Saturday, March 17, 2007

RH Jones: ORTA off base

RH Jones to Rep. Gordon Rice, March 17, 2007
Gordan, ( My District Rep.)
ORTA is off base and struck out. It is a lame excuse that it is old news at 4-6 weeks. All the excesses of photos and social "news"are sometimes 4-5 wks. old.
Bob Jones

Duke Snider to Ann Hanning: Time to step down

From "Duke" Snider, March 17, 2007
Subject: Fw: Refusal to print Dennis Leone Article
A. Hanning,
Well, ORTA seems to be living up to their reputation as in the past. Ms Hanning, my first impression is the same as in the beginning. I believe it's time for you and others to step down.
Duke Snider, one of the southern Ohio malcontents

Comments on the ORTA issue

From John Curry, March 17, 2007
Molly - I also asked Dennis if it was OK to put the article out on my chain. Also, I had CORE Pres. & VP permission to send it out as a CORE Alert. If we had to depend on some organizations to grow backbone for reform at STRS.... we would still be living in the year 2000 and Herb Dyer would still be calling the shots! John
From Molly Janczyk, March 17, 2007
Subject: AND! Spoke With Don Bright
Don, Please do not use 'ORTA-ese' and place responsibility on someone else. Make this happen, please.
Dear Don, Please do not let this happen. It is grossly unfair. State your restrictions straight out prior to the next articles and I assure you, I WILL NOT put out articles prior! I AM THE ONE WHO ASKED LEONE IF IT WAS OK TO SEND OUT! HE HAD NO IDEA IT WAS NOT! BLAME ME: NOT DENNIS AND YOUR MEMBERSHIP!! I was SO pleased when you stood up to introduce yourself to me at a CORE meeting. This should not hamper relations as no one knew the rules.
Most respectfully, Molly J.
From Nancy Hamant, March 17, 2007
Subject: Fwd: Fw: Spoke With Don Bright
Molly Janczyk points out that ORTA had ample time at last Thursday's CORE meeting to state that the article would be withdrawn if it was disseminated prior to the ORTA Journal publication.
Again ORTA reacts in a "hot-headed" manner to what it feels are slights or incursions on it. ORTA, as in the past, reacts instead of being proactive!
Nancy B. Hamant

Molly Janczyk to Dave Speas and ORTA: Lay out the rules BEFORE the fact

Molly Janczyk to Dave Speas and ORTA, March 17, 2007
Subject: MEMBERSHIP should determine what THEY want: ORTA Refuses to Publish Column
What copyright? It is Leone's with no agreement to exclusiveness. CORE Leadership asked LEONE who owns the article and he said he did not feel there was a conflict since nothing had been said about exclusiveness. Did ORTA LEADERSHIP not think to state such vs. stating it after the fact? Please! Just a convenient excuse to not use the article because Leone is too explicit for them. So, talk about limits BEFORE the fact so ALL know the RULES OF THE CHANGING WINDS AND DAY!

And they wonder why membership is in decline?

From a retiree to Ann Hanning, March 17, 2007
Subject: Refusal to print Dennis Leone Article
ORTA continues to grow mushrooms. (FYI, keep people in the dark and cover them with horse s---.)
You have done it again. Many of us thought that progress was being made to make improvement in ORTA. The recent actions have taken retiree confidence back to Page 1. I am ashamed to be a life member of this organization.
(name withheld due to request)
Please feel free to share this email with Jim Bright and and others that were involved in this decision making process.

Jim Kimmel to Ann Hanning: 'COULD' -- but not yet!

Jim Kimmel to Ann Hanning, March 17, 2007
Subject: Censorship of Dennis Leone
How narrow and petty! Dennis Leone's words need to be read by as many people as possible! So what if his words come up on the Internet first? I had been an ORTA member but quit when ORTA failed to support Dennis and CORE some years ago. CORE and Dennis have been the only salvation -- not ORTA. ORTA Board's attitude is condescending and narrow minded about the very teachers it purports to serve. I was about to rejoin but now changed my mind. ORTA and CORE could work together and complement each other in many ways for the betterment of the cause. COULD -- that is the operative word. But apparently not yet! Reconsider you decision about Dennis Leone's column!
James O. Kimmel, M.Ed
STRS Retiree
Proud Core Member
FORMER ORTA member, and NOT proud of it!

ORTA decides what's fair and it's ORTA's newsletter to publish as they see fit? Why does this have a familiar ring?

Dave Speas to Molly Janczyk and Ann Hanning, March 17, 2007
Subject: Re: ORTA Refuses to Publish Column
Molly and Ann,
It saddens me to see two organizations who profess to work for retirees having a squabble over something like this. The Quarterly belongs to ORTA and has been for years. Did the CORE leadership not think about asking officially if they could use the article on the Internet before they voted to do so? I have written articles for many publications and it is clear that the article in a copyrighted publication does not belong to me. ORTA should let this pass, publish the article and move on as I believe both organizations are making a big mistake.
Cordial relationships are built on lines of communication on both ends. I am so tired of seeing organizations who profess to be for the retirees end up in public squabbles and all sides looking smaller for it. Our membership will probably not have to read the Quarterly as they will have read Dennis' article as it is sent out. Can't the leadership of both organizations sit down and discuss the differences before they become public?
I was taught to give the other party the opportunity to sit down and talk before public disagreements were aired. How terrible it would be if schools allowed disagreements between parents and teachers, teachers and administrators, coaches and parents, boards and administrators, and so on before the opportunity to sit down and find out there is very little wrong that cannot be taken care of in a civil manner. Working TOGETHER for retirees should be the number one goal for all the retiree organizations and open communication and thoughtful gestures toward one another are necessary for harmonious and one for all strength to be used. All parties in this issue should find a way to bury this small issue and get back to fighting the real battles.
From Molly Janczyk, March 17, 2007
Subject: Re: ORTA Refuses to Publish Column
Freedom of press controlled by a small band rather than asking membership what they want.
Ryan Holderman to Molly Janczyk, March 16, 2007
Subject: Re: ORTA Refuses to Publish Column
Dear Molly:
Just when I was beginning to think that a positive relationship with ORTA might be possible its leadership betrays that trust with this sort of action!
We have, as you so clearly stated, welcomed ORTA leaders to our CORE meetings, sought to help with several mutually beneficial initiatives, and trusted that positive change was in the offing.
It would seem that we've been mistaken after all.
Sincerely, Ryan

Dennis Leone: STRS Report, March 2007

Ohio Retired Teachers Association (ORTA)
By Dennis Leone, STRS Retiree Board Member
March, 2007

After my last column was published in October of 2006, the Board agreed to re-visit a motion I made months earlier to prohibit Board action on vendor contracts unless the Board first had an opportunity to review a summary of the proposed contracts. My original motion, as you may recall, was defeated 8-2, with only John Lazares joining me in support. Many retirees, in the months following, expressed their consternation over the 8-2 vote.

