RH Jones: ORTA doing members a disservice

From RH Jones, April 17, 2010
Subject: RHJones comments and Fw: Dennis speaks............

To all ORTA members:

Every ORTA member needs to get on the phone, or the computer, to protest ORTA's support of the 1% cut in our fixed, flat, COLA. Never, should the ORTA Director Ann Hanning and the leadership of ORTA set back and say, and do, nothing when retired educators are being threatened with any type of cut. If ORTA does not aggressively defend our interests at the STRS, or else, they are doing the members a disservice that will in the long-term hurt membership when it is most sorely needed.

Note: Some of us can not attend meeting ORTA meetings for a variety of reasons, but that does not mean that we should not have a voice in ORTA do nothing policy. Traveling around the state means nothing. Monitoring our STRS means everything!

RHJones, PUFL ORTA member

RH Jones: Board decision not fair!

From RH Jones, April 17, 2010
Subject: Leone to McGreevy....."Make sure you do what the OEA wants you to do."

To all retired educators:

Please forward this to every retired teacher you know and especially to those you know to be OEA-R members. OEA-R needs to start representing us. Most do not want a 1% COLA cut. We have been cut already in our HC/Rx. Therefore, we have done our part to keep the STRS funded. And, what about the 3% cut that the STRS took when they moved 3% of the HC/Rx fund into the general fund?

Jim McGreevy represents retired teachers on the STRS board. The board voted to delay the changes for actives until 2015, but want to cut 1% of our much needed COLA by July 2011. Fair? I do not think so. I do agree with Dennis 100%. Please read below.

RHJones, PUFL Member of OEA-R & OEA

Dennis speaks..............(but ORTA sure doesn't!!!)

From John Curry, April 17, 2010

Yes, Dennis....ORTA sat there and did their usual thing....."silence." It sure doesn't do anything for their membership nor retirees, does it? John

From Dennis Leone, April 17, 2010
Subject: RE: (Corrected Version) That's OK....Laura says "there's no urgency just yet."

Did anyone notice that ORTA sat quiet at the STRS Board meeting while Bill Leibensperger and HPA said that its perfectly fine to start cutting the COLA in 2011, but please please please delay the changes for actives as long as possible………….at least until 2015. Don’t even think about changing the final average salary rule from 3 years to 5 years until then, or later. No sir. By golly, protect those actives!

-------------------------------------------------

[To Jim McGreevy; Subject: If You Cut the COLA in 2011, Then Do The Same With the FAS]:
Oh, I forgot Jim. You’ve already told me that there is no relationship between hitting the retirees beginning in 2011, and not touching the actives until 4 or 5 years later. I see……….
Make sure you do what OEA wants you to do.
Dennis Leone

That's OK....Laura says 'there's no urgency just yet'

From John Curry, April 17, 2010

That's easy for Laura to say...she doesn't have a spouse to insure through STRS (at retiree rates) like 20,000 STRS retirees, does she? John

"State Teachers Retirement System spokeswoman Laura Ecklar said the delay isn't likely to harm the system. It isn't planning for any of its changes to take effect until July 2011, which would mark the first phase of an increase in employee contributions, so there's no urgency just yet, Ecklar said."

http://www.dispatch.com/live/content/local_news/stories/2010/04/17/election-delaying-pension-reform.html?sid=101

Election delaying pension reform

Bill on funding of state workers’ retirements expected after Nov. 2

Saturday, April 17, 2010
By James Nash

THE COLUMBUS DISPATCH Election-year politics are holding up a solution to the funding woes faced by Ohio's public pension systems, the state's second-largest retirement plan said yesterday.

A bill that would stabilize funding for retirement systems for hundreds of thousands of retired teachers, police officers, school custodians, budget analysts and other government employees probably won't be introduced until after the November elections, according to the State Teachers Retirement System.

State pension leaders had hoped to have the bill on the floor early this year.

"This is a correction to the pension systems that is going to have some implications for current retirees, future pensioners, current taxpayers and future taxpayers," said state Rep. Todd Book, D-Portsmouth, who plans to sponsor the bill. "When it gets introduced, my goal is to get it right."

The economic downturn that began in 2008 battered the bottom lines of the state's five public pension systems. Even before that, some of the pension systems were struggling to keep up with costs related to the retirement of baby boomers, increased life expectancies and health care. Three of the pension systems - the State Teachers Retirement System, the Highway Patrol Retirement System and the Ohio Police and Fire Pension Fund - are out of compliance with the state law requiring them to have enough assets to cover their obligations for 30 years.

The legislation is supposed to ensure the long-term solvency of the retirement plans through a variety of measures, some unpopular. Existing teachers and school districts would be required to pay more toward teacher pensions. Cities and counties would pay more toward police and firefighter retirements, as would the employees. Retirement ages would be raised for nearly all public employees.

The proposed changes have been approved by pension-system boards but have drawn opposition from some Republican lawmakers and the Ohio Municipal League. They object to squeezing cities and school districts for higher contributions.

In a regular update to members, the State Teachers Retirement System said the pension fixes likely will be delayed for months.

"Because of the politics surrounding the November elections, it is becoming more and more unlikely a bill will be introduced before November," the message said.

Book, who must leave the House because of term limits, said he's unaware of any specific political holdups. But he acknowledged that the pension fixes could be held hostage as the governor and other statewide officeholders are up for re-election.

State Teachers Retirement System spokeswoman Laura Ecklar said the delay isn't likely to harm the system. It isn't planning for any of its changes to take effect until July 2011, which would mark the first phase of an increase in employee contributions, so there's no urgency just yet, Ecklar said.

The Ohio Police and Fire Pension Fund, on the other hand, had planned for the first phase of the increase in employee contributions to kick in this year.

Aristotle L. Hutras, director of the Ohio Retirement Study Council, which advises the state and public officials, said the pension systems remain in solid fiscal health, boosted by the recent upturn in the stock market.

