Don Gatchell: Board liability for contract problems

From Don Gatchell, October 24, 2006

Subject: Mark Meuser and Board Delegation

Kathie,

Mark Meuser e-mailed recently his interpretation of the STRS Board's fiduciary duties vis-a vis the STRS executive staff. I have one caveat to add to the discussion. My understanding from my duties as a fiduciary and as a past military officer is that one can delegate authority, but never responsibility. Therefore, the STRS Board should review every contract over a certain dollar amount to make sure there are no glaring errors, conflict of interest, misfeasance or malfeasance before they delegate authority to the STRS staff. Won't the Board be liable for major contract problems even if they plead ignorance because they are the elected decision-making body. Isn't that how it works?

Just a thought.........

Don Gatchell

Ross County RTA

Chillicothe OH