I am pleased to report that on October 20, 2006, the Board voted 7-2 to approve a motion I made (seconded by Lazares) that will require the STRS staff to provide a summary of all proposed contracts for services provided directly to the Board, and for any proposed contract in excess of $100,000. Former Board member Geoffrey Meyers and current Board member Mark Meuser voted against this initiative.

I am also pleased to report that 13 changes I desired in the Board’s travel and expenditure policies were adopted 9-0 on February 15, 2007. The changes were long overdue. Here are some highlights:

  1. There will be no reimbursements for meals in the future unless itemized receipts are provided. This is the only way to make sure that pension money is not being used to purchase alcohol.
  1. Airplane tickets must be purchased 30 days in advance, and Board members who choose not to do this will pay the difference in cost between the two tickets. Also, Board members – not STRS – will personally pay for any additional fees charged by the airline if ticket reservations are changed for personal reasons.
  1. The previously adopted $6,000 maximum for individual Board members to spend on out-of-state trips per year did not include the conference fee for registration or tuition. Now it does. Board member Conni Ramser last year spent well over $6,000 on out-of-state trips, but this was not in violation of Board policy because her conference registration fees weren’t part of the calculation. They will be now.
  1. Meal reimbursements are now limited to $10 for breakfast, $15 for lunch, and $25 for dinner. Previously, Board members could spend up to $60 per day, which meant that if Board members passed on breakfast and received a free lunch, they could – and did – spend $40 or $50 on a single dinner. My original proposal called for spending limitations of $5, $10, and $20, but the majority disagreed.
  1. No overnight lodging will be provided by STRS on the day that Board meetings end or the day after conferences conclude. I will never understand why the previous policy permitted this. It was so wrong.
  1. Board members will not be reimbursed for expenses while attending in-state meetings unless they are a formally invited speaker or an official participant at the meeting, or unless the Board votes to approve attendance in advance. There were examples in the past when some Board members would decide on their own to attend an association meeting and expect to receive a travel reimbursement.
  1. STRS funds will not be used ever again to purchase credit cards, fax machines, fax lines, or lap top computers for Board members. Also, Board members cannot expect STRS to pay for their personal long distance phone calls when they are attending meetings. It was an embarrassment that Board policies permitted these things, and that – up until a few months ago – several Board members still were contending that such expenditures and reimbursements were reasonable.
Two points of irony regarding the above changes:

No. #1: Three weeks to the day after the Board adopted the revisions, Gov. Strickland ordered a meal reimbursement freeze for certain state agencies like the Ohio Board of Regents – a group that used taxpayer money for a $1,000 dinner. (Sound familiar?)

No #2: My push for the travel policy changes was triggered after Gary Hollow, from OEA-R and NEOEA-R, made a public records request for the travel expenditure report of one Board member – me. He did not express any interest in seeing what the other Board members were spending. He wanted to see what only Dennis Leone was doing. Damon Asbury then produced a travel expenditure report for all board members. What did it show? Credit cards had been purchased for Board members Conni Ramser, Michael Billirakis, Jeff Chapman, Mary Ann Cervantes, and Steve Puckett. A fax line, with a monthly fee, had been purchased for the home of Michael Billirakis. STRS paid for the long distance phone calls Steve Puckett made when he attended a conference in Orlando. Single meals costing in excess of $40 existed for several board members. I wonder how Mr. Hollow and OEA would have reacted if the travel reports for only Dennis Leone or John Lazares had shown these types of expenditures? I think I know.

I wish to explain why John Lazares and I were the only board members who voted no on November 16, 2006, when the board set the reimbursement rates for Medicate Part B retirees, and therefore increased the out-of-pocket costs for said retirees. We both felt: (A) The Board needed to first consider other options for change, like the $1.4 million dollar premium fee STRS pays yearly to provide a small $1,000 life insurance plan for all retirees; and (B) We couldn’t support such an increase for Medicare retirees when STRS money still was being used for things like Board member credit cards, fax lines, lap tops, and phone bills. ORTA, in my opinion, should have supported Lazares and me on this issue.

Finally, I have an obligation to share with retirees why I disagree with published projections by STRS that our current 47-year unfunded liability is projected to hit the desired 30 years by 2009. Note the four charts below:

(Click image to enlarge.)


The increase of about 3,500 retirees per year is what we expect. However, the average decrease of 1,626 active teachers per year over the past three years was not expected. Another decline not expected has been the payroll growth in the past three years. STRS budgets for an anticipated payroll growth of 4.50% per year – not the 2.71% average we’ve received over the past three years. The staff projects only a 2.50% increase for fiscal year 2007. What’s keeping our heads above water? The fantastic investment returns we’ve received – averaging a whopping 14.45% over the past three years. Through eight months in fiscal year 2007, we’re receiving another 12.50%. (STRS budgets for returns totaling 8.0%.) My point is simply this: Absent a continuation of the great investment returns, we will not offset the realities (if they continue) of the other three areas shown above. I am hopeful my fellow board members will be agreeable to approving a contingency plan to minimize the negative impact of a significant stock market downturn. More on this, and my recommendations for such a plan, later………

*Note: While this article was submitted to ORTA in a timely fashion, they refused to publish it or give an intelligible reason why.
Original posting date: March 11, 2007; redated to assure appearance on blog

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Molly Janczyk to ORTA, Tom Seamon: You give after-the-fact notice?

