STRS FLASHBACK - 7 years ago - Thanks to Dr. Leone, no more $1,037 board dinners after a committee meeting, credit cards or system-furnished vehicles
STRS is tops in employee perks
By PAUL E. KOSTYU Copley Columbus Bureau chief
Canton Repository, July 31, 2003
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: 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
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