"Eventually, this is going to happen," he said. "This is the prudent and necessary thing to do. Is there an emergency? No."

jnash@dispatch.com

STRS Board News for April 2010

From STRS, April 16, 2010

This week, the State Teachers Retirement Board held its monthly meeting. Following the regularly scheduled meetings, a report titled "Board News" is posted on the STRS Ohio Web site, as well as mailed to a number of members and education organization representatives who have requested it. As a member of STRS Ohio with an e-mail address on file, you will also receive this report each month. The April report follows.

APRIL BOARD NEWS

PENSION LEGISLATION NOT LIKELY UNTIL FALL The bill that will contain proposed changes for all five Ohio pension systems, including STRS Ohio, still has not been introduced. Consequently, the Ohio Retirement Study Council (ORSC), which is the legislative oversight body for the five systems, has not provided an analysis. Because of the politics surrounding the November elections, it is becoming more and more unlikely a bill will be introduced before November.

At the April 2010 State Teachers Retirement Board meeting, additional discussion was held regarding the alternative proposal for pension benefit changes presented earlier this year by the Healthcare & Pension Advocates for STRS (HPA). The HPA proposal calls for a longer phase-in of additional service required for full retirement benefits and provides for a different cost-of-living adjustment (COLA) than the plan approved by the Retirement Board last September. The HPA reported that it continues to support a 2% COLA for current retirees, beginning on July 1, 2011. It also continues to support a 2% COLA for new retirees after that date, with a deferral for 36 months from the date of retirement, but with no minimum age requirement. The longer phase-in, coupled with this COLA scenario, would result in a funding period of 35.1 years for the pension fund versus the board-approved plan that brings the funding period to 33.4 years. During the discussion, staff reminded the board that additional plan design changes may be necessary if economic and demographic assumptions are not met, and any plan components are removed or weakened and/or implementation dates change during the legislative process. There was consensus that the board will consider taking action on the HPA proposal at its May meeting.

PROPOSED OPERATING BUDGET FOR FISCAL YEAR 2011 REFLECTS 2.1% INCREASE At its April meeting, the Retirement Board received its first look at the proposed system budgets for fiscal year 2011 (July 1, 2010-June 30, 2011). The proposed operating budget totals $89,773,600, which represents a 2.1% increase over this year's operating budget. No merit or cost-of-living salary increases are included in the budget, effectively freezing salaries for most associates at July 2008 levels. The budget also supports 592 full- and part-time employees, which is in alignment with the current head-count freeze that calls for 605 or fewer associates. Payment of expected Performance-Based Incentives (PBIs) to eligible Investment Department associates for fiscal year 2010 performance, plus expected payment of the first half of the deferred PBI payments for fiscal year 2009 performance, are included in the budget. (The deferred payments will only be paid if the market value of STRS Ohio's investment assets remain at $60 billion or higher as of June 30, 2010; as of Marc h 31, 2010, the value stood at $60.9 billion.) Aside from potential incentive payments to eligible investment associates and accompanying fringe benefits, all other major spending categories in the proposed operating budget are lower when compared to last year's budget.

The proposed capital budget for fiscal year 2011 totals $2,101,000. Additionally, the system expects to spend $580,000 in contract payments for the STaRS system that has replaced STRS Ohio's former obsolete pension management computer system. The Retirement Board will be asked to approve the budgets at its June meeting.

BOARD APPROVES HEALTH CARE PROGRAM CHANGES FOR 2010 AND 2011 During April's meeting, the board approved a new program for STRS Ohio Health Care Program enrollees who receive their prescription drugs through Express Scripts. (These are individuals who are covered under the Aetna, Medical Mutual and Paramount health care plans.) The program, known as Select Home Delivery, encourages individuals who are filling prescriptions for maintenance medications at retail pharmacies to move to home delivery. This move will lower the individual's copayments plus reduce expenditures from STRS Ohio's Health Care Stabilization Fund, which supports the health care program.

Express Scripts will use a series of letters and phone calls to explain the advantages of home delivery and encourage the enrollee to make the transition. For those that wish to move their prescription to home delivery, they can direct Express Scripts to contact their physician to obtain a new prescription for home delivery through Express Scripts' "concierge service." Also, the first copayment for a generic maintenance medication moved to home delivery will be free up to a total of $50 per enrollee. There will be no change in copayments and enrollees will not experience any penalties if they choose to continue filling their maintenance prescriptions at retail. If just 50% of the eligible prescriptions move to home delivery, enrollees will save $3.1 million in copayments and the health care fund would retain an additional $4.7 million. The Select Home Delivery Program will begin this summer.

Looking ahead, the board also approved the following for the STRS Ohio Health Care Program in calendar year 2011:

- Implement a Medicare Part D prescription drug plan (PDP) through Express Scripts. Currently, STRS Ohio participates in a Medicare Part D subsidy program. This change should increase the subsidy amount to STRS Ohio by $6.3 million. In addition, many Express Scripts enrollees will benefit from less restrictive requirements for step therapy and prior authorization, 90-day supply at retail and some formulary adjustments. Eligible enrollees will receive additional information this fall.

- Change the family in-network annual deductible for the AultCare plans (available in select Canton, Ohio, ZIP codes) to $1,600 from $1,200, beginning Jan. 1, 2011. These plans will then match the single-to-family annual deductible ratio of all other STRS Ohio health care plans.

- Continue the Health Care Assistance Program with the same coverage level, eligibility requirements and $0 monthly premium.

- Continue the 2010 premium reimbursement amounts for Medicare Part B. The maximum amount of reimbursement from STRS Ohio remains at $52.83 per month for the 30-year retiree; the minimum amount of reimbursement is $29.90 per month.

