Tuesday, June 29, 2038

NOTE: To find the most current posts, please scroll down to the two big red arrows. You can't miss them.

Friday, June 25, 2038


Thursday, June 24, 2038


Friday, May 28, 2038

Items of interest in the Archives: The 2013 STRS Board Election

Many people have been very interested in reading about the irregularities of the 2013 STRS board election. There are many posts related to this topic, beginning the first week of April 2013, after the ballots were mailed to retirees from STRS. You can find them by going to the Archives for this blog, over in the right sidebar, and clicking on dates beginning with April 7, 2013. Dennis Leone announced his candidacy for a retired seat in November, 2012. There is a lot of information about him in the Archives, beginning with November 12, 2012 posts. 5/28/13

Wednesday, February 27, 2036

.....so what REALLY happened in 2003 that touched off a firestorm at STRS that is still smoldering today? Read it here, from the Cleveland Plain Dealer. (Hint: It ain't over yet!)

More here (Akron Beacon Journal, 2003)

Wednesday, April 11, 2035

Thursday, March 10, 2033

To find current, day-to-day posts -- pull your scroll bar down a ways, just below the big red arrows (you can't miss them). Thanks.

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Monday, September 15, 2031

Note from this blogger.....


In case you weren't aware, I am quite willing to post opposing views on this blog; in fact, I welcome such opportunities. If you disagree with anything you see posted on my blog, please feel free to submit your views and I will gladly post them.
Kathie Bracy 
kbb47@aol.com 9/15/10.........................................

Monday, February 24, 2031

Find your state representative and senator here.

Tuesday, May 15, 2029

Gettin' a little tired.....


Some communications to Mike Nehf and Tim Myers, dating back as far as 2009, continue to go unanswered. Looks like it will be a long wait, but we haven't forgotten. You can see them here and here.

Saturday, April 29, 2028

I know, it's weird.........

Many posts that appear "at the top" for a while are eventually moved down, where they can be found under their original posting dates. Also, if you are confused by the postdating, this is done to keep these posts up there; otherwise, they drift down when new posts are added. It's a "blog thing" which I have no other way to control. KB

Wednesday, February 24, 2027

Handy links: Contacts, information and more (short version)
This is an abbreviated version of the original 'Handy links' post.
 Click here to view a more complete list. (Some of it is old.)
STRS Board.....STRS website
Board calendar
E-mail contacts at STRS (old, but some may still work)
Map/directions to STRS, 275 E. Broad St. Columbus, OH 43215
Rich DeColibus' PowerPoint presentation STRS' PBI Program; Does it work?: click December 21, 2008 (blog Archive) and scroll down to December 23 posts.
Popular links; click, then scroll down: , , , ,

Tuesday, February 24, 2026

SPECIAL (must read):

Dennis Leone's INVESTIGATIVE REPORT on STRS: May 16, 2003...Who is Dennis Leone?........(PDF version)...More on Dennis Leone .......(PDF version)
Dennis Leone's STRS Report to ORTA, March 2007
Dennis Leone's Testimony at the Statehouse 9/5/12
The Plain Dealer article that started it all
Historic PBI vote, January 16, 2009

Sunday, February 23, 2020

CURRENT POSTS BELOW

Tuesday, May 23, 2017

Wanna see what those guys in the Investment Dept. are getting (while your income keeps shrinking away) ?

Jim Stoll to John Curry and Others
May 23, 2017
John and All,
This salary and bonus chart paid to our 88 investment staff should make us all sick.. 88 STRS employees collected over $7,000,000 in bonuses for a performance way less then the 7.5% return which is STRS goal each year!  This is crazy! How does losing your Cola feel now?
Jim Stoll
Click images to enlarge


Thursday, May 18, 2017

Letter to us from Mike Nehf...and it isn't a love letter!


Click images to enlarge 


Worth repeating.....

I also believe we have something I call the STRS Investment Mis-Management Tax
It's a tax you can't get back
It's a tax you can't vote on
It's a tax you can't deduct
It's a tax that's gone forever, and
It's a tax that currently provides smaller benefits than everybody paid for
~ Mike Mulcahy
STRS speech May 18, 2017

Bob Buerkle's speech to STRS May 18, 2017: Warren Buffett Wins $500,000 Investment Bet

"For the past few months we have been telling this STRS Board that your investment returns would be larger (and less expensive) if you used index funds. This is the same thing that Warren Buffett has been saying for a very long time. This Board should take notice and learn from the 'Oracle of Omaha'."

"Here are a few index funds you should be familiar with and they are beating the tar out of your investment experts. The reason you should be familiar with them is simple. They are index funds that STRS provides to Defined Contribution Plan members through the Nationwide Insurance Co. and you can see them yourself on your own STRS website."


