Janczyk and Curry: words to Judge Reece; child-care center; Kostyu on bonuses; ORC 3307.15

PLAYGROUND. The State Teachers Retirement System headquarters in Columbus includes a child-care center (center) for employees' children. The director of the center, Jodi L. Wells, earned a bonus in part for maintaining "open communication between parents and staff."


From: Molly Janczyk
To: Guy Reece, John Curry
Sent: Sunday, November 06, 2005
Subject: VOTERS ASK: YOUR HONOR: Have you considered this info; Curry letter follows

Judge Reece, Would you be agreeable to workers at your pension system receiving bonuses for simply doing their jobs? STRS felt it had millions of our dollars to be plentiful and easy with it during the market ride and implied an endless bounty to its staff. Does that make it right and if implied promises made with NO cntractual responsibility made, should they be honored when they should never have been made in the first place? Was it the workers' fault? Perhaps not. WAS IT RETIREES' FAULT? MOST CERTAINLY NOT! It is STRS membership contributions and earnings and should never have been promised away for merely doing one's job.

We are the victims; not the staff. They are paid with our money given away with no thought of membership who was forced to save the system with untendable HC increases.

Remember we are the voting public and far outnumbered a handful of STRS staff. We have been devastated and our only recourse for change is to change those who continue to harm us just as we changed the faces of the STRS board in only 2 years overturning incumbants and electing those who represent membership-not staff following ORC:3307.15.

We have achieved pension reform with SB133 which we lobbied hard to enact with language to remove any future board offenders and prohibiting past offenders from ever sitting on the board again due to overspending.

We have forced the arrogant past Exec. Direc. Dyer's removal obtaining the letter on which he wrote back to a retiree that STRS money was theirs to spend as they wish.

We have met with STRS monthly in small committee meetings and with the help of eliciting media and legislators forced changes in spending at STRS resulting in reductions of staff and bonuses and eliminations of credit cards, cars, parties, cutbacks in travel and airfares, subsidies for cafeteria and fitness and lowered subsidies for childcare which is still a sore point for educators who had to pay for their own childcare and expected to pay for STRS staff as well UNKNOWN to us until the past few years.

We promise to remember those who force STRS to follow the ORC:3307.15: to act solely on behalf on membership and beneficiaries. Paying bonuses for doing one's job wrongly promised in any manner THOUGH WITHOUT ANY CONTRACT is against this code and harms membership as it is membership money and membership who is suffering. If I promised YOUR money or its earnings to others for doing their job, WOULD YOU ORDER IT PAID even tough I had no right to do so? This money should be ordered to be used for needy retirees who cannot afford housing or medical treatments and RX's vs. overpaying staff for merely doing their jobs.

Molly Janczyk

From: John Curry
To: Guy Reece
Subject: Your Honor, have you considered this information re. STRS bonuses? (letter follows article)
Date: Sun, 6 Nov 2005

Controversy surrounds STRS's awarding of bonuses

Repository / Stan Myers

PLAYGROUND (photo above). The State Teachers Retirement System headquarters in Columbus includes a child-care center (center) for employees' children. The director of the center, Jodi L. Wells, earned a bonus in part for maintaining "open communication between parents and staff."

By PAUL E. KOSTYU
Copley Columbus Bureau chief
July 13, 2003

COLUMBUS - The people who run the pension system for Ohio's teachers got millions in bonuses for attending workshops, talking to parents and keeping spreadsheets of expenses.

The bonuses are just one of the controversies swirling around spending by the State Teachers Retirement System. Critics blast the payments as an example of excessive spending. The system paid nearly $19 million in bonuses to its investment and non-investment staff from 2000 to 2003. During that same period, health care costs for retired teachers skyrocketed, and the pension fund's portfolio plummeted.

By comparison, the larger Ohio Public Employees Retirement System gives only its investment staff bonuses, and those bonuses totaled just $2.06 million from 2000 through 2002.

The controversy about the teachers system's spending has led nearly 80 percent of Ohio lawmakers and Ohio Auditor Betty Montgomery to call for Executive Director Herbert Dyer to resign. The system's board met for nearly five hours behind closed doors Thursday to talk about "staff performance, compensation and other terms and conditions of employment;" many think the discussion focused on the terms under which Dyer will leave.

Meanwhile, the teachers pension board has temporarily suspended all bonuses as it reconsiders its policy.

Documents from the last full year for which bonuses were paid - the fiscal year that ended in June 2002 - showed at least 42 supervisors reached 100 percent of their bonus goals. Records for another eight employees did not make it clear if goals were met.

Of the 15 who did not meet all their goals, 10 were in the 90 to 96 percent range. For example, Damon Asbury, deputy executive director of administration, reached 96 percent of his goals and got a $49,728 bonus. That was on top of his $148,000 salary.

Shun Koizumi, supervisor of the copy center, was the least successful at reaching planned goals, 60 percent, but that was good enough for a $1,367 bonus tacked onto a $45,580 salary.