From Molly Janczyk, March 16, 2007
Subject: ORTA Refuses to Publish Column
ORTA, Tom Seamon: Since this condition has never been stated and it is not a previously known practice, it seems unfair to make this now a condition. We shared this article with Dennis' permission as many members are not ORTA and we do not reach many all ORTA membership. If this is to be a condition, then it should start with notice after this printing or in this printing along with Leone's article. You obviously have many members who WANT to receive his articles since he is invited to so many RTA's over and over and new ones all the time. This is not the way to do things: 'after the fact' notification having never been told this previously.
This is akin to one newspaper not printing something because another paper reaching some of the same folks printed info on the news when many others are not reached by the other paper. So they state they will not print an article or an editorial because someone else printed it. WE ARE an alternate form of communication. Some who receive us also receive your news. Some only receive ours and some only receive yours. Since when is news curtailed because of another source publishing information.
I think we have made progress recently in communication and this would surely be a major step back for you to keep information from your membership simply because CORE sent it out. You have approx. 40,000 members before OCHER and we certainly do not reach many of them. It is unfair and arbitrary and punitive to behave in this manner.
Please reconsider. We pass your info all the time including your updates and any articles with no mind to whom they may or may not have been previously sent. We welcome you to our meetings and you have access to all our information. I am deeply disappointed by this decision and hope you are open minded and independent enough in your thinking to be flexible.
Molly Janczyk

Molly Janczyk to ORTA: It is a new day and you will not attract new members with this kind of decision

From Molly Janczyk, March 17, 2007
Subject: Re: ORTA Refuses to Publish Column
I think this is an excuse by ORTA for perhaps several reasons. Too specific naming persons and organizations and not in line with what ORTA articles generally are: generic: Chapman's articles are nice and generic say not much of anything of any import. It is a new day and you will not attract new members with this kind of decision. Newer retirees want total truth and more contemporary attitudes. The website has been updated, thinking needs updating as well.
There is no reason for this and if a problem existed, it should have been worked out and certainly mentioned on Thurs. during the discussion on it going out on CORE Alert.
We are also an avenue of info and research and issues. Does one paper not report a story because another one does? This is not acceptable and easily rectified.

Friday, March 16, 2007

ORTA drops the ball again

From Kathie Bracy, March 16, 2007
Subject: Publishing Dennis Leone's column

Dear Mr. Seamon,
I am very puzzled about your decision not to publish Dennis Leone's latest STRS Report so that many thousands of retirees would be informed about what is happening with their pension system.
I understand you have indicated there is a policy that prohibits ORTA from publishing such a column in the Quarterly if it has been distributed beforehand. I have some questions I would like to have answered.
  1. When did this policy go into effect?
  2. How is it worded?
  3. What is the rationale for such a policy?
  4. Has the ORTA board ever considered revising/updating it? If not, why?
Surely, you are well aware that in this age of technology, news travels at an incredible speed, and those of us with computers are able to take advantage of this, while many have to wait for newsletters, etc. I am extremely grateful to ANYONE who can get news to me quickly about what is going on at STRS. Why in the world would I want to wait for a newsletter that comes out a few times a year to read important news that is happening NOW? Why does ORTA persist in clinging to such an outdated policy? This is the 21st Century -- WHEN IS ORTA GOING TO GET ON BOARD? No wonder many retirees STILL have no clue about much of what is happening at STRS. YOU PEOPLE ARE KEEPING IT FROM THEM!! I hope you are proud of that -- I sure wouldn't be.
Kathie Bracy
Life member of ORTA, but not proud of it

CORE and one-upmanship by ORTA? The beat goes on and on and ON........

Dennis Leone to Kathie Bracy, March 16, 2007
Subject: Re: ORTA Refuses to Publish Column
I called Don Bright, ORTA president, tonight at his home in Bowling Green. I told him that at no time did anyone tell me that there were privacy conditions with anything I wrote. I also asked him "what's the difference anyway.......shouldn't the real issue be what retirees are entitled to know?" This should not be an ORTA issue of who is first to publish something.
I told him that Ann Hanning or he should have called me. In fact, I told him, neither Ann nor he has ever called me about anything since I've been a board member. Nothing about the policies I have advanced, nothing about the changes that have occurred, nothing in the way of input or support or suggestions. Nothing. That's it. His response tonight: "We'll try to do better."
I am convinced this is about CORE and one-upmanship.

Thanks to some obscure policy not spelled out to Dennis Leone in advance, ORTA refuses to publish a report they invited him to submit.

Why are we not surprised? Nice going, ORTA -- thanks to you, THOUSANDS will have no clue what is REALLY happening at STRS. Yes......the beat goes on....and on.....and ON!! KBB

Dennis Leone to Tom Seamon, March 16, 2007
Subject: Re: STRS Report
Since when is it ORTA's policy, as a condition for a column to be published, to tell another with whom he/she should not share something he/she has written. I just wonder how many ORTA members, then, will not see it. Is there a certain number to dictate your decision?
The beat goes on with ORTA..........
Dennis Leone
Tom Seamon, March 16, 2007
Subject: STRS Report
Friday, March 16, 2007
Dear Dr. Leone,
I was somewhat surprised yesterday to receive several emails that included your STRS Report to ORTA. I haven’t sent the Quarterly to the Printer yet. It is not due to be mailed to our members until the first week in April. I don’t know if you were aware of this premature distribution. Our usual procedure is to send our articles to our web site a week after the publication has been mailed. I even found the report on a member blog, and one email labeled it a “CORE Alert.”
I have consulted our executive board and they agreed with me that there is no reason to publish an article that will be about 3 or 4 weeks old by the time it is in the hands of our members.
For this reason, I must inform you that we have decided not to include your STRS Report in the Spring Quarterly.
I hope you understand,
Tom Seamon
Editor, The ORTA Quarterly

Marc Dann to speak in Brown County on March 30

From Sondra Stratton, March 16, 2007
Subject: Re: AG Dann kicks more butt!

Dann will be the speaker at the annual spring democratic dinner to be held on Friday, March 30, 2007 at Rhomemus (named after one Al Rhonemus) Hall on the Brown County Fairgrounds.
Tickets are $20 each and can be purchased in advance from any central committee member or at the office of attorney Pat hours are 9 AM-noon Monday through Friday. His office phone number is: 937-378-4769.

