disappointing to learn that a man that's trusted to care for these children takes advantage of that vulnerability," Flood said.

She said Kraegel was taking the girl, who is mentally handicapped, home from a summer program at Yankee Hill when he stopped the bus near her home.

A paraeducator who usually rides on the bus with students had called in sick that day, Flood said.

Biggs said paraeducators are placed on buses when possible, based on student needs, Biggs said. For instance, medically fragile students always have a paraeducator.

Also, if a bus is full and more adult supervision is needed, a paraeducator can be assigned, she said.

Biggs said LPS officials have had no other complaints about Kraegel.

"He's been a really good employee," she said.

Flood said police know of no other victims and have had no other criminal contacts with Kraegel.

Kraegel's bond was posted before 4 p.m.

Reach Lori Pilger at 473-7237 or lpilger@journalstar.com. Reach Margaret Reist at 473-7226 or mreist@journalstar.com.