Click images to enlarge:


Bob Buerkle: The STRS Pension Penalty for Working in June During Your Last School Year

Click image to enlarge:

Dean Dennis' speech to STRS Board May 18, 2017

"I retired in 2008. In 2008 a teacher named John Curry wrote Director Michael Nehf about the safety of his pension. Director Nehf responded back reassuringly."
"The applicable provisions of the statutes that govern STRS Ohio and SERS are very similar. The pertinent language of each state provides that pensions are vested when granted. This means that retirees vested in the STRS Ohio defined benefit plan cannot have their pension formula reduced by STRS Ohio. In simple language, once an STRS Ohio member begins receiving a pension STRS Ohio cannot reduce that pension." 
Click images to enlarge.


Mike Mulcahy's speech to STRS May 18, 2017: The 2 main types of pension plans

"Who is responsible for fulfilling the pension promises made by STRS when your investment experts lose so much of 'our' money? I suggest to you that it is not the retirees. However, STRS acts as if they have the right to steal the benefits that we were promised after we signed our retirement contract.This is what we worked for and paid all of our STRS required contributions for." 
"Now, you think you have the right to make us pay for your mismanagement, when the obligations are clearly on the STRS to deliver on our promised pensions. Find a way!"
Click image to enlarge.

Wednesday, May 17, 2017

Jesse Parete: Some questions for Nick Treneff

From: Jesse Parete 
Date: Thu, May 11, 2017 
Subject: Questions I hope you can answer
To: Nick Treneff
Dear Mr. Treneff,
One of the immediate topics engaging STRS retired teachers when they socialize is what is going on with STRS. I have tried to synthesize from those conversations the following questions.
1. When was the percentage teacher pay into STRS raised from 10% to 14%? 
2. Two years ago STRS retirees skipped a COLA: What effect did it have on the solvency of the STRS system? 
3. For the past several years retirees have received 2/3 of their original COLA.  When did this start and what effect has this had on the solvency of the STRS system? 
4. Are any of the other four state retirement systems in the same financial straits as is STRS?   
5. Have any of the other four state retirement systems altered or suspended  their COLA for their retirees?
6. Why has STRS had trouble averaging 7.5% with investments?
I don’t know about what those that I talked to actually have been averaging more than 7.5%, but I know that I have a very conservative Edward Jones advisor who has helped me average 9% from 2009 through 2016 and so far this year it is much more than 10%.
I hope that you can provide some context and answers.  We all want what is best for Ohio as well as for ourselves.
Sincerely,
Jesse Parete
Retired since 2009

Thursday, May 11, 2017

You can bet nobody at STRS has to look for a cheaper apartment now! Thanks, Board!

STRS retiree to John Curry
May 11, 2017
John, I am looking into finding an apartment due to increase. As my STRS check is going down, I have to look into lower living costs. I just can't believe I am facing this due to the incompetency of STRS. I only fear more doom is coming. I have called several places and told them about STRS and its financial condition. Several of the resident managers said they have gotten calls from people like me and the STRS mess. Isn't that just wonderful??? I can't believe I am facing this at age seventy. Can't something be done with this STRS group?  I know they meet next week, but they seem insurmountable.

John Curry: the STRS investment staff should participate and retire in the same system they invest in

John Curry to Dean Dennis
May 11, 2017
Subject: Re: What STRS isn't doing
Dean...well stated. Another concept that I would like to see is that the STRS investments staff be forced to participate (and retire in) the SAME SYSTEM that they invest in ....rather than retiring in OPERS as they currently do. Maybe that would cause them to invest smarter and be more conscious and responsible with their investing. As it is now....if they make risky investments to pad their healthy bonuses and FAIL...they simply don't get the bonus....but their nice salary remains intact and the retirement system THEY retire in doesn't take a hit for their careless risk taking.
John Curry

Dean Dennis: What STRS isn't doing

Dean Dennis to Jim Stoll
May 11, 2017
Subject: What STRS isn't doing
Jim,
I've been going to the STRS meetings with Bob lately trying to encourage them to make investments in our interests. For instance, why has STRS lowered their earning assumption to 7.45%? This makes no sense. Are they trying to enrich their investment staff or our pension fund? I say this because S&P 500 has historically annually averaged over 9% since the 1920's. There have been sixty (60), thirty year (30) cycles from which to measure. In other words, over a thirty year cycle how much will the S&P 500 return on an annual basis? The answer is the S&P has always returned greater than 8% and over a third of the time has returned greater than 10%. Simply investing in ETFs (Equity Trading Funds) tied to the S&P 500 lowers risks and provides a greater return that STRS performance.
Also consider this, why aren't they investing significantly in other baskets of ETF's in different segments to increase what they can earn with our monies?  Here are four: XSD (a basket of semi-conductor stocks) it has returned 157% over the last 5 years, PSCT (a basket of information, software and electronic stocks) it has returned 142% over the past 5 years,-VHT (a basket of stocks tied to health care) it has averaged 124% over the past 5 years, XBI (a basket of biotech stocks) it has returned 170% over the past 5 years.
My point is the above basket of ETF's have averaged 18% annually over the last 5 years. Why are we investing in hedge funds, foreign equities and real estate. It take very little research to discover that Foreign Equities have under performed US Equities over the last 5, 10, 15, 20, 25 year periods. That said, STRS likely pays a quarter of a million annually to outside firms who either don't share this information, or it is simply ignored. Bottom-line, when you refuse to look at solid investments maybe you do need to lower your earning assumption expectations to lower than the market provides.
Dean Dennis

2011 PBIs

Jim Stoll to Nick Treneff
Subject: Investment Staff Salaries and Bonuses fiscal years 6/30/ 2016 AND 6/30/2017
Date: 5/11/2017
 
Nick,
Here is the format you had sent previous similar requests in.  If this is still possible that would be great.
Thanks.
Jim Stoll
(Click images to enlarge.)