Finally, the board approved Prudential as the carrier for the Long-Term Care (LTC) Program. Since November 1988, STRS Ohio has offered a long-term care plan through Aetna. However, Aetna is exiting this market as of Dec. 31, 2010. The almost 12,000 individuals currently enrolled in the program will have the option to stay with Aetna via a trust or transfer to the Prudential long-term care plan. Detailed information, including premiums and coverage options, will be mailed to all affected STRS Ohio members in June 2010; additional information and assistance with making a choice will be provided through Prudential's Web site and a customer service center. Open enrollment for new long-term care program enrollees - both active and retired STRS Ohio members - will be held in February 2011.

In the coming months, members will receive more detailed information about the STRS Ohio Health Care Program changes approved at this April meeting through newsletters, the Web site, e-mail news service and direct mail, including the health care program open-enrollment materials sent to members in the fall.

IMPACT OF NATIONAL HEALTH CARE LEGISLATION ON STRS OHIO STILL TO BE DETERMINED With a piece of legislation as massive as the health care reform bill that recently passed in Washington, STRS Ohio and many others will be analyzing its content for some time. All attention will now be on the regulatory process and how the administrative authorities interpret and implement the numerous reforms. Although the bill's full effect will not be felt for several years, some clarifying regulations are expected to be developed during the next 180 days. Some areas where staff believes there is a strong likelihood that adjustments to the STRS Ohio Health Care Program will be necessary include: elimination of lifetime limits for coverage; increasing dependent children's eligibility for coverage to age 26; and eliminating any out-of-pocket costs for preventive services in the Medical Mutual Plus Plan. STRS Ohio may also be able to apply for participation in the early retiree (age 55-64) reinsurance program for the years 2010 through 2013. However, until regulations are fi nalized, nothing is for certain. STRS Ohio will continue to use its newsletters, e-mail news service and Web site to keep health care program enrollees informed of any changes affecting them.

RETIREMENTS APPROVED The Retirement Board approved 123 active members and 83 inactive members for service retirement benefits.

NO CHANGE TO SERVICE CREDIT RULE FOR PARTIAL YEARS OF TEACHING In January 2010, the Retirement Board was asked to consider a change that would require STRS Ohio members to work 180 days to receive a full year of credit. Currently, members who are employed on a full-time contract can receive a full year of service credit by (a) working 120 full-time contract days, or (b) completing two full-time quarters. However, upon further research, staff has determined that 120 days for a full year of service was chosen in 1971 to be consistent with other sections of Ohio law affecting teachers. As a result, staff has determined that the existing service credit rule should stay in effect.

So, how did STRS stack up with the rest re: investments to 12/31/09

From John Curry, April 14, 2010
I'll let you be the judge and read this summary sheet released today (4/14/10) by the Ohio Retirement Study Council. This attachment is page 72 of the report. If you want to read the entire report, please click on this link below. John

http://www.orsc.org/uploadpdf/Invest_Perf_12_31_09.pdf
Click image (twice) to enlarge.

Josh...do you have something against pensioners?

From John Curry, April 15, 2010

John Curry to Rep. Josh Mandel (district17@ohr.state.oh.us)
April 15, 2010
Subject: Josh...do you have something against pensioners?

The Honorable Representative Josh Mandel,

As a benefits recipient of the State Teachers Retirement System of Ohio I have a few questions to ask of you. It's nothing personal but......do you have something against pensioners and the pension systems that the pensioners belong to?

I ask that for several reasons. First of all, back in 2007, you introduced a mandatory divestiture bill aimed at forcing all Ohio public pensions to divest of investments involving companies that dealt with Sudan and Iran. You remember it, don't you. It was House Bill 151. It didn't pass but, because of it, all of Ohio's five public pension executive directors were coerced to meet in Columbus. At that meeting in June 2007 they were kowtowed, by then House Speaker Jon Husted, into signing a pledge to divest of at least 50% of these funds over a six month period of time. If they all signed, he would see to it that HB 151 would not be pursued any further . This selloff (and sell out) caused my retirement system to lose millions of dollars and.....as you well know, all retirement systems really can't afford to lose one dollar, let alone millions of them. Why weren't the banks, brokerage houses and individuals who owned these very same investments not kowtowed into divesting their holdings in Iraq and Sudan?

Well, maybe I can begrudgingly write off seeing my retirement system losing millions of dollars but, speaking about bankers (as I did in the sentence above), I see that you have a "banker friend" who has donated to your campaign recently and repeatedly. His name is Elliott Brody...here is a list of his donations to your campaigns over the years 2005, 2006, 2008 and 2009. Following the Secretary of State's website campaign contribution list (below) is an article featuring Mr. Brody. Mr. Brody is also very familiar with state retirement systems and has recently paid dearly for bribing four officials so as to do business with pension funds. There's that pension fund thing again, Mr. Mandel.

I wish to close by asking you to return the tainted donation dollars to charity or another good cause....how 'bout donating it back to Ohio's pension funds...the ones who lost millions of dollars on your divestiture whim. That $13,000 total will really not hurt your campaign in your race for Ohio Treasurer but it would be gladly accepted by those five state funds whom you cost a whole lot more money a little less than three years ago.

I want to end this letter with a word of praise that is due to you for serving your country as a Marine in Iraq. For that, I feel you deserve kudos...for your friends in high places...well, I think you get my point, don't you?

Sincerely,

John Curry an STRS benefits recipient

P.S. Come election time, I will vote for anybody else who runs against you for the office of Ohio State Treasurer.

