Tuesday, June 29, 5999

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

Thursday, August 27, 4950

Have you joined the Ohio STRS Member Only Forum on Facebook?

If you are a member of STRS Ohio and have a Facebook account, you are eligible to join thousands of others who are make up the Ohio STRS Member Only Forum. This is a closed group of retirees and actives who are advocating for the return of our COLA, which, as you no doubt know, your STRS Board SUSPENDED on April 20, 2017. Two of our members, Bob Buerkle and Dean Dennis, filed a class action lawsuit against STRS on May 23, 2019 suing for the reinstatement of our COLA. The text of the lawsuit can be found on this blog. You can go here to join the Forum and sign the petition, already signed by more than 20,000 people, for the return of our COLA: Ohio STRS Member Only Forum

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Friday, June 25, 2038

Angel of Grief

Thursday, June 24, 2038

Garrison Keillor

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.


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


Thursday, October 10, 2019

GE freezes worker pensions — what to do if your employer changes the terms of your retirement plan

What to do if your employer changes the terms of your retirement plan
By Alessandra Malito
Published: Oct 10, 2019 
Once the Holy Grail of a secure retirement, pensions are becoming less reliable 

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General Electric just announced it was freezing its pension plan.
General Electric is pulling the plug on its pension plan, and that’s a surefire way to derail workers’ retirement planning.
GE GE, +1.20% announced on Monday it was freezing pensions for 20,000 employees with salaried benefits in an attempt to reduce its $8 billion pension deficit, and that it would also freeze supplementary pension benefits for about 700 workers. Current retirees already receiving their pension payments will not be affected and no new hires have been enrolled in the pension plan since 2012.
When a pension is frozen, it is no longer earning benefits, but it is still federally insured and employees do receive whatever amount of money was already accrued. Still, it means potential earnings are lost and workers must scramble to create a plan to ensure they have enough money in the future for their retirements (usually by saving their own dollars, as opposed to relying on their company to do so).
“Every time we see someone lose a defined-benefit plan, we see that they’ve lost all of the sacrifices they’ve made,” Teresa Ghilarducci, a labor economist and director of The New School’s Schwartz Center for Economic Policy Analysis. “Almost all workers in defined-benefit plans have given up a lot of raises in the past so not only do they lose a secure income for the rest of their lives — they also lost all of those past wages they’ll never get back.”
Many private companies have moved away from pension plans, known as defined-benefit plans, since the 1980s, especially after the introduction of 401(k) plans, which put the responsibility on employees to save for their own futures. There are different types of pensions, however, including single-employer plans (where just one company controls the pension), multiemployer plans (where numerous companies band together to offer its employees a pension) and public pensions, which are typically for teachers, law enforcement and other government workers.
Avery Dennison AVY, +0.71% was one of the last companies to terminate its pension plan last year, eight years after freezing the program. Other major corporations to freeze their plans in recent years include UPS UPS, +1.25%, IBM IBM, +1.05% and DuPont DD, -2.58%, according to the Pension Rights Center, a nonprofit consumer advocacy group.
The state of single-employer pensions are improving and moving away from a deficit, according to the Pension Benefit Guaranty Corporation, the federally-instated insurer of private pension plans, but multiemployer plans are in trouble. About 130 of these plans, which cover 1.3 million people, are at risk of running out of money within the next 20 years, and if nothing changes, the multiemployer branch of the PBGC that insures these plans will also be out of business by 2025.
This is how the GE pension freeze works: employees with these frozen pensions won’t see any additional benefits nor have access to contribute to their plan, beginning Jan. 1, 2021. The company will, however, contribute 3% of those workers’ salaries to a 401(k) plan and provide a 50% matching contribution for up to 8% of employee contributions. The company is offering a lump-sum payment plan, for a limited time, to 100,000 former employees who have yet to start receiving their benefits.
GE employees, or those in similar situations, should look into their benefits — to see how much they’ve accrued, and how much more they may need to reach their retirement goals. Workers should also assess what other retirement income they can expect in retirement — not just whatever payment they’d get from their pension if they decide not to take the lump sum, but also any 401(k) savings, Social Security and spouse’s benefits and savings.
Employees should consider discussing whether they should take monthly payments or choose a lump-sum with a financial professional, who can calculate how much more or less they’d get in total over their lifespan depending on which avenue they take.
“If the company’s financial situation is somewhat in question, it may make sense to take the money and run,” said Nate Wenner, principal and senior financial adviser at Wipfli Financial in Missoula, Minn. If they do decide to take the lump sum, workers should consider rolling that money into an individual retirement account to avoid any tax surprises in April, he said. Doing so will keep the money tax-deferred until retirement, as would rolling that money into a company 401(k) plan.
And of course, employees should plan to save more between now and retirement, said Edward Snyder, a financial adviser at Oaktree Financial Advisors in Carmel, Ind. Workers should boost or max out their 401(k) contributions, if they can, and also stash more in health savings accounts, if possible. (Health savings accounts are a tax-friendly way to save and invest for current or future health expenses, although they are only available for people with high-deductible health plans, which can be expensive.)
Saving is imperative to ensuring a comfortable retirement. “I always advise clients to try to plan with what you can definitely control,” said Kashif Ahmed, president of American Private Wealth in Bedford, Mass. “Sadly, most of those workers probably were only counting on this pension to survive retirement. They are now in a precarious, if not death sentence position.”
The Latest From the Coffee Bar

'When you retire, you expect to be able to count on The Deal You Made, the deal that you were led to expect and contributed to for your entire career. What you don't expect is to be a victim of someone else changing the deal.'

