Posts related to the above two posts:

http://kathiebracy.blogspot.com/2009/10/you-can-expunge-it-from-court-records.html

http://kathiebracy.blogspot.com/2009/10/strs-flashback-6-years-ago.html

An oldie but a goodie! Please focus on item #4 in this 2003 email from Dr. Leone!

Since the Christmas season is almost upon us, item #12 is also of particular interest!

From Dennis Leone, September 9, 2003
Subject: Important STRS Update

1. In a few days, State Representative Michelle Schneider tells me that she will be sponsoring a NEW bill regarding the make-up of the STRS Board. While she intends for the time being to let House Bill 227 stand as it is, the bill she will be introducing will call for the State Auditor and the Atty General to be removed from the STRS Board, and replaced by: (1) A retiree; and (2) A "person" to be appointed by the Ohio Retirement Study Council. This "person" could be whomever the Study Council desires, but likely will be someone with a strong financial background....or so I am told. Rep. Schneider is not willing to pull the plug on H.B. 227 just yet. If both bills pass, the net effect will be the addition of TWO retirees plus the "person" appointed by the Study Council. If OEA leaders were wise on this issue, in my opinion, they would support the new bill vigorously. They lose nothing by doing so, and the Board becomes better and more representational in the process. I hope all understand that there will be political realities and difficulties facing H.B. 227. It seems that the new bill is a very smart move on Rep. Schneider's part. And it's clear Petro will support it because he was "legislator shopping" for a sponsor for similar language.

2. State Senator Kirk Schuring tells me he is introducing a new bill on Thursday of this week which will permit the Ohio Retirement Study Council to contract independently with the State Inspector General to investigate STRS. While State Senator Teresa Fedor intends to let her original Inspector General bill stand as it is, Kirk is going to move ahead with this one anyway. The new legislation also will include a new process to REMOVE pension system board members for malfeasance or misfeasance. Sen. Fedor also will co-sponsor the new bill. This is a huge step in the right direction. This would mean, for example, that there would be a mechanism to remove board members using STRS money for alcohol, parties, inappropriate travel expenditures, etc.

3. Senator Schuring also tells me he is sponsoring an amendment to an earlier bill he submitted (S.B. 105). The original bill called for ALL employees at STRS (not just non-investment staff members) to file financial disclosure statements with the Ohio Ethics Commission. His amendment will require all pension system boards to adopt an "ethics policy" as recommended by the Ohio Ethics Commission. Another good move on Sen. Schuring's part !!

4. I have received the official STRS form that is signed and certified by board members when they ask their home school district to bill STRS for replacement teacher costs when a board member misses work due to STRS "business." This is the form the home school district sends to STRS seeking a reimbursement for lost teacher services. But read the following language carefully that's on the form, and think about how Michael Billirakis could possibly have submitted this form in the past:

"Attached is a bill from the __________ Board of Education for reimbursement of substitute teacher compensation incurred while I was away from school on STRS business. I certify that the bill is correct and reflects substitute teacher services needed during my absences from my employment to attend official meetings of the STRS Board. I hereby request that the reimbursement be paid directly to the _________Board of Education."

Wow! It is clear from the above verbatim transcription of the form that the STRS guideline is designed to make a school district whole for lost teacher services and for substitute replacement costs. How is possible that Michael Billirakis ever certified such form from the first day he served as OEA President, not to mention his current "leave of absence" from Perry Local for a job he's never had and for a position that doesn't exist?

5. Damon Asbury has informed me that he has put new guidelines into effect "to ensure there are no unnecessary expenditures of STRS funds for special events." A step in the right direction, but I wonder who gets to define the word "unnecessary." In the past, someone decided that gifts, instamatic cameras, airfare and lodging for former board and staff, etc., were necessary and proper expenditures. What will happen in the future? It's like the definition of "due diligence" in the new travel policy. Who decides what the "due diligence" exceptions will be for travel in the future?

