Sunday, February 24, 2013

Flashback: 2005 campaign flyer for Dennis Leone


Dr. Dennis Leone is a thirty year educator and administrator who retired in 2004.  He is the recipient of the First Amendment Award, received in 2004 from the Ohio Society of Professional Journalists, for uncovering in 2003 the inappropriate spending practices at STRS (State Teachers Retirement System of Ohio). 
  • He received the Ohio Senate’s Outstanding Educational Service Award in 1999.
  • He was the only superintendent to receive an award in 2002 from the Ohio Association of Public School Employees for collaborative labor/management relations.
  • Dennis Leone, along with John Lazares, was solely responsible for the exposure of the waste and mismanagement at STRS Ohio.  He has worked with retirees to effect change at STRS Ohio.
Ohio’s retired educators need Dennis Leone to represent them on the STRS Board:
  • He addresses the monthly STRS Ohio Board meetings with the concerns of retired educators.
  • He is constantly fighting behind the scenes for retired educator causes.
  • He testified on the proposed pension legislation and lobbied for changes in Senate Bill 133.
  • He travels extensively in Ohio, speaking to active and retired teacher associations concerning the problems at STRS Ohio.
  • He has met face-to-face with the Auditor of State concerning the spending practices at STRS Ohio.
  • He has addressed the ORSC (Ohio Retirement Studies Council, which oversees Ohio’s five pension funds)
  • Since his landmark paper of May, 2003 which uncovered the misconduct at STRS, he has been tirelessly working for retired educators at his own expense.
  • Dr. Leone’s efforts have saved Ohio’s educators millions of dollars.
  • No one else has earned the right to represent Ohio’s retired educators more than Dr. Dennis Leone.  This is why CORE encourages you to vote when you receive your ballot in April for Dr. Leone for retired educator seat on the STRS Ohio Board.
Facts Regarding Spending Abuses at STRS Since 1995

The following represent a number of spending abuses discovered by Dennis Leone that occurred at STRS since 1995.  The abuses occurred even though assets at STRS dropped $12 billion, retirees lost their 13th check, health insurance premiums for retirees significantly increased, active members of STRS saw their STRS contribution rate increased from 9.3% to 10.0%, and school districts were implementing budget reduction plans to make ends meet.  STRS expenditures included:

