Tom Curtis on 'sabbatical'

July 28, 2006

For those who are wondering about Tom Curtis, I talked to him earlier this week, and he and his family are just fine. He is also very swamped, trying to take care of projects he had been putting off for the past few years. Besides being involved with building a pole building (which I believe is almost finished now), he's been busy maintaining three properties -- his own, plus two others, including the house in Alliance that he grew up in, and where my three sisters and I babysat Tom and his brother many years ago (@ a whopping $0.25 per hour). Just trying to keep up with the mowing alone has been a killer this summer, with all the rain they've had. I believe he's planning to sell off some of the property, once he gets the houses emptied (into his pole building).

Tom wants to fix his computer and get back online to all of us, but hasn't been able to find a good block of time to do it yet. Actually, I think his wife Linda is thrilled, as they have some semblance of a life and time to enjoy family again. It probably wouldn't break her heart if he never got it running again, but that won't happen. I think Tom was past due for a break for a number of reasons, but he is keeping up as he can with what's going on. He'll be back in the arena again one of these days. Meanwhile, this is an ideal time for others to come forth and shoulder some of the load that a relative few have been carrying for a long time. CORE needs help from you, and you, and you. If you want to help Tom and others, stepping up your involvement is the best thing you can possibly do. CORE needs numbers!

Kathie Bracy

FLASHBACK -- 3 YEARS AGO - Herbie loses the PT Cruiser but gets the 'pink slip' + a cool half million

Dennis Leone, the Chillicothe superintendent who questioned STRS spending, said “nothing changes the work that needs to be done. The dollar amount was inappropriate. The board brought this on themselves.”

Canton Repository, August 6, 2003

STRS chief has contract bought out for $550,000

By Paul E. Kostyu

Copley Columbus Bureau chief

Columbus -- Under pressure from its members, the board of the State Teachers Retirement System bought out the contract of Executive Director Herbert L. Dyer for $550,000.

The representatives of state Auditor Betty Montgomery, Attorney General Jim Petro and Superintendent of Public Instruction Susan Tave Zelman balked Tuesday at the price tag and voted against the package. Dyer will remain an STRS employee until Feb. 29, 2004, but he will not have an office, and he must return the company-owned car and credit card he was using.

Dyer’s contract was last renewed April 1, 2002, and was good through June 30, 2005. His base salary this year was $266,810.

All eight board members agreed that Dyer had to go.

Dyer’s last day was Tuesday. He was immediately replaced by Damon Asbury, 60, who Dyer hired in July 2000 as deputy executive director for administration. Asbury was the superintendent of the Worthington City Schools in Central Ohio from 1991-2000.

Asbury and the pension fund’s three other deputy directors were present when the board acted after a three-hour closed meeting. It was the third such meeting used to discuss how to end Dyer’s contract.

Stephen A. Mitchell, the deputy executive director for investments and the only person other than Dyer who has a contract, refused to comment after the meeting.

Asbury said he has not discussed a contract with the board.

John Patterson, the board’s attorney and an assistant attorney general, said the settlement should prevent any lawsuit from being filed.

Under a barrage of questions from reporters, Deborah Scott, chairwoman of the board, left the meeting in tears. “It’s not over,” she said. “There are other things we need to do.”

Those include restoring the trust of the fund’s 413,219 members, according to Scott and Asbury.

Asbury said his immediate priorities include controlling expenditures, changing travel policies, developing tougher guidelines for special event costs and modifying compensation.

He said STRS would not pay for a going-away party for Dyer, though he did not rule out such a function that was “self-pay.”

Dyer was not present at the meeting, but issued a statement through STRS saying it was an honor “to serve Ohio’s teachers.”

Dyer will turn 65 prior to the settlement end date, he noted, and said “this time in Ohio capped a long career in retirement plan design and administration.”

Gerald B. Chattman, Dyer’s Cleveland attorney, could not be reached for comment.

Eric Hardgrove, a spokesman for Montgomery, said she was unhappy with the buyout.

“She would have felt better if the board just removed Mr. Dyer and take the compensation battle to court,” Hardgrove said.

He said the board’s decision did not serve the interests of members.

Dennis Leone, the Chillicothe superintendent who questioned STRS spending, said “nothing changes the work that needs to be done. The dollar amount was inappropriate. The board brought this on themselves.”

“It seems to be a golden parachute,” said Sen. Kirk Schuring, R-Jackson Township, a leading critic of Dyer. “It’s a shame that kind of money has to be spent to get out of a contract for someone who misled the system.”

“I want that $550,000 to go to the health-care system,” said Susan Jacoby, a retired Canton teacher. “I want Herb to give it back.”

She said Dyer’s departure will have no impact on a statewide rally planned for Aug. 15 at the Statehouse — the day of the board’s next monthly meeting.

When Dyer began at STRS in January 1993, the pension fund was $26.3 billion. It’s now $47.2 billion.

Dyer was the seventh executive director in the fund’s 83-year history. He was the second to come from outside the system. Scott said a consultant will be hired to find his replacement. She expects the process to take six to eight months.

Hardgrove said Montgomery does not want Asbury to be a candidate for Dyer’s permanent replacement. Asbury said he had not decided whether to apply for the job.

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

The terms of Herbert Dyer’s $550,000 buyout package includes:

• $153,392 for salary and retirement contributions

• $70,009 for 72 days of unused vacation

• $164,327 for 218 days of unused sick leave

• $162,272 lump-sum payment on Feb. 29, 2004.

Damon's reply to an editorial & a "PROACTIVE APPROACH!"

2 [²pro- + reactive] : acting in anticipation of future problems, needs, or changes

Damon: "Our retirement board has taken a proactive approach to address retiree health care coverage for Ohio’s public educators and looks forward to continued and constructive dialogue with STRS Ohio members and members of the Ohio Legislature in the months ahead."

What proactive approach? If "our retirement board" had taken a "proactive approach" when OPERS took a genuine "proactive approach" - we wouldn't be in the expensive healthcare premiums situation that we face today. Damon, we are taking a reactive approach! ~ John Curry

Canton Repository, Aug. 4, 2006

STRS board is looking out for interests of retirement system’s members I am writing in response to an item in Michael Hanke’s July 24 column, “Retirement system board shouldn’t pay double dippers’ insurance.” It addressed the issue of school systems that rehire retired educators who are eligible to get health care coverage through the State Teachers Retirement System of Ohio. Mr. Hanke concluded: “The State Teachers Retirement System board has the authority to change this, but since some of the board is comprised of active teachers who more or less are near retirement, you can see how they might not want to change.” Mr. Hanke rightly points out that this is a controversial issue. However, the suggestion that the members of the board are voting only in their self-interest is unwarranted and misleading. The issue of health care for re-employed retirees is continuing to be evaluated by the retirement board as well as by the Ohio Legislature, as is the bigger issue of ensuring health care coverage well into the future for thousands of current and future retired and disabled educators and their families. There is no basis to imply that individual board members are looking out only for themselves. Our retirement board has taken a proactive approach to address retiree health care coverage for Ohio’s public educators and looks forward to continued and constructive dialogue with STRS Ohio members and members of the Ohio Legislature in the months ahead. If Repository readers would like to keep abreast of the discussions, they are encouraged to visit the STRS Ohio Web site at: www.strsoh.org DAMON F. ASBURY, WESTERVILLE EXECUTIVE DIRECTOR, STATE TEACHERS RETIREMENT SYSTEM

FLASHBACK, 3 YEARS AGO: Could this involve some more of the Dennis Leone-type logic that -- to some -- was "difficult to follow"?

