Saturday, February 21, 2009

Dennis Leone to John Bos re: Compensation for the West Coast investment employees

From Dennis Leone, February 21, 2009
To: John Bos
Subject: RE: Need help to understand something.
John – here is the history on this matter:
1. The board voted 8-1 in September to approve the investment staff bonus compensation for the prior fiscal year 2008 (which ended 6-30-08). The day of the vote, the board received an itemized listing of the individuals and their bonuses in executive session.
2. I noticed during the November board meeting, when the executive director presented his monthly expenditures for board approval, that the total amount shown for fiscal year 2008 bonuses was higher than what the board had approved in September. The answer given that day by Steve Mitchell was that pursuant to prior (?) board action, three “west coast employees” were given higher amounts. Nothing more was said and no other board members asked questions.
3. During the month of January, I asked about the “prior” board action and received email information from Steve Mitchell. He wrote that in 1999, the board adopted a formula to provide the west coast investment employees with higher bonuses. I believe the spirit of the policy at the time surrounded the notion that the cost of living is greater on the west coast. I replied in writing that I did not feel a 1999 board philosophy decision trumps a 2009 board budget decision that approved individual bonuses. I said I felt that if the staff was using a 1999 guideline to award higher bonuses to 3 people, then the board needed to approve the amounts.
4. During the Salary/Benefits Committee on February 18, and again at the regular board meeting on February 20, I took this matter further: I stated that I believed that it was illegal NOT to approve the individual bonuses of the 3 west coast employees, and that the staff was not authorized to pay the additional amounts because the board had not approve them. Mr. Nehf contended that the action of the board in September was sufficient, but he would look into the matter further, and report back to the board in March.
I will bring up this matter again at the March 19-20 board meeting. The staff, in this case, needs to admit that a mistake was made and present the additional amounts for the board to approve………even though it will be after-the-fact. It will be, in my opinion, that only way this matter can be corrected. I will let you know what happens at the March board meeting. Once again, it disappoints me that not one of my fellow board members is questioning this. Sometimes I feel that they do not know what questions to ask.
Dennis Leone
From , February 20, 2009
To: Dr. Dennis Leone
Subject: Need help to understand something.
John Curry told me that some of the STRS Staff were given PBI that were not on the list and approved by the board. Is this true? If so, this may not be a legal expense.
I am waiting for the $$$$ to be posted on the web [on the STRS website]. I plan on raising HELL!!!!!!! if it is not posted by Tuesday.
Thanks for answering my question regarding the "California" staff.
John Bos