[Since the chart below was wider than my screen, I had to cut off part of the first column (Contributor Name). Each cell in that column says "BROIDY, ELLIOTT." To find this chart, go to http://www2.sos.state.oh.us/pls/cfonline/f?p=119:2:2940161059191393::NO:2 and fill in two blanks: "Contributor Name" (enter "Broidy") and "Candidate Name" (enter "Mandel"); then click "Run Report," at the upper left part of the page. KBB]

Click image to enlarge. Then click it again when it comes up.

http://www2.sos.state.oh.us/pls/cfonline/f?p=119:11:2940161059191393::NO:RP:P11_PREV_PAGE:2

Banker Elliott Broidy pleads guilty to bribing ex-Alan Hevesi aides in $250M pension fund scheme

By Kenneth Lovett

Daily News Albany Bureau Chief

http://www.nydailynews.com/ny_local/2009/12/03/2009-12-03_top_investment_banker_.html

Originally Published:Thursday, December 3rd 2009, 1:26 PM Updated: Thursday, December 3rd 2009, 1:52 PM

Click image to enlarge.

Elliott Broidy pleaded guilty to bribing four senior officials under former Controller Alan Hevesi to get $250 million in pension fund business.

ALBANY - A top investment banker pleaded guilty Thursday to bribing four senior officials under former Controller Alan Hevesi to get $250 million in pension fund business.

Elliott Broidy is said to have paid $90,000 in rent, living expenses and hospital bills to the girlfriend of a senior controller's office official, Attorney General Andrew Cuomo announced.

He also gave $44,000 to the girlfriend's family Cuomo said.

"This is an old fashioned payoff of state officials case," Cuomo said.

While he would not name the official, the Daily News has reported it is Jack Chartier, who had a close relationship with former "Mod Squad" actress Peggy Lipton.

Cuomo said Broidy also gave $300,000 to help finance a poorly received movie "Chooch," which was produced by the brother of Hevesi's chief investment officer, David Loglisci.

Loglisci has been indicted in the massive pension pay-to-play scandal. A third official was paid nearly $400,000 through a sham consulting agreement to a relative of a state official.

Broidy also covered $75,000 in expenses for "luxury travel" to Israel and Italy to a fourth official and his relatives, Cuomo said.

In exchange, Broidy's firm, Markstone Capital Partners received $250 million in pension fund investments.

"This is effectively bribery of state officials -- and not just one, but a number of state officials in the comptroller's office."

Broidy pleaded guilty to a felony charge of rewarding official misconduct. He is said to be cooperating with Cuomo's ongoing investigation.

Broidy agreed to forfeit $18 million.

Read more: http://www.nydailynews.com/ny_local/2009/12/03/2009-12-03_top_investment_banker_.html#ixzz0lDZUbS2t

Jim Stoll’s speech to STRS, April 15, 2010

Anatomy of a Pension Fund Disaster

September 30, 2008 STRS Board News

STRS Ohio Retirement Funds Remain Safe and Secure, Despite Market Turmoil.

"In other words, STRS Ohio has the liquidity needed to pay pension benefits when they are due near term, and the accumulated investment assets and income from employer and member contributions (future revenues) to allow us to continue to do so into the future."

October 23, 2008 STRS Board News

"Under my leadership, (Mike Nehf's) your management team is closely monitoring what is happening in the markets and is assessing both short and long term impacts."

Jim Stoll editorializes - (Did our management team know that we bought 143,000 shares of YRCW, a debt ridden company, for about 15 dollars per share and sold them a year later for about 90 cents per share, a loss of over 90% of our entire investment?)

How closely are you monitoring YOUR OVERPAID INVESTMENT STAFF?

After Losing Millions of Dollars by buying Fannie Mae and Freddie Mac stock and selling those shares for pennies on the dollar - have we learned nothing of preventing catastrophic losses of our pension dollars…. Each and every investment should matter to us!!

August 24, 2009 STRS Board News

"It was reiterated that unless changes are made, STRS Ohio will eventually be UNABLE to pay future benefits." "As fiduciaries, the retirement board members and staff must make changes to help ensure long term solvency of the pension fund." "It was noted that the system cannot "invest" its way out of the problem."

Yet the STRS Board voted to approve 3.3 million in bonuses to investment staff, albeit to be paid at a later date……

STRS is still in discussions to continue paying bonuses and outrageous salaries even though they cannot pay their liabilities……

Question: What private company facing insolvency or bankruptcy could afford to continue down its same path? Answer: NONE!

(See attached Salary and Bonus Schedule for YOUR Retirement System which is telling you that they cannot Pay Your Future Benefits.) This is unbelievable.

October 16, 2009

"The PWC report confirmed the data shared much earlier in the year with the Retirement Board……" "Consequently, the system's unfunded liabilities are at infinity - meaning the system can NEVER pay off its liabilities unless changes are made."

The plan for changes calls for….. increase in contributions from members and employers, increasing FAS, changing benefit formula, reduce COLA, etc., etc.

STRS 2008 Investment Associates Compensation Totals
Click image TWICE -- once on each page -- to enlarge.
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STRS 2009 Salary Increases (comparison chart)
Click image TWICE -- once on each page -- to enlarge.
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STRS Ohio 2009 PBI Preliminary Analysis
Click image TWICE -- once on each page -- to enlarge.
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Ralph Roshong's speech to STRS, April 15, 2010

TO: STRS Board Members
XC: State Legislators
FROM: Ralph Roshong
RE: General Comments

I am a 1991 retiree into the STRS having retired with 30 years of service. I would like to provide the following comments for you to consider as you conduct our STRS business:

1. I have grave concerns for the strategic long term well being of our pension fund. I have expressed these before, But I will express them again:

a. Every public pension fund in the country is either bankrupt or on the brink of it. I do feel that our system is better off than most, but needs immediate and serious adjustments. These funds all have been guilty of giving away the funds too quickly rather than being prudent stewards. It is always easy giving the money away in good times, but almost impossible to get it back when the fund absorbs large losses. We have an ethic of just thinking someone else will replenish the fund.

b. I still remain confused in the investment fund?s long range planning using a goal of 8% avg. growth/yr when the past 10 years reflect only approximately an average of 6% growth/yr.

c. When the Board, back in 1999, instituted the 35 year/88.5% retirement benefit, where was ORSC, supposedly the fund?s oversight for us(STRS) and supposedly, the Legislature? Implementing that benefit while having a temporary large balance, was similar to a teenager being given a couple dollars. They cannot wait to get to a store fast enough and spend it. This displayed the Board?s ABSOLUTE LACK OF STRATEGIC PLANNING AND RESPONSIBILITY.