Note from John: Since Dr. Leone has brought many of the below perks into question -- STRS has hatcheted many of them. A little legislative grousing has also helped. Meanwhile, hop in the PT Cruiser and take a tour! A word of consolation -- Herbie "left Dodge" before the PT Cruiser left the garage!

_______

STRS is tops in employee perks Canton Repository, July 31, 2003 By PAUL E. KOSTYU Copley Columbus Bureau chief COLUMBUS — Ohio has five public retirement funds. The State Teachers Retirement System is not the largest in investment portfolio, nor in members. But it outstrips all others in the number of employees and the credit cards and cars they get. The teachers system owns 16 vehicles, including two Dodge Durango SUVs costing about $34,000 each. Eight of the vehicles are assigned to executives. Five of those executives can drive them on personal trips. In fact, so can their families. The system also pays the insurance on the fleet, which is valued at $428,101 and includes 10 vans, a truck, two sedans, a wagon and the Durangos. Another expense for the state system is 50 American Express credit cards distributed to employees and board members, and 20 BP gas cards. “They don’t need to exist in that magnitude,” said Rep. Michelle G. Schneider, R-Cincinnati, a critic of the system’s spending. The teachers fund guidelines say that the vehicles assigned to Executive Director Herbert Dyer and his four deputies can be used “for both business and personal use,” though the latter is “considered as taxable income” to the employee and must be reported to the Internal Revenue Service and Ohio Department of Taxation. Any family member with a driver’s license can use the vehicles as long as the employee is in it or, “is about to be picked up or has just been dropped off.” In other words, an employee’s son can take the vehicle and his friends on a trip as long as he drops off dad or mom at work on the way. No other pension fund has that policy. In fact, none of the directors of the state’s four other funds use a company car. But the Ohio Police and Fireman’s Pension Fund, which employs 180 people, allows some personal spending on American Express cards it distributes. Thirty-two employees and board members have the cards, at a cost of $50 each. The police fund also maintains three cards for its purchasing department, five corporate AT&T calling cards (though four are locked in a safe), and three corporate Sam’s Club cards. The fund has one vehicle, a 1999 Ford Windstar van, used to carry supplies and mail. Laurie Hacking, executive director of the Public Employees Retirement System, the state’s largest in terms of members and portfolio, has no vehicle assigned to her. And none of that fund’s fleet of seven vans and five cars can be used for personal use. Hacking said vehicles must be reserved in advance for pension fund-related trips. Gas credit cards are checked out with a vehicle and mileage must be recorded. Hacking uses her own car and submits mileage for reimbursement for fund-related trips. The fund, however, has 60 cards from three gas companies, a number Hacking said is high and “being looked at.” As for credit cards, the Public Employees Retirement System issues MasterCards to 21 people. There is no annual fee. Hacking said the number of cards will be reduced because Bank One now will allow cards to be issued to departments instead of individuals. “It will make cleaner record keeping,” said Hacking, who has no corporate card. “We don’t want as many cards out there.” Richard Curtis, executive director of the Highway Patrol Retirement System, the state’s smallest, also uses his personal car for fund business. There are no gas credit cards. “There is no practical value in having a (corporate) car,” said Curtis, who drives about 10 miles one way to work each day. “There is less expense and less overhead for maintenance and insurance.” His pension fund distributes eight Visa credit cards obtained through the Highway Patrol Credit Union, which has no annual fee. One card is assigned to Curtis and each of the seven board members in their name with a tracking number. Curtis said the card holders are billed individually for their purchases and are reimbursed if proper receipts are submitted. The same policy is used at the teacher’s retirement system, according to Robert A. Slater, deputy executive director of finance. But the teachers system has an exception: board members. The only board members without fund credit cards are the representatives of Attorney General Jim Petro and Auditor Betty Montgomery. But Steven Puckett, who joined the board in January to represent Ohio Department of Education Superintendent Susan Tave Zelman, has one. He’s used it twice for a trip to Milwaukee to attend training seminars. “So often using a personal card, the reimbursement lag time is extensive,” said J.C. Benton, a spokesman for Zelman. “He doesn’t travel anywhere else with it or take people out to lunch or dinner.” The American Express cards are given to teachers fund employees “who travel frequently as part of their responsibilities or who make local purchases,” Slater said. The cards cannot be used for personal purchases. The monthly statements go to the employees’ home addresses. Cards go to a range of employees including administrative assistants, portfolio managers, counselors and real estate buyers. Executive Director Herbert L. Dyer turned down an American Express card, though he has a BP card, said spokeswoman Laura Ecklar. Dyer’s executive assistant Eileen Boles has an American Express card. Dyer uses his personal credit card and submits receipts for reimbursement. Schneider said she was aghast at the number of STRS vehicles and credit cards. “Every week there’s a new abuse,” she said. Letting “a whole family drive” an STRS car “is ludicrous. All of this going to have to change.” Schneider owns and operates a skilled nursing facility and a home health-care agency with 350 employees. She said they use their own cars and credit cards for business trips. “There is very little abuse, if any, if you do it that way,” she said. Another critic, Sen. Kirk Schuring, R-Jackson Township, said it is not uncommon for business executives to have corporate cars and credit cards. But “given the extravagant past behavior of (STRS), it’s important ... there’s not abuse of the perks,” he said. You can reach Columbus Bureau Chief Paul E. Kostyu at (614) 222-8901 or e-mail: paul.kostyu@cantonrep.com Dyer OK’d board’s own $1,037 restaurant tab One example of State Teachers Retirement system spending. An expense report Executive Director Herbert L. Dyer submitted on March 18, 2002, for a 15-person meal at a Columbus restaurant showed a $1,037 bill for a “board dinner with deputies after committee meeting.” Dyer signed the report twice — once as the person submitting the expense and a second time approving its payment. Approving one’s own expenditures and its circumstances are items that probably would be reviewed in the course of an audit, said Eric Hardgrove, a spokesman for State Auditor Betty Montgomery. The Dyer bill, minus a $165 tip, meant that each person spent an average of $58 for their meal. The receipt did not indicate whether alcohol was part of the tab. Even though every agency is set up differently, Hardgrove said, there must be a system of checks and balances in handling expenses. “All significant transactions need to be scrutinized,” he said. — Paul E. Kostyu Pension funds Ohio has five public retirement pension funds. In terms of porfolios and membership, the Public Employees Retirement System is biggest. In terms of employees, staff credit cards and staff vehicles, the State Teachers Retirement System is the largest. State Teachers Retirement System Portfolio $47.2 billion Employees 659 full time, 30 part time or interns Membership 413,219 Vehicles 16 Corporate Card American Express Number 50 Total Annual Fee $1,750 Gas Card BP Number 20 Public Employees Retirement System Portfolio $52 billion Employees 545 Membership 797,232 Vehicles 12 Corporate Card MasterCard Number 21 Total Annual Fee None Gas Card Shell, BP, Sunoco Number 60 Highway Patrol Retirement System Portfolio $554 million Employees 9 Membership 2,800 Vehicles None Corporate Card Visa Number 8 Total Annual Fee None Gas Card None Number None School Employees Retirement System Portfolio $7.2 billion Employees 164 Membership 180,000 Vehicles 5 Corporate Card American Express and VISA Number 9 and 3 Total Annual Fee $900 Gas Card BP Number 8 Police and Firemen’s Disablity and Pension Fund Portfolio $7.8 billion Employees 180 full time, 4 part time Membership 52,000 Vehicles 1 Corporate Card American Express Number 35 Total Annual Fee $1,750 Gas Card BP Number 2 Sources: Ohio’s five public pension funds — Paul E. Kostyu STRS credit cards The State Teachers Retirement System has issued 50 credit cards and 20 gasoline cards to staff and board members. The rules for the cards are: Corporate Credit Card Eligibility 1. Take at least three trips per year, spend $500 yearly on local meals and-or make purchases to meet departmental business needs. 2. Satisfactory credit history 3. Annual review to determine continued necessity. Use and Responsibility 1. Lodging, car rental, meals, organizations and business purchases, board uses and airline travel. 2. Personal use is prohibited and “will result in cancellation of card privileges.” Abuse will be noted in employee’s personnel file and made part of next annual review. 3. Annual fees are reimbursable. 4. Receipts required for expenditures over $15. 5. Reimbursement will occur within 48 hours of submitting approved expense report. 6. Monthly invoices are sent to employee’s home address. 7. Invoiced amount must be paid within 10 days. 8. Overdue accounts not paid within five days of notification could result in cancellation of credit card, payroll deduction for personal expenses and disciplinary action. Source: State Teachers Retirement System — Paul E. Kostyu State Teachers Retirement System staff vehicles The State Teachers Retirement System has 16 vehicles assigned to staff. Here are the vehicles, purchase prices and staffers they’re assigned to. 2002 Chrysler LHX Van: $24,833 Sandy Knoesel, deputy executive director, member benefits 2003 Chrysler LX Van: $34,277 member benefits counseling staff 2003 Chrysler PT Cruiser: $24,443 Herbert Dyer, executive director 2004 Chrysler 300M sedan: $30,132 Damon Asbury, deputy executive director, administration 2003 Dodge Caravan: $24,225 member benefits counseling staff 2003 Dodge Caravan: $23,950 member benefits counseling staff 2003 Dodge Caravan: $23,950 member benefits counseling staff 2001 Dodge Durango SLT: $33,650 Greg Taylor, director, information technology service 2002 Dodge Durango SLT: $34,535 Steve Mitchell, deputy executive director, investments 2001 Ford F-150 XLT Truck: $27,550 Greg Ruess, director, building services 1998 Plymouth Voyager van: $23,250 mail center staff 1999 Plymouth Voyager van: $23,825 Fred Williams, director of administrative services 2000 Plymouth Voyager van: $23,250 information technology service staff 2000 Plymouth Voyager van: $24,472 member benefits counseling staff 2000 Plymouth Voyager van: $23,862 member benefits counseling staff 2004 Pontiac Grand Prix: $27,897 Robert Slater, deputy executive director for finance Source: State Teachers Retirement System — Paul E. Kostyu