'The actives and retirees were taken to the outhouse. The associates were driven to the bank to deposit OUR MONEY INTO THEIR ACCOUNT!'
'Greed has no conscience!'

Tuesday, October 01, 2019

Is THIS what's been going on behind our backs?


Damschroder Column: Good work if you can get it
John Damschroder, Columnist
Published 10:45 a.m. ET Oct. 16, 2018
The Pew Charitable Trusts have come to a conclusion long held by this column: State public pensions are overpaying investment managers for under-performance. Moreover, Pew concludes most of the billions in fees collected by these pension-funded investment managers are not included in the Comprehensive Annual Financial Report (CAFR) required of the funds.
It’s not just Ohio. No state met the targeted return on their alternative investment portfolio over a 10-year measurement. With the benefit of an Ohio Public Records Act request for all five state public pension systems, I’ve been able to piece together the contract terms that are standard in these pension system deals, despite record redactions that claim nearly every important detail in the contract as a “trade secret,” exempt from disclosure.
Thankfully, some of the exact contracts provided by Ohio retirement systems, after heavy redaction by their investment partners, were available to me in full detail, as they were produced during discovery in lawsuits over performance by the investment managers.

An example of the redacted documents provided through public records requests (on left).
To illustrate how wonderful it would be to manage a small portion of each Ohio public pension alternative investment portfolio under the contract terms I have read for existing state agreements, assume I am penniless but connected. If my buddy the governor helped each of the Ohio funds see the wisdom in contracting with me to manage $100 million, I would be instantly rich.
To manage an alternative investment fund for Ohio I only need 1 percent of the total equity stake. Since my $500 million fund comprised solely of state pension money will pay me 2 percent a year for at least 10 years, the $10 million a year I will collect for a decade guarantees me $100 million and easily collateralizes a loan for my necessary $5 million.
The contract allows me to charge Ohio for any normal business expenses, such as an office and a staff, I can collect millions more for expenses tied to investment research, like conferences in idyllic settings, and I can establish my business in some wonderful foreign location with strict bank secrecy laws to keep prying eyes like mine away from the details. I can even establish an advisory committee with meetings in more places I’ve dreamed of visiting, also paid for by the funds.
Because of my incredible investment expertise — it must be that because I have none of my own money in the fund — I will collect 20 percent of any profit I generate. Had this deal been in place from October of 2008 to October of 2018 and I simply parked all of the money in an ultra-low cost Standard & Poor’s 500 index fund with dividends reinvested, I would have turned $500 million into more than $1.8 billion and pocketed another $260 million profit share on top of my $100 million management fee.
But wait, I took advantage of the ability the Ohio contract gives me to leverage the fund with borrowed money; who wouldn’t when they have no risk and all reward? With the leverage I made an even $300 million. With a governor who sees my genius I could go from zero to $400 million in 10 years. So could you! But it’s not all profit, however. I will be expected to tithe through hard-to-trace ways that send campaign money to the wonderfully visionary public servants who gave me this change to show my investing prowess. And I would be widely seen as a genius, since the plan I’ve laid out more than doubles the return of the best pension performance in the Pew study.
Given that Ohio public pensioners have all had benefits cut during that 10-year period, it’s not politically wise to share the standard details of the incredibly one-sided deals the state pensions have willingly entered. But political considerations are not cause for exemption for public records act disclosure under Ohio law.
“I compared a redacted copy of a private equity partnership provided by OPERS to an unredacted copy and found the redactions had nothing to do with trade secrets of the firm," said Chris Tobe a former Kentucky public pension trustee and author of "Kentucky Fried Pensions." "The redactions seem to be areas that allowed excessive hidden leverage and risk, excessive secret fees and expenses, breaches of fiduciary duty by the general partner, offshore locations for custody and hiding advisory committee membership. These redactions in my opinion appear to cover up violations of state pension and fiduciary laws and have nothing to do with trade secrets.”
Good thing for Ohio politicians that the fiduciary auditor examining these alternative investment contracts is also the alternative investment adviser helping OPERS pick the funds. Otherwise some of the facts I’ve detailed might emerge.
John Damschroder, a Fremont native who worked in Gov. George Voinovich’s administration, writes about business and economic development in Sandusky County.