STRS: March Board News

From STRS, March 16, 2007
Subject: March Board News Details Retirement Board Actions and Discussions
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 March report follows.
RETIREMENT BOARD APPROVES 30-YEAR FUNDING REPORT At the State Teachers Retirement Board's March 2007 meeting, the board approved a report showing that STRS Ohio is on track to return to a 30-year funding period for its pension fund within two-to-three years, assuming there are no net actuarial losses. This report will now go to the Ohio Retirement Study Council (ORSC), which, by law, must receive a plan from any of the five Ohio public pension plans whenever the amortization period for their unfunded actuarial accrued liability exceeds 30 years. (ORSC is the legislative oversight body for Ohio's five public pension plans.) This report is posted on the STRS Ohio Web site
In November 2006, the State Teachers Retirement Board adopted a report from its actuary, Buck Consultants, detailing the actuarial funding status for pension benefits as of June 30, 2006. In reviewing the actuarial gains and losses for the fiscal year, it was reported that an actuarial gain of $958 million had been experienced and the funding period had dropped to 47.2 years from 55.5 years. The funding period should continue to decline toward 30 years.
ACTUAL EXPERIENCE COMPARED TO ASSUMPTIONS IS RARELY IN SYNC As part of these projections, STRS Ohio expects that in the next two years some actuarial assumptions will be met or exceeded; others will fall short. For example, for the past three fiscal years, payroll growth has not been at the expected level. As a result, STRS Ohio recognized a total of $1.1 billion in losses for that particular assumption.
On the other hand, investment returns have far exceeded the actuarial assumption of 8% for the past three years; the compound rate of return has been more than 14.5%. For STRS Ohio, this means that last year it had a market-related investment return gain of $1.49 billion, plus more than $4.3 billion of additional investment gains that were "deferred" to 2007, 2008 and 2009 because of smoothing.
Because the market value of investments can literally change daily (e.g., U.S. stocks traded on the national exchanges), there is a tremendous amount of volatility in this assumption. Public retirement systems across the country, including STRS Ohio, use an approved accounting and actuarial technique called "smoothing" to spread this volatility over a longer period of time when recording investment returns as part of the annual actuarial valuation process. It makes investment returns more of a "trend" rather than a "spike." This smoothing results in a market-related value of investments. Most public pension plans smooth investment gains and losses over three-to-five years; STRS Ohio has used four-year smoothing since 1997.
As noted earlier, STRS Ohio assumes that the value of investment assets will increase 8% each year. Anything more than 8% is a gain, and anything less than 8% is a loss. With four-year smoothing, each year's gains or losses are recognized evenly over the current and subsequent three years: 25% per year. The calculation is done every year, so it just rolls forward.
A REVIEW OF ALL ASSUMPTIONS IS PLANNED IN 2008 Public pension systems typically review all their actuarial assumptions every five years; STRS Ohio is slated for such a review in 2008. This ensures that the board will have an ample amount of experience in each area with which to make future assumptions. In addition to payroll growth and investment returns, the board will also look at such areas as retirement trends, benefit recipients' mortality and annual teacher salary increases.
There is no actuarial assumption specifically regarding the number of active members in the future per se. A member's contributions, plus the employer's contribution and investment earnings, are expected to fund that member's benefit in retirement. The percentage increase or decrease in payroll growth reflects both annual salary increases for teachers and the number of members. If membership is not increasing, payroll growth is less likely to increase 4.5%, which affects the amount of time it takes to pay off the system's unfunded liability.
There is likewise no assumption about the number of retirees in the future. As noted above, the value of each retiree's benefit is accrued throughout that individual's career, so the expense is recognized every year -- even though the benefits are not being paid in cash. However, there are assumptions about how many members will retire at various points in their career (e.g., 30 years, 35 years, age 55 and 25 years, age 60 and five years, etc.). As noted above, this is one of the assumptions that will be reviewed in 2008.
CONTROLLING FUTURE LIABILITIES IS IMPORTANT The actuarial funding for STRS Ohio pension benefits is improving, primarily due to investment income. The Retirement Board members also took a prudent step to control future liabilities in February 2006, when they reached consensus that they would consider pension benefit improvements only when the funding period is less than 30 years and the funding ratio exceeds 85%. In other words, "13th checks," compound cost-of-living increases or enhanced pension benefit formulas cannot be considered at this time.
Further, if the contribution increase being sought through the health care legislation can be obtained, the current 1% of employer contributions going toward health care can start flowing back into the pension fund, further accelerating the speed at which the pension fund's unfunded liabilities are reduced.
TAI HAYDEN UNOPPOSED FOR RETIREMENT BOARD ELECTION In November 2006, Taiyia (Tai) L. Hayden was selected by the current board members to fill the contributing member seat vacated by Michael Billirakis in September. The term for this seat runs through Aug. 31, 2007. However, Hayden was the only STRS Ohio contributing member to file enough completed petitions for the election for this seat by the deadline of Feb. 23, 2007. Therefore, according to Ohio statute, no election needs to be held since she is unopposed and she will continue in this seat through Aug. 31, 2011. Hayden is currently a kindergarten teacher with the Columbus Public Schools.
7, 2007, Ohio Attorney General Marc Dann announced that AOL/Time-Warner agreed to terms with the five Ohio retirement systems and the Ohio Bureau of Workers' Compensation (BWC) to settle a securities fraud opt out case. BWC and the state pension funds will share a gross settlement of $175 million and a net amount of $144 million after reductions for attorney fees and expenses. STRS Ohio should receive about $66.5 million, pending final negotiation of the settlement. This is approximately $62 million more than what STRS Ohio would have received if it had not opted out of the federal class action suit and instead remained part of the class. The securities fraud case alleged that AOL inflated its stock price before merging with Time-Warner in January 2001. The suit sought recovery of funds lost by the pension systems and BWC when the price of AOL/Time-Warner stock fell dramatically in July 2002.
HEALTH CARE STRATEGIC PLAN REVISED In May 2005, the Retirement Board adopted a comprehensive Health Care Strategic Plan for 2007-2009. This plan outlined steps the board and staff would take to: help control medical and prescription drug costs; encourage members to take an active role in managing their health; and engage members in discussions regarding how to fund health care coverage in the future. The Health Care Advocates for STRS provided extensive input during the development of the plan. At the board's March 2007 meeting, revisions to the plan were adopted to reflect the progress board and staff have made on many of the strategic plan's components, including work on the legislative proposal to fully fund the health care program on a 30-year basis. Future issues of the STRS Ohio newsletters, as well as the STRS Ohio Web site, will provide details about the changes to the Strategic Plan.
RETIREMENT, INVESTMENT TRANSACTIONS APPROVED The Retirement Board approved the following retirements and investment transactions:
- 132 active members were approved for service retirement; 58 inactive retirements were approved.
- In February, fixed-income purchases totaled $548 million, domestic equity purchases totaled $572 million, and real estate purchases totaled $36.8 million.

STRS OHIO RETAINS TOP CREDIT RATING Standard & Poor's (S&P) affirmed STRS Ohio's "AAA" issuer credit rating in February. This rating is S&P's highest possible rating for an organization's ability to pay its financial obligations. STRS Ohio has maintained the AAA standard since first requesting a rating in 1999.
The STRS Ohio news e-mail list is designed solely to provide timely and accurate news and information about legislation, benefits and other issues affecting the STRS Ohio membership.
To view past news e-mails, go to
If you wish to comment on a topic, please either e-mail or call the Member Services Center toll-free at 1-888-227-7877.

