Tom Curtis: Letter to Sen. Schuring

From Tom Curtis, December 9, 2006

Subject: 120806 Sen Schuring, Tom Hall & STRS Unfunded Liability

December 8, 2006

Dear Senator Schuring,

Congratulations on your re-election to the Senate. In my mind, knowing your willingness to work with your constituents is the reason you were re-elected to continue your fine work. Further, I compliment you on your campaign commercials, as they were above board and represented you well.

I am writing to request that you please consider and support others who will be recommending Dr. Thomas Hall to fill the vacated position on the STRS board. According to SB133, The President of the Senate and the Speaker of the House appoint this position. Geoffrey Myers, the former CFO of Ohio Manor Care recently resigned from his appointment. In my opinion, Mr. Myers though very pleasant when we have spoken, was far removed from the level of income garnished by educators and their concerns for the much-needed reductions in spending and staff at the STRS. He was far to supportive of the spending practices that occurred in the past and continue to this date. During a regular board meeting, he recently told Dennis Leone that issues he has brought to the board were a waste of time, such as actually viewing contracts before voting to approve them. We absolutely do not need board members that will rubber-stamp the continuance of the spending practices and management style that Herb Dyer established. Much of it still exists today and is a cancer fails to respond to stakeholder requests. In my opinion, Tom Hall will not support such actions and will represent the membership with far more experience and knowledge in business practices and finance then others that were elected to the board.

Tom Hall is a professor of economics at Miami University. He has a very adequate background in various areas of finance and should prove to be beneficial to the board. Please review his vitae, which follows. Further, Tom is a contributing member to the STRS and understands the many issues that need to be addressed. Senator, our retirement system is at risk. I personally believe the problem can be corrected, but not by doing business as usual.

In closing, because you are a member of the ORSC board, I would like to bring to your attention an issue I have grave concerns about, the STRS unfunded liability. The most recent 2006 STRS valuation report from Buck Consultants indicates that the unfunded liability has been reduced to 47 years, from 55.5 due to the outstanding returns on investments over the past two years. In my opinion, this is incorrect and needs immediate attention. One of the numbers used in figuring the unfunded liability, the percent of payroll increase at 4.5% is far from the correct number. The actual number as I view it from the 10-year history listed on page 43 of that report should be 3.2%. If this is true, the STRS unfunded liability is at infinity and that is very disturbing to me. Would you kindly respond to my request and concerns?

If I could arrange a time to speak with you by phone, I will gladly contact you at you convenience. If you would permit me some time to talk with you about the STRS during the Holidays when you are back home in our area, I would appreciate it. I view our unfunded liability as something to be very worried about. Beginning in 2001, STRS retirees started loosing the benefits they were promised when they retired and this has never stopped. We have lost more ground each and every year, while management continues to justify their poor performance in running an efficient operation.

Sincerely,

Thomas Curtis
North Canton, OH