Thursday, February 19, 2009

Nancy Hamant's speech to STRS Board, February 19, 2009

STRS Board and Mr. Nehf:
Thank you for the opportunity to speak to you. My name is Nancy B. Hamant. I am a 26.8 year STRS member. I have been following STRS actions since 2001. Some STRS Board members and STRS staff question why STRS members and retirees continue to monitor STRS actions. We do so not only because of excessive spending uncovered in 2003, but today because of the apparent culture of entitlement and greed in banking, on Wall Street and in corporate America, major factors in an economic calamity second only to the Great Depression. The economic crisis today is "déjà vu" to STRS members. Starkly similar to the sense of entitlement engendered by former director, Herb Dyer.
The display before you contains about half of the Cincinnati Enquirer's articles on the calamity since the December STRS Board meeting. One cannot look at the mass of articles without feeling the fear of STRS members, of Ohio citizens and the entire nation regarding their futures during this disaster.
STRS Board members, the "buck stops" with you. You have fiduciary responsibility for STRS actions on members' behalf and for making prudent decisions. STRS members expect you to do what the economic world said should have been done prior to this mess, question anything you are asked to approve, to halt the greed and entitlement. STRS members expect you to question all actions occurring at STRS. STRS Board, you must not permit "business as usual" or following "Wall Street practices" as a reason to approve any action. Those reasons should raise a red flag causing you to demand justification from STRS staff for any recommendation, action or spending by STRS. "Business as usual" was a major factor in the mess the nation faces. STRS Board members, you are morally bound to provide ethical and legal leadership via the policies you establish. STRS policies should have one goal - ensuring the stability of the STRS Pension and Health Care Funds for the future of all STRS members.
Also, STRS pays many consultants to analyze various aspects of its operation, health care and staff performance. The consultants are often cited as providing "unbiased" analyses of the pension fund or of the health care fund. Often these consultants appear to give "sales pitches". Particularly shocking was commentary by a health care consultant at the December meeting. The consultant asserted that "STRS lost an opportunity to make the most money on Medicare Advantage reimbursements, as STRS made last year, but some money could yet be made." The presenter seemed focused on promoting Medicare Advantage plans and was not unbiased. Such bias-laden presentations cannot provide a true analysis! STRS Board members must question and question consultant data as to its accuracy and usefulness for making decisions, as well as require that all consultants are truly unbiased and ethical.
Mr. Nehf, the STRS Board voted unanimously to hire you. That is a feat unto itself. It represents the STRS Board's faith and hope that you would work tirelessly on behalf of all STRS members. All chief executive officers want to provide a work climate that promotes the best efforts of his/her staff. STRS members expect you to do that. An optimal work climate should never come at any expense or detriment of your fiduciary responsibility to all STRS members to protect pension and health care funds. Another of your responsibilities is to provide leadership to STRS staff to ensure the growth and viability of the STRS Pension Fund and Health Care Fund. Mr. Nehf, STRS members expect you to be "ahead of the game" during this economic calamity. STRS members expect you to analyze all the changes that are forthcoming from federal and state legislation developed to get the nation out of this crisis. Just because a change is recommended does not mean that it is in the best interest of managing the STRS Pension and Health Care Funds. STRS members expect you to fight at both the state and national levels for change that will protect and grow the pension and health care funds. STRS members expect you to require the best of all STRS employees and help them to change to meet the continuing economic challenges. Do not permit STRS staff to use the excuse "this is the way it is done in the corporate investment world." On December 30th, an investment consultant on MSNBC stated "Wall Street has been operating the last few years on the principles developed by Bernie Madoff". Heaven help us if that is true!
STRS members respect the work STRS staff does on our behalf. STRS staff are most patient and gracious in answering members' questions. Members expect STRS staff to be paid fairly and equitably for efforts in protecting and building STRS assets. STRS members also expect staff to present information about those assets in direct, simple and unambiguous language. STRS members expect graphs, charts and diagrams to accurately delineate any issue in light of the current situation, i.e., when showing growth during a period of loss, please be honest enough to show that amount of growth within the entire range of the loss. Showing only the amount of growth within one or two points is not the total picture. STRS members do understand Performance Based Incentives - we just question the percentage of the Incentive. When so many STRS staff are making a total annual salary greater than that of Ohio's Governor and more than the President, that is difficult to understand. Don't follow Morgan Stanley's lead and rename the PBI Bonus - a retention award. For most Ohio educators, an annual raise of 8.7% is unbelievable, and a raise of 15% has probably never happened! In fact, such increases are not given for a three-year contract period. Today, Ohio districts are not hiring teachers, are cutting teachers, are freezing salaries or are asking teachers to take pay cuts. "Unknown" perks, such as STRS staff being paid for the Friday after Thanksgiving as a "holiday" are beyond belief! Educators can only wonder at such generosity any time, let alone during the second greatest financial crisis for our country.
STRS members are more than worried - we are fearful for entire future! Without a doubt - change is here and STRS has to ensure that O.R.C. 3307.15 is followed.

CORE endorsements

February 19, 2009
At today's CORE meeting, the following candidates for STRS Board were selected for endorsement:
.....Bob Stein (retiree seat)
.....Jim McGreevy (retiree seat)
.....Jim Stoll (active seat)

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Bob Stein, candidate for retired seat on STRS Board