2. As I have commented before, I support a bonus program for our investment staff. However, I am not in favor of our current program. There is too much differentiation in the bonus percentages which are then added on top of an already highly differentiated base salary schedule. The extreme differentiation of the salary schedule is to reflect responsibility. A flat bonus percentage across the salaries would differentiate the bonuses and no need to be differentiated a second time. It is difficult to swallow your goal of an anticipated 8% gain in our investments and then our investment personnel are scheduled to receive up to 90% bonuses applied to their base salaries. Our country, and rightly so, is overwhelmingly unhappy with exorbitant and inappropriate bonuses, exemplified by Wall Street greed, which has been characterized as ´poker players playing a $100,000 card game every day and if they win, they keep the pot, but if they lose, the government (taxpayers) pays the bill¡. The process of granting bonuses and paying them ´later¡ after other parameters occur, is ´absurd¡. If they are earned it, pay it, if not, don?t pay it now or later.

3. I feel the legislature should seriously consider allowing the pension systems provide the benefit of health savings accounts(HSA) for their retirees. I would encourage STRS to pursue this plan.

4. Again I ask you to consider holding all or a portion of your scheduled executive sessions at the start of the meeting in the morning rather than an elongated lunch hour during which your guests have to sit for 2-2.5 hours with no Board business to witness. I believe this was a topic at your recent work meeting, but have not heard of any decisions or thoughts. I do appreciate your discussing it.

5. I request the amount of square footage of the STRS building again. We appear to have a lot of space that could be utilized for potential income by making office space available to rent to other groups. (other groups could conceivably be other pensions systems, ORSC, or small governmental type groups). The market may not be great for this now, but we should explore the potential. I first made this request, I believe, last October or November. I have received nothing other than a comment that it is being considered. Six or seven months deserves a little more than that, I would think.

Thank you again for listening to my concerns and we retirees are very appreciative of your efforts in directing our STRS pension system.

Jim N. Reed to the Dispatch: STRS at Another Fork

From Jim N. Reed, April 14, 2010

Jim N. Reed to the Columbus Dispatch, March 29, 2010
[Unpublished]
Subject: STRS at Another Fork
To: letters@dispatch.com

During the month of April Ohio's "active" educators are at another fork and will be voting for new STRS board members.

Since the terms of board members Dennis Leone and John Lazares ended, watch-dogging and challenging rubber-stamp policy have dangerously retreated and their warnings diluted by an OEA-controlled board. Unfortunately for actives and retirees, prognostications regarding STRS financial mismanagement have been corroborated including the $30 billion asset loss from 2007-2009.

Current OEA-trained and endorsed board members recently voted to increase: service retirement from 30 to 35 years; minimum retirement age to 60 (or until 35 years of service);member contribution by 2.5%; employer contribution by 2.5%; and your FAS calculation to five years.

Cincinnati Sycamore H.S. Athletic Director Jim Stoll offers 24 years as a teacher, coach, administrator and successful businessman as experiences that can monitor and challenge policy in making STRS accountable to its members. Stoll's platform emphasizes cutting STRS spending and not member benefits.

Actives, do some homework and vote. Too many have blindly followed Yogi's advice, "When you come to a fork in the road, take it." STOP! Become STRS-literate.

Jim N. Reed
Baltimore, Ohio

Our fellow Police & Fire public servants also are seeing the rip-off!

From John Curry, April 14, 2010

Mr. Monto makes some excellent points. I find, of particular interest, the statement about the governmental contribution to the Police & Fire Retirement System for health care to be 6.75% of the employer contribution and their healthcare premiums are sky rocketing. Just think, STRS ONLY dedicates 1% of their employer contributions (from the school boards) for teacher retirees' healthcare. 1% is a very miserable amount to be applied for healthcare, isn't it? "Our" system applies less than one sixth of your system's contribution toward healthcare!!! 6.75%, to retired educators, would look like a Godsend!

Yes, Gary, I also echo your statement, "Don’t think that our members are getting a free ride at taxpayers’ expense."

John

http://www.daytondailynews.com/opinion/columnists/guest-column-police-firefighers-need-cities-and-townships-to-pay-what-they-owe-643072.html?printArticle=y

Guest column: Police, firefighters need cities and townships to pay what they owe

Dayton Daily News, April 8, 2010

Gary L. Monto is president of the Police & Fire Retirees of Ohio

The Ohio Police & Fire Pension Fund is asking for more money from cities and townships, the employers of police officers and firefighters. Let me explain why.

When the state took over the various pension systems in 1967, the newly created Ohio Police & Fire Pension Fund was underfunded by more than $400 million. Employers had not been contributing enough to the pension plan to fully pay for the benefits they had promised employees.

These employers were given a “loan” at a very low interest rate, and they had little incentive to pay off the principal. In fact, they did not even attempt to do this until a deal was struck with the legislature that allowed these cities and townships to pay only slightly more than half of what they owed the police and fire pension system.

Meanwhile, the employing cities and townships have not had an increase in the percentage they pay into the pension system since 1986. Since then, the percentages have remained the same at 19.5 percent for each police officer and 24 percent for each firefighter on their payroll.

Where else in today’s economy can you go without an increase in costs for more than 24 years?

To make matters worse, the actuaries for both the Ohio Retirement Study Council and the police and fire pension system have been telling local governments and Ohio legislators since the early 1990s that they need to increase these percentages.

This recommendation has been stated each year in the study council’s annual reports.

Now, when the economy is in a downturn and the cities and townships are having a hard time balancing budgets, these same folks are wringing their hands, saying they do not know how this could happen.