A letter from Herb Dyer to Dennis Leone, May 22, 2003: Diversionary tactics to avoid addressing the issues in Dennis’ 5/16/03 investigative report

May 22, 2003

Dr. Dennis Leone, Superintendent
Chillicothe City Schools
235 Cherry St.
Chillicothe, OH 45601-2350

Dear Dr. Leone:

We appreciate you sharing your comments with the Retirement Board and myself both in your written paper and in your personal appearances before the board. You invited us to respond to your comments. I have not tried to respond to each item individually. Rather, I would like to provide you with some information that I believe addresses your major concerns regarding the following:

· Retirement Board expenditures;
· Overall administrative costs;
· Salaries and performance incentive awards; and
· Investment losses and expenses.

Please read on to appreciate how I come to different conclusions than you do.

Retirement Board Expenditures

The majority of the Retirement Board consists of six elected individuals – five active teachers and one retired teacher – who have firsthand knowledge of the needs and expectations of STRS Ohio members and benefit recipients. These individuals receive no pay for sitting on the board and are reimbursed only for their expenses. Also at the board table are three ex officio voting members: the auditor of state, the attorney general and the superintendent of public instruction.

The most significant responsibility the board has is to provide fiduciary oversight of STRS Ohio. Upon election, Board members become trustees for an organization that currently issues nearly 2 million benefit payments totaling more than $3 billion in benefits annually. The Board legally administers Chapter 3307 of the Ohio Revised Code and must comply with many sections of the federal tax code. STRS Ohio staff invests for the Board nearly $45 billion on behalf of more than 400,000 active, inactive and retired members in assets that include domestic and international stocks, commercial real estate in the USA and abroad, and a wide array of fixed-income securities.

Recognizing the importance of carrying out this oversight role well, the Ohio Revised Code demands that Board members prepare themselves to perform such responsibilities competently. They do so by undertaking a number of rigorous knowledge development and awareness activities. These development activities include attendance at seminars, workshops and certificate courses offered by entities like The Wharton School at the University of Pennsylvania and Stanford University, as well as meetings and training seminars offered by the National Council on Teacher Retirement, the International Foundation of Employee Benefit Plans, the National Conference on Public Employee Retirement Systems and Board-appointed consultants. These tailored activities by universities and national and international educate and enlighten public fund trustees across America and are not offered locally in Ohio. A board member must travel to and stay in the cities where they are to benefit from them.

Overall Administrative Costs

The goal of STRS Ohio is to provide outstanding service to members as efficiently and effectively as possible. These services for 400,000 members include a telephone call center that handles more than 325 calls per year; many thousands of one-on-one counseling sessions either in Columbus or at other locations around the state; educational workshops to help members prepare for a financially secure retirement; an interactive Web site with password-protected personal data; print communications that provide accurate and up-to-the-date information about benefits, services, investments and administrative costs; and assistance to 940 contributing employees around Ohio. Survey after survey shows that STRS Ohio members and benefit recipients are getting and are extremely satisfied with the service levels provided by the system.

The recently adopted 2003-2004 STRS Ohio administrative budget, which covers the period July 1, 2003, through June 30, 2004, is actually 3% less than the current year’s budget. Capital expenditures are also lower. In addition, actual expenditures for the current year are running millions of dollars below budgeted amounts.