 1.  $94.2 million on the new STRS headquarters.
 2.  $869,235 on artwork, sculptures and polished stones for the new STRS building.
 3.  $818,000 on a child care services center for the children of STRS employees.
 4.  $500,000 per year to run the child care services center.
 5.  $426,000 on a fitness center in the STRS building.
 6.  $88,397 per year to provide food services for STRS employees.
 7.  $428,056 on 16 cars, vans, and SUV's.
 8.  STRS Board policy that permitted staff members to drive STRS vehicles for personal use, and the family members of said employees to drive said vehicles.
 9.  52 American Express Credit Cards and 20 BP gas cards used by Board members and STRS staff members.
10.  Alcohol purchases incurred by staff members and Board members attending conferences -- using STRS credit cards.
11.  $18,810 on "Discovery Park" gala event, including the purchase of Instamatic cameras for attendees.
12.  $15,100 on new STRS building dedication, including alcohol and gifts for attendees, as well as airfare and lodging for out-of-town STRS visitors.
13.  $4,100 on a private retirement party for an STRS Board member.
14.  $5,594 on poinsettias to decorate STRS during the holiday season in 2002.
15.  $1,000 dinners for 12 board members/staff members on 2 occasions, again with alcohol.
16.  $7,116 for baseball tickets, concert tickets, movie rentals, and Kings Island tickets for STRS employees in the summer of 2003 for "team building."
17.  $530,284 spent by Board on trips and meetings around the country in 2000, 2001, and 2002.
18.  Multiple trips taken by Board members and staff to places like Honolulu, Palm Springs, Kiawah Island, and Anchorage.  A planned trip to China in 1995 was cancelled after it was suggested that it would have the appearance of junketeering.  
19.  Frequent occurrences of at least 6 Board members going to the same meeting, sometimes twice a year, costing STRS over $9,000 each year.
20.  $36,736 spent by a Board member Jack Chapman in a single year for trips all over the country.
21.  $1,017 airplane ticket for a Board member that would have cost $258 if it had been purchased 30 days in advance of the conference.
22.  $1 million cash payback per year to full-time STRS employees for 18 days of unused staff vacation days and unused sick leave.
23.  Total administrative expenses at STRS increased 17.4% per year between 1996 and 2002.
24.  Total STRS employees increased from 414 to 725 between 1996 and 2002.
25.  A total of 1,035 employee bonus checks were issued to STRS staff in 2000, 2001 and 2002.
26.  $24.4 million was awarded in bonus checks to employees between 1998 and 2003.
27.  $3.2 million had to be paid by STRS to PERS because of bonuses alone since 1998 to satisfy that pension system's 13.31% annual employee contribution requirement.  STRS employees are members of PERS.
28.  34 STRS employees in 2002 received bonus checks in excess of $40,000 (with 18 of those getting bonuses in excess of $70,000).
29.  One STRS employee received bonus checks of $110,000 and $68,800 in 2001 on top his base salary of $164,000.
30.  Over 150 STRS employees had base salaries over $100,000 in 2002, with 32 of those making over $155,000 -- topping the salaries of both the governor and the chief justice of the State Supreme Court.
31.  A total of $39,251 was paid to the Perry Local School District by STRS in 2002 and 2003 for sub teacher costs for Board member Michael Billirakis (when he attended STRS meetings), even though he did not have a position in the school district.  NEA pays Perry Local the dollar amount associated with the salary and benefits for Billirakis, enabling him to be listed as an employee.
32.  Excess STRS furniture was sold to STRS employees in 2000 and 2001 for $27,703, and instead of this amount going back into the pension fund, it was given to charities.
33.  The regular work week for STRS employees is 37 1/2 hours.
34.  If an STRS employee adopts a child, the STRS Board awards a $5,000 cash gift to said employee.
35.  Between 1999 and 2004, the STRS Board paid out $2.1 million in educational stipends for STRS employees to take college courses.  This amount was double what the other 4 public pension systems in Ohio paid out, combined, over the same time period.  STRS pays up to $7,000 per year (per employee) for undergraduate or graduate work.

Changes at STRS Since Leone's Report on May 16, 2003

On May 16, 2003, Dennis Leone presented a 13-page position paper that summarized recent spending abuses by the STRS Board.  The report made numerous recommendations for the Board to change its spending practices and to do a better job of representing its membership.  The following changes have occurred since May 16, 2003:

 1.  The 52 credit cards and 39 gas cards held by staff and board members have been turned in.
 2.  All but a couple of the 16 cars, vans and SUV's purchased by STRS have been sold.
 3.  The policy that permitted staff to use STRS cars for personal use has been dropped.
 4.  The STRS staff has been reduced by 100 employees and the administrative budget has been cut.
 5.  New policies prohibit the use of pension money for things like alcohol, parties, movie rentals, Kings Island, concerts, and baseball games, or for airfare, lodging, and gifts for out-of-town STRS visitors.
 6.  New policies require plane tickets to be purchased at least 30 days in advance in order to receive the cheapest rates.
 7.  New policies restrict how many professional meetings Board members can attend yearly, the number of Board members who can attend said professional meetings, and how much can be spent at said meetings.
 8.  The cost to run the STRS child care services center has been reduced from $500,000 per year to $100,000 per year.  It is still promised to be cost neutral.
 9.  Cafeteria services in the STRS headquarters are now cost neutral.
10.  Fees to use the STRS fitness center have been increased.
11.  Bonus checks for non-investment staff have been eliminated -- affecting over 300 employees -- and bonus checks for investment staff will occur only if said employees earn money for STRS.
12.  NEA paid back STRS the $39,251 that the Perry Local School District received from STRS for sub teacher costs for Michael Billirakis when he was attending STRS meetings.
13.  STRS Executive Director Herb Dyer resigned to avoid being terminated, after 105 legislators called for his resignation.
14.  Senate Bill 133, signed by the governor on June 16, 2004, put in place a number of oversight regulations.  It also requires ethics training and travel policies for all Board members.
15.  Senate Bill 133 added another retiree to the Board, removed State Auditor Betty Montgomery and State Attorney General Jim Petro, and added three investment specialists -- thereby stripping OEA of its majority control of the STRS Board.
16.  Senate Bill 133 stipulates that the "big spender" Board members from 2000, 2001 and 2002 -- those who spent in excess of $10,000 per year of pension money on trips around the country -- may never again run for the Board or serve as an appointee to the Board.  This affects Jack Chapman, Eugene Norris, Hazel Sidaway, Gloria Gaylord, and Debbie Scott.  It deserves noting that Eugene Norris, a former OEA officer and Board president in 2004, was defeated in his re-election attempt immediately before Senate Bill 133 went into effect, by John Lazares -- Warren County ESC Superintendent.
17.  Senate Bill 133 contains a disciplinary procedure that will authorize the State Attorney General -- in the event that Board members improperly spend pension money in the future -- to seek restitution, pursue civil charges against Board members, and cause their removal from the Board. 

Bottom Line

 1. It was Dennis Leone who wrote the report two years ago that summarized the spending abuses (hundreds of millions) of OUR pension money by the STRS Board and staff.  The theme of his 13-page report was that the Board needed to change its spending practices immediately and do a better job of representing its members.

2.  You will not see Dennis Leone’s name on any endorsement list by either OEA or ORTA, because OEA and ORTA don't plan on telling their membership who the 5 candidates are and what their credentials are.

3.  When Dennis Leone issued his report on STRS two years ago, the LAST thing he expected was the initial reaction he got from both OEA and ORTA afterwards......OEA wrote a statewide memo that said his findings were inaccurate and "misrepresentations," while ORTA initially try to ignore his report.  It was not until thousands of actives and retirees statewide became outraged over the truth that both OEA and ORTA then said:  "Of course we are concerned about the spending practices at STRS."  His 13-page report stepped on some toes at OEA and ORTA.  (OEA had 5 former officers sitting on the STRS Board, and also caused many retirees to ask ORTA why they had not first discovered what Dennis Leone found.)

4.  To quote Dr. Leone: “I believe an STRS Board member needs to be an uncompromising guardian and caretaker of OUR pension money.”  Ohio law REQUIRES all decisions of the Board to be for us and our beneficiaries.........and this has not happened in the past!!

Questions to Consider

Candidates Leone and Speas have been very active over the past two years, pushing for constructive changes at STRS, addressing the Board, writing the Board, testifying on pension reform legislation and working with legislators on Senate Bill 133.  Have the other three candidates (Green, Chapman and Johnson) done this?  How many times have they addressed the STRS Board?"  (As of March 2005, Dennis Leone has addressed the STRS Board in 20 out of 24 meetings, missing only when absolutely necessary.)

Why isn't ORTA sending out a summary of the credentials of all five retiree candidates?  Is it because ORTA doesn’t want us to make up our own minds?  Is it true that ORTA is sending out a flyer soon to all 110,000 retirees that will not include the credentials of Leone, Green, and Chapman (all of whom are ORTA members)? 

Parting Thoughts

In 2002, STRS told you they didn't have enough money for your 13th check -- right?  But they sure had enough money for parties, alcohol, trips to Honolulu, big bonus checks for staff, and child care services!!

 Once we get him elected, Dennis Leone will be an ADAMANT voice on the STRS Board that will sayTHIS CAN NEVER, NEVER HAPPEN AGAIN!!!”
Larry KehresMount Union Collge
Division III
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