Bob Stein is the only STRS candidate with a specific plan to improve investment returns.
We must recover benefit cuts of the last 10 years as well as make STRS sound. Future benefits and pensions are not fully secure unless the fund is growing.
Health Care -- Retirement without healthcare is not really retirement. Requiring retirees to pay increasing health care costs slashed spendable pension dollars. Expect higher costs next year. Increasing investment returns by 1 1/2 percentage points could fully fund retirees’ health care. This is reasonable if the recommended investment reforms are adopted.
Cost of Living Adjustment -- Current COLA is not compounded and only slows purchasing-power losses during retirement. 1977 retirees have lost 14% in purchasing power since retiring. ($140 loss for every $1000 in your pension.) This does not include increased health care costs that come directly out of pensions. STRS should cover real cost of living increases.
Better investment strategies must be implemented. -- STRS’s investment advisory firm's plan has similarities to mine but we have not adopted anything close to either one. Global markets are maturing. Without proper adaptation our fund will continue to suffer large market shocks.
How A Pension Fund is Different
Most people are used to budget systems like households or schools where the incomes are relatively fixed by employers or tax rates. The best control they have is over expenses. We know such situations well and tend to see controlling expenses as THE solution to any money problem. Pension funds, however, are primarily large investors with payroll-dependent income that creates investment income. Contributions at 24% of your salary plus investment returns should pay your pension. While control of expenses is desirable, investment income is absolutely necessary in order to pay benefits.
Stopping losses and improving returns should be our first focus. Expenses can only be cut to a certain degree before the only cut left is pension benefits. For example, 2008 administrative costs were near $0.065 Billion. Total pension benefits are almost $5 Billion. Eliminating ALL administrative costs might pay for about 1 day of pension benefits. At $30+ Billion, losses since our fund’s recent peak represent about 6 years of pension checks.
As you can see, creating income from investments is many times more important than any other activity STRS undertakes. It may be our only real choice. We’ve lost 35+% because STRS investments follow US stock markets too closely. Not “everybody” is losing money in this economic decline. Our investment model needs updating. We must adopt strategies that allow better returns and avoid wide stock market swings.
Income from increased payroll contributions requires legislation that is unlikely in tough economic times. The only realistic choice is better investment returns.
The board must decide. Staff and advisors can’t make investment policy regardless of what they know.
We need more investment experience and training on the STRS board.
Vote Bob Stein for STRS
Bob Stein
for the STRS Board
Unique Experience
· SEC Registered Investment Advisor
· NASD licensed securities broker
· 27+ Years of teaching
· College for Financial Planning
Investments, Taxes, Insurance, Retirement and Estate Planning, Employee Benefits
Since 1972 Bob has traded and invested in stocks, bonds, real estate, partnerships, futures contracts of all types, and foreign exchange.
Bob Stein is the only candidate with:
· Broad Investment Experience
· Financial Training
A real plan to improve investment performance.
Endorsed by Concerned Ohio Retired Educators for details and a complete bio

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James McGreevy -- Candidate for STRS Board (Retired Seat)

Endorsed by: " OEA/OEA-Retired " Ohio Federation of Teachers " CORE (Concerned Ohio Retired Educators)