Jim Stoll: Public records request to STRS for investment staff salaries, bonuses

From: jastoll@yahoo.com
To: treneffn@strsoh.org
CC: nevilleb@strsoh.org, board@strsoh.org
Date: 5/11/2017 2:06:34 P.M.
Subject: Investment Staff Salaries and PBI  Bonuses for Fiscal year ending 6/30/2016 and 6/30/2017
Nick,
I'd Like to make a public records request that you send me the Salaries and PBI bonuses and total compensation for each of our entire investment staff via email or in electronic form for the fiscal year ending 6/30/2016.  I'd also like the same for fiscal year 6/30/2017 as soon as that year is calculated.
Thanks in advance and I appreciate your help.   Feel free to call if you have any questions.
Sincerely,
James A. Stoll

John Curry: Time to change the Ohio Revised Code

John Curry to Jim Stoll
May 11, 2017
Subject: Re: Fw: STRS Investment Staff
Agreed, Jim.....AND....the ORC needs to be changed to "force" the STRS investments staff to pay into and retire with STRS rather than OPERS as they should be risking their own retirement security with their investments. As it is now...they can take huge risks and if they fail.....they just don't get their bonus....but their retirement system's health is not affected. 
John Curry

Jim Stoll: Why STRS Ohio is losing money and what's keeping the investment staff VERY happy

Jim Stoll to John Curry
May 11, 2017
John,
This is exactly why STRS OHIO is losing money and why our pension dollars should be invested in Index Funds..... It is ridiculous for STRS to pay 88 Investment staffers Millions in salary and millions more in BONUSES for subpar performance.... They should NEVER receive a bonus if they fail to beat their own 7.5 % investment return Benchmark. We should heed Warren Buffett's Advice.
Jim Stoll

Wednesday, May 10, 2017

Corruption, fraud and theft at ORTA? Say it isn't so!

Retired teachers non-profit faces allegations of theft, mismanagement
Dayton Daily News
May 9, 2017
Columbus —The recently fired executive director of a non-profit lodged a complaint with the Ohio Attorney General that alleges he was fired after uncovering corruption, fraud and theft.
John Cavanaugh, who was dismissed earlier this month by the Ohio Retired Teachers Association, said in his complaint: “This is an urgent matter as my office manager and I have been tipped off that the Executive Committee plans to destroy evidence of criminal activity and fraud once we are terminated.”
ORTA, a non-profit with roughly 20,000 members, keeps an eye on pension issues impacting retired Ohio teachers.
“Everything you got in front of you is just ridiculous,” said Randy Overbeck, president of the ORTA board, regarding Cavanaugh’s complaint. “John was fired for insubordination and breach of confidentiality.”
Cavanaugh declined to comment.
Evelyn Massey, who joined ORTA as the office manager in April 2016, also filed a complaint with the Attorney General’s Charitable Law Section, detailing that she found a lack of documentation for credit card charges and extra paychecks issued to some ORTA employees.
But on Tuesday, Massey said she was pressured by Cavanaugh to file the complaint in February and now she wants to withdraw it. “He wanted me to go ahead and file a complaint, so I did. He was my boss,” she said.
She said she isn’t sure if the lack of documentation for some checks and charges is a matter of honest mistakes or something more serious.
In June 2016, Mark Anderson, a certified public accountant who reviewed ORTA financial records, told the board that the previous administration did not appear to know how to use the sophisticated accounting and bookkeeping software that ORTA purchased.
The accountant also flagged ORTA’s use of several credit cards, saying that charges were excessive, and he noted that ORTA’s investment performance has been below average.
In a February email to Overbeck, Cavanaugh outlined 21 steps he had taken as executive director to tighten internal controls, review investment performance, remedy tax errors with the IRS and monitor cash flow.
This newspaper obtained the Cavanaugh and Massey complaints from the Attorney General’s office through a public records request. The AG’s investigative records are not made public unless it results in a court case or settlement, a spokesman said.

Bob Buerkle: A letter to STRS retirees and active teachers

From Bob Buerkle
May 10, 2017
To all STRS Retirees and active teachers,
When STRS held a March, 2017 informational meeting in Cincinnati, Nick Treneff and Gary Russell told the audience that STRS was still considered a "Top Quartile" pension system. NO WAY JOSÉ!
That boat shipped out on 01/07/2013 when the Ohio Legislature gave STRS the authority to eliminate our COLA.
STRS is now back to treating our money as if it was theirs again. They want to fund their ideas, not deliver on the pensions they promised. That is exactly what got STRS Director Herb Dyer fired in 2003. Dyer wrote a retiree saying “the pension system’s money is the Board’s money to spend as they see fit,” and “perhaps retirees should go out to dinner less often.” A few months before this time Dyer spoke at a meeting in Cincinnati covering his infamous leaky bucket of health care funds. That time he suggested to the audience that they "should consider downsizing from a Cadillac to a Chevy".
We did not expect to buy Cadillacs in the future, since few of us bought them when we were working.  Instead of STRS Management telling us to how to manage our finances after they have ravaged them, let's put the real problem out there. STRS keeps losing more of our money, our finances! "I say, Just invest our money in the various indexes that historically have always returned over 8% over 30 year periods.  That is the only requirement necessary so STRS can fulfill the retirement promise that was made to us. That is STRS' most important job! That's what you are employed to do, and at our expense".  Remember, it is our money not yours. You are supposed to be our Fiduciary and deliver the Benefit what was codified and Defined by law when we accumulated our benefits while working, and which were  specified by law when we retired.
STRS Management and the Board have now stolen over 25 Billion dollars of our promised pension benefits in their two money grabs. It is our money but they think they can do what they want with it by telling us that this is what they need to do to provide assurance that STRS will be able to pay future benefits. That's hogwash!  This is a smoke and mirrors game by management and it is not what the retirees and current members need or want.
After the first 13 Billion Dollar grab in 2014 no lawsuits were filed by any Union, any Organization, any Individuals or any Class Action Lawyers. Emboldened by this non-reaction to the STRS pension takeaways, they looked ahead to other takeaway ideas, describing them as "necessary to be able to pay future pension benefits". So in February, 2015 the STRS Board voted to adopt a "30 Year Closed Amortization Funding Period". This is costing Billions of your pension dollars to implement and it was not necessary. This is a lofty goal but should only be attempted when it could be achieved without destroying retiree pensions. A good year that this could have started would have been in 2000 when STRS had a funding ratio already at 92%. In 2017 STRS is in no position to start a 30 year closed funding program when we have a funded ratio standing at only 69%. All they are doing is stealing our money to fund their project. This is something that STRS Management wants to do for their own self desire and self aggrandizement. It is not what retirees need, it's what STRS wanted to do with your money, not what you wanted and not what you needed! 
It is also not a Legislative Mandate.  And if "Closed Funding" is so great, why doesn't OPERS do the same thing for their members and retirees?  OUR STRS EMPLOYEES ARE IN THE OPERS RETIREMENT SYSTEM.  WHY DON'T THEY RAISE THE ROOF OVER THIS NOT BEING DONE FOR THEIR OWN PENSION SYSTEM?  WHY DON'T LEGISLATORS FORCE THEIR OWN PENSION SYSTEM TO DO THIS FOR THEM?  AFTER ALL YOU KNOW, THIS "30 YEAR CLOSED FUNDING PERIOD" IS ALL THE RAGE NOW!  The path chosen by the STRS Board and Management is not mandated and should be shelved for now.
STRS already had the tools to deal with 30+ year unfunded periods like they used in the 1980's, 1990's and through 2006. Then STRS management came up with a plan in 2010-11 to seek legislative authority to reduce and/or eliminate our COLA. That is so much easier than writing those time consuming annual letters to the Ohio Retirement Study Council explaining how STRS will get back under a 30 year funding period over a period of years. By the way, this process was followed many, many times in the past and STRS was always able to work their way back under 30 years of funding and this is still the Legislative Mandate. One of the most recent periods occurred after the 2001 recession. STRS wrote their plan each year. In 2005 the plan that was written to work our way back under 30 years of unfunded liability by 2020. Instead of taking 15 years to achieve this it was accomplished in just two years and by 06/30/2007 the unfunded period was reduced from 42 years to 26.2 years.
We should demand that no more unnecessary and non-mandated ideas be implemented until all lost pension benefits are repaid to retirees and restored for current workers.
Bob Buerkle 

Saturday, May 06, 2017

The Urban Institute on state pension systems; guess where STRS Ohio ranks

Seen in the New York Times: the Urban Institute gives STRS Ohio an "F"
"No states got an A and only six states received a B: Arkansas, Delaware, Florida, New York, Oregon and Wyoming. Most states — 33 — received a C, while six got a D. The last six — Connecticut, the District of Columbia, Kentucky, Massachusetts, Ohio and Rhode Island — each received an F."
 *    *    *    *    *
Bob Buerkle to Mario Iacone, May 4, 2017
Subject: Re: How Does STRS Rank Compared to other retirement Systems
Mario,
UPDATE, UPDATE!
This article based it's information on data that became obsolete between two and six weeks after it was written because STRS lowered it's earning assumption 30 basis points below the 7.75% the authors used and then the Board eliminated the COLA for Ohio Retirees which massively worsens our position.
I bet we now have surpassed Massachusetts and hold the rank of the worst of all states, and future retirees will never get back the value of their employee and employer contributions plus the added investment earnings value during their lifetime.
Bob 
*    *    *    *    *
Read more here

Tuesday, May 02, 2017

Value of COLA

From Mario Iacone
May 2, 2017
FYI:
STRS WILL SAVE approximately TEN BILLION DOLLARS over the next 30 YEARS by ELIMINATING COLA!!!
RETIREES WILL LOSE approximately TEN BILLION DOLLARS over the next 30 YEARS by LOSING COLA!!