Thursday, March 15, 2007

Update on John Lazares

From Molly Janczyk, March 15, 2007
Subject: Subject: Our Lazares...........
is rising again!
Tricia called to update. John came home last Fri. and had a rough weekend complete with fever on Sat. But it turned out to most likely be 'bug.' However, he is now improving and today, Thurs., is better and Tricia said, "It finally feels like he is stable."

Good news from Dennis Leone: Sen. Kirk Schuring elected chair of ORSC

From Dennis Leone, March 15, 2007
Subject: Good News

To all: Learned today that State Senator Kirk Schuring has been elected as the new Chair of the Ohio Retirement Study Council. This is good news. Kirk has supported retirees many times, in many ways, in the past 4 years.
Dennis Leone



Report on 3/15/07 STRS/CORE meetings from Mary Ellen Angeletti

Attorney General Marc Dann addresses STRS Board
From Mary Ellen Angeletti, March 15, 2007

Subject: CORE/STRS Meetings - March 15th
Glenna Barr will be sending out detail minutes of the CORE meeting later.
I have already sent you the Public Speaks speakers. Since the two speakers spoke on the same subject regarding the changing schedule for the STRS Board meetings, Ms. Ramser addressed the reason for needing to adjust the schedule again this month. Apparently there is an attempt to consolidate the STRS business into one day or to reduce the current number of days (Wed. Thurs. & Fri.) in the interest of saving travel time, expenses, and accommodate teaching schedules for the active teacher members. Dr. Leone asked if consideration could not be given to a motion to have Public Speaks, health care, and pension benefits on Thursdays out of consideration for the retirees who attend the meeting that day. There was some discussion. Ms. Cervantes suggested that an effort be made to TRY to schedule these reports on Thursdays without a formal motion. Dr. Leone asked how other Board members felt. Mark Meuser said they must consider the retirees when scheduling reports. Dr. Puckett agreed that they should try out the effort. It was left this way.
Russ Harris, OEA, spoke to CORE concerning the constitutional amendment (Glenna will be reporting on this as well). Everyone attending the CORE meeting today received petition guidelines for the Initiative Petition which we were asked to circulate to any registered voter to collect signatures. Everyone received an Initiative Petition as well. I have 16 petitions which folks can get from me. Mr. Harris arranged for more petitions to be delivered to STRS for us to take home with us and pass out.
Some general guidelines are:
1. A voter can sign only one petition.
2. A voter should NOT sign the petition he/she is circulating.
3. When signing, one must use the address on file with the Board of Elections.
4. The petition must be signed in ink.
5. One petition has space for 72. signatures.
6. The date must be correct on the petition.
7. The ward/precinct is not necessary.
8. All signatures must be registered voters residing in the county listed on the first page of the petition.
9. A petition Circulator may circulate petitions from more than one county at the same time, provided that each county is on a separate petition.
10. All completed petitions must be returned to the Labor Relations Consultant who will then forward to Bonnie Joseph at OEA headquarters.
11. The Circulator must complete the Statement of Circulator at the back of the petition but the name and address of employer is NOT necessary. All other info. is required of the Circulator.
Following Dr. Asbury's Executive Director's report, Dr. Leone asked about the pension forfeiture bills that have been introduced that would prohibit a member convicted of a felony related to his or her official duties from collecting the employer portion of a public pension. Only a refund of accumulated employee contributions and interest would be paid. The Senate bill would also prohibit a felon from running for office for any political subdivision of the state. System staff have met with the sponsor of the House bill to discuss implementation issues.
Dr. Leone also inquired whether Mr. Warner's (who spoke last month during Public Speaks) concerns and questions had been answered. His questions concerned the high expenditures for certain medical supplies. Dr. Asbury said that they had not been answered yet but that the Member Benefits staff was working on getting answers to his questions. Next Dr. Leone inquired as to whether the revised travel policy had been extended to the STRS staff and again Dr. Asbury said that they were working on this. Finally Dr. Leone asked about the Lifemasters program and whether retirees may refuse to give certain personal information when they sign up for this program. all retiree information obtained by Lifemasters was confidential. Dr. Asbury said that all retiree personal information obtained by Lifemasters must be kept private. It is confidential information.
Marc Dann arrived following Steve Mitchell's Investment Report. After Ms. Ramser welcomed him, he said that he is meeting with ALL pension boards. He introduced his Assistant Attorney General, Tom Winter. He said that he wanted to share his philosophy of the Attorney General's office which would be responsive and available to STRS to deal with both large and small issues and provide hands on, high level legal service to STRS. He then announced success in the settlement of the AOL/Time Warner case which he said turned out to be much more successful for STRS and the other pension systems than if the case had been handled as a class action suit. He was able to achieve a $66 million dollar settlement for STRS, $175 million total for all of the pension systems. He promised to be client sensitive. . .more selective in choosing cases. He wants to change the way the Attorney General's office interacts with STRS by training certain members of the STRS staff.
He also will consider three options regarding cases:
1. Sit and wait attitude
2. Seek lead plaintive status
3. Opting out of class action and pleading alone.
Many STRS Board members asked questions and thanked Mr. Dann and his staff for the money from the AOL/Time Warner settlement. Dr. Leone reminded Mr. Dann that at one time, the Attorney General had a representative on the STRS Board which was wrong. Mr. Dann agreed saying that it had been a conflict of interest situation & should never had occurred. Dr. Leone also reminded Mr.Dann that his office must act as a watchdog over STRS and the other pension systems. Dann agreed saying that all five systems would be provided oversight. He said that he would strongly offer independent judgment which would not be beholden to government or any pension system. He also offered that he had come from a law firm of 4 lawyers in which mistakes had been made. He is now the head of a 350 lawyer firm, and he is certain that mistakes will be made so he said to let him know.

