Duane tells 'em, but they'll never get it in a million years -- 'hardship' is hardly in the STRS vocabulary

Duane Tron to Sandy Knoesel, November 9, 2008
Subject: STRS bonuses in difficult economic times

Dear Ms. Knoesel,

It has been several years since I responded to any issue at STRS. I had to return to work following the loss of the spousal subsidy six years ago. Nobody seems to care that thousands of retirees have had to return to work or make significant lifestyle changes, or both, as a result of this unilateral decision by the OEA-dominated board.

My lifestyle was severely impacted by the huge increases I have been required to pay to maintain health insurance for my wife of nearly 44 years. When I retired I asked the question as to whether I needed to purchase supplemental health insurance to cover my wife and I was advised that STRS has (had) the finest retirement system in the nation and I don't (didn't) need supplemental insurance.

Four years following my retirement in 1998, I was hit with a huge loss of income. Then add a couple of illnesses that created pre-existing conditions and I could no longer afford to purchase quality supplemental insurance. In 1999, the OEA-dominated board made the unilateral decision to implement a 35 year and 88% pension plan claiming it was cost neutral.

I took data and numbers to three certified CPA friends and asked them to assess the status of the cost neutral claim, and all three told me in 2003 that the initiative was NOT cost neutral, and based on the numbers, without significant increases in contribution rates, it would NEVER be cost neutral. All three indicated shock at such a move, as they proclaimed they weren't aware of any viable pension plan in the country that provided an 88% incentive at 35 years of service with any public or private sector business retirement plan. We are the only retirement system with such a lucrative plan.

During the past six years my wife and I have had to adjust our standard of living lower due to inequitable and unfair decisions rendered by management at STRS. We have less expendable income today than at any time in our lives. I continue to drive an eight year old car, as I can't afford to replace it. We haven't been able to take a really nice vacation, apart from a trip we had saved for before all of this came down, to celebrate our 40th wedding anniversary. My wife has to continue to work full-time which she has done for the past 44 years. Retirement doesn't appear to be a viable option for her.

We reside in a small frame house (1,165 sq. ft.) in St. Paris where we have lived for the past 30 years. We clip coupons, look for sale items and scrounge every penny we can. What a wonderful retirement I have received for 30+ years of public service to education in Ohio. While those who retired following me stayed for another three to four years and received 88% of their three best years, I watched my annual pension reduced by $11,600.00 this coming January due to increases in the cost of health insurance for my non-teaching wife. My annual COLA's have averaged around 2% which has increased my annual pension by about $600.00/year. This represents an increase of $6,000.00 over the past ten years and my pension has decreased by a gross of $8,000.00/year due to the increases in health insurance premiums. This translates into a reduction in my annual pension below what I retired at ten years ago.

We have had to cut our living expenses. We have skipped prescriptions so we can meet living expenses. We can't take a decent vacation for the same reasons. We can't relocate to the Sun Belt, like many retirees following us, during the colder months. My wife can't afford to retire because of our lousy health insurance premiums. I had to return to work to meet our expenses and continue to work while battling several serious health issues. Then while we are being required to tough it out STRS continues to pay out lucrative bonuses, while those you are supposed to protect and provide for are doing without and watching our standard of living decline. Many in the system continue to enjoy the "good" life, while many of us struggle to grow old and try and die with some semblance of dignity.

I am facing serious surgery in the immediate future. I have been ordered out of the hospital by our health insurance provider even though my doctor tried to inform them I needed to remain so they could run necessary tests to evaluate my condition. Then I had to go back in on an outpatient basis the day following discharge to undergo essential tests that should have been performed while I was in the hospital. I can't afford to go to Indianapolis or Cleveland Clinic for less invasive surgery because of costs due to distance and our ridiculous health insurance provider dictating how long we can stay in the hospital following surgery. We are strapped with bureaucrats in an office who have the authority to overrule our doctors who are treating our condition. The people in the insurance offices are obviously more qualified than our surgeons and doctors treating us.

Let me conclude by saying that in tough times everyone should be required to share in the pain. This includes those vested with investing OUR money. We are being required to make major sacrifices at an increasing, and alarming rate, and STRS tells us that we can't expect those who work for US to forego bonuses when we've lost nearly 25 billion dollars from our total portfolio?

The problem is you and others at STRS weren't around the last time this country underwent a major economic crisis and you don't really understand, comprehend, nor appreciate the necessity for sacrifice! What part of the term "hardship" don't you and our investment staff understand? It's perfectly all right to reduce our income over the years but it's not all right to stop paying bonuses to an investment staff that dropped a paltry 25 billion dollars over a 12 month period? The STRS Board, you, the investment staff, and others at STRS are totally out of touch with reality.

My wife and I have investments we put back toward her retirement and we watched as we lost over 50% of what we had earned. Nobody is considering any bonuses for us because of the downturn! In fact nobody has proposed a penny to try and help bail us out of our economic crisis; not even our illustrious and outrageous retirement system. Then you insult us by paying out six million dollars in bonuses and have approved new incentives for 2009. There is really something wrong with this picture and it isn't those of us out here who understand sacrifice, understand how to do without!

Ms. Knoesel, my brother, sister, and I grew up in a small four room house. We didn't have any hot water, no water heater, no central heating system, no indoor plumbing, no washer and dryer; and we grew an acre and a half of fruits and vegetables every summer; and we canned them and used them during the winter. My 16-year-old brother, 14-year-old sister and I slept in the same bedroom until our father enclosed a porch and made it a bedroom for our sister. We bathed in galvanized wash tubs located in front of an open oven door once or twice a week. We used an outhouse in the winter and summer. We all worked from the time we were old enough to remember. Ms. Knoesel I understand the meaning of "HARD" times and I resent the lame excuses you and others proffer as to why we have to continue providing incentive bonuses for our investment staff when the economy has gone 'south.' This is a disgrace!

My wife and I? We'll survive whatever this life throws at us because we grew up doing without. We know how to make do! We know how to survive hard times without help from you or the government. We have never asked for anything from anybody and we remain steadfast in that concept. I don't expect the government to bail us out of anything. I do expect the STRS Board to demonstrate fiscal responsibility, and oversight, of OUR money and this isn't happening! No bonuses! I repeat, no bonuses!

Duane Tron
STRS Retiree 1998
St. Paris, Ohio