Thursday, April 27, 2017

80-member investment staff at STRS? You've got to be kidding me!

This was in 2013; I wonder how many there are now? And what kind of bonuses they're getting while retirees are getting poorer and poorer? Click here to read more. 

New COLA Tree from Bob Buerkle

From Bob Buerkle, April 27, 2017
Here's what your new COLA Tree looks like
With the STRS Board vote on 04/20/2017 to completely eliminate our COLA they have set a future legacy that will leave our Retirees Impoverished.
In The Past - Consider a retiree with a 1979 retirement date and a $$20,000 beginning pension, enough to buy a new Cadillac. On their anniversary month beginning in 1980, STRS provided a 3% simple COLA and continued to do so each year until 2013. Over that 33 year period their pension rose to $40,000, nearly enough to buy a new Cadillac. Even so they had lost 5.1% in purchasing power. Still, at least they saw a doubling of their original pension over that period thanks to a well-managed pension system. Over 33 years your payments would total $1,003,200 under the old STRS COLA Plan.
Today - Now consider a 2014 retiree who will likely never receive a COLA. Their pension may start off at $40,000 but it will probably never increase. Even so, that's a pension about the same amount that the 1979 retiree now receives and nearly enough to buy a new Cadillac when they retire. However, with average inflation rates and no COLAs for the next 33 years, it is unlikely that your $40,000 pension could buy any model new car in 2047. Under the new STRS "No-COLA" plan your pension payments would total $1,320,000, not the $2,006,400 it should be. You'll lose $686,400 in missing COLA payments, stolen by current "Management of the STRS Retirement System".
A recent fidelity article said that a 3% compounded annual inflation rate will cut the value of a fixed benefit in half in 24 years. The last 100 years of U.S. inflation was 3.19% so you are sure to lose 50% of the purchasing power you retired with.
        Contact your legislators immediately

Tuesday, April 25, 2017

The rest of Bob Buerkle's 4.20.17 speech to the STRS Board

Since STRS public speeches are limited to three minutes, Because of this, Bob was not able to complete his speech at the time, but he did have copies to present to the Board and he did get his last sentence in. Here is the rest of his speech. Read it and weep; there's too much truth in it to cheer you up. Remember when they used to tell us STRS was the Cadillac of pension systems? Yeah, right. It's not even an Edsel today!
 *    *    *    *    *
STRS management and the Board have made a mess of our pension system. 
Thousands of teachers were forced to make quick decisions about retirement in order to beat the newly imposed retirement rules.  (in the last 5 years, the number of retirees increased from 125,000 to 159,000, a 27% increase over a short period of time). 
For every extra retiree that was forced out at the top of their pay scale, STRS receives only about half of the previous employee and employer contributions from their replacement.  This means that for many years the STRS will receive lower contributions from these replacement teachers than they would have if they had not forced so many people to retire early. 
Teachers were told that the formula would be lowered for service years beyond 30, the FAS would increase to five years from three, new age requirements were being phased in, and they would not receive a COLA for their first five years if they retired after 08/01/2013.   Now even that turns out to be a lie, since the STRS Board just eliminated the COLA for these recent retirees.  After all, they were told by STRS Counselors and even read in STRS Publications that they would receive an annual COLA without waiting five years before it started.  What a remarkable scam STRS has devised. 
Here's what retirees have learned about STRS. When you make investments that lose money, we lose benefits!  STRS balances its pension obligations by stealing our money from the retirement contract benefits that retirees were promised.

Monday, April 24, 2017

Retirees home in on the grim news.....

"Can you believe that we will never get a cost of living increase again? Retirees like me with only the STRS pension are going to be cooked. I may have  in a few years no choice but to commit suicide. Boy it sure would be horrible to ask actives with salaries we could have only dreamed about to pay more. We have nobody standing up for us.  My God Where is OEA or ORTA?  I guess I should just hurry up and die. That is now the STRS plan. Next I suppose they will take away my healthcare. My God, when will this stop?" 
*    *    *
 "This is a grim, disturbing, and devastating development. (X) paints a picture that is horrifyingly close to the reality that many retirees, especially those who retired prior to 1999, face. The loss of Medicare reimbursement coupled with this COLA cut are a blow to our financial welfare. There's no doubt that the next blow will come in the form of drastic health care changes. (X) and other members/leaders of CORE fought valiantly for ten years to stop this sort of debacle. They supported Dr. Dennis Leone and John Lazarus in their efforts to clean up the STRS Board and make them accountable to retirees even in the face of scorn and personal defamation at the hands of OEA and ORTA. Where is the new generation of retirees who are willing to stand in the gap and speak out against the draconian actions of the present STRS Board? I will repeat yet again that there should be at STRS an immediate freeze on all hiring, salary increases and bonuses until the COLA is restored for retirees."
*    *    *
"I believe the following statements are all accurate.
Retirees are the ones paying for STRS Investment mistakes
No usual and ongoing demographic changes caused this problem 
The 3% simple COLA did not cause this problem
No service formula benefits of any kind caused this problem, including the 88.5% for 35 years
The combined effect of all of the above did not cause this problem
ONLY EXTREME LOSSES BY IN-HOUSE STRS INVESTMENT EXPERTS CAUSED THIS CRISIS
(From Bob Buerkle)