6. Damon Asbury informed that he has reduced the staff level for food service and is exploring "ways to enhance revenues to make this operation self-supporting." Another good step in the right direction, but it causes me to wonder what will happen if there are NOT ways to enhance revenues. He also informed me that he is currently reviewing issues regarding credit cards, STRS-owned vehicles, and travel expenditures by staff. Good. I hope there are solid changes forthcoming.

7. While it appears that STRS has raised the tuition rates for the child care center, and while additional increases will go into effect on Jan. 1, 2004, I am still not seeing evidence that the child care services will either pay for themselves or be eliminated. Damon Asbury informed me that "the family income level used to determine eligibility for a fee subsidy (for child care services) will also be reduced." That's fine, but why is there a fee subsidy of any kind?

8. Damon Asbury has informed me that he disagrees with me completely about my recommendation to eliminate annual cash reimbursements for unused employee vacation days and sick leave. He also has informed me that the artwork is not going to be sold or auctioned. Further, he also disagrees with me completely regarding my criticism of Board members and staff members continually saying that ORC Section 3379.10 was the STRS "guideline" for the artwork purchases. I am NOT going to let this one go. They cite the statute's language which stipulates that 1% of "state money appropriated" be spent on artwork, even though NO state money was appropriated for the new STRS bldg, and even though ORC Section 3379.10 doesn't apply to STRS. They want to say that it's their guideline, but they are not volunteering to anyone that it's a guideline they don't have to follow. Without that admission, it's deception in my book.

9. Damon Asbury has informed me that he disagrees completely with my recommendation that a special 9-member committee be appointed to review several aspects of STRS operations and make recommendations to the STRS board. He informed me that the 9-member committee already exists, and it's the STRS Board itself. This posture is completely unacceptable in my eyes. The actions and behavior of the current Board have been a dismal failure. The Board would NOT be giving up its statutory and legal responsibilities by receiving such recommendations from a committee of STRS members. In fact, it would be a way to involve more in the decision-making process and improve communications, which is what the STRS Board said it was interested in doing.

10. On Sept. 17, I am meeting with Senator Lynn Wachtmann about the scope of the audit that the Study Council desires. I am concerned that the scope will be unreasonably restrictive. I am also concerned that the audit will be overly concerned with what other pension systems in the country do instead of being chiefly concerned with the economic realities facing Ohio. I care not if the pension board in New Jersey spends money on bonus checks, and I care not if the pension board members in California fly to Honolulu every year.

11. On Sept. 23, Dave Travis will be joining me in a meeting with Dave Varda, who is Betty Montgomery's deputy auditor. She felt it was better to meet with him first since all compliance issues go through him. I wish to know why STRS appears to be able to operate under a different set of rules than all school districts in Ohio. I wish to know what will be done in the form of findings for recovery and non-compliance citations.

12. Fact of the day: Last year, around the Christmas season, STRS purchased 323 poinsettias to decorate the STRS headquarters. The cost: $5,594.00 !!!

Dennis Leone

Happy Halloween!

Click image to enlarge.

John Curry to Dispatch reporter: Catherine...re. your excellent article in today's Dispatch

John Curry to Catherine Candisky, October 31, 2009
Catherine,
I am a benefits recipient of the State Teachers Retirement System and a reader of your article that appeared in today's Dispatch entitled, "$112,000-a-year job - Convicted ex-union leader gets state post.

I want to thank you for calling this to the attention of all Ohioans. A particular quote in this article bears more investigating: "Loebs said Gov. Ted Strickland's office also reviewed Billirakis' record and approved the appointment. Amanda Wurst, spokeswoman for Strickland, said the governor's office did not approve the hire but merely verified that funds were available."

From the above quote, it appears as though someone is "speaking with a forked tongue." Would you please follow up on this apparent discrepancy to see, in fact, who is speaking with a forked tongue? Thank you,

John Curry
An Ohio public schools retired educator

Dennis relates 'The Rest Of The Story'

Dennis Leone to John Curry, October 31, 2009
Subject: Re: Catherine...re. your excellent article in today's Dispatch

John --

I wish you would share the following with this reporter:

(1) Billirakis didn't stop an OEA lie in 2004 when both an OEA promotional newsletter and an STRS board candidate publication (reviewed in advