An Update from Dennis Leone re: August, 2007 STRS Board meeting

From Dennis Leone, August 18, 2007
Subject: Update: STRS Board on August 17

Interesting, wasn't it (as the Canton Repository accurately reported), that Puckett accused me of "badgering" on August 16, seconds after I expressed my concern over the fact that the STRS staff had NOT given full information to the Board before the original June 21 divestiture vote. I guess it did not bother Puckett (who seconded the motion on June 21 to direct the staff to prepare a divestiture plan) that he did not have all of the facts before him at that time. It was okay in the past for Puckett, as you know, to have an STRS-purchased credit card, to have STRS pay for his personal long distance phone calls, to have STRS spend money on wine for a Hazel Sidaway going-away party, to vote for a settlement agreement without having a document in hand, and to support STRS paying for the private legal fees of 3 employees. Maybe I should do a little more "badgering" when it comes to Steve Puckett's behavior.

You soon will be reading about a motion I made at the STRS Board meeting on Friday, August 17, regarding Damon's decision to issue severance checks (costing $93,000) to eight STRS employees who were laid off recently from the IT Dept. I challenged that Damon did not have the authority to do what he did and pushed for a formal Board action to have our internal auditors (who now report directly to the Board, not to the STRS exec director) do an investigation into whether the payments were proper and pursuant to board policies. (They clearly were not proper and not pursuant to adopted policies, in my opinion, based on my research of ALL policies, board minutes, etc.) I made this motion, and Chapman seconded it. Before the vote was taken, Meuser gave a speech that he was not about to "jump because Leone says jump" and that he was NOT sure if such a follow-up was "worthy." After hearing that, I replied: "From my perspective, any board member who does not vote for this resolution is engaging in misconduct from a fiduciary standpoint." (Meuser's "don't know if this is worthy" statement and Puckett's "badgering" comment remind me Judith Fisher's "intrusive" comment, Geoff Meyers' "waste of time" comment, and Bob Brown's "shut up" comment.)

Anyway, after Meuser and I exchanged words, even Conni Ramser (yes, Conni Ramser) told Meuser that the spirit of my proposed resolution was to have our own internal auditors look into the matter. The motion then passed 7-0, with Meuser voting yes as well. Board members Johnson and Puckett had to leave the meeting before this vote was taken. Board member Hayden was absent on Friday. Before the vote, STRS staff members spoke in defense of the severance checks (and the continuation of STRS-paid health insurance for the laid-off employees) because the laid-off employees were "deserving," because many of them "have car payments," and because we shouldn't "send the wrong message to other STRS employees." Funny, isn't it, that staff wasn't as concerned about retirees' car payments in 2002 when health insurance was cut for spouses. Meuser's comments on Friday also reminded me of his written comments of a few months ago, when he wrote that any board involvement in vendor contracts "inhibits the staff's ability to negotiate." Whether Meuser realizes it, it was individual board involvement in the recently adopted PBM contract (as it was being negotiated) that caused it to be a better contract in the long run. He just plain doesn't understand this.

One vote change occurred on Friday. If you recall on Thursday, Ramser was the abstaining vote in the 5-4-1 vote to raise the reimbursement costs for retirees who are on the Medicare Part B plan. Ramser asked on Friday to change her vote to a yes. This means the record will now show that Ramser, Cervantes, Meuser, Johnson, Puckett and Brooks voted yes. Voting no on this cost increase were Leone, Lazares, Chapman, and Hayden.

All of the above can be verified by the Board meeting tapes. Also, Fayette County retiree Marie Fetters was in the audience on Friday and heard it all.

As you can tell, it sure is very hard to predict how board members will vote on these issues.

Dennis Leone