Tuesday, September 24, 2019

John Damschroder: Ohio pension funds are a great deal for the people who manage them as they are getting rich while lowering value and passing the pain on to workers and retirees

Damschroder: OPERS presentation reads like a Hollywood script
John Damschroder, Columnist
September 24, 2019
The Ohio Public Employees Retirement System Board of Trustees meeting had everything you expect at a good movie, except the popcorn. There was an elaborate slide show of more than 750 pages detailing proposed changes to fund allocation, member benefits, board responsibility and ethics guidelines, and bonus
structure for internal investment managers. But just like Hollywood’s elaborate sets and scripts designed to create an illusion, following the OPERS presentation required suspension of disbelief.
OPERS slides showed high returns for the 31 percent of the portfolio in alternative assets with no public market transparency. But the settlement to my public records lawsuit against OPERS revealed that the state’s largest retirement system has no knowledge of what those assets are and accepts valuations as provided by the contractors they’ve funded.
Trustees protecting an $87 billion fund that doesn’t know what it owns, and can’t confirm what a third of its portfolio is worth, want Ohio lawmakers to freeze retirees' cost of living adjustments, push retirees under 65 off the health care plan, and increase employee contributions while cutting benefits for future OPERS members.
State lawmakers will eventually go along because OPERS-recognized liability will cross the 30-year payoff requirement in Ohio law next year, and it’s a sure thing that the true value of the alternative investment portfolio is well short of the valuations supplied by people pulling in huge fees from OPERS, so the actual shortfall is larger than shown. Then there’s the assumption that OPERS will meet its investment return target. But there wouldn’t be need for cuts if OPERS could perform that mission. The high fee managers are articulate failures.
It’s the fees that are killing OPERS retirement benefit just as a cancer cell kills its human body host. In 2001, OPERS had a $1.3 billion surplus and paid outside fund managers $10.7 million. By 2017, OPERS pay to Wall Street managers had increased by 56.6 times to more than $606 million. Had the $58 billion in OPERS account back in 2001 grown like the fees, OPERS would have $3.2 trillion dollars and be more than four times larger than the Gross State Product of Ohio.
Had the state simply put OPERS and all the rest of the public pension funds, who’ve already made the cuts OPERS wants because unlike OPERS they don’t need the legislature’s approval, on auto-pilot in a 60-40 stock to bond fund everyone would have achieved the needed return on investment. The 10-year annualized return exceeds 9.5 percent, but none of the state fund managers would earn six figure bonuses following that path.
My column detailing bonuses collected through dubious valuations supplied by outside fund managers dependent upon OPERS managers to keep the cash coming, brought records from the State Teachers Retirement System. In 2018, 84 STRS internal investment managers collected bonuses. There was a $416,000 bonus, five bonuses above $300,000, and seven investment managers making more than a half million dollars in combined bonus and salary at STRS.
None of Ohio’s public retirement funds has been able to fully meet obligations to members because none of the funds has achieved their assumed investment returns over the 10-year period and all of the funds pay top dollar to outside managers and richly reward internal managers.
If the pensions truly worked for the benefit of the public employees who’ve paid into the system, the elegant Columbus headquarters would be sold, the retirement fund workforce would be terminated and all of the money would be rolled into a 60-40 index fund provided by the low cost bidder who would also make the monthly benefit payments.
Ohio pension funds are a great deal for the people who manage them as they are getting rich while lowering value and passing the pain on to workers and retirees. A 60-40 index fund is the ultimate no brain investment. It’s unconscionable that public servants are being rewarded and treated as irreplaceable without beating that measure.
There hasn’t been such a low bar since Gordon Gee declared a tie with Michigan to be “one of Ohio State’s greatest wins ever.” If this pension scandal was about something important like Ohio State football, every media outlet in the state would be on the story and the six figure failures would be terminated without delay.
John Damschroder, a Fremont native who worked in Gov. George Voinovich’s administration, writes about business and economic development in Ohio.

Monday, September 23, 2019

Freeloading administrators? Surely not! But John Curry tells is like it is.....

From John Curry
September 23, 2019
Thank you, Robin, for having the intestinal fortitude to say what many have been thinking.....the employer also needs to pitch in to help in this situation. The employers haven't had an increase in their contribution rate in over 40 years....and it's about time they also step up to the plate. Some schools can afford this additional payroll burden immediately, others may have to "cut corners" to do so...and some may have to ask their taxpayers for additional funds to care for their cadre of educators that they (rightfully) always praise as being highly talented. The bottom line is they will also have to pitch in to cover their concern for their highly valued employees.
One immediate way to make contribution rates more affordable to public schools won't win me any friends in the education community (ask me if I care)...but it is one that I always felt needed attention is the fact that public schools can save significant moneys by forcing superintendents and other administrators to pay their "fair share" out of their paychecks (14%) into STRS just like all their classroom teachers have to. I can't think of how many police chiefs, fire chiefs and county administrators I have talked to who had no idea that most Ohio superintendents and other school administrators pay nothing (or only partially) to their retirement system out of their own paychecks. They were in disbelief when informed of this benefit...one that they didn't receive. This practice, that could accurately be called "freeloading," isn't common in other venues of public service jobs.....all of their city and county administrators, as well as department heads, have to pay their fair share....just like their underling employees.
P.S. Many classroom teachers are still not aware that this inequity exists even today. P.S. Sometimes the truth hurts, doesn't it?
John Curry

