Dennis Leone to Paul Boyer: STRS Board action today (12/08/05) on proposed final settlement agreement on bonus lawsuit issue

From: Dennis Leone
To: Paul Boyer
Sent: Thursday, December 08, 2005 8:38 PM
Subject: Final Settlement Agreement Vote

Paul -- in answer to your question, here is what happened at the STRS Board meeting today regarding the proposed final settlement agreement on the bonus lawsuit issue:

After there was a motion and second to approve the final settlement agreement (which included a provision that the STRS Board also pay the employees' PERS contribution associated with the bonus checks) I made a substitute (addendum) motion that called for the Board to first pursue legal remedies against Herb Dyer and the Board members who approved the bonuses in 2002 (for fiscal year 2003). I stated my conviction that the bonuses were contrary to the spirit of 3307.15 and the pension fund should not bear the financial responsibility of the settlement that was caused by the misconduct of others. John Lazares seconded my motion.

Board Chair Bob Brown and Vice Chair Connie Ramser then objected to my substitute motion and invoked a seldom used board policy that apparently says that such an amendment cannot be approved unless one-third of the board membership agrees to even vote on the amendment. So, in other words, the first vote was whether at least 4 board members would agree to ALLOW my substitute motion to be voted on. Get it?

The vote was 7-4 against allowing my substitute motion to receive a vote -- but the 4 votes meant that the Board WOULD have to take a formal vote on my substitute motion. The 4 who voted in favor of my motion getting a chance were Lazares, Buser, Chapman and me.

Then my substitute motion failed on a 9-2 vote, with only Lazares and me voting for it. Fisher and Meyers both stated that they considered my language (about the previous Board being in violation of 3307.15) offensive.

When the board voted on the original motion to approve the final settlement agreement, the vote was 7-4, with Lazares, Buser, Ramser and me voting no.

The main reason the 7 voted in favor of the settlement was their concern that STRS would incur additional costs at the appellate court level (with no guarantee of winning) as well as the concern that the employees might succeed in punitive claims as well. My motion was to pursue another option first. I also stated that I disagreed with the conclusions of the Board's legal counsel.

Bob Brown recessed the meeting before I had a chance to make another motion, which was for the Board NOT to pay Jim Petro the $263,000 bill he intends to give us for the legal representation STRS received.

That's what happened.

Dennis Leone

From: Paul Boyer
To: Dennis Leone
Thursday, December 08, 2005 7:49 PM
Subject: vote

Dennis, I assume that you and John were two of the four that voted against the final agreement on the lawsuit. Are you at liberty to tell me who the other two were?

Also, did you try today to make your motion not to pay the attorney general for his lawyer fees or does that come tomorrow?

Whatever your reply, tell me if I can circulate it.

Paul