Dennis Leone: a possible appointee to the STRS Board?

From Dennis Leone, July 12, 2009
(In response to an inquiry from Kathie Bracy)

Kathie – when I spoke to the Jackson County RTA a few weeks ago, someone in the audience asked whether I would accept (if offered) an appointment by the State Treasurer. I said yes, then I added that I doubted the State Treasurer would conclude that I meet his definition of an “investment expert.”

No, I do not have the pure investment experience of a Craig Brooks or a Steve Buser, but I certainly have as much as Tom Johnson, Judith Fisher, Geoff Meyers, or Steve Puckett (all of whom were recently appointed as “investment experts”). My investment knowledge is what I have learned, and pushed for, in my 4 years on the board, and what I acquired in my 3 years of investigating things at STRS before that.

While on the board, I have been the only board member who has pushed for a restructuring of the STRS passive investment portfolio philosophy. And, as you know, I was the only board member who initially pushed for a restructuring of the bonus plan for investment staff, a suspension of the bonus plan, the elimination of the bonus plan in down stock market years, and the establishment of a threshold of $65 billion in assets to trigger bonus potential in the future. (While all of these investment-related items were approved, all were met with initial strong resistance from both the STRS staff and the board.)

With the possible exception of Tom Johnson and Craig Brooks, no one on the STRS Board has as much budget experience than I have had professionally. I am not fooled, for example, regarding whether a proposed budget really is showing a decrease in expenditures rather than showing a play on words like “projected expenditures” and “actual expenditures.” I am also not fooled about the real cost of staff fringe benefits, policies, and operations. As a supt for 23+ years in Ohio, and as a school law professor for 5 years, I have done a lot in terms of budget preparations, cost reductions, and staffing.

Would I do it if asked? Yes. Do I think the State Treasurer will ask me? No.

Dennis Leone