Robin Rayfield to STRS Board: Not paying the obligations of STRS to the beneficiaries is not a ‘plan to strengthen the system’

Robin Rayfield's speech to STRS Board
September 19, 2019
Greetings STRS Board of Trustees and Staff. My Name is Robin Rayfield and I represent the Ohio Retired Teachers Association. I am a STRS beneficiary, having retired in 2011 after 30+ years of service.
I want to publicly acknowledge the work of the STRS employees throughout the 2018 fiscal year. As reported during last month’s meeting of the STRS Board of Trustees, the investment people added just over $1.1 billion to the assets of our retirement fund. If I understand correctly, STRS earned just over $5.1 billion through its investment activities. With approximately $4 billion going towards paying beneficiaries, the net result of the work of the investment staff resulted in $1.1 billion being added to the assets of our pension fund. 
Although the increase in assets brings the pension system closer to the 85% funding level required by the recently revised funding policy, the system remains well below the level identified for serious consideration of benefit enhancement. Many of our retirees do not have 7 or more years of life left to enjoy prior to receiving an increase in the benefit that they were promised at the time of their retirement.
ORTA encourages the board of trustees to take action to rectify the hardship the loss of COLA has placed on retirees. Two specific actions would demonstrate a commitment to the retirees that STRS Ohio serve:     
1. STRS should seek an increase in the rate of employer contributions. The 40% increase forced upon active educators that resulted from the pension reform efforts put into place in 2012 were not matched with an increase in employer contributions. Similar to the ‘phased in’ increase in employee contributions, STRS should seek a similar increase in employer contributions. It does not make sense for active employees to contribute more, retirees to receive less, and employers to be exempt from the process of strengthening the STRS pension system. 
2. STRS should revise its funding policy to allow for a COLA for retirees providing at least some of what they were promised. Establishment of a minimum level of asset increase, for example $500 million, would allow STRS an opportunity to provide a COLA, although that COLA might be much less that what was promised, to current retirees during the time that the STRS pension system is moving towards 100% funding status. 
I hope that the Board of Trustees will seriously consider actions that will strengthen the STRS pension system while offering retirees more of what they were promised. 
I respectfully remind the STRS Board that simply not paying the obligations of STRS to the beneficiaries is not a ‘plan to strengthen the system’.   

Saturday, September 21, 2019

Dean Dennis compares Ohio and Nevada teacher pension systems: a real eye opener!

Dean Dennis' speech to STRS Board
September 19, 2019
I am Dean Dennis, I retired after 35 years of service. I'm the STRS Chair for Cincinnati's Local 1520-Retirees and the Spokesperson for the Facebook, Ohio STRS Member Only Forum.
I want to share the similarities and differences of the teacher pension systems between Ohio and Nevada. Ohio and Nevada are both Non-Social Security States. The average Employer Contribution for Non-Social Security States is 22.5%. However, Ohio's Employers Contribution rate is only 14% while Nevada's is only 14.6%. For Non-Social Security States, Ohio is the lowest in the nation. Conversely, Ohio's Employee Contribution Rate is 14% and Nevada's is 14.6%, these are the highest in the nation. The Employer Contribution Rate in Ohio has remained at 14% for over 35 years, perhaps the most stagnant in the nation. Over this same time period, Ohio teacher's contribution rate has doubled. Other similarities between the states are, Ohio and Nevada pension systems are both currently funded at around 75%. Also similar, Nevada has a 7.5% Earnings Rate Assumption; Ohio's is 7.45%.
How the states differ. Ohio has around $77 billion for investments, Nevada $41 billion. STRS Ohio employs an investment staff of over 100 people. Nevada employs an investment staff of just one person. Nevada's total investment cost is only 12 basis points, significantly below the industry average of 51 basis points. I could not find where STRS Ohio shares their investments costs stated in basis points. Ohio's long term 30 year investment returns are 8.59%. Nevada's 35 year investment returns are 9.2%. Nevada invests 44% of their portfolio in domestic equities, STRS Ohio invests only 28% in domestic equities. Nevada does not invest in hedge funds, Ohio does. So, what do respective retirees from each State receive for their contributions upon retirement?
Ohio provides a 2.2% annual benefit formula. Nevada provides a 2.5% benefit formula. In Ohio a member must work 35 years and be at least 60 years of age to receive 77% pension benefit. In Nevada a teacher can retire after 33.3 years of service, at any age, for a 83.25% pension benefit.
In Ohio a teacher after a 5 year wait, might receive a simple 2% COLA but subject to adjustment leaving financial security up in the air. Currently, Ohio retired teachers do not have a COLA. In Nevada after a 4 year wait a retiree receives a compounded annual COLA of 2%. In years 7-9 the compounded annual COLA increases to 3% COLA. In years 10-12 the compounded COLA increases to 3.5%. In years 13-14 the COLA is increased to 4%. In years 15-16, the COLA increases to 5%, so long as they haven't exceeded the purchasing power at their point of retirement after factoring in inflation. In Nevada, retirees are grandfathered against changes made to the retirement system to protect their guaranteed benefits.
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Bob Buerkle: Nevada Pension System Invests in Index Funds