Glenna Barr's speech to the STRS Board, March 15, 2007

Good afternoon, Dr. Asbury, Board Members, staff, and visitors.
I was disappointed when I opened my email Tuesday to find that the Thursday a.m. session was not going to be held. Also the health care benefit discussion was to be held on Friday again. I realize that all the Board members have schedules in their respective jobs to meet. However, for the retirees who wish to attend the Thursday session to speak and hear about health care and pension information, Friday is in most cases out of the question due to travel time, energy, and expense to attend both sessions.
Health care is of most importance to me and the eight Southwest counties retirees. I travel t the eight counties to speak to the ORTA county retiree associations to give them information as well as many of them call me regarding questions on this subject. This is not the first time this has happened. I do not know the reason for not having this Thursday a.m. session. If it is due to a Board member who cannot attend, could another member of the vice chair conduct the meeting? This is truly something for you to consider. Thank you,
Glenna Barr

STRS Board Meeting Schedule: March 15-16, 2007

The State Teachers Retirement Board and Committee meetings currently scheduled at the STRS Ohio offices, 275 East Broad Street, Columbus, Ohio 43215, are as follows:
Thursday, March 15, 2007
...10:30 a.m.
Disability Review Panel (Executive Session)
.....1:00 p.m. Retirement Board Meeting (Public Session), followed by ..................Ad Hoc Committee to Review Webcasting
Friday, March 16, 2007
.....9:00 a.m.
Resumption of the Retirement Board Meeting
The Retirement Board meeting will come to order at 11:30 a.m. on Thursday, March 15, 2007, and is expected to immediately enter executive session. Public session is expected to resume at 1 p.m. on Thursday, March 15, with the Executive Director's Report, followed by public participation and a report from the Investment Department. The first meeting of the Ad Hoc Committee to Review Webcasting will be held when the Retirement Board recesses on Thursday afternoon. The Retirement Board meeting will resume at 9 a.m. on Friday, March 16, with reports from the Member Benefits Department regarding health care and pension benefits. The Board will also address routine matters and any other issues that may require its attention.

Wednesday, March 14, 2007

FLASHBACK -- 3 years ago and it's contract renewal time again -- will transparency demands be included this time 'round?

Medicare changes could save STRS, members millions
By PAUL E. KOSTYU Copley Columbus Bureau chief
March 19, 2004
COLUMBUS — Changes in the federal Medicare program could save the State Teachers Retirement System and its members tens of millions of dollars.
Jim McCready, a consultant with Mellon, reviewed six possible scenarios with the retirement system board Thursday as it tries to design a prescription drug program for 2006 when the Medicare changes go into effect. The plans apply to the 53,000 members who are 65 and older.
The proposals would save the retirement system from $16 million to $54 million annually, but not all would help out retirees with their prescription drug costs.
“Why would we consider any scenario that would increase the retirees’ cost?” said board member Jack Chapman.
Three of the proposals would either keep the retiree contribution at its current 53 percent rate or raise it, costing them $2 million to $7 million.
“We have to make sure we’re fully informed,” said Deborah Scott, who chairs the board’s Health Committee.
The board is not expected to make a decision anytime soon, but wants to be prepared to do so once the federal government finalizes the rules for prescription drug coverage under Medicare.
The plan that seemed to be most attractive to board members was one that would save the retirement system $35 million annually and retirees $19 million by lowering their contributions for drugs. The plan also would extend the life of the retirement system’s Health Stabilization Fund by three years.
It would eliminate the prescription drug benefit but replace it with an annual $1,000 Health Reimbursement Account, which would allow flexibility in how the money is spent.
Board Chairman Eugene Norris said the board needs to move cautiously. “It sounds good,” he said. “But what the federal government giveth, it taketh away.”
Chapman agreed. “We have to have more than an expectation of having money in the bank.”
Also, the committee approved allowing Executive Director Damon Asbury to negotiate a new three-year contract with AdvancePCS Health as the retirement system’s pharmacy benefit manager.
Asbury said he hopes to cut a better financial deal with the company. He also wants the company to allow the retirement system to get out of the contract without penalty should the prescription drug landscape change.
You can reach Copley Columbus Bureau Chief Paul E. Kostyu at (614) 222-8901 or e-mail:

Press release: Rep. Brian G. Williams comments on Gov. Strickland's State of the State address

Akron Representative Comments on State of the State
March 14, 2007
AKRON/COLUMBUS, OHIO – Reflecting on Governor Strickland’s State of the State Address, State Representative Brian G. Williams (Ohio House District 41) said, “As an educator, Governor Strickland’s words will be appreciated by Ohio’s students, parents, teachers, and property owners. With this budget proposal, the State’s share of basic funding for public schools will reach 54% by 2009. I am very enthusiastic and motivated to act on these initiatives, which promise a bright future for Ohio.”
In his first State of the State Address, Ted Strickland, offered words and phrases that will appeal to skeptical Ohioans weary after sixteen years of one-party rule. Strickland’s budget includes property tax breaks for senior citizens through expansion of Homestead exemptions; added opportunities for more senior citizens to stay in their own homes through additions to Ohio’s PassPort Program; cutting increases in college tuition for Ohio’s tuition-poor students and parents; and a budget that is one of the most streamlined in several decades, with only a 2.2 % rise in revenue annually. In part, these improvements will be made possible through accessing Federal funds. Strickland also plans trimming some State departments; harnessing the $5 billion Tobacco Settlement Revenue; cutting subsidies now going to the for-profit charter schools; and eliminating corporate welfare schemes. “This is not going to be an easy budget to implement,” Representative Williams pronounced. “…But for the first time in many years we see money being directed toward programs that our Ohio voters called for in the last election. This plan offers more equality for senior citizens, children, and parents. I particularly identify with the Governor’s comments that for the first time in over a decade Ohio’s public schools will be … constitutional, functional, and exceptional.” Williams said.
The new Governor’s message was one that reflected the House Democrats’ Core Values Policy including:
  • rebuilding the state’s economy through job training and educating all citizens
  • improving Ohio’s higher education system with -0- tuition Increase in ’08; Less than 3% Increase in ‘09 protecting Ohio consumers through changes targeting a reduction in home foreclosures
  • improving access to health care for children
  • rebuilding trust and accountability in state government through greater accountability and transparency
Brian Williams closed by announcing his renewed enthusiasm for the new Ohio and said: “It’s an ambitious plan, but an attainable one with long-term objectives. In the coming weeks, the Legislature will provide the infrastructure to reach these goals, but it will be Ohioans who will stay the course, and be rewarded with an improved quality of life.