You can only ignore the problem for so long before it catches up with you.

Let’s compare our pensions to the private sector. The average retirement check is $25,700 per year. But consider also that the average private-sector retirement check — together with Social Security benefits — totals more than $26,000 per year.

Public-sector retirees are penalized by Social Security because we belong to a state pension system. Our members who do qualify for Social Security realize only 40 percent of the benefits they have earned.

Many of our members held second jobs or formed private companies during their careers and also paid into Social Security. How is this fair?

Police and fire retirees receive government-sponsored health care. But the police and fire pension system uses 6.75 percent of the employer contributions for this; the remainder of the total cost of this government health care is generated from premiums paid by retirees and investment income.

Our members have seen their government-sponsored health care costs rise nearly 800 percent in the last several years. Don’t think that our members are getting a free ride at taxpayers’ expense.

Pension pick-up is another hot-button issue. Several years ago, some employers saw this as a cost-saving measure. If they picked up a portion, or the entire amount, of employees’ contributions to the pension fund, they felt that they were able to save money by not giving pay raises.

While the employee did not see more money in his or her paycheck, the municipalities and townships could better control their budgeting process.

Last, about double-dipping: Has anyone ever looked at the number of private-sector workers who are double-dipping? I doubt that anyone has or even cares.

If the Ohio Police & Fire Pension Fund is in violation of state law for not being able to fund its liabilities for 30 years, you can place the blame directly at the feet of the cities, townships and legislators who have repeatedly failed to act.

Shame on them! The pension fund can only manage the money that it has — not the money that was withheld from it.

Take Metformin? Let's see Express Scripts beat this one!

From John Curry, April 13, 2010

http://www.dispatch.com/live/content/business/stories/2010/04/12/meijer-giant-eagle-offer-free-diabetes-drugs.html?sid=101

Meijer, Giant Eagle offering free diabetes drugs
April 12, 2010
By Tracy Turner
THE COLUMBUS DISPATCH

Meijer and Giant Eagle are offering free diabetes medications to customers with a prescription, upping the ante among grocery chains hoping to lure customers with free medications.

Metformin Immediate Release, the most commonly prescribed medicine to treat type 2 diabetes, now joins several types of antibiotics and prenatal vitamins now available at no charge at the Michigan-based grocery retailer, Meijer said yesterday.

Dosages offered include 500 mg, 850 mg and 1000 mg tablets, said Effie Steele, clinical services coordinator. Tablets will be dispensed at up to 100 at a time. The pills typically would cost a patient $14.30 for the 500 mg dosage and $41.99 for the 1000 mg dosage, spokesman Frank Guglielmi said.

Giant Eagle will offer five generic medications to treat diabetes, including Chlorpropamide, Glimepiride, Glipizide, Glyburide, and Metformin, at no charge to its customers with a prescription in its Columbus-area and Toledo stores, spokesman Mike Duffey said yesterday.

tturner@dispatch.com

RH Jones: Employer increase needed

From RH Jones, April 13, 2010
Subject: Re: Jim Stoll: STRS Active Board Candidate Responds To Tim Myers STRS VICE CHAIR - Statement to Ashland City School Reps
Molly, Jim, Tim & all:

How can anyone who was endorsed by a union (OEA), that spent a lot of money getting him elected, vote for extending retirement age from 30 to 35-years of service. There are few "gravy jobs" in the field of education. Personally, even though I would have had a 6% raise my next year of teaching, I, for one, "hit the wall" as a Marathon runner may do, and could not go another step -- not even another day. This was true even as the following year's students had the reputation of a thirst for learning and, consequently, behaved well. However, it would have not been right for me to teach them after the extreme stress of my last year. And, to make matters even worse, each year grows a multitude of more classroom regulations, restrictions on the freedom to teach, physical/mental assaults by students, parents and, yes, even incompetent and anti-teacher administrators who do not back their teaching staff.

And, yes, I know that the STRS may not now be able to pension teachers with 30 years, but Ohio will pay one way or the other. If the 35-year restriction passes in the legislative halls of Ohio, I predict that there will be an increase in disability retirements that could even be more costly for our STRS. "Burnout" is a serious problem with teaching as it is with our brother and sisters in police work. Today, even though as a retired teacher I would benefit by teachers toiling longer before retirement, I can strongly sympathize with those actively teaching today, and would expect that their OEA would fight "tooth and nail" for them to be able to honorably retire with the same, or even better, benefits than those of us already retired.

If the teacher is doing her/his best, and I think the vast majority do, the act of teaching is known to be extremely exhausting. Every teacher understands this and pay their union dues so that they can have timely retirement without penalty. Not all school districts are the same. Good middle class school systems are widely known to be the easiest. Many pay better than the difficult systems; do not punish them or their students even more by making them have to teach 35 years before full retirement. Does not every one know this? I have said this before and I will say it again: For the sake of today's and Ohio's future Pre-K-16 there needs to be an employer increase; never mind that it costs; for without proper or even sacrificial spending on education, we are left prone to a greatly diminished standard of living that invites foreign takeover of our system of freedom for the individual.

It is not the job of active or retired teachers to find the funds to support OH STRS. This is what we pay the STRS staff for; and this is why we contribute to PAC funds to elect enlightened OH political representatives who have brains enough to realize the difficulty of the job of teaching; but yet the importance to the economy and security that an educated population can deliver. These are my thoughts.

In sympathy with the active teachers,

RHJones, retired PUFL OEA "member builder"

Somewhere, a village is missing its idiot........

(Click here.)

Dennis Leone: One More Thing About Myers...........