Bob Buerkle's speech to STRS Board
September 19, 2019
Who is Steve Edmundson, this 47-year-old investment director of Nevada PERS, whose 1, 3, 5 and 10-year returns have bettered all of the other big public pension systems? Is he a super investor? Is he taking excessive chances? Is he gambling with the Members' Pensions? The answer is NO to these last three questions. Steve is just following the investment protocol that the Nevada Legislature has established. It describes four Asset Allocation areas, along with a range of percentages, that the index funds can be invested in. I am providing a copy of this legislative investment protocol for you.
I guess Nevada took Warren Buffett's advice seriously over a decade ago. Buffett has stated for decades that "pension systems should stop trying to beat the market, which they always fail at over the long term, and just accept what the market delivers. They should use index funds and that way they will not lose a greater percentage than the market in a downturn."
Edmondson works out of a modest office in a one-story building in Carson, City. It was larger than he needed, so he let the room be walled off for other workers. He himself has no co-workers. On his desk is a stapler, a tin cup of paper clips and his business cards. He has a small conference table and 4 chairs. In 2015 his salary was reported in the WSJ as $127,121.75. Market turmoil, volatility, oil prices and elections have no effect on his workday. He does as little as possible on a daily basis. His investment plan is in place and outperforming his peers. Last year Nevada earned an 8.5% return while STRS earned 6.9%. Nevada has grandfathered its retirees and has never eliminated its COLA.
According to CALLAN ASSOCIATES, the STRS Investment Advisors, who also track expenses of numerous other retirement plans, "Nevada's outside management bill is about one-seventh the cost of the average public pension system."
Calpers Spokeswoman Megan White said "Nevada Demonstrates the benefits of reducing the complexity, risk and costs of a portfolio." Nevada has handily outperformed CALPERS returns for all periods over the last decade.
According to Stephen McCourt, co-CEO of the Meketa Investment Group consultants, "The pension world is definitely migrating toward Nevada."
For your additional information, I am also including a copy of the actuary's signature sheet. As you can see, it's Segal Consulting and Kim Nicholl, Senior Vice President and Consulting Actuary for Nevada. Kim Nicholl was also the STRS Senior Consulting Actuary for about 25 years dating back to her employment with Buck Consultants in the early 1990's.
Lastly, in Ohio, if your last workday is June 2nd, your first pension check is paid on July 1st. In Nevada if your last workday is June 2nd, your first pension check would be paid as of June 3rd, which means your pension is paid more like you were paid when you worked. This also means that Nevada Retirees are paid one more check in retirement than our STRS Retirees receive.
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Mike Mulcahy to STRS Board: We need the COLA we were promised! STRS present Management is pathetic!

Mike Mulcahy's speech to STRS Board
September 19, 2019
The Ten-Year Total Investment Return Average is 10.44%.
The 2019 STRS Fiscal Year is Over.
This 10-year average return exceeds our current "Earnings Assumption Rate" of 7.45% by a ridiculous safety margin of 40%, yet no COLA can be paid to our retirees?
In 2017 the STRS Board, pressured by Management and Callan Associates lowered the STRS Earnings Assumption Rate for a second time in recent years, reducing it to 7.45%. The two reductions added over $25 Billion dollars to our projected debt. The explanation for doing this was because Callan projected that STRS would earn only between 6.85% and 7.45% for the next 10 years. THEY WERE WRONG.
Over the past three years since the rate reduction STRS has earned an average 10.25%. That's a ridiculous 40% safety cushion.
Don't tell us that our COLA is unaffordable when it is your actions that are unaffordable. The Board approved high salaries and extreme bonuses for the Investment Department, this Excessively Expensive Building and its garage with its Expensive Paver brick floor, the Heated Sidewalks, the expensive Art Work and Furnishings, That's what's unaffordable!
All of this has been accomplished even though STRS actions were taken to prevent such stock market successes going forward. Those Board policy actions have drastically lowered our potential stock market returns by reducing our Stock investment exposure from the 72% range to only 53%. The majority of this difference has been placed in Alternative Investments, which Callan reported to have returned less than 5% for the past six or seven years!
As an example, for the first month of FY 2019-20, STRS earned 3% while the Dow earned 5%. That's 66% more than STRS earned.
Getting out of the game when the Stock Market has extreme losses is exactly the wrong thing to do. This is a well-known Truism in the investment world. You would not think that a 100 year-old pension plan like STRS would make such a blunder, but they have.
These STRS mistakes have cost our members dearly! We need the COLA we were promised! STRS present Management is pathetic!
STRS speech September 19, 2019 by E. Michael Mulcahy, STRS Retiree 31 years, Cincinnati Public Schools, Life time member Hamilton County Retired Teachers Association.