Salaries and Performance Incentive Awards

Compensation and Benefits

Current independent studies show that STRS Ohio associates’ total compensation including bonuses falls just above the middle of market rates for comparable positions. Associate benefit costs – as a percentage of gross payroll – are reasonable. STRS Ohio staff benefits comprise 30% of gross payroll, a bit more than federal Bureau of Labor Statistics say is 26% for average state and local governments employees. Facilities where STRS Ohio associates perform their work for teachers are comparable to other mid-town office buildings in Columbus, like Ohio PERS and the Rhodes Office Tower.

The competitive compensation and benefits package provided to STRS Ohio associates contributes to its consistently low staff turnover rate. In 2002, the STRS Ohio turnover rate of 5% was just one-third the industry average of 15%. This helps ensure consistency in service to members and reduced expenses for training.

Performance-Based Incentive Award Program

Nationally recognized Buck Consultants in Chicago conducted a thorough analysis of STRS Ohio’s performance-based incentive award program in 2002. This program rewards associates for work over and above their routine assignments completed during the previous fiscal year. Buck staff found that:
Similar incentive plans are in place at 44-65% of all employers;
The structure of the STRS Ohio plan is consistent with best practices; and
Total cash compensation for eligible associates is competitive with the market.

The performance-based incentive award program, as part of STRS Ohio’s total compensation and benefits program and competitive work environment, help the system attract and retain the type of associates needed to provide accurate and timely benefit payments and highly rated services and to manage billions of dollars in investment assets.

Investment Performance and Expenses

Investment Performance

STRS Ohio has for decades assumed its assets would earn about 8% over long periods of time. As a pension fund, STRS Ohio must invest for the long-term. The average rate of return the system did earn over the decade that ended in 2002 was in fact 8.1%.

I appreciated your kind remarks about the good work you think Steve Mitchell and investment team did during the Nineties. More recently, STRS Ohio is not the only institutional investor that has experienced losses during the past three years. Corporate and public pension plans, insurance companies, money managers and financial institutions alike have been negatively impacted by this unprecedented downturn in the markets, as have millions of Americans’ individual savings plans, such as 401 (k), 457 and 403 (b) plans.

Since 2000, I can’t believe everyone suddenly lost their ability to make good investment decisions. The reality is that the economy is cyclical, with both growth and recessionary periods. That is why Ohio state statutes require the earnings rate assumption for STRS Ohio’s assets stood at $42.4 billion. A few weeks later, the market value of STRS Ohio assets has risen to $45 billion.

Several years of negative returns have hurt all investors. We expect it will take a number of years for the markets to fully recover. In the interim, a steady, long-range focus on investment opportunities, a prudently diversified asset mix and consistently monitored cost controls will allow STRS Ohio to “ride out the storm” of these fluctuations. Promised pensions are being and will be paid when due.

Corporate Misdeeds in the Private Sector

One factor that is complicating the market situation is the extreme acts of corporate misconduct and dishonesty that have occurred in this country. It is difficult to make investment decisions based on corporate financials if the numbers are false. Again, millions of large and small investors alike have lost money in such companies as Enron. In fact, it has been estimated that the losses to public funds from Enron alone approach $1.5 billion.

However, as noted earlier, investment gains and losses cannot be viewed in just quick snapshots. STRS Ohio is now part of a class action suit against Enron, its officers and its auditors filed by the Attorney General of Ohio on behalf of STRS Ohio and OPERS (Ohio Public Employees Retirement System). In this suit, STRS Ohio’s allowable litigation loss is around $56 million. However, if you look at STRS Ohio’s total history of Enron investments (including its predecessor companies Houston Natural Gas and InterNorth), the total investment losses associated with this one investment are reduced to $14 million due to gains on earlier transactions.

STRS Ohio also has aggressively pursued strong reform measures at the national level to protect the integrity of the financial markets, as well as included provisions in its own policies addressing corporate accountability.

Further, some years ago the Retirement Board established a policy for pursuing and maximizing recovery of losses caused by corporate misconduct. STRS Ohio has recovered more than $20 million under this securities fraud litigation policy. STRS Ohio is participating in all of the current lawsuits alleging corporate misdeeds. However, such cases are usually pending in court for several years before conclusion, so it is likely to be some time before the outcome of the current cases can be evaluated.

Investment Expenses

Many public pension plans use “outside” commercial money managers to manage their assets at significant cost. The State Teachers Retirement Board determined 30 years ago that it was more financially prudent to hire its own skilled investment staff to manage the majority of assets (8.5%) in-house. That is why STRS Ohio has a large investment staff. For example, in real estate assets alone, STRS Ohio internal real estate staff manages hundreds of directly owned properties worth billions of dollars. This practice is virtually unique in the public sector and allows us to retain tons of millions of dollars for use by the Board to pay benefits. By way of contrast, other Ohio public retirement systems pay outside firms to manage their holdings in this asset class.

Independent studies have confirmed the cost saving wisdom of the Retirement Board’s decision. Comparison studies conducted by Cost Effectiveness Measurement, Inc., a Toronto-based firm, show that STRS Ohio effectively saved $53.8 million in just calendar year 2001 alone on the assets managed internally instead of using outside firms. That’s an extra $53.8 million still here for teachers, instead of in New York or Boston.

Teachers’ Benefits

As noted earlier, STRS Ohio provides retirement benefits, along with survivor benefits and disability protection, to Ohio’s public educators. In addition, STRS Ohio is one of only about 10 teacher retirement systems out of nearly 80 nationwide that provide any kind of optional health care benefits for its retired members.

Over the past 10 years alone, the amount of assets and the total benefits paid have increased significantly. Benefits (including health care) have increased to more than $3 billion during fiscal year 2003 from $1.3 billion in fiscal year 1993. Presently, STRS Ohio’s monthly net benefit expenditures are about $195 million – about $8 million of which is being spent for benefit increases allowed through legislative actions initiated by the Board in the last five years.

When Ohio law and high investment returns permitted it, the Retirement Board also issued supplemental payments often called “13th checks.” These helped older retirees deal with losses in the purchasing power of their pensions that happened even after payment of annual cost-of-living adjustments. Since the COLA is not a compounded figure, the annual adjustment did not keep up with the dost-of-living in past periods of high inflation. The supplemental payment and other Board-initiated legislatively enacted purchasing power restorative catch-ups have worked to keep the major effects of inflation in check for most pensioners.

It has taken me a lot of words, Dr. Leone, as I thought about how to address your concerns. I accept that you and I may still not agree on how to view these issues. I can tell you, though, that I believe all decisions at STRS Ohio are made with the best interest of our members and retirees foremost in our minds.