From Dennis Leone, April 12, 2010

…………..and here is one that slipped my mind. Just before I got off the board, Tim Myers made a motion (which was seconded by either Ramser or Meuser ) to stop discussion on the matter of the STRS Board paying the STRS investment staff any bonus at all for the first half of fiscal year 2009 when we lost billions of dollars. Minutes earlier, I attempted to explain to the board why the bonuses should not be paid in ANY fiscal year when we lost money. Let me repeat exactly what happened: Myers attempted to gag me AND STOP BOARD DISCUSSION ON THE MATTER ENTIRELY. The Myers motion failed either 6-3 or 5-4, and we still discussed this issue, but the minutes will accurately reflect that Myers thought it was his role as a board member to try to shut me up and stop discussion on the bonus matter completely. It was one of the dirtiest motions I have ever seen in my entire career. But that’s the OEA way.

Dennis Leone

Jim Stoll: Response To Tim Myers, STRS VICE CHAIR; Statement to Ashland City School Reps

To see Tim Myers' letters, see posts below (April 12, 2010)

From Jim Stoll, April 12, 2010

Tim,

Please see below my response to your recent email which you sent to Ashland City School representatives among others. (Not sure why you, and not my opponents in the STRS election, would speak to this issue?)

I would welcome the opportunity to debate you or either of the OEA candidates on issues related to STRS in an Open Forum, anytime, anyplace and a moderator of your choosing.

Let me know where and when and I will be there. Tomorrow, I will be sending this to the entire email list of Ashland City Schools so they can have further discussions.

To: Ashland City Schools Reps: From Jim Stoll - STRS Candidate

Re: Message Rebuttal of Tim Myers Which Was Sent to You.

Dear Ashland City School Reps:

First let me say that I would welcome the opportunity to drive from Cincinnati to Ashland to meet with you and your membership. That being said.....

I was forwarded the message below which Tim Myers, Vice Chair of STRS, recently sent to you in response to my STRS Board Candidacy. First, as Mr. Myers is not running against me, I find it ODD that he would try to disparage the candidacy of someone running for the Board...... If my statements are misleading I would think that my opponents would be the one's responding? Let me state some facts.....which are indisputable.....

1) "STRS without changes is not sustainable and would not be able to pay future benefits." That is a quote from the STRS Board News by Exec. Dir. Mike Nehf.

Tim Myers voted FOR the Following Changes to YOUR (and My) Retirement.
...(1) Increase Service Retirement from 30 years to 35 years
...(2) Increase minimum retirement Age to 60 or until you have 35 years of service
...(3) Increase your contribution by 2.5%
...(4) Increase Employer contribution by 2.5%
...(5) Increase Change your FAS (final avg. salary) calculation from 3 years to 5 years
...(6) Cut COLAs for retirees from 3% to 2%

Tim Myers Voted to pay STRS Staff outrageous salaries and Bonuses in 2008 and to pay 2009 bonuses at a future date when assets reach 60 Billion..... This in spite of a loss of 33 Billion dollars and Cuts to your benefits. I have attached those salaries to this email........ If you think these SALARIES and Bonuses are good expenditures of your retirement dollars then by all means tell your folks to vote for my opponents...... If you think these salaries are obscene and a waste of dollars from a pension system (STRS) that admits it is bankrupt and unable to pay future obligations without changes then I think you need to vote for Jim Stoll and a change to your system.

Tim Myers voted to recommend grandfathering the Retirement Rules for those teachers in years 25 and beyond........ Ironically, this was a conflict of interest as he is One of those teachers who will directly benefit from the proposed changes and retire under the old rules.

Tim Myers and the STRS Board is breaking "Their Contract" which you and I have paid into for 24 + years and that is a travesty.... He and STRS have been such "GOOD STEWARDS" of your retirement dollars that the system is BANKRUPT or INSOLVENT without changes...... That quote is from Mike Nehf, Exec. Dir. of STRS not Jim Stoll.

I hope you will take the time to educate yourself to the facts at STRS before you encourage your folks to vote for someone.

Thank you for your time and consideration. I am from Sycamore Schools in Cincinnati, Ohio and would welcome the opportunity to drive up to Ashland City Schools and share information with your staff about STRS. I'd also WELCOME the opportunity to "DEBATE" Mr. Myers or the other candidates in an open forum at your School. Please don't hesitate to call me if Mr. Myers will accept which I'm sure he won't, because he won't face someone who will share the truth of what's going on at STRS in a public forum - I on the other hand would welcome that opportunity. I look forward to hearing from you on this invitation to engage your staff.

Jim Stoll
Director of Athletics
Sycamore Schools
cell 513-615-4690
facebook: Jim Stoll STRS
Click image TWICE (once on this page and once on the next) to enlarge.
...............................................................

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John Curry to Tim Myers: Why don't you go to the source for answers?

From John Curry, April 12, 2010
Subject: Curry to Myers re. Myers to Curry

Tim,

Since you are asking me what Dennis is "saying," why don't you go right to the source and ask Dennis? Here is his email address: dennisleone@roadrunner.com I'm sure he will be glad to reply.

As far as what does and what doesn't get on Kathie's blog, she is the blog master and here is her email address so that you can ask her: kbb47@aol.com I am sure that she will be glad to reply.

John

From Tim Myers, April 12, 2010
MyersT@strsoh.org
Subject: [No subject]

John,

This is the fiduciary duty that Dennis never understood! We can disagree on the vote, but then EVERYONE supports the decision after it is over. Even the one's you disagree with.

So is Dennis saying that Stoll is lying? Why isn't that getting on Kathie's blog?

Tim

RH Jones: A response to Tim Myers' letter

From RH Jones, April 12, 2010
Subj: Fw: Dennis puts it in no uncertain terms!

To all:

Tim Myers will retire someday. All the while the some underperforming STRS investment staff employees are reaping unearned bonuses during down market conditions, will he want to have his pension COLA cut? However, over the years employee expenses that shock the sensibilities of the average person do add up negatively for our STRS seed funding assets. In the first place, this is contrary to the reason the STRS was formed. The STRS was formed to reward educators with a secure retirement. Pecuniary employees are hired to achieve this noble and responsible goal; and, whenever they are in a bear market condition, and the goals are extraordinarily surpassed; in my opinion, they deserve a proper bonus; and, as their Investment decisions exceed other public retirement systems' performance nationwide -- morally then -- they should be awarded a bonus.