Friday, September 20, 2019

Dan MacDonald to STRS Board: STRS, our hen house, is being decimated by the foxes that administrate our plan

Dan MacDonald's speech to STRS Board
September 19, 2019 
Last month Investment Director John Morrow stated that CalSTRS is not doing anything unique, I beg to differ. 
I am Dan MacDonald, veteran and also STRS retiree, 38 years active, plus Executive Director of Local 279-R, NEO AFT retirees, 1,000 members strong. 
CalSTRS has a mature plan just like STRSOH. CalSTRS has gone through the same market volatility as STRS. CalSTRS educators have no Social Security. CalSTRS rate of return was less than STRS’s in FY 2019. CalSTRS, I am sure, has a sensitive and knowledgeable Board just as STRS. 
CalSTRS appears to have the support of its state legislature, perhaps that’s a difference. 
CalSTRS has managed to pay a COLA for the past 43 years, that is a difference. 
CalSTRS has Inflation Protection. This is purchasing power protection which maintains its retirees’ benefits at least at 85% of the retiree’s initial monthly benefit. That’s a BIG DIFFERENCE. 
CalSTRS retirement formula appears to be what STRS had before STRS’s “Pension Reform.” That’s a BIG DIFFERENCE. 
If these last are not unique from STRS, I don’t understand. Perhaps CalSTRS Board chair might be invited to Ohio to explain before our Board, California’s thought process, concerns, and benefits. CalSTRS has a goal of 2046 for full funding, but I’m sure they are also concerned about the next market drop. How can California continue to support its actives and retirees while we can’t? 
STRS, our hen house, is being decimated by the foxes that administrate our plan. While actives and retirees are losing hope of financial safety with the loss of a good benefit formula, COLA, and income protection, OUR employees; in other words, STRS staff, continue gaining merit based salary increases and performance-based incentives. 
Don’t consider placating us with a thirteenth check. We want our COLA back! 
Thank you.

Saturday, August 31, 2019

Recently seen on the OEA Facebook page.....

(Addressed to a member of the Ohio STRS Member Only Forum on Facebook): "Please make sure potential teachers are fully aware that they will be the only state employees required to work 38 years minimum if they get a teaching job after graduation. Scott DiMauro we invite you to address this issue with STRS and state officials." 
[This may have been "filtered" out by now, along with other "irrelevant" comments. Disclaimer also posted with the comments that were not "filtered" out: "Most Relevant is selected, so some comments may have been filtered out"]

Tuesday, August 20, 2019

Ryan L. Holderman
A dedicated founding member of CORE (Concerned Ohio Retired Educators), Ryan served as its Secretary and Treasurer. His unflagging commitment to his responsibilities and his keen sense of fairness made him a valued leader for Ohio's retired educators. Many will also remember his ready smile and his beautiful singing voice. He will be greatly missed by his many friends in education.

Robin Rayfield to STRS Board: The lack of "shared sacrifice" is difficult for retirees to understand when they have lost a promised benefit

STRS comments August 15, 2019 
Robin Rayfield, ORTA Executive Director
Greetings STRS Board of Trustees and Staff. My name is Robin Rayfield and I represent the Ohio Retired Teachers Association. I am a STRS beneficiary, having retired in 2011 after 30+ years of service.
As you may recall, in my comments to the STRS Board of Trustees in June, I commended the board for its decision to revise the funding policy at STRS to consider benefit enhancements at the 85% funding level. I also urged the board to consider ‘ad hoc’ benefit enhancements as the STRS retirement system is restored to a healthy funding level. I hope that the leadership at STRS, along with the trustees, are exploring ad hoc benefit enhancement, especially for the retirees in most need of assistance. 
Over the last few months I have visited several local chapters of ORTA and attempted to provide information regarding the pension system, with a focus on the loss of COLA. As trustees you are very familiar with the health of our system, but for many retirees, it is difficult to understand the changes at STRS that resulted in the loss of a promised benefit.
What is more difficult for retirees to understand (and for actives that continue to fund our system) is the lack of ‘shared sacrifice’ on the part of STRS employees. The recent salary increases, and enrichment of the performance-based incentives has created a lack of trust and confidence in the pension system. Speaking from experience as a teacher and as an administrator I can say that this mistrust and angst are common when others in the system are not feeling the pinch of unfavorable economic conditions.
I am convinced that the Board of Trustees for STRS does want all STRS members, active and retired to have confidence in the STRS system and to trust STRS with their retirements. I am concerned that the actions of the STRS Board of Trustees regarding salary increases and performance-based incentives will have the opposite effect regarding the confidence of STRS members.