Sincerely,

Herbert L. Dyer
Executive Director

C Retirement Board
Laura Eckler [sic], Director, Communications

Calls for Health Insurance by 2012 (from Suddenly Senior)

From John Curry, Aug. 1, 2006
Subject: ??? calls for health insurance for all by 2012 - from Suddenly Senior

Note from John (especially to STRS retirees):

The question marks above (???) were put there by me. I wanted you to think a little bit about what health insurance for STRS retirees will be next year (we'll find out at the August STRS meeting). For a 30 year retiree who wishes to insure him/her self with an STRS PPO plan (80/20), the monthly tab will certainly be over $800 per month. Do you think that those making over 200K per year are really that concerned about the monthly cost of health care premiums for themselves or for those of us retirees who are struggling to eat, pay utilities, buy prescription medicine, gasoline, and heating fuels? They are even happier that they recently received their tax cuts complements of our President and members of his majority in Congress. What's 200K have to do with this? Read on.
_______

Nationalized health care is a concept that is gaining in popularity in the U.S., even though the rest of the industrialized has already seen the light. "Nationalized" Medicare is a concept that has been with us for many decades now although part of it has recently been "privatized" with the addition of Medicare Part D and it's accompanying donut hole - this in an appeasement to Big Pharma for their campaign contributions. With the exception of Part D, most Medicare recipients are happy with their coverage even though some Docs aren't too happy with Medicare's "ceiling" on payments to them with the prohibition that they legally can't charge the additional fees to their patients (sorry, Docs - I just hate to see you cry "poor mouth!"). Some even limit their Medicare practice to a certain set percent of their clientele.

Oh - almost forgot the (???) question marks in the title above. Who was he -- the guy who proposed this idea that has now even been realized as reasonable by more U.S. citizens?

HINT: Well, half (48%) of you sided with him a few years ago - wonder what the results would be today?

Scroll down to see the article. John, a Proud CORE member

----- Original Message ----- From: "Frank Kaiser" To: Sent: Tuesday, August 01, 2006 9:16 AM Subject: [SeniorNews] Kerry calls for health insurance for all by 2012 - from Suddenly Senior>

Kerry calls for health insurance for all by 2012

By Associated Press

Monday, July 31, 2006 - Updated: 10:14 AM EST

BOSTON - Sen. John Kerry on Monday proposed requiring all Americans to have health insurance by 2012, "with the federal government guaranteeing they have the means to afford it."

The Massachusetts Democrat, whose name is figuring prominently in 2008 White House speculation, repeated his 2004 presidential campaign call for expanding the federal Medicaid program to cover children. He also proposes creating a program to cover catastrophic cases so an employer providing insurance doesn't have to pass the cost to his other workers, and; offering Americans the ability to buy into the same insurance program used by federal workers such as members of Congress.

Kerry proposes to pay for the program by repealing tax cuts enacted during the Bush administration that benefit those earning over $200,000 annually. He did not immediately elaborate on how he would enact his insurance mandate.

"One of my biggest regrets is that fear talk trumped the health care walk, and that we are less safe abroad and less healthy at home because of that," said the prepared text of a speech Kerry planned to deliver at midday at Faneuil Hall. The senator has already delivered two other speeches at the Revolutionary War meeting house laying the ground work for a second presidential campaign.

The senator also promoted his health care proposal in a Boston Globe op-ed piece published Monday morning, and during an appearance on Don Imus's national radio program.

In his speech text, Kerry conceded his health care proposal is virtually the same as the program he outlined during his failed campaign. However, he said that continuity was a measure of his commitment to his health care ideals.

"Every day since Election Day, the health care crisis has grown steadily worse," said the remarks. "The president has stuck to his guns - or, more accurately, his empty holster - and done nothing beyond trotting out the conservative hobby horse of health savings accounts."

The senator said his plan will lead to universal coverage by 2012, "but if we're not there by 2012, we will require that all Americans have health insurance, with the federal government guaranteeing they have the means to afford it."

The Republican National Committee, which typically responds to political criticism of the president, said Kerry's critique ignored the prescription drug program enacted by the Bush administration.

"It's unfortunate that John Kerry's bitterness over losing the election clouds his ability to recognize the president's prescription drug plan is providing millions of seniors with more affordable medicine," said RNC spokeswoman Tracey Schmitt.

Whatever his criticism, Kerry faces the reality that the governor of his home state - Republican Mitt Romney, himself a potential 2008 presidential candidate - has not only talked about but enacted a sweeping health care overhaul designed to bring universal coverage to Massachusetts. Last week, Michael Leavitt, secretary of the U.S. Department of Health and Human services, called the program "a model" for the nation.

Romney negotiated the plan with a Democratic Legislature, and in cooperation with Sen. Edward M. Kennedy, D-Mass., Kerry's senior colleague.

Under Romney's plan, which the federal government is assisting with $385 million annually, Medicaid will be expanded for 100,000 people, the government will cover premium costs for another 200,000 who buy private programs, while an additional 200,000 will be required to buy insurance from low-cost policies offered by private companies working in tandem with the government.

Romney signed the bill into law in April on the same Faneuil Hall stage where Kerry planned his remarks.

Lady Educators

From John Curry, Aug. 1, 2006

Subject: Lady Educators

Lady Educators (active and retired) - Labor Day is upon us. Below is a link to a survey re. healthcare and other issues that affect not only you, but all Americans. The results of this survey will be sent to our dear (and some not so dear) politicians in Washington. Maybe with your participation, the "good 'ol boys (and gals)" in D.C. will get the message even before election day!

Yes, this survey is sponsored by the AFL/CIO. Some of you will be thinking (OMG!), but consider that unlike some professional educational organizations, the OFT (affiliated with the A.F. of L.) has concentrated LESS on how to teach Johnny to read and MORE on the working conditions, salary, and health benefits (active and retired) of Johnny's teacher! Please help send the message to politicians on Capitol Hill your true feelings. If you are not a "lady" educator, please forward this on to one who is. John - A Proud CORE member

The message is ready to be sent with the following file or link attachments:
Shortcut to: http://www.aflcio.org/issues/jobseconomy/women/wwsurvey2006.cfm

Poorly Achieving Charters Gaming the System - ODE caught napping!

Charter schools' sponsors become point of concern Dayton Daily News By Scott Elliott Staff Writer 7-30-06 DAYTON — Ohio's charter movement continues to change rapidly, with Dayton leading the way. Statewide about 15 percent of charter schools changed sponsors after just one year of a new sponsoring law, but in Dayton, nearly a quarter of all charters changed sponsors. Those shifts have created concern that poor-performing schools could evade accountability by jumping to new sponsors and the state education department is just now putting in rules to try to prevent it. "We've seen a lot of sponsor-hopping," said Lisa Zellner of the Ohio Federation of Teachers. "Bad schools fear they are going to be shut down, as they should be, leave one sponsor for another hoping their funding won't be interrupted." Todd Hanes, Ohio's executive director for community schools, said sponsor shopping is not allowed. Sponsors overseeing poor schools have an obligation to address the problems. "I don't necessarily see this as a loophole in the law," he said. "First and foremost, good monitoring is an expectation of good sponsorship. Beyond that, schools do move." Charters have newfound mobility after changes to state law last year. The education department now approves sponsors that oversee the schools. Sponsors can be school districts, universities or nonprofit groups and each can manage up to 50 charter schools. The state continues to approve new sponsors — nine since last summer — bringing the number to 67 across Ohio. In Dayton, the biggest change came when four Richard Allen charter schools switched to Kids Count of Dayton, a new sponsor group, from Cincinnati-based St. Aloysius Orphanage. Krista Allen, superintendent overseeing Kids Count's nine schools statewide, said it was founded by the board of directors for the West Park Academy, a Dayton private school. But two other local charters with past academic or management troubles also changed sponsors after one year. Academy of Dayton's contract was not renewed by the Toledo-based Ohio Council of Community Schools for poor academic performance but found a new sponsor in the Cleveland-based Ashe Cultural Center. Rhea Academy, involved in a financial disagreement with the state auditor, also changed to Educational Resource Consultants in Cincinnati from the Columbus-based Buckeye Community Hope Foundation. Hanes said his office will soon launch an evaluation process for sponsors that would keep a school on probation, suspension or termination from changing sponsors. And evaluators will be looking at how sponsors handle low-rated schools. "Without question, the expectation would be to place on probation any school failing to meet the expectations of the sponsor," he said. Sponsors that fail evaluation could see the schools they operate reduced or other sanctions. But one curve ball is that the education department may not have authority over all the sponsors. The state board of education has asked lawmakers to make it clear that it can evaluate sponsors that were operating before House Bill 364 was passed. Now just 18 sponsors are directly accountable to the department, Hanes said. Even so, evaluations will start this fall for 20 sponsors. Zellner said more oversight is needed as the state will spend half a billion dollars for charter schools this school year. "It's good to see them moving forward on these things," she said. "The question is if we are in a situation where it is already too little and too late." Contact this reporter at (937) 225-2485 or selliott@DaytonDailyNews.com.

