Ohio's pensions travel expenses; STRS is mentioned

From John Curry, September 8, 2010

Pension officials note that vendors no longer can pay for meals and other perks at conferences, and there often is no better way to familiarize themselves with the companies in which they invest. A portfolio manager for the State Teachers Retirement System of Ohio justified a $2,400 trip to San Francisco, in part, because the fund owns real estate in the area.

(Note from John....STRS does staff California offices with STRS employees. Here is a link to that staffing:)

http://www.strs.state.oh.us/westcontacts.html

Laura Ecklar, spokeswoman for the teachers pension fund, noted that employees of the system manage 88percent of its real-estate holdings, a significantly higher percentage than other pensions that outsource such responsibilities.

The teachers pension system is the only one of the five to pay for significant foreign travel. In the year ending July 1, managers with the State Teachers Retirement System of Ohio visited Japan, China, South Africa, England, Mexico, India and Malaysia, sometimes tacking personal vacations onto the end of their official business. Several trips cost more than $10,000.

An international consulting analyst who visited Mexico - the cheapest foreign trip, costing less than $2,000 - said he was able to get a read on the country's economic situation just by looking around.

"I was able to see for myself the level of building activity and traffic on the street in Mexico City to get a gauge on economic activity," wrote the analyst, Larry Tedeschi.
http://www.dispatchpolitics.com/live/content/local_news/stories/2010/09/08/copy/pension-officials-traveled-in-style.html?sid=101
Pension officials traveled in style

Public systems' excursions exceeded $1 million in year

Columbus Dispatch, September 8, 2010
By James Nash

NEWYORKPALACE.COM

(Click images to enlarge)

Two board members of the Police & Fire Pension Fund attended a conference at the New York Palace Hotel in rooms costing more than $400 a night. When two board members of the Ohio Police & Fire Pension Fund jetted to New York in October for a conference on protecting investments, the pension fund made an investment of its own: more than $400 per night for each trustee to stay in a hotel that "blends old-world elegance and new-world opulence."

The board members, Columbus Police Officer Ed L. Montgomery and retired Cleveland firefighter William Deighton, stayed three nights each at the New York Palace, a five-star hotel that happened to be the venue of the conference. The conference itself wasn't cheap, either: $1,125 for each board member.

All told, Ohio's five public pension systems spent more than $1 million between June 2009 and June 2010 on conference-related travel, according to records obtained by The Dispatch under a public-records request. The expenses ranged from a few dollars to attend a workshop at a Columbus hotel to more than $10,000 to hobnob with executives in South Africa and London.

Even as the downturn in the economy sucked billions of dollars of value out of Ohio pension investments, board members and employees of the public pension systems continued to travel across the country - and sometimes out of it - to attend conferences on investing, information technology and management practices.

Pension officials defend the expenditures as necessary to stay on top of developments in the markets during a volatile time. And records do show officials scrimping in some instances. When two leaders of the Ohio Highway Patrol Retirement System traveled to Florida in March to speak to retirees at a snowbirds gathering, they stayed in a Clarion Inn for $85 a night. For every $41 steak billed to a retirement system - and there were few of those - there were a dozen hamburgers, salads and pizzas at airport and hotel cafes.

Still, some of the 1.1 million retired government workers in the five systems question the need for expensive travel and conferences that cost as much as $2,544 in attendance fees alone.

"That doesn't really surprise me, but it seems like the little people in a corporation - and I don't care what corporation you're talking about - are the ones that suffer," said Kathy Bowman, a retired charter-school liaison who lives in Van Wert. "The big wheels are the ones taking the extravagant vacations."

Bowman worked eight years for the Electronic Classroom of Tomorrow before taking a disability retirement last year. Her health-insurance rate through the School Employees Retirement System of Ohio will increase from $202 a month to $579 at the beginning of next year as part of the pension system's drive to remain solvent.

Tim Barbour, spokesman for the School Employees Retirement System of Ohio, noted that the pension system has cut back on travel costs by, for example, no longer sending officials to the International Foundation of Employee Benefit Plans annual conference in Hawaii. Board members are limited to three out-of-state conferences per year, he said.

Some retired police officers and firefighters question the need for Ohio Police & Fire Pension Fund trustees - who themselves are retirees rather than financial experts - to attend pricey out-of-state conferences. But Gary L. Monto, president of the retirees' association, said the trustees need to be educated about investments, although $400-per-night hotel rooms "do not make me happy."

Pension officials note that vendors no longer can pay for meals and other perks at conferences, and there often is no better way to familiarize themselves with the companies in which they invest. A portfolio manager for the State Teachers Retirement System of Ohio justified a $2,400 trip to San Francisco, in part, because the fund owns real estate in the area.

Laura Ecklar, spokeswoman for the teachers pension fund, noted that employees of the system manage 88percent of its real-estate holdings, a significantly higher percentage than other pensions that outsource such responsibilities.

The teachers pension system is the only one of the five to pay for significant foreign travel. In the year ending July 1, managers with the State Teachers Retirement System of Ohio visited Japan, China, South Africa, England, Mexico, India and Malaysia, sometimes tacking personal vacations onto the end of their official business. Several trips cost more than $10,000.

An international consulting analyst who visited Mexico - the cheapest foreign trip, costing less than $2,000 - said he was able to get a read on the country's economic situation just by looking around.

"I was able to see for myself the level of building activity and traffic on the street in Mexico City to get a gauge on economic activity," wrote the analyst, Larry Tedeschi.

jnash@dispatch.com