I know teachers did not receive bonuses; but, when warranted, in speculative investment employment, our STRS board has the responsibility to provide competitive salaries/bonuses -- that the average American public retirements systems are paying. That is the cost we must pay to keep competent investment staff employed at our STRS. Not being unionized, I see nothing wrong with terminating the employment of individuals who are not producing, and who are not performing at their competitively set goals. Unlike teaching, investing employment can be straightforwardly measured without difficulty.

As a retired OH STRS member, that is my opinion,

RHJones

'Duke' Snider to Tim Myers: I hope we can count on you to do the right thing

From Kenneth "Duke" Snider, April 12, 2010
Subject: thought

Mr. Tim Myers, My wife and I have been attending STRS meetings since about 2002. We have seen all types of actions going on including board members (indicted etc.). It would appear to me that the number one priority would be retirees.

I feel the top priority is STRS employees. You might respond by asking "Why," to which I would answer by saying retirees are the ONLY ones who have had any elimination of a benefit such as the 13th check. Yes, STRS employees have supposedly had a stop placed on bonuses UNTIL there is a turn around.

There was no such compromise with the 13th check or what you (STRS board) recommended about reducing the COLA. You didn't even consider in the recommendation about current retirees. It was a flat out elimination of 1 percent, and not even considering reinstating it if things improved.

I have read other recommendations by retirement systems, and it appears they seem to want to take care of their current retirees. In fact one system recommended reinstating the one percent if things improved. Now if I have read or heard any information that is incorrect, I would appreciate being corrected.

I had a person say to me the COLA should be reduced, because the cost of living isn't that high. My response was "Where do you buy your gas and groceries?" The COLA is SIMPLE interest and not compound interest. Again, it appears to me, the finger seems to be pointed at retirees. I would imagine that retirees would not say much if their retirement check would be as much as STRS employees.

Another thought, why don't STRS employees contribute to STRS instead of PERS? STRS building including parking garage, etc is a class act. It appears no expense was spared. Now some people will say that it's a drop in the bucket, but I'm just a country boy and I think how a person spends other peoples' money regardless of how little is spent, indicates how money is spent on big decisions and taking chances.

I keep wondering if certain people are still upset with retirees because of indictments etc in the past which Dr. Dennis Leone spearheaded? Thank God we had Dennis and John Lazares. How can anyone criticize either for what they have done? Both are icons in the eyes of retirees, but I feel we are being punished because of what they did for us.

I am a school board member, and if I ever thought someone was doing something wrong, I could not sit and let it happen. If STRS employees ever have their bonuses reinstated, then the retirees should have their 13th check reinstated. What is good for the goose is good for the gander.

There are other issues which I haven't mentioned, such as healthcare etc. I don't want to take all your time. I have one more thought, and it's only mine. I firmly believe if STRS asked retirees to give up one or two percent of their COLA for one year and have it reinstated back to three percent, I believe many would be agreeable. Now, I might be wrong, but I don't think so. I hope we retirees can depend on your integrity, honesty, and intelligence to do the right thing.

Kenneth "Duke" Snider
Sardinia, Ohio

Dennis Leone responds to Tim Myers' remarks of 4/8/10

From Dennis Leone, April 11, 2010
Subject: RE: FW: STRS campaign email response

………..and those cost saving measures (freezing salaries and stopping bonuses in years STRS loses money) were Leone motions that none other than Tim Myers initially opposed and fought against. The minutes prove it. He even lied publicly when he said that by NOT paying the bonuses, the board was “breaking a promise.”

Dennis Leone

Tim Myers: A response to a teacher who dared to ask his OEA rep about non-OEA-endorsed STRS Board candidate Jim Stoll

From Tim Myers, April 8, 2010
Subject: FW: STRS campaign email response

______Thanks for your email.

However, you are being intentionally misled about the incentive program. NO INCENTIVES have been paid since September 2008. The board suspended the Incentive program well over a year ago. Even the incentives that were earned LAST fiscal year, prior to the suspension, have not been paid either. They will not be paid until a number of fiscal benchmarks are met, including the assets of the System reaching 60 billion dollars.

There have been NO incentives earned or paid out since the suspension was instituted. You may also be interested in knowing that last year the board voted to freeze all staff salaries, instituted a hiring freeze, instituted a longer employee work day, AND we cut 11 million dollars out of our budget for the current fiscal year. At our last meeting in March, we also voted to again freeze our staff salaries for a second year. In total it will be 2 1/2 years without a staff salary increase.

As you can see, spending at STRS is not the problem. We actually have been very good stewards of your money! The factors that have led to the proposed changes have nothing to do with spending, it is an income problem. You can not blame proposed cuts to pension benefits on “rampant spending.” The collapse in the world economy resulted in a loss of tens of billions of dollars. No pension system was immune. Eliminating the entire budget for STRS would account for 0.3% of this amount. Taking the position that no changes to benefits need to be made fails to recognize the scope of the problem. Blaming proposed changes on spending or mismanagement is disingenuous at best.

Please distribute this email to anyone in your district who may have gotten the misleading email.

Again thanks for your letter to the STRS board.

Tim Myers, Vice Chair
STRS Ohio [Board]

From Tim Myers, April 8, 2010
Subject: STRS campaign email response

Attached is an electronic copy of part of the STRS report for tonight's NCOEA meeting. It is an email that I have put together in response to some misinformation that is being emailed to local associations from an administrator who is running for the STRS Board Active seat.

Please distribute to your members if your local gets the email. The administrator in question is NOT endorsed by OEA.

Thanks
Tim Myers
Thanks for your email.