Mary Ellen Angeletti, Letter to Gov. Taft: Tom Hall for STRS Board

Date: July 30, 2006
To: governor.taft@gov.state.oh.us
Subject: Appointee to STRS

Dear Governor Taft,

Please consider Professor Tom Hall as an appointee for the STRS Board to replace Judith Fisher. Professor Hall came in third in the recent STRS elections with an impressive 13,000 plus votes and was the third most popular candidate. The first and second place candidates won the election and presently sit on the Board. You have received Prof. Hall's resume from others who have written you to recommend him. He is most capable and as a STRS member would certainly hold our interests at heart. Please do consider him as he has the background necessary to be a very effective Board member. He understands investments, accounting, and finance and has written many books about these fields. Most important, his perspective will be from a pension fund point of view rather than a corporate world point of view which was frustrating to Ms. Fisher. She simply did NOT understand the retiree's conservative stance when it came to THEIR funds which had already been misspent. She did not grasp the emotional history of this particular situation, and she did not seem to care or want to understand the perilous situation in which we retirees found ourselves when the misspending facts at STRS became known. Professor Hall understands all of this and will be a sensitive & astute STRS Board member who will follow ORC 3307.15 to the letter. This is the kind of individual we need on the Board. Please do the right thing for Ohio's retired teachers and appoint Professor Hall.

Yours very truly,
Mary Ellen Angeletti, STRS Retiree

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SOS: CORE needs YOU!!! It's YOUR future!!!

From Molly Janczyk, July 31, 2006

CORE MEMBERSHIP: ((ACTIVE AND RETIRED EDUCATORS AND DEPENDENTS)):
*******PLEASE ATTEND AND PLEASE BRING OTHERS WITH YOU! We need to grow membership and involvement and need YOUR help! If you have never attended, please mark at least 9/14/06 on your calendar for the Annual CORE Meeting. This is an important time for us all to help bring the need for proposed legislation for increased contributions to the attention of voters, School Boards, neighbors, and your local legislators. We need YOU to come and share ideas and further CORE's message to your > local areas. We need YOU to bring your local areas thoughts and concerns on issues. We need a REPRESENTATIVE from EVERY county to bring and take back issues > for future campaigns for the STRS Board, legislation for HC, changes and direction for CORE, ideas to increase donations for operations in these areas, and Committees to help distribute the work.
*******PLEASE ASK YOUR AFFECTED FRIENDS AND LOCAL MEMBERS AND EDUCATORS TO JOIN US THIS YEAR ON 9/14 to hear Tom Mooney speak on unification and > decide CORE's future. Please bring interested parties to any meetings possible - esp. 8/17 at > STRS to formulate final thoughts on the upcoming Constitution proposal and pertinent items.
WE NEED YOUR HELP AND YOUR ATTENDANCE!
~~~~~~~~~~~~~~~~~~~~~~~~~
Please Plan to attend the CORE/STRS Meetings in Aug. and Sept. on the 2nd flr of STRS in the Sublett Rm. at 11:45 AM. If you wish lunch, please go > to cafeteria adjacent to Sublett Rm at 11:30 AM so as to be ready for our > 11:45 Meeting. Table will be set up for those wishing lunch in the back of the Sublett Rm. Chairs will be in the front rows.
August brings more discussion on a proposed Constitution and Set of By > Laws for CORE and establishing offices allowing outside organizations to > perceive us as a bonified organization to work on common goals and lto consider > input from CORE as coming from an official source.
This does not in any way preclude personal opinion from a member regarding > a concern. It does put some credence on statements from CORE since they will be approved by membership and overseen by CORE ADV. BOARD.
Please plan to attend to have a say in how this process will occur. While > a Constitution and a Set of By Laws has been proposed, it is for further review in August and specifics as to how to develop a state wide Representation System open for discussion. This is all to make us more efficient and effective. We are all tired from the last few years of elections and hard work. This is an attempt to make our lives easier and attract and utilize more assistance.
This plan is excellent and needs members to get it rolling. Please help > by attending and sharing ideas and tactics.
~~~~~~~~~~~~~~~~~~~~~~
SEPTEMBER 14, 2006 BRINGS OUR ANNUAL CORE MEETING AT STRS!!!!
The Annual Meeting brings OFT President Tom Mooney as our guest speaker. The date was changed so mark 9/14/06 on your calendars if yo have not done so.
This part of the meeting is open and ALL are welcome to hear Tom Mooney > and speak with him.
Following the speaker session, is the CORE Annual Meeting for Membership.
Important points:
1. Please registar on Sept. 14 or email your info now if you have not done so. Registration is needed for organizational reasons. There will be tables for members, for members with information changes > such as new email addresses or mailing addresses or phone numbers, and a table for new members. New members may be asked how they learned of CORE and from whom. This to help > identify unknown individuals' intentions. Of course if you are with known members, or you are known online with CORE, it is obvious. Believe it or not, attempts have been made in the past to infiltrate. All known or verified CORE members will be able to vote on 9/14 on future goals, Constitution, whether to endorse political candidates, etc.
2. Donations are critical to the ongoing efforts of CORE. Without donations, we cannot survive. Contributions help pay for election flyers, postage, at times gas when one travels long distances and frequently, printing, etc. Many of us have > paid numerous times out of our pockets for over 3 years and cannot continue to > do so. Please be as generous as you can with a donation this year. Info > will be provided.
3. Speaker : Introduction by Dave Parshall Tom Mooney: Speech, ques and ans.
4. To be announced: When the STRS Meeting reconvenes, we will either go > to the 6th flr for Public Speak and then return to the 2nd flr for our Annual Meeting, or stay in the Sublett Rm for the Annual Meeting (my choice as > many have to leave early; another choice is to begin the CORE Annual Meeting > with Registration and some agenda items at 10:00AM or earlier and break for Mooney. Whatever is determined will be published).
5. Agenda Items: (SO FAR) - input meeting for direction and focus for CORE annually. -Political Endorsements ? Should CORE make endorsements? -Constitution Approval -Committees for involvement discussion and possible implemention
Both these meetings are most important ones for organization, execution of some new organization, direction and focus. Bring your talents and ideas > , concerns and input.
YOU are CORE! Please participate to ensure CORE's future. We must let nothing undermine us and let nothing interfere with the big picture for CORE. There is nothing more important than retirees who cannot fight for themselves. Everything else pales in the face of their needs.
September is the beginning of a new year for CORE. We all do not have to hold the exact same beliefs, likes or dislikes just as in any > organization. We ALL can work towards helping current and future retirees regardless of all else. Beyond that , it is simply differences. We can all grow with the current times and as issues change, we can change as long as we are within CORE parameters. Otherwise, we are individuals speaking and acting as such.
Change and elections bring hard perspectives and reactions. But they should never affect our common goal of working together for the betterment of retirees. There's room in the world for all of us and we each bring something different to the table. Help comes in many forms and all need recognized for what they do. A > member helping in a far corner of the state may never pay or come to meetings but affect hundreds of voters. Some do best behind the computer, some as > front persons. None are more or less important. Just different which has been the beauty of CORE: people have filled in > when they could as they could depending on their responsibilites and comfort level. If we help, we help.
A New Year! A New Beginning! A New Persepctive.
Thank you! Molly J.