According to retirement system officials, the performance-based incentive program was set up so organizational goals could be achieved cost effectively.

"The goals are to expand beyond the associate's regular assignments, representing additional initiatives and increased workload outside the normal scope of responsibility," says one document.
Each employee develops and assigns a weight to his or her own goals. They're approved by the employee's immediate supervisor, the deputy executive director overseeing that department and Dyer.

At the end of the year, the employee reports whether he or she met the goals and by what percentage. That assessment is approved by the same three officers.

Teachers retirement system officials say the program is one reason member satisfaction with their pension system exceeds 95 percent.

What are some of the bonus goals that were above regular assignments and workload?

● Fifteen percent of Jodi L. Wells' goals as director of the system's child care center was to "continue to maintain open communication between parents and staff."

She also was supposed to "stay abreast of latest research dealing with the Information Technology field as it relates to children's use." In other words, she read about Internet filters and talked to parents and staff about them.

Wells also was to "maintain awareness of budget and continue to explore options to increase efficiency." To reach that goal, she created spreadsheets and monitored monthly spending.
All told, Wells achieved 93.8 percent of her goals and got an $8,639 bonus on top of her $61,400 salary.

● Carol Hamilton, supervisor of food services, achieved 100 percent of her goals in 2001-2002 and received a $1,965 bonus. Her goals for 2002-2003 were nearly identical. For example, in both years, four of her six goals were maintaining her dietary manager's certification, performing employee safety training, assuring technical training for the food service staff, and making sure the staff was certified.

● To help earn his $13,462 bonus as the supervisor of business systems analysis, David Donithen participated in "a minimum of three formal activities to enhance technology and/or investments related knowledge." In doing so, he met 20 percent of his incentives for the 2001-2002 fiscal year.
For the fiscal year that ended June 30, Donithen proposed going to two formal activities, counting toward 15 percent of his bonus.

Not reaching the goals has no effect on regular salaries or cost-of-living raises that supervisory staff receive.

According to the system's spokeswoman, Laura Ecklar, any employee who gets a negative annual review or a "needs improvement" notation is not eligible for a bonus.

The number of non-investment employees eligible for bonuses increased from 46 in 2000 to 66 this year.

Retirement system officials and their consultants defended the incentive plan to the Ohio Retirement Study Council last week.

Lawmakers questioned why the STRS bonuses are "so vastly different" than those at the state's four other pension funds.

Deborah Scott, chairwoman of the teachers' board, said the program is based on the advice of consultants, Dyer and staff, who said the bonuses generally follow those at similarly sized pension funds in other states.

But council Chairman Sen. Lynn Wachtmann, R-Napoleon, called the bonuses "extraordinary" and said he was "extremely upset" by "a lot of misjudgment."

"Help me out here," said Rep. John Boccieri, D-New Middletown, addressing Peter Gundy with Buck Consultants, who was hired by the pension fund. "How do you justify bonuses for the copy center supervisor, the day care director and the maintenance supervisor?"

Gundy said his firm did not address incentives for those positions when it advised the board.
Boccieri asked if his firm consulted the retirement system members about the bonus policy.

"No," Gundy responded.

You can reach Copley Columbus Bureau chief Paul E. Kostyu at (614) 222-8901 or e-mail: paul.kostyu@cantonrep.com

John writes:

Judge Reece, the real pain and suffering has and is being experienced by over 100,000 STRS retirees who have now resulted to skipping medications and pill-splitting so as to be able to continue on with their lives and maintain health care insurance which has increased over 600% for this retiree and his spouse - it is now $671 per month for this retiree who spent 30 years educating Ohio's youth. Had I educated Ohio's youth under the your retirement system (OPERS) , this coverage would be a total of $80 per month ($0 for myself and $80 for my spouse).

Mismangement, misspending, bonuses, and an entitlement philosophy by those formerly in leadership roles at STRS has contributed to current retirees' miseries - additional compensation awarded to plaintiffs would only make this situation worse for current and future retirees.
The ORC section 3307.15 (copied below) dictates that STRS funds be used solely in the interest of the participants and beneficiaries of STRS. I ask you to consider this information before granting any additional monitary compensation to the plaintiffs involved in the class action suit against the STRS of Ohio. Thank you for your consideration.

John Curry -- an STRS retiree who educated Ohio's youth for 30 years without a bonus (ORC 3307.15 listed below)

ORC 3307.15. Investment and fiduciary duties of board:

(A) The members of the state teachers retirement board shall be the trustees of the funds created by section 3307.14 of the Revised Code. The board shall have full power to invest the funds. The board and other fiduciaries shall discharge their duties with respect to the funds solely in the interest of the participants and beneficiaries; for the exclusive purpose of providing benefits to participants and their beneficiaries and defraying reasonable expenses of administering the system; with care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with these matters would use in the conduct of an enterprise of a like character and with like aims; and by diversifying the investments of the system so as to minimize the risk of large losses, unless under the circumstances it is clearly prudent not to do so.