Storm the Taj? What a novel idea!

Why was the storming of the Bastille a turning point in French history?

The Storming of the Bastille

July 14, 1789, was a turning point in the French Revolution, and a symbolic event in European history. It demonstrated that a force of people could challenge a monarchy and overpower it. The six months leading up to July 14 was a period of ever-increasing turmoil.

WHEN ARE WE GOING TO STORM THE TAJ?

Top 25 Salaries of Ohio Pension Systems

From John Curry

December 20, 2023

Ohio public employees & Ohio Taxpayers,

Compare and contrast as below are the top 25 Ohio public pension employees' 2022 salaries  (minus the Ohio Police & Fire Retirement System data). Police & Fire are famous for "foot dragging!"

This data comes to us from the Ohio Treasurer's Office and it updated each year. Notice that the dark blue indicates regular salaries while the light blue indicates bonus amounts added on to their regular salaries. NO Highway Patrol Retirement System employee made it on this "top 25" list. Their highest paid employee was their Executive Director, Carl Roark. Carl's salary is only $154,000 and he receives NO bonus.

17 of the top 25 are STRS employees

7 of the top 25 are OPERS employees

1 of the top 25 is an SERS employee

Here is a link to this chart below:

Is there any doubt that STRS pays way too much in salaries as compared to the other systems? https://checkbook.ohio.gov/Salaries/Pension.aspx

Toledo Blade Editorial: The last things STRS should be trying to do is shut down a forum teachers have effectively used, or paying members' money to consultants so clueless they make such a foolish recommendation.

Keep public comment

THE BLADE EDITORIAL BOARD

December 20, 2023

The State Teachers Retirement System of Ohio is getting some terrible advice from high-priced consultants, which if followed would only deepen the distrust between teachers and their pension administrators.

AON Consulting recommends public participation in the monthly STRS board meetings be significantly curtailed. The fiduciary experts at AON want the STRS board to cut the number of public speakers they’ll allow from the current 15 per-meeting and require speaker requests to be submitted a week before the meeting with written remarks for examination. 

The STRS board wisely ignored that counterproductive advice. STRS members attend their pension board in large numbers. The three-minute public comment opportunity is zealously utilized and gives STRS board members more direct input on important issues than any of the other Ohio pension funds receive on a regular basis. 

In recent years that input has been decidedly negative. Disgruntled STRS beneficiaries use the public comment section of the meeting to argue against many policies advocated by the pension staff. 

There is no issue raised more often than the outrage of multimillion-dollar bonuses for the STRS investment staff while pension beneficiaries have gone years without a cost of living adjustment. 

There are dozens more issues regarding the value of the benefits versus the cost of the teacher contribution, the administrative costs of staff salaries, and headquarters upkeep and credibility of the financial reporting from the STRS staff. But no matter what the issue, the ability of teachers to speak on the issue publicly without prior restraint is the single best way to vent frustration with the pension. 

The public comments have signaled deep dissatisfaction and presaged the results of board elections that have given huge majorities to reform candidates for the last four board seats. In fact, because the teacher comments are publicized through the Ohio Retirement for Teacher Association and the STRS Watchdogs Facebook group, they greatly impact the board elections. 

But it’s surprising the AON Consulting anti-participation recommendation ever made it to the board for public ridicule. STRS has a huge in-house public relations team with the top managers well into six-figure salaries. Anyone who has ever seen Ohio teachers address the STRS board would understand the hell to pay for restricting that forum.

Read the rest of the article here. 

What??!!! Where are they all going?

Thanks to John Curry for this one.

December 19, 2023

Overheard.....

 OMG, no WONDER OEA dues are so wild!!!

Edward Siedle exposes a BIG LIE from STRS -- and it's hurting YOU!

Ohio Teachers Pension Fees Are More Than Double What The Pension Reported

In 2021, when STRS Ohio was touting investment fees of only $279 million, we estimated fees of nearly $1 billion. A new analysis based upon pension reports shows total fees of over $800 million.

EDWARD SIEDLE

DEC 19, 2023

It’s no surprise that the State Teachers Retirement System of Ohio has for years been grossly under-reporting the fees it pays Wall Street. It’s not alone.

In June, 2021, my firm issued a blistering report entitled The High Cost of Secrecy: Preliminary Findings of Forensic Investigation of State Teachers Retirement System of Ohio, Commissioned by Ohio Retired Teachers Association. As we noted at the outset of the report, the overwhelming majority of the most critical disclosure information we requested pursuant to state public record laws regarding the pension was summarily denied. Most disturbing, not a single prospectus or offering document required to be provided to all investors under our nation’s securities laws was provided in response to our public records request.

In our findings, we included our estimate of the total investment fees and expenses the pension paid to Wall Street. Our estimate was based upon expert knowledge of industry practices. However, we were not provided with any of the documents which would have enabled us to prove the exact amounts actually paid. Worse still, we were not even able to establish whether the pension itself possessed the key documents—documents required for the pension to substantiate its fee disclosures.

Here's what we said in 2021: 

“It is stated that the pension’s investment cost of 40.1 basis points was below its benchmark cost of 54.5 basis points which suggests that the fund was low cost compared to its peers., i.e., was low cost because it paid less than its peers for similar services and had a lower cost for implementing its style. The report later states that the investment costs were $279.1 million or 36.9 basis points and $302.8 million or 40.1 basis points when hedge fund performance fees and private equity base management fee offsets were added. However, it is disclosed that transaction costs and private asset performance fees were not included in the latter total.

Further in the report, performance fees of $160.8 million are estimated in 2018. When performance fees of $160.8 million are added in, the revised fee total rises from $279.1 million, then $302.8 million to $463.6 million or 61.3 basis points, versus the 40.1 basis points noted earlier. This cost is significantly greater than the fund’s benchmark cost of 54.5 basis points, suggesting that STRS was high cost compared to its peers. Again, these findings appear to be strikingly different from those publicly touted by STRS. However, it appears that even the $463.6 million estimated total cost is incomplete.

In our opinion and based upon forensic investigations we have undertaken, there is ample reason to believe the total fees are nearly double what the pension is reporting, amounting to almost $1 billion annually. To put the hidden, unreported fees—alone—into context, they amount to $2.75 million per school day, and more than twice the $210 million required to pay STRS COLAs annually.”

In summary, in 2021, lacking any of the key investment reports, we estimated total fees of nearly $1 billion, while the pension—with complete access to all documents—reported fees of only $279 million. 

A month later, in August 2021, STRS Ohio fiercely disputed our estimate, preposterously asserting—contrary to the federal securities laws (and the SEC’s website)—that performance fees are not investment costs! 

We recently were made aware of the following Total Expense disclosure prepared for certain members of the STRS Ohio board detailing fees amounting to—wait for it—in excess of $800 million. 

That’s far closer to the near $1 billion we estimated—again, without access to any of the investment documentation we requested from the pension. We have every reason to believe this higher fee analysis, while closer to the truth, fails to include all multiple layers of fees and expenses.

So, how could a state pension with 500 employees and full access to all documents related to its investments, have under-reported the fees by $500 million? That’s the question pension stakeholders, including participants and taxpayers should be asking.

Rudy Fichtenbaum on what would have happened if STRS used index investing

From Dr. Rudy Fichtenbaum,

STRS Ohio Board Member

December 18, 2023