Tom Curtis: Letter to the Canton Repository

July 31, 2006 STRS board needs leadership that will put needs, concerns of members first Recent comments by State Teachers Retirement System Board President Conni Ramser about Dennis Leone, the board member most dedicated to saving the STRS system, are truly pathetic (“Strife leads STRS board member to resign,” July 13). They show her inability to view the importance of the agenda needed to right a sinking retirement system and to keep our pension system intact. What her comments do indicate is her lack of business or financial background. This is utterly ridiculous. The Ohio educational community elected her without any knowledge or willingness to learn about her credentials, or lack thereof. It is obvious the educational community in Ohio does not understand what background is needed for someone to be on the STRS board today. I am a retired teacher, and in my opinion, Ms. Ramser has been totally brainwashed by the Ohio Education Association leadership throughout her only career as a special education teacher. She exemplifies the saying that the apple does not fall far from the tree. For nearly 100 years, most Ohio educators have placed their faith and trust in STRS and OEA concerning their future. For approximately two decades, the leadership of both organizations has not been worthy of that faith and trust. Those leaders were far more concerned about their own financial future than that of their clientele. STRS members are now beginning to find the future of their retirement system to be disastrous. Already, 20 percent have been financially affected by the drastic changes in the health care benefit. Those not experiencing financial concerns to date may start seeing their pensions reduced soon, along with the absence of a health care benefit, because of the unethical leadership in place within these two organizations. Only then will they finally begin to understand what Dr. Leone and John Lazares have been trying to accomplish for four years. THOMAS CURTIS, PLAIN TOWNSHIP

RH Jones: Barbara Sykes is Best for State Auditor

To all:

Absolutely essential to active/retired teachers is that we get Barbara Sykes (D) elected as state auditor. Running against her is Mary Taylor (R) who has the strong financial backing of the state's largest for profit Charter School Entrepreneur, David Brennan. As reported in the Beacon, front of Section B, 07/31/06, Taylor, thanks to Brennan, has twice the campaign dollars as Sykes.

If teachers, or anyone else concerned with public education, vote for Taylor, you can expect a continued downward spiral of your public schools and the STRS.

RHJones, Registered Voter.

Not STRS, but related to your health and the health of your wallet - OR - A tale of two worlds

From John Curry, Sunday, July 30, 2006

Not STRS, but related to your health and the health of your wallet - OR - A tale of two worlds

Note from John:

Now, if you are an educator, retired educator, or a public employee, you probably have or are experiencing the high cost of prescription drugs. You are being squeezed by by an industry and an industry lobby who has had its way with Congress for far too long. We public servants often don't view things from the point of view of those in the pharmaceutical business world and/or investors whose business is to make money off our medical ailments. They like to enrich themselves at our expense, and - it's perfectly legal. It is compounded by the fact that these industries are in bed with the very same institution that purports to regulate them - the FDA. Where does one "draw the line" between a reasonable profit and rape - especially when it involves life-saving and life-sustaining drugs needed by citizens who can't afford them? What can we, as public servants, do about it?

For starters, we can send the message to those who have carried the banner of the pharmacetical manufacturers by their voting patterns in Congress. A good example would be Ohio's two Senators who recently voted against a bill in the Senate which would prohibit U.S. Customs from separating U.S. citizens from thier Canadian purchased Rx when they come back across the U.S. and Canadian border. Mr. Voinovich and Mr. DeWine didn't want to allow you to bring them back - George and Mike were OUTVOTED even by thier fellow Republican Senators on this issue!! The bill passed, but it will probably be "watered-down" when it reaches the House of Representatives. What does this tell you about Voinovich and DeWine? You'll get a chance to give DeWine a vote of confidence/no confidence come November 7. Will you thank him for what he has done?

If you are an investor or a pharmaceutical manufacturer, you probably have or will read the article below which will give you an idea of how well you'll do in the near and not-too-near future with your money or your business. Some of you would be very happy if the prices of your wares doubled in price over night. You certainly wouldn't like to see anything "bother Big Pharma." Heaven forbid that you would be stifled by a requirement from Medicare to cause you to submit bids for your medicines for Medicare Part D Rx like you are forced to do for the Veterans Administration Rx! For your purposes it is much better to operate "in the woods" rather than in the sunshine. (the article below will explain this).

From Forbes.com
Pharmaceuticals
Nagging Doubts For Big Pharma
Matthew Herper, 07.26.06, 6:00 AM ET

After looking at the pharmaceutical industry's second-quarter earnings, some investors might be tempted to see a miracle cure for a sector that has been plagued by competitive pressures and safety and marketing scandals. They should watch out for some nagging symptoms that are still likely to bother Big Pharma.

This quarter's results are certainly impressive, and a very good sign. Pfizer and Merck both boosted their full-year earnings forecasts. Merck and Schering-Plough both beat analyst projections for adjusted earnings by a whopping 8 cents per share on sales of cholesterol drug Vytorin, which they sell together, and separate allergy blockbusters Singular and Nasonex. The sector enters the home stretch of earnings season today and tomorrow as GlaxoSmithKline, Bristol-Myers Squibb and AstraZeneca report.

In the long term, though, there is still plenty that could go wrong.

The drug giants are going through an extremely painful transition. In the last decade, they launched a series of mega-blockbusters, which ensured massive and fast-growing profits. Now, a lot of the earnings are coming from temporary gains--like a good allergy season--and cost controls.

Merck Chief Executive Richard Clark is pleasing Wall Street by promising that he will trim costs and force a new level of efficiency using tools like Six Sigma. Pfizer Chief Executive Hank McKinnell has built a drug company so enormous that it has incredible earnings flexibility even when it cannot promise that sales will rise.