Sunday, April 23, 2017

ORTA and OEA-R....haven't changed much in the last 8 years

From John Curry, April 23, 2017
"By the way…when was the last time you saw a representative of ORTA or OEA-R stand up, at an STRS “public speaks” portion of an STRS Board meeting and…speak as a representative for ORTA or OEA-R while calling the STRS administration or Board to task over an issue of misspending, mismanagement, or entitlement?"
I penned those words below back in 2009....and ....... at the last STRS board meeting not one soul from ORTA or OEA-R stood up at the public speaks portion of the board meeting to condemn the practices at STRS that has lost my fellow retirees their COLA....not ONE PERSON FROM ORTA or OEA-R SPOKE OUT!
*    *    *    *    *
SUNDAY, MARCH 08, 2009
Please pass the green beans!
From John Curry, March 8, 2009
To those STRS retirees looking for immediate relief...
...before the STRS Board "guts" more of our current health insurance program benefits and increases already unaffordable benefit premiums, I have some more bad news! Some of you, including myself, were hoping for almost immediate reform of our national health policy....a praiseworthy wish but...not a realistic wish. This time 'round, the President will turn over a significant amount of this "reform" to Congress. With Congress in the driver's seat comes the reality of lobbyists for the pharmaceutical manufacturers and the health insurance industry to ply their trades...at out expense. We will eventually get "reform," but it will come to us in the finished product as a "watered-down" package...one that will still allow a profit-over-service business model. We can and should take an active interest in the directions that these "reforms" will take. We can and should become educated with the current happenings in Congress and, most importantly, write our U.S. Congressmen (and women) about our feelings concerning them. Will we?
So, how did we get to where we are today with our current STRS healthcare picture? My take.... is it is a combination of forces that have caused neglect for the retiree for over a decade. We can start the decline of our healthcare program beginning back in the Herb Dyer days. In those times it was not really a well-kept secret that Herb and some of those in management at STRS really wanted to get out of the healthcare business...to pass it off onto the private sector.
This was compounded by teacher labor organizations who sat idly by while the management at STRS made their executive decisions with no hard questions being asked...nor hardly any questions being asked about the dozens and dozens of motions being passed monthly at STRS with an almost immediate unanimous rubber stamping by those who were supposed to be looking out for our (the retirees') interests - the STRS Board. Think about it....retired educators don't pay association dues to the OEA or the OFT, do they? The Ohio Revised Code 3307.15 didn't and doesn't apply to the OEA or the OFT. These organizations are just recently alerting the active educators as to an impending crisis with STRS healthcare...a crisis that began in the early 2000's but was certainly not actively broadcast to their rank-in-file membership until after the fact...and then the coverage was minimal. This was not broadcast to their membership, in particular, due to the fact that five of the former STRS Board members were criminally convicted for violating Ohio ethics laws...along with former Executive Director Herb Dyer. Things like this you just don't want to brag about, do you?
This was also compounded by the reality that those in executive positions at STRS were and are not educators....they are actuaries, investors, accountants, and business men and women. Some(note-not all) of them even have the Wall Street mentality that we have come to see being exposed these days in every newspaper and electronic media on the face of the globe. It was a good game for those while it was being played in an environment of lax regulations (no real STRS Board member oversight and hard question asking in our case) but....the greed and deception finally has been exposed for what it was...greed and deception. If the STRS administration didn't generate policy internally to present to the Board for adoption they brought in paid consultants who also worked in and lived by the Wall Street mentality of entitlement to do the same. Problem is, the ORC 3307.15 doesn't recognize nor condone an entitlement mentality, does it? If "our" associates, or at least those in management positions, were placed in and paid into the Ohio STRS with Ohio STRS retirement benefits things might have gone a different direction, might they have not? The same can be said for placing our Ohio politicians into the STRS retirement system rather than OPERS system they currently pay into....do you think that may have had something to do with the vast differences in the healthcare premium schedules of STRS vs. those at OPERS and the OPERS proactive planning for future healthcare obligations? I do!
The last factor that led retirees to where we are today is one that we can blame on ourselves, the retirees! Far too many of us have stood idly by and trusted our professional (?) retirement organizations to be a watchdog over the actions and day-to-day work at STRS. These organizations have, for the most part, served only as social gathering service clubs fostering a monthly opportunity to hash over old times with portions of meat and mashed potatoes with gravy and green beans. A tasty time-out in a retiree's monthly calendar with a smidgen of current, and the most important part but not realized by retirees, legislative report which was and is usually met with the more often heard request, "Please pass the green beans!" And then.....the legislative report is neither discussed nor thought about for another month because most retired educators, as well as actives don't pay attention to their retirement system's actions and planning (or lack thereof), do they? Guess what.....they are now! The best way, unfortunately, to get the attention of a retiree is to reduce benefits or increase deductions on that monthly paycheck, isn't it? By the way…when was the last time you saw a representative of ORTA or OEA-R stand up, at an STRS “public speaks” portion of an STRS Board meeting and…speak as a representative for ORTA or OEA-R while calling the STRS administration or Board to task over an issue of misspending, mismanagement, or entitlement? It’s been a long time, hasn’t it? We do have, along with Dr. Leone, some new members on the Board that are open to your suggestions...remember that. Now, please pass the green beans!
John
Oh, that was SO much fun!!! Let's go after their healthcare next.