My priorities for STRS are:
1. Health Care -- Unless a dependable, adequate revenue stream to fund health care can be secured, this important benefit is in jeopardy of being eliminated in a very few years. The recent credit and equity market problems, combined with a continued high rate of medical care inflation, have accelerated the decline in the Health Care Stabilization Fund. Legislation to provide additional funds will be a hard sell in these tough economic times. Although health care is not guaranteed for STRS benefit recipients, retirees know there is no secure retirement without health care. A solution must be found.
2. Pension Funding -- STRS total fund assets have dropped precipitously in the past year. As a long-term investor, STRS has the resources to weather this downturn, but prudent management of its funds and increased attention to investment policy and asset allocation should be a major focus of the Board's work.
3. Defense of Defined Benefit Pension Plans -- In the past few years, defined benefit pensions like STRS have come under attack in a variety of ways. Public sector pension systems have seen politicians demand divestment of stocks, without regard for the impact on our assets, in order to further some political, foreign policy, or cultural agenda. Defined contribution programs have been pushed in the hope of driving down costs, disregarding the facts that such programs do not provide an adequate income for retirement and are actually more expensive. For-profit charter schools undermine teacher salaries, reducing contributions to STRS. Social Security "reformers" continue to propose mandatory coverage that would ultimately dismantle pension systems like STRS. These assaults represent greater threats to teachers' retirement security than stock market crashes, terrorist attacks, or bad investment choices, and we must be vigilant in fending them off.
Candidate's Background Information
2008 Awarded The International Foundation of Employee Benefit Plans' Certificate of Achievement in Public Plan Policy (CAPPP) following training and examinations on pensions and health care
2008 Attended Ohio Forum for Pensions
2005 - Present Attended STRS Board Meetings, Retreats, and Special Health Care Committee meetings as OEA-R representative
2007 - Present Health Care Champion for STRS - in support of HB 315
2006 - Present OEA Board of Directors, OEA-R representative
2000 - 2003 OEA - Audit Committee Chair
2000 - 2003 OEA Program & Budget Committee Vice-Chair
1997 - 2003 OEA Board of Directors - EOEA Representative
1997 - 2003 OEA Program & Budget Subcommittee
1995 - 1997 EOEA District Vice-President
1978 - 1997 Mid-East Education Association - various executive offices and lead negotiator on three master contracts
Other Experience
1985 - 1993 MCS Employees Credit Union - Board of Directors, Treasurer
(MCSECU was a multi-county teachers credit union that merged with the Ohio Educational Credit Union in the 1990's)
1980 - 1984 Corporate officer and assistant manager of family-owned wholesale beer distribution business.
1997 - 2008 Festival of Learning, Cambridge, Ohio - Steering Committee
2005 - 2008 OSU Alumni Association of Muskingum County - Board of Directors, Scholarship Committee Chair
1970, 1975 The Ohio State University, B.S., M.A.
1970 - 2005 Mid-East Career & Technology Centers, Social Studies Teacher

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Wednesday, February 18, 2009

A response from RH Jones re: George Doyle's letter to the STRS Board today

From RH Jones, February 18, 2009
Subject: Fw: Allen County RTA President to STRS Chairperson of the Board...
ORTA members,
George Doyle needs to run for ORTA president. It is about time someone stepped up to the plate to play hardball. Only sissies play softball.
My opinion,
RHJones, ORTA Life Member

Tom Curtis: Response to George Doyle

From Tom Curry, February 18, 2009
Subject: 021809 Curtis To Doyle, Re Outlandish Raises
Hello George Doyle,
From reading your letter to the Board chair, you seem to have your concerns directed at the wrong person or persons. The Board is and has been the real problem for approximately 3 decades now.
The people that have sanctioned all of the outrageous costs of the operation of the STRS are the board members, not the Director. He truly has no authority to do so any longer. Even all cost decisions made above 100 K must be approved by the Board (thanks once again to Dennis Leone).
No one, but the Board, can allow for the outrageous expenditures to take effect.
Mr. Nehf is doing his job, but at a cost far above what it should be in my opinion. Yes, he works for us, but ultimately, he works for his own self interests. He and all STRS staff pay their retirement contributions into the OPERS, which by the way, still offers a HC plan for $80/month, which includes a spouse.
The STRS management has for many years used our money to pay for professional accounting, budgeting and/or consulting services, which in turn call for increases in their salaries. That is what I call a mutual admiration society. The STRS pays these outside sources big bucks to call for salary and program increases. Everyone benefits, but the stakeholder. The STRS staff has grown to the largest of any of the five public employee pension funds, yet we do not have the largest holdings. No one seems to understand this very basic concept and call for change. This is wrong, but until the stakeholders as a group, call for reform, it will not likely happen. To my knowledge, the staff has never elected to take any pay cuts or reduction in benefits, yet the stakeholder has had to do both. This is wrong and they know it!
Please understand, not one employee of the STRS pays one dime into our retirement system. So ask yourself, what has any employee got to lose, other then their employment? The investment people can invest our money at will and have absolutely nothing to lose.
The $6 million paid out recently to the investment staff at a time when our holdings had been reduced by approximately $30 billion dollars would surely document my statement above. Unbelievable!
Our Board is now and always has been run by the OEA by a majority seat vote. The OEA has always purchased the STRS Board seats. Not until Jeff Chapman and Mary Ann Cervantes were elected in 2005, did the OFT come into play. The OFT provided the funds for them to be elected. Few of those on the Board would EVER be elected if their knowledge of what they are asked to make decision on were considered. I feel qualified to make this statement because most have absolutely no background or education in business and finance. So ask yourself, why would I want those people handling my future? I don't, but the unions make that decision. And further, they make it using another dedicated flow of income that comes directly from educators. In essence, we are screwing ourselves. Isn't that ironic?
I welcome any correspondence that can prove any of my statements to be incorrect.
Tom Curtis
STRS Stakeholder