Saturday, August 17, 2019

Bob Buerkle to STRS Board: Why do retirees continue to be denied a COLA?

Bob Buerkle's speech to STRS Board
August 15, 2019

5 STRS Board Actions that Continue to Hurt Retirees

STRS missed the payroll growth assumption.  The 3% figure they had the actuary use missed the actual 4% growth rate by 25%, making the liability of our pension system look larger than it really is.  

The low inflationary period we have been in will not last forever.  The average inflation rate for the past century is a compounded rate of just over 3%. STRS Retirees could suffer greatly in the future because of this action. 

Retirees have had their COLA reduced to 0% by STRS actions. The STRS COLA was never compounded.  ORC 3307.67 says that STRS “SHALL” pay a 2% “Simple” COLA annually. This change in Ohio Revised Code has cut another third from the original benefit that was promised during your career and up through the COLA change of 2013. Meanwhile, massive bonuses, one over $400,000, are still paid to STRS Employees.

STRS lowered the Earnings Assumption Rate to 7.45%, which is about 3% less than our actual returns of 10.25% since the change was implemented 3 years ago.  It is also over 3% less than the average STRS returns for the last 10 years.

Finally, STRS investment portfolio return results, could have been as much as 30% higher by simply investing more in the same equities, all because the STRS chose to reduce their “Stock Exposure” from 73% down to just 51%.  (73% – 30% = 51%)  Was this done to slow our recovery and justify STRS actions?                           

Even with these policy changes, STRS has just completed another Fiscal Year and the results show that the ten-year investment return average is now 10.61%.  That is 315 basis points more than Callan Associates, the STRS investment advisers, have projected they would earn on the total portfolio. 

The Question is, why do retirees continue to be denied a COLA?

Suzanne Laird to STRS Board: Can you spell "breach of contract"?

Suzanne Laird's speech to STRS Board
August 15, 2019

My name is Suzanne Laird. I retired in June, 2013, with 30 years experience and have been denied my full COLA for the past 5 years.

Good Morning, members of MY Board, and welcome to a new school year! I'm sorry to inform you, but you've been retained due to inadequate AYP scores. What's AYP? Anyone? (Please don't ask Betsy DeVos for the correct answer.)

In the interest of No Board Member Left Behind, I'll help you with the answer:  AYP stands for Adequate Yearly Progress. 

Grade yourselves on this one: how well did you do last year? Did you really listen when educators took the time to speak to you about the impact of the increased number of years needed before retirement or the loss of the COLA after retirement?

I learned a lot from my students over 30 years; all we ask, every month, is that you humble yourselves and listen. 

There's always one bright star in every class: last year, we witnessed a glimmer of hope as one of you chose to question the data, question the budget, question the manipulation of facts. Let us hope that Board member's brave example sets the tone for the upcoming year.

Did you do your required reading over the summer? The one titled, United States District Court Class Action Lawsuit? I hope you took notes, because there's a big test coming…….

Can anyone here spell "breach of contract"?

Dan MacDonald to STRS Board: Active and retired teachers deserve purchasing power protection

Dan MacDonald's speech to STRS Board
August 15, 2019

CalSTRS went from 109% funded to 63% was an article emailed by Chair Stein in early July. I am Dan MacDonald, an STRS retiree with 38 years with the CH-UH City Schools District. I am Executive Director of Local 279-R and am here representing over 1,000 279-R retirees. 
Stein commented: 
“A brief case study on why you want your pension system funded at least 100%. 
“Most novice critics of STRS Ohio’s funding policies ignore how shifts in the economy, natural maturation of the plan, and ‘optimistic’ risk management can endanger pensions at funding levels that may have been acceptable in the past. 
“Notice that even increasing state contributions were not enough to save CalSTRS from cyclical economic downturns and a lower ratio of active teachers to retirees (plan maturity). I estimate that CalSTRS went from a ~2% probability of a catastrophic funding event in 2000 to a 60% probability in 2017. Without the high funding going into 2001, CalSTRS risk of failure would have been near 100% after the 2008 downturn – base pensions would certainly have been reduced or possibly eliminated. CalSTRS educators also have no Social Security.” 
After reading the article I proceeded to Cal’s webpage and explored. In 2018-19 Cal had a 6.8% ROR. Looking at benefits, an active is vested in 5 years. The final pension benefit is determined by service credit times an age factor times a benefit percentage. An active can retire after 30 years but an age factor enters. Teaching to age 60 [and under a new formula 62], is set at 2% but will go up to 2.4 percent if one stays to age 65. A FA is determined by the best 36 months; our plan is 60 months. Added to their benefit is Inflation Protection. Your retirement benefit is protected against rising prices in two ways: 1 starting September 1 after the first anniversary of your retirement date, your benefit increases automatically each year by 2 percent of your initial benefit. 2 If inflation erodes the purchasing power of your retirement benefit to less than 85 percent of your initial monthly benefit, you’ll receive an additional quarterly payment, subject to the availability of funds set aside for purchasing power protection. After January 1, 2014 the California legislature guaranteed the COLA of 2%; those retiring before that date are not guaranteed a COLA but it has been paid for 43 consecutive years. 
My point? CalSTRS has a 2046 projection of being fully funded and is still functioning and taking care of its actives and retirees. 
Ohio actives deserve purchasing power protection, as do retirees. We want our COLA back and a better benefits determination for actives.

Susan Brannan to STRS Board: You should be cutting expenses!

Susan Brannan's speech to STRS Board
August 15, 2019
Board Members, Retirees, Active Teachers: 
My name is Susan Brannan. I retired in 1995 with 30 years of service. Receiving a COLA has had a positive impact on my financial well-being. The future is indeed bleak! 
So, what do we do when there has been no COLA for the 3rd straight year & no prospect of receiving one for the next 6 – 7 years? We CUT EXPENSES. This Board should CUT EXPENSES. 
Let's review STRS expenses as reported in the Fiscal 2018 Comprehensive Financial Report. 
The 3 categories are: Administrative Expenses of $65.7 million, Internal Investment Expenses of $42 million, & External Asset Management Fees totaling $218.3 million. (Schedules are attached) The Board patted themselves on the back in the July Newsletter for ranking 4th in a peer group of the 17 largest U.S. Public Pension Funds for having the 4th lowest investment costs. Perhaps these costs are too high in ALL Public Pension Funds. It was reported by STRS that this 4th place ranking was due to using internal investment managers for about 70% of the assets. Internal expenses are 1/5th of the External Fees of 218.3 million. Internal expenses include: Personnel salaries, Professional & Technical Services, printing & supplies, Staff Education, Memberships, etc. Looking specifically at the asset class Alternative Investments (only 15.5% of all assets) external management fees of $152.2 million were paid to 116 different companies. The external fee figure, $218.3 million is double the amount spent on all Administrative & all Internal Investment Expenses. 
Perhaps the following suggested changes can be implemented in order to pay a COLA & also meet future inflationary pressures: 
Cut all expenses by 5-10%. Decrease the 57 Stock Brokerage Companies now used, as well as the 116 Alternative Investment Groups. Negotiate lower external management fee schedules. Show “good faith” to retirees & actives by not increasing employee wages or paying bonuses. Review the operational costs of this facility. Does this building meet STRS needs going forward for the next 2-3 decades?

Wednesday, July 31, 2019

Tennessee pension fund investments in marijuana company generates smoke

"Interesting! STRS investment department would never be this creative."
"Who knows."
"From the dismal track record, I seriously doubt it."

Thursday, July 25, 2019

NEA in trouble?

Excerpts from The Teachers Union Secession Crisis
By Keith J. Williams
Wall Street Journal
July 23, 2019
"The National Education Association, America's oldest and largest teachers union, faces a revolt from its member unions. In the past five years at least 11 local teachers unions have departed from the NEA and its state affiliates. In response, the NEA recently passed two bylaws to impose roadblocks and crushing penalties on locals seeking to leave the national body." 
"Most teachers I know value their local unions, but many are fed up with the bureaucratic, hyperpolitical and remote NEA."
The entire article can probably be viewed at your local library.
~    ~    ~    ~    ~
"Wonder how many went over to the AFT?"
"If they knew what was going on they would (and should ) have crossed over long ago!"
"When we switched to the AFT OFT the NEA and OEA sued our union and its executive committee. Since that time, I’ve held the conviction that the NEA And OEA can go pound rocks. I will NEVER trust them... ever."
"OEA is complicit through their silence and lack of action regarding retirement age, years of service, and COLA. I’m calling them out on everything they post on social media and encourage others to do the same. I don’t care what they post, I always respond with “what are you doing about our retirement age and COLA?”
"Long overdue! Best news regarding the NEA, when I first joined the local teachers union it was required to belong to the OEA and the NEA!"
"Sad, considering what a great organization the NEA used to be."
"They just want our money. Never did anything for us as a union."
"Like all big advocacy groups in DC, they have lost their way and become pawns in the game. I feel the AFT is a far superior organization that still accomplishes things rather than collecting money to fatten the pockets of its executives."
"Whatever your feelings are about unions, all of this will do little if anything to help our cause. It certainly hasn't made any difference with the OEA-endorsed members on the STRS Board. I am not surprised."
"The NEA and state organizations have not been "on top" of teacher needs and concerns for years. It has all been talk and no real action. It is time to break up the union."
"I agree. We peasants have thought that for years! If these organizations can’t be 100% in support of those that pay their salary, I see no need to give them one red cent. OEA should be at every STRS meeting addressing this board and advocating on behalf of active and retirees."
"CFT, OFT, and AFT doing a great job for us!" 
"What does this have to do with our COLA?"
"There are some frustrations that the OEA-endorsed STRS Board members have not acted in our best interest and that OEA has silently sat in the sidelines as retirement benefits have been changed for active teachers and retirees."
Larry KehresMount Union Collge
Division III
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