A definition of "smoothing" from KPERS

From Kristin Basso, March 14, 2007
Subject: RE: FW: Smoothing
Kathy, looks long, but hang in there. Let me know if you have any questions after going over this ...
Each year KPERS does an actuarial valuation to figure out what our assets are and what our liabilities are. This gives us a snapshot of our financial health.
“Smoothing” is a method used to “smooth” the effect of market ups and downs when calculating the value of our assets for the valuation.
Smoothing calculates the difference between the actual investment return and the assumed invested return. KPERS assumes a return rate of 8% each year.
The difference in the actual return and the assumed return is recognized equally over a number of years. KPERS uses a 5-year period. Losses and gains are phased in to lessen the impact up or down.
With five-year smoothing, for example, a 10% loss in one year shows up as a 2% loss in the following year’s actuarial valuation. The remaining 8% will show at 2% per year over the following four years. The 10% loss is spread out over 5 years instead of showing all at once.
Retirement plans use a smoothing period to reduce year-to-year ups and downs in funding levels and required contribution rates. This method is used for the valuation, but our investment return rates in the annual financial report and on the web are the actual rates.
Kristen Basso
Communications Kansas Public Employees Retirement System
(785) 296-1759
(785) 296-2422 - fax

Dennis Leone: The Anti-spike rule

Dennis Leone to Molly Janczyk, March 14, 2007
Subject: Anti-Spike Rule

The anti-spike rule likely went into effect in the mid-1980s when many professors were loading up on summer classes in their final year of employment as a way to artificially boost their final average salary. The same is true for public school teachers who take 5 supplemental contracts in their final year (thinking it will help their final average salary) or for supts who receive a buyout bonus from the school board. For example, if -- in my last three years of employment -- I got a 3% raise, another 3% raise, and a 10% raise, STRS will only honor three 3% raises for the final average salary. That 10% increase in the final would be brought down to a 3% increase. I told the group that in my opinion, it makes perfect sense. The person receiving a 10% increase made STRS contributions for that higher amount only in his/her last year of work (instead of his/her entire career) it would not be fair to base one's life pension, in part, on a spike he/she had in the final year. Doing so would mean that active teachers would have the burden of covering the increased costs.

Last month, during an appeal before the Board in exec session, one teacher argued that her increase in the final year was based on an "overload" of pupils she received. In other words, she got more money because she taught more kids. We told her, however, that a spike is a spike.........and I recall telling her that she would not want us to take away pension money if she had LESS kids due to her district's declining enrollment.
Does all of this make sense? It does to me.
I got burned personally with the anti-spike rule in a different way. My last 3 years were: 0% due to a board imposed freeze on everyone, 0% due to a voluntary self-imposed freeze I gave myself during an operating levy campaign, and a 3% base raise. So, in other words, my last 3 years were 0%,
0%, 3%. STRS, even though my 2nd 0% was a voluntary thing, gave me credit for only a 1% raise in my final year because THAT was the average of last 3 years. I shot myself in the foot and didn't realize it when I voluntarily took the freeze.
From Molly Janczyk, March 13, 2007
Subject: Re: Link to the report
Wonderful. So glad about OSBA as they seem a major obstacle. I know you were convincing! We are lucky to have you 'out there' informing such types.

What is the anti spike rule?
From Dennis Leone, March 13, 2007
Subject: Re: Link to the report
Yeah, I know. By the way, I spoke to 75 administrators today (mostly supts) in Zanesville. HC was a big topic. After my remarks, some in the room expressed frustration with OSBA, given their acquired awareness that alternatives for solving the problem are few. As you might guess, there were several questions about calculating final average salaries and the anti-spike rule. Many are nearing retirement.

RH Jones: A supplemental benefit would help those who need it the most: those who have been retired the longest

From RH Jones, March 14, 2007
Subject: Fw: PLEASE ATTEND THURS:3/15:CORE Meeting Speaker:12:15 & Sen.Dann may speak to Board
John and CORE,
Dr. K. Fluke and I will not be able to attend the important CORE/STRS meeting tomorrow. There is illness in the Fluke family and heavy rain coming. Being 75-yrs of age limits our driving.
If I were to go, it would be to address the STRS board on the present need for a supplemental benefit this year. He and I feel strongly that this is a benefit is fair and helps those who have been retired the longest. The need is there.
It is not the retirees' responsibility to raise the funds: It is the STRS responsibility and a legislature that honors retired teachers today as they did more than 25-years ago by crafting this supportive O.R.C. Not all retirees will live to see the passage of any future HC/Rx benefit increases. Since multi-faceted grab for our STRS funds, retired members have suffered the most.
Retired members have always been grateful and honored to receive this benefit --Confirmation of this can be had by reviewing the large numbers of retired educators who gave their "'thank you" speeches at the public input portion of the many STRS board meetings most especially prior to the year
RHJones, SummitCRTA Leg CMTE Mem & CORE Mem.

RH Jones on Rep. Lynn Wachtmann's proposal

From RH Jones, March 14, 2007
Subject: Public school facilities "on the cheap"
To all:
Could slave labor be a solution for State Rep. Lynn Wachtmann (R) 75th Dist. as he searches for a co-sponsor for his plan to reduce the prevailing rate of wages the state pays for a public school district's classroom facilities projects,? Or, perhaps a Communist Gulag or a Nazis style slave labor camp could be a solution for him?
And, further, I wonder: How would these poorly paid workers be able to pay their home mortgages, car loans, utilities, health bills, and, on and, on and on.? Requiring only water, feeding, and no clothing, perhaps the GOP elephants could do the work?
Ohio should set the example for contractors and other businesses by paying the prevailing wage to insure both strong school buildings and a strong state economy.
RHJones, (I am proud to have been a Shop Stewart for the United Rubbers Workers Union in 1950-51.)

Tom Curtis to AG Dann: How can electricity bill soar when usage doesn't?