One reason Big Pharma performed so well this quarter: the new Medicare prescription drug benefit, which is enrolling a ton of senior citizens in privately run health plans paid for by the government.

Right now, health maintenance organizations and pharmacy benefit managers are trying to attract as many Medicare patients as they can, says Roopesh Patel, a pharmaceutical analyst at UBS. He says exact numbers are hard to come by, but he believes that more prescriptions are being written for chronic care drugs like blood pressure and cholesterol medicines.

Down the road, this Medicare boost could be a double-edged sword. Once they have enrolled all those new patients, the HMOs and benefit managers will start exerting more price pressure on the drug companies, forcing them to sell more medicines on the cheap. In just a few years, the government could account for about half the money spent on prescription medicines in the U.S., and it may look to lower prices. Patel says he doesn't expect this to happen until 2008.

Making matters worse: By 2011, a quarter of current drug sales in the U.S. will be eaten away by less expensive generic pills as medicines lose patent protection. Between 2007 and 2011, more than 80 medicines are expected to face this fate.

View a slide show of the next five years of patent expirations.

Even biotech drugs, which are synthetic versions of natural proteins, may face copycats.

So far, only one such version, the Omnitrope human growth hormone from Novartis, has reached the market. But doctors can't interchange it for the branded generics. Still, there is gold in biotech copycats. On Monday, Novartis pledged up to $275 million in a deal to make such copycats with Momenta Pharmaceuticals, a small biotech in Cambridge, Mass. The biotech's shares rose 38%. Momenta Senior Vice President Steven Brugger says such copies won't be nearly as cheap, because there will be fewer companies able to make them and create competition and drive down prices. But the threat is still there.

None of this would be a problem if the drug industry had a wealth of new breakthroughs, but even with new potential big sellers like Pfizer's Lyrica, for neuropathic pain, or Merck's Gardasil, a vaccine for a virus that can lead to cervical cancer, it's not clear that new drugs can make up for the ones that will be lost.

Worse, buying new experimental medicines from tiny startups is getting increasingly expensive. For instance, Genentech yesterday offered to pay up to $605 million for rights to co-discover and develop new cancer drugs with a privately held biotech, Inotek Pharmaceuticals.

Even Gardasil, one of the most exciting drug company inventions of recent years, illustrates this trend. Merck revealed during a conference call that it would pay royalties totaling about 25% to other companies, including GlaxoSmithKline and CSL Limited of Australia, on sales of the HPV vaccine.

Big pharma is certainly getting a little more sun these days--but that doesn't mean that it is out of the woods.

30 days hath September, April, June, November, & Ohio's statute of limitations

From John Curry, July 30, 2006

Subject: 30 days hath September, April, June, November, & Ohio's statute of limitations

It will be 30 days until the two year mark of Eugene Norris's departure as a former STRS Board member has expired. In 30 days the statute of limitations (two years) will expire for the Columbus City Prosecutor's Office to file in the Franklin County Municipal Court any ethics charges against former STRS Board member Norris - should charges be warranted.

Keep in mind that the OEC waited until the last second to file against both Sidaway and Chapman.

Below are two articles that are pertinent to this deadline - one from STRS themselves and the second one from Paul Kostyu:

Past STRS Ohio News Items & Reports

Election Results

On May 8, 2004, the ballots for the active teacher seat on the State Teachers Retirement Board were counted at the STRS Ohio offices. Overseeing the ballot count were the tellers designated by each candidate and a representative of the Secretary of State. The results of the election are as follows: John Lazares, 22,625 votes and Eugene E. Norris, 22,351 votes.

The term of office for the winner of this election begins Sept. 1, 2004, and ends Aug. 31, 2008. The State Teachers Retirement Board will receive the report from the Board of Tellers regarding this election at its Friday, May 21, 2004, meeting.

Canton Repository, April 18, 2006

Sidaway unlikely to be last charged BY PAUL E. KOSTYU COPLEY COLUMBUS BUREAU CHIEF COLUMBUS - If your name is Jack H. Chapman, Mike N. Billirakis, Eugene E. Norris, Deborah Scott or Joseph I. Endry, and if you served on the board of the State Teachers Retirement System, and you don’t have an attorney, you haven’t been paying attention. If your name is Stephen Mitchell and you work at STRS as the deputy executive director for investments, you should be talking to an attorney, too. And there might be a few others at the pension fund who should consider getting legal advice. A clear message came from the Franklin County Municipal Court last week. While Hazel A. Sidaway, a former Canton City Schools teacher, was on trial, prosecutors linked her to others on the STRS board and its culture of entitlement. The message: The Ohio Ethics Commission and prosecutors know about your shenanigans, and they’re coming after you, maybe as soon as next month. Sidaway’s two convictions for violating state ethics law were a test of the strength of evidence in a more than two-year probe of corruption at the pension system. Offered a deal similar to that for former Executive Director Herb Dyer, who was convicted on one charge, Sidaway refused. She claimed she had done nothing wrong when accepting four tickets to a Cleveland Indians game and two tickets to a Broadway show. She insisted they were meetings for conducting STRS business. The only people with her in the four box seats 10 rows back from the Indians’ dugout were her family. She and fellow board members attended the Broadway show “Hairspray.” She said they talked business before taking their front-row seats at the Tony-winning musical, during intermission and after the show. At least they didn’t give Ohioans a bad name by talking during the performance. Perhaps the board should be charged with violating Ohio’s open meeting laws for conducting business without notifying the public. “They were not discussing matters appropriate for an executive session,” said Paul Nick, chief investigator for the commission. “Who knows what’s been going on?” Something more troubling, however, became clear at Sidaway’s trial. Based on her own testimony, former in-house STRS attorney Cynthia E. Hvizdos apparently gave Sidaway bad legal advice, and she may have helped cover up the violations once the ethics commission began its investigation. “Cindy Hvizdos agreed to assist in purposely disguising the tickets,” Nick said about her testimony. “She might be liable.” Prior to the trial, Hvizdos offered to help Sidaway, who didn’t disclose that communication with her own attorney. He was caught off-guard and put at legal risk for failure to disclose the communication to prosecutors. Hvizdos retired because she has multiple sclerosis and apparently no longer practices law. So it’s not likely she will face charges or sanctions. Sidaway’s ethics violations may not be the worst. One poorly kept STRS secret concerns a former board member who took his golf clubs on many, if not all, trips he made on behalf of STRS. I’ve always found it difficult to play golf at night. So does that mean this board member was playing hooky from meetings while he was swinging a club? Sidaway was not convicted of illegally accepting meals at high-end Columbus restaurants. Those meetings, too, could have been attempts to avoid the state’s open meetings law because the board’s investment counselor was careful to take only three or four members at a time, not a quorum. If board members were so intent on holding meetings over food, they could have eaten in the STRS cafeteria. Apparently, the food wasn’t good enough, and neither was the show. Reach Copley Columbus Bureau Chief Paul E. Kostyu at 614) 222-8901 or e-mail: paul.kostyu@cantonrep.com