Allen County RTA President to STRS Chairperson of the Board re: Raises instead of bonuses

From George Doyle, February 18, 2009
Subject: Outlandish Raises
Madam Chairman:
What in the world is happening down there at STRS!!! Our director is deliberately going against the decision of the Board and issuing outlandish raises instead of bonuses. Why can't he get it through his head that "ENOUGH IS ENOUGH" and we aren't going to stand for any more of his disrespect for retirees. Do your job and get rid of him. He is not doing his job for which he was hired! Are you going to give him a big raise also?
What about we retirees who don't even get enough COLA to pay for our medications. I was forced to drop the healthcare to save money and our director just gives it away! That makes no sense to me and the hundreds of others who were forced to pay for our own insurance. We retirees don't mind doing our part to save money, but what good does it do if the money we sacrifice is given to people already making hundreds of thousands a year in salary? Get rid of them and hire cheaper help! I'm sure with the number of people out of work there are qualified people that can be obtained at a lower price!
I will be glad when we get three new members on the Board. It seems as if they all have some sense of responsibility for the retirees. I'm sure that when the time comes the current board will not be reelected except for those who are trying to do everything they can to help the retiree. The active teachers are being informed of the mess that our director is creating at STRS and I am sure that they will have a lot to say in the coming election.
I know that when we talked before I was against threatening and nasty e-mails, but it seems this is the only way to get through and make our views known. We can no longer discuss it like adults on a face-to-face basis because of the new director and his behind the scenes tricks. Please call him to task for his despicable actions! As long as nothing is done to him he will continue until there is no STRS.
George V. Doyle, President
Allen County Retired Teachers Association

Donna Seaman to STRS Board: Wake up!

From Donna Seaman, February 18, 2009
Subject: Pay increases
STRS Board: Now we learn that two of the investment directors have been given 14.6% pay increases! Wake up, STRS board! We are in a catastrophic national economic crisis! The STRS board investment portfolio has decreased at least 40% in value! Do you pay attention to what is going on? Will the sweetly worded STRS newsletter to members report those pay increases and gloss over the huge losses taken by STRS assets? Will you and your OEA "partners" report to working teachers that you continue to grant raises to STRS staff while teachers locally and nationally are willingly taking cuts? How did these people qualify for a 14.6% pay increase when retirees still have not had their 13th check reinstated? Will you be granting a 14.6% increase to retirees, too? As I have emphasized to and urged you before, this is the time you, the STRS board, must:
• Cut staff
Cut operating expenses
• Freeze STRS employee salaries
• Remove performance based incentives/bonuses
When can we, your constituents, expect you to start making sane, thoughtful wise decisions? I was so hopeful after January's board meeting when six of you showed the wisdom and courage to remove the PBI program for investment staff. Now is this 14.6% pay increase for at least two of them (are there others as well that we haven't yet found out about?) a justification to keep the "best and brightest" as you always tell us? Where are the staff decreases and pay freezes that are overdue?
It is past time for you to admonish Mr. Nehf for his inappropriate action in granting "black Friday" off for STRS staff, against board policy and contract language.
When can retirees expect some of you to begin taking your board fiduciary duties seriously and thoughtfully? When I attend board meetings (and when I can't, I carefully read all minutes and reports), I observe only business as usual!
Thank you.
Donna Seaman, 2002 retiree

Just a little 'ole salary comparison...

From John Curry, February 18, 2009
[Click images to enlarge.]

Governor Strickland's 2009 salary = $144,830

The 2009 salary of an Ohio Supreme Court Justice = $150,850
The 2009 salaries of the two top investment associates at Ohio STRS = $309,500! Their 2008 salary was $270,000!


Tuesday, February 17, 2009

Thank you, Jim Stoll, for turning over some MORE rocks at our beloved pension system!

"In my opinion, to give any employee a “RAISE” of approximately 15% which calculates to an salary increase of $39,500 for at least two of these associates, when our NET ASSETS have declined by almost 30 BILLION in the last 18 months is in no way a prudent expenditure of our funds."

From Jim Stoll, February 17, 2009

Subject: 2009 STRS INVESTMENT ASSOCIATE Salary Increases

Dear Kathie,

As an “Active” Teacher who is certified to be on the STRS Retirement Board Election Ballot in April, I wanted to share some more information with you and all STRS members. While the STRS Board voted to suspend the outrageous PBI bonus plan, something even more disturbing may have occurred. It seems to me if one looks at the 2009 Salary Increases of the 83 “Investment Associates” that the Executive Director and I assume the Board if they have already approved the 2009 Salary increases may be trying to make up for the bonuses by giving them huge increases in salary.
In my opinion, to give any employee a “RAISE” of approximately 15% which calculates to an salary increase of $39,500 for at least two of these associates, when our NET ASSETS have declined by almost 30 BILLION in the last 18 months is in no way a prudent expenditure of our funds.
For your reference please note these two examples: (Both of which were confirmed by the STRS Office)
Did You know that the Two STRS Asst. Dir. Investments both received a SALARY INCREASE of $39,500 this year.
[Click image to enlarge]
Unfortunately for STRS members paying into the system there are 81 other investment associate examples, similar to the above, which have yet to be listed here. I’m working on a spreadsheet to share all the information with you.
I really don’t know how STRS can justify these salaries and increases at a in economic times like these.
Respectfully Submitted,
James A. Stoll

Jim Stoll is a teacher and coach in the Sycamore school district in Cincinnati. He is currently a candidate for the soon-to-be-vacant active seat position on the STRS Board.