Tom Curtis to Attorney General Marc Dann, March 14, 2007
031407 Curtis To Att Gen Dann, Thank You To You And Your Staff

Attorney General Dann,
As an STRS retiree, I would like to thank you and your staff for representing all of the Ohio pension fund membership by helping to bringing about a reasonable recovery of funds from AOL to be returned to our 5 pension systems.
Hopefully this settlement will send out a strong statement to individuals that devise such schemes to defraud their stakeholders. Human greed has become such a pervasive part of our society throughout this land. This has to stop!
Why are the CEOs of these companies paid millions of dollars? They possess no special talent, or skill that deserves that kind of remuneration. Who really does? This kind of blatant disregard for a reasonable wage for services rendered is unfathomable. These corporate people are simply gifting one another with outlandish employment contracts that are breaking the system and ultimately results in the loss of jobs to foreign countries or labor.
Today I received a letter from my electric utility, American Electric Power. I was told about the process for determining my monthly budget. They told me they reviewed my account and were going to adjust the monthly amount to align it with my actual usage. Therefore, they are changing my budget amount from $135/mo. to $186.00/mo. This is unbelievable to me. How can my bill increase that much per month? I have not changed my usage habits and we conserve electric more then most as I was a technology education teacher and taught conservation of not only electricity, but also all types of utilities and materials.
Why is the gouging of the cost for our utilities, gasoline, medical expenses and everything else continuing to spiral up? The profits for some of these companies are huge and the executives are paid way more then would seem within reason.
The 3% COLA I receive each year is based on the amount I received at retirement and is not compounded. The buying power of my pension (ret. 1998) has shrunk enormously since retirement. The cost for health care for my wife and I currently exceeded one third of my pension in 2004, and has grown ever since. Things are really getting out of control and it appears that the number one reason is simply due to GREED!
Thomas Curtis
North Canton, OH

Administrators concerned about HC, frustrated with OSBA

From Dennis Leone, March 13, 2007
Spoke to 75 administrators today in Zanesville (mostly supts). As you might guess, HC was the big topic of conversation. I felt I made some headway with them. After the meeting, some expressed frustration with OSBA given their newly acquired awareness that the alternatives are few. They also had a lot of questions about how final average salaries are calculated..........and the anti-spike rule.

Tuesday, March 13, 2007

Herschel Grim: We all need to work together on Health Care while the time is right

Molly Janczyk To Herschel Grim, March 13, 2007
Subject: Re:13th Check Guidelines

Thank you, Herschel. I appreciate your comments and agree totally. It is not realistic to expect excess monies at this time for all the reasons given now over several days. We do understand the loss this is but it cannot be reinstated without huge cost: Ex. Only $500 for each retiree at only 100,000 retirees = $50,000,000 (100,000 x $500). Let's ALL focus on the big and ONLY real picture: HC.

Additionally, I was pleased to see the new STRS HC booklet include benefits for the Assisted Program for those with total family assests below $20,000. Any who qualify should contact STRS ASAP! You earned it and you deserve it!!!!!!
From Herschel Grim, March 13, 2007
Subject: Re:13th Check Guidelines

Molly - I just received this correspondence and would like to comment... My predecessor, George Taylor, championed the importance of this Supplemental Benefit (13th check) for our retirees. It was (is) not - as is the case with health care - an entitlement nor a guarantee, but a benefit provided by STRS Ohio to their benefit recipients - as it is determined by the Board - to be affordable. The rules have not changed and someday there may be good reason to expect resumption of payment of this benefit.

Now, however, with the unfunded liability of the system in excess of 30-years and the health care program nearing crisis, I believe it is extremely important for ALL of us to recognize the importance of prioritizing our actions and discussions. The importance of the 13th check pales in importance to the issue of health care. If we were all to receive the best formula 13th check ever paid and have it guaranteed to continue forever we would be suffering an insurmountable loss if it were to come at the cost of "no more health care."

My point is...Let's not give our opposition fodder to use against us in working toward our ultimate goal of providing the best possible chance we have for actuarially providing funding for future health care. Now is the time to back away from secondary issues and work toward one common goal. And, this is not to minimize the importance of a 13th check or to suggest we disallow debate on this or any other issue, but for now we MUST provide a common message of unified support for perhaps the most important issue of our time. Let us ALL stand together.

I confess I am not much of a politician. I have always seen myself more in the realm of diplomat. But, I have learned over the years that politics has a role. However, I firmly believe that now is not the time. Tom Mooney demonstrated the importance of working together, if nowhere else, through his the efforts to organize and support the efforts of the Health Care Advocates for STRS. It has been a four year journey with STRS Ohio and their Board to develop this initiative and legislation. Examine the constituency organizations of the HCA. Their work has not been purely self centered and political. It has instead been the result of recognizing the importance of working toward a common goal for the good of all the members of STRS, be they active or benefit recipients.

May ALL of us, whether we be OEA, OFT, CORE, AAUP (the constituency list goes on), STRS Ohio Board members (collectively or individually), STRS Ohio staff, etc. agree to disagree later, but for now to work together on the issue of health care before our last/best opportunity is lost.

Herschel Grim,
OFT Health & Retirement Consultant

Monday, March 12, 2007

STRS rules re: 13th check

Ryan Holderman to Molly Janczyk, March 12, 2007
Subject: Subject: Re: "13th Check" ORC ordinances / STRS rules
Dear Molly:
Copied below, or attached as files, are the regulations from the Ohio Revised Code and STRS Rules that govern the issuance of the "13th" check...actually called the "Temporary Supplemental Benefit".
There was a resolution passed by the STRS Board that suspended consideration of this benefit until certain requirements were met in the areas of unfunded liability, etc. I could not find that resolution on the STRS website but I'll go back through some of the STRS Board notes to see if I can find the exact wording. If you have a copy of it, please send it my way.
Perhaps this will help some to understand why this benefit has not been issued in recent years.
Later, Ryan
PS: I personally feel that reducing health care costs is more important and more equitable than issuing a "13th" check.
From the Ohio Revised Code:

[§ 3307.67.1] § 3307.671. Temporary supplemental benefit fund established.

In December 1980, and in December of each year thereafter, the state teachers retirement board may allocate an amount from the guarantee fund created in division (E) of section 3307.14 of the Revised Code to establish a temporary supplemental benefit fund for the purpose of making a lump sum benefit payment to all persons receiving an allowance, pension, or benefit under sections 3307.50 to 3307.79 of the Revised Code for each of the twelve months preceding the first day of the following January.

On or after July 1, 1980, and on or after the first day of July of each year thereafter, the board may determine the amount to be placed in a temporary supplemental benefit fund. Such amount, if placed, shall be not more than twenty-five per cent of the income from investments for the twelve months preceding the first day of July not otherwise required to be credited to the several funds set forth in section 3307.14 of the Revised Code.

The board shall adopt rules to administer this supplemental benefit. The rules shall recognize the effective date of the allowance, pension, or benefit and the years of Ohio service credit for each recipient as an equitable basis for allocating the amount payable to each recipient.

If the board determines that a supplemental benefit shall be paid under this section, it shall pay such amount within sixty calendar days following its allocation to the supplemental benefit fund.

Amounts paid pursuant to this section shall not be included in the base for increasing an allowance, pension, or benefit provided in section 3307.67 of the Revised Code and shall not incur any obligation or liability for future payments under this section.
Larry KehresMount Union Collge
Division III
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