Saturday, April 22, 2017

Wanna see what people are saying about the COLA cut?

Friday, April 21, 2017

Dennis Leone: Comments on Bob Buerkle's 4/20/17 speech to STRS Board

Dennis Leone to Bob Buerkle
April 21, 2017
Thank you Bob.  You gave a great, accurate speech……….AFTER the vote.  Amazing.  The STRS Board decision is PERMANENT, irrespective of what anyone might think. I recall saying and writing in 2013 that the so-called 5-year temporary freeze on the COLA for new retirees beginning that year was a sham, and that the COLA would be completely eliminated for them by 2018 – which is when 2013 retirees were due to begin receiving it –  because Board members would cleverly take the posture of “Oh well, they’ve never received a COLA anyway, so what’s the big deal.”
I hope to attend the next STRS Board meeting, and start my chain of frequent public records’ requests pertaining to staff salaries at STRS.  I wish to know if ANY employee will get a raise now from pension system money, and I will howl if it happens.  If raises are given, this will trigger letters from me to lawmakers, and believe me when I say that it will get their attention.  Also, here is an unintended consequence of the STRS Board’s decision, and something that no one on the STRS Board even thought about it:  With retirees now with an absolute fixed income that is FROZEN, retirees  will be less likely to vote for ANY school levies, especially those that hit property taxes.  Without knowing it, the STRS Board has hurt itself, which in turn, hurts retirees long term.  Had the STRS staff and Board members listened in 2006 and 2007 to repeated warnings that their payroll growth assumptions, year and year, were horribly overestimated, and had the 2012 legislative changes adopted by the Board occurred five or six years earlier as they should have been, we all would be in a lot better shape today. 
The Board’s decision to eliminate the COLA also gave the finger to the oldest retirees who have the least.  No one the STRS Board gives a damn about my 88-year-old mother-in-law, whose COLA was the only way she hoped to cover increased costs for things like car insurance.  At a minimum, the Board could have done something to protect the COLA of our oldest retirees who have the least.  I may be wrong, but I suspect that all 11 STRS Board members have their health insurance through their employer or through their wife’s employer.  I doubt that any of them are paying the full freight as many retirees are, and as I did when I served on the board in 2005-2009.  The STRS Board is out-of-touch again, as it was throughout the 1990’s and during the early 2000’s.  Sad.  I guess we all should be happy that the current STRS Board and staff aren’t using pension money for booze, parties, $1,000 dinners, bonus checks for 500 employees, and lavish trips to vacation resorts like the Board and staff did years ago.  I saved a 2002 letter that former STRS Executive Director Herb Dyer sent to a retiree:  Dyer wrote “the pension system’s money is the Board’s money to spend as they see fit,” and “perhaps retirees should go out to dinner less often.”  A few weeks after that, when the letter was shared with the Ohio General Assembly, there were 101 lawmakers who called for Mr. Dyer’s resignation.  How quickly we forget.
Dennis Leone

Thursday, April 20, 2017

Question: How do you pronounce "Buerkle"?

Answer: Like "Berkley". Now you know.

April 20, 2017 STRS Board Speech by Bob Buerkle, former CFT Retirement Chair

Wharton’s Insurance and Risk Management professor Kent Smetters notes that “Federal law prohibits firms from taking away pension benefits already earned” but companies are free to change their policy for future years at any time.  
“Many insurance company annuities enable you to plan for inflation by offering a cost-of-living adjustment”.  When you purchase a COLA contract rider you can elect to have your income increase annually by a selected percentage, typically from 1-5%.  (From Fidelity Investments Newsletter, March, 2017) 
If any insurance company reneged on their promised annuity payments, including those with COLA’s, Lieutenant Governor Mary Taylor, Director of the Ohio Department of Insurance, would come down on them like the “Ohio Blizzard of 1978”. “The publicity and fallout would be massive and certainly lead to the downfall and takeover of any insurance company, not only in Ohio but in any state, where such a company defaulted on their promised contractual benefit payments” says Bob Buerkle, former Cincinnati Federation of Teachers Retirement Chair and Insurance and Annuity licensed since 1985.
In 2002 Ohio Legislators passed a law requiring STRS to annually pay a 3% simple COLA each year.  This was the law.  The effect of the law appears in Ohio Revised Code and STRS regulation 3307.67 prior to 01/07/2013.  Effective on that date the law changed going forward to a 2% COLA after a one year freeze for retirees prior to 08/01/2013 and no COLA for 5 years for new retirees after that date.  Laws can be prospectively changed so that they can be effective for future retirees who sign pension contracts after that date.  That is not what happened to STRS Retirees who had retired under the old COLA law. They lost their contractually promised 3% COLA retroactively. 
 