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Monday, February 16, 2009

Leon Knore to STRS stakeholders: More changes needed at STRS

From Leon Knore, February 16, 2009
Subject: STRS improvements needed
Hi STRS Members,
Educators and retirees writing to STRS Board members seems to have had a positive effect in getting the Board to act in suspending employees bonuses temporarily. Yet, more changes are needed in the administration of STRS. I have attached a copy of a letter that I mailed to the Board members. If you agree with any of the points in the letter, I encourage you to write a letter to the Board members too. Letters can be sent to each Board member at the STRS address:
275 East Broad Street,
Columbus, Ohio 43215-3771
The Board members are:
Mary Ann Quilter Cervantes, Chair
Mark H. Meuser, Vice Chair
Jeff Chapman - retired teacher member
Taiyia L. Hayden
Dennis Leone - Retired teacher member
Tim Myers
Constance K. Ramser
Steve Puckett - representative for Superintendent of Public Instruction
Craig C. Brooks - Appointed by the treasurer of state
Regina F. Burch - Appointed by Governor Strickland
Michael J. Nehf - Executive Director
[E-mail addresses: E-mail contacts at STRS
General address that goes to all Board members:;
Michael Nehf:]
From Leon Knore, February 16, 2009
Mary Ann Quilter Cervantes, Chair
Ohio State Teachers Retirement System
275 East Broad Street
Columbus, Ohio 43215-3771
Dear Mrs. Cervantes,
Please seriously consider all of the following ideas to improve the STRS. Some of these changes need immediate attention but some would require STRS inspired actions by the legislature. I know many STRS retirees who strongly agree with these recommendations.
• The STRS Board and officials need to establish a new leadership attitude in accomplishing their mission. STRS leadership needs to consist wholly and directly in orientation toward an unpretentious attitude to “discharge their duties with respect to the funds solely in the interest of the participants and beneficiaries...with care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with these matters would use in the conduct of an enterprise of a like character and with like aims” as stated in the Ohio Revised Code 3307.15, rather than consisting of an arrogant attitude of greedy entitlement and self-enhancement for employees.
• All STRS Salaries need to be frozen and hiring new employees should be frozen where possible until investments show an annual gain. The goal for STRS investors’ salaries seems to be the 25%ile of the private sector, plus the prevalent attitude of the current STRS board and administrators is that the present investors are irreplaceable! The fact is, no one is irreplaceable. STRS needs to try to keep their experienced investment associates and maintain a staff of good in-house investors. However, these investors do not have to compete for clients like private investors do. They have an automatic income from public tax funds and educators’ salaries. Hence the STRS investors’ salaries should be set, keeping in mind the salaries of their clients (educators), and in comparison to salaries paid by other and similar public retirement systems in the state (PERS, SERS, etc.) and throughout the nation. STRS Retirees have difficulty understanding the justification of paying STRS investors and administrators salaries of $225,000, $270,000, etc. with 96% to 98% bonuses when the average state teachers’ salary is $49,157, the Governors salary is $144,830, and the State Supt. of Education’s salary is $194,500, all with no bonuses. STRS Investment Associates’ Bonuses (PBI) are outlandish and out-of-control. Here again, the same principles stated above for salaries should hold true for PBIs. Whatever happened to working for a salary? The STRS board adopted a bonus plan in January, 2009, that my state senator (lawyer) cannot fully understand. Why is this so complicated? STRS lost one third of their assets last year. If this would happen this year and next, we are busted! Bonuses should never be paid when the system is losing value. Why not pay a reasonable salary plus a simple commission of 5 or 6% on the value of the assets gained? Who started this bonus asininity for investors, Enron or Merrill-Lynch? Can you tell this situation produces anger?
• For the sake of transparency, all STRS salaries above the state teachers average salary (without personal names) need to be published annually to the membership. (state average salary in 2007-2008 = $49,157)
• Establish a “self-sufficiency” safety net for retirees. No pension for a retiree with 30 or more years should be less than the federal “Self Sufficiency” income (defined as 200% of the federal poverty level, approximately $21,660 presently) We now have 769 retirees who taught 30 or more years receiving pensions below this amount!
• Establish hospital insurance premium discounts for verifiable good health practices such as gym memberships, verified weight management within the AMA prescribed range for height, for verified non-smoking, etc.
• All retirees Cost-of-Living-Allowances (COLA) need to be compounded. Until this COLA compounding for retirees occurs and an annual gain in investments becomes a reality, all STRS salaries should only be increased annually at a rate that is not more than the annual percentage increase for retirees’ pensions. That is, STRS salaries would only increase at the rate of inflation according to the Consumer Price Index (CPI) up to a maximum of 3% of the employee’s entry year at STRS.
• All retirees’ pensions (before and after the year 2000) should be determined according to the same calculation chart, that is, at the same 2.2% rate for each year of experience, plus the increase in additional percentages for each year of experience over 30 years should be limited as follows [click to enlarge]:

Previous retirees with pensions figured at a higher rate would be grandfathered into the calculation to keep their current pensions. To maintain positive public relations for educators (on which public educators depend) the practice of “double dipping” by STRS retirees needs to be eliminated as a choice in the future. Presently, pensions are all over the place according to when one retired.
• Re-institution of the 13th check program for retirees as soon as the following conditions are met: (1) Unfunded liability stands at 30 years and (2) the amount of dedicated revenue from employers for retiree health care is increased back again from 1% to at least 3%.
Leon Knore, Ph.D.

RH Jones: SB 2 needs close monitoring

From RH Jones, February 16, 2009
Subject: GOP Carey's SB2
To all:
Since only three GOP US Senators voted in favor of the federal stimulus package. It seems that Ohio Senator Carey wants Ohio SB2 to “… create a process to spend expected federal infrastructure stimulus money.” The GOP made a mess out of Ohio for over 10 years that they were in power. Now they think they should create a process to spend the dollars from the Democrat federal initiative? Not in my opinion. Their record lately has created distrust.
I think that this bill should be monitored very carefully. Enough is enough.
Larry KehresMount Union Collge
Division III
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