Molly Janczyk's take on increased basis points (investment staff)

11/18/05

Insert of my own understanding of the debate re: increased basis pts. that the investment staff must meet: in the investment paragraph below:

Lazares and Leone voted no on this issue: Though they approve the increased basis pts, they question debated issues such as: -need for addt'l staff Damon and some board members felt was in order for STRS to reach its goals with increased basis points -sharper staff (translates to more money needed to pay a 'sharper' staff) to take on the riskier investing in order for STRS to reach its goals with a higher basis point in order to make more money for us. With 26 fewer investment staff than in 2002, STRS has earned higher returns than other like pension systems and Leone felt it needed more substantiation that more staff translating to more costly staff was indeed needed. -since this vote was open to change after reading the upcoming compensation study report STRS paid for, Lazares and Leone questioned WHY vote on 11/17 when the topic was going to be discussed in Dec. anyway.
((ISN'T THIS WHY THEY WANTED THE COMPENSATION STUDY IN THE FIRST PLACE? m.j.))

Additionally, John Lazares commented during the investment portion of 11/17 board meeting:
"I can't believe, we got to this point at STRS and that we have to hire additional investors," expressing his shock upon hearing this statement .
He also wants retirees to know that they will get their pensions (some have asked) even if something catastrophic would occur (it won't) as our pensions have already been set aside for current retirees.