Here's what retirees and current teachers have learned about STRS.  When you make investments that lose money, we lose benefits!  STRS balances its pension obligations by stealing our money from the contract benefits that we were promised at retirement.  This should never happen in a defined benefit plan.

What STRS proposed in 2012, was to retroactively change previously guaranteed pension contracts, that included a 3% simple COLA.  This was also done in such a way that it altered the Defined Benefit Contracts that retirees had selected and changed us to a quasi type of Defined Benefit/ Defined Contribution structure that allows STRS to place the risk of losses on the backs of the DB Pensioners, as if we were DC plan members.
 
“Social Security is an awesome annuity” says Wharton’s professor Kent Smetters.  That’s because of two main features. First, Social Security will increase your age 66 base annuity benefit by 32% if you delay your first check to age 70, or 4 years beyond full retirement age of 66.  (This increase is 50% greater than the old 22.5% STRS formula enhancement for delaying your pension for 5 years).  The other main reason the Social Security benefit is awesome is because it provides a guaranteed and compounded COLA.  Therefore, inflation should never be able to reduce your original pension purchasing power. It also means you don't have to find a job in your 80’s.  
Since STRS members pay 125% more than Social Security workers, what valid reason can this Board give for the ruination of our pension system beyond losing our money?

Dayton Daily News on STRS COLA-cutting action 4.21.17

Tuesday, April 04, 2017

Kathie Bracy: Letter to ORTA Membership Committee Chairman Bruce Hodges

In a message dated 4/3/2017 11:56:24 P.M. Eastern Daylight Time, KBB47@aol.com writes:
Hi Bruce --
Good letter, except that I'm a bit bothered by your last paragraph. My gut feeling is still what ORTA needs, instead of seeking nifty new ways to increase membership, is a refocused attitude and approach of supporting retirees with fervor, which includes directly taking on the STRS Board and staff. The STRS Board would like nothing more than for ORTA to be a “Can’t-We-Just-Get-Along” mouthpiece for the STRS Board, telling its members the STRS Board and staff are doing all they can for retirees, blah, blah, blah. No one EVER at ORTA has directly criticized the STRS Board and staff for their poor decision making. It is then, and only then, that STRS responds.  
I'd like to refresh your memory a little. I don't know if you've ever read Dennis Leone's 13 page report from 2003 and his change initiatives during his tenure as an STRS Board member between 2005-2009, which are proof of that. ORTA, instead, has criticized those who criticize the STRS Board and staff for two reasons: (1) Such criticism makes ORTA look like they aren't doing anything; and (2) Much of the criticism pointed at the STRS Board involves the same misconduct by ORTA Board members and ORTA staff. Joe Endry convinced ORTA long ago that criticizing STRS decision-making would only hurt ORTA. So ORTA has made its choice, which is to criticize those who demand change and better decision-making at STRS. In the meantime, retirees lose.
In addition to the two reasons stated above, ORTA made conscious choices to ignore proposals and initiatives that were authored and pushed by Dr. Leone while he was on the STRS Board (see the attached two documents) ALL of which were designed to support retirees and improve the overall management of STRS.  
ORTA also chose to look the other way and not speak in support of Dr. Leone’s repeated warnings between 2005 and 2009 that the STRS Board was wrongly overestimating payroll growth and investment returns. He also attempted to implement a stopgap procedure for STRS to pull out of investments that were significantly going south. In other words, he wanted losses for accounts like Enron to -- at some agreed-upon point --  trigger STRS' withdrawing in order to avoid further losses. NO, said Steve Mitchell, the Board majority and the so-called "experts" advising STRS; as a result, STRS lost millions more. ORTA sat silent through all of this, and these are the poor decisions that have come back to haunt us NOW, in April of 2017!
The bottom line is had the STRS Board listened and made its big 2013 changes between 2005 and 2009, we would NOT be in the mess we are in now.  ORTA simply chose NOT to become involved.  ORTA hates to hear it, but it is the absolute truth, and the masses of retirees know it. Bruce, if we really want to increase ORTA's membership, we MUST deal with the elephant in the room: being completely honest with the membership and going after STRS much more aggressively than ever before. To do otherwise simply smacks of "business as usual, let's all just get along!" Will today's ORTA have the fortitude to push for real change? I am keeping my fingers crossed.
Kathie Bracy
[Currently a member of the Ohio Retired Teachers Association board as Trustee from Franklin County]
Larry KehresMount Union Collge
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