Dennis Leone to Tom Curtis, August 5, 2007
Subject: FW: 080507 Curtis To Leone, Divestment
Tom -- I agree with you that any decision for a divestment plan is contrary to the spirit of 3307.15. What the Board majority will say, however, is that since the official Board resolution states that our ultimate divestment plan will not compromise the total assets at STRS, this is supposed to make it okay. In other words, even though tons of staff time will be needed to find different investments to make up for divestment changes, the Board majority will tell you that their fiduciary role also has not been compromised because total STRS assets have not be compromised. That’s similar to the philosophy that existed when pension money was spent (in the past) on “team building” – you know, for Kings Island, concerts, baseball games, the Columbus Zoo Light Show, parties, booze, super-expensive dinners, etc. The Board can always find a way to say that their actions (like spending pension money on the private legal fees of staff members) are proper for staff morale or staff retention, etc.
What is difficult for me to accept about the Board’s divestment resolution is that when the decision was made, the Board knew the matter was headed back to a Senate subcommittee for reconsideration and additional discussion. This was stated publicly by Mary Ann Cervantes BEFORE THE VOTE. Did this slow down the Board? No. Full speed ahead. Why? Because the staff wanted a vote to be taken. The whole thing smells bad.
Labels: Dennis Leone, Divestiture, Legal fees, Mary Ann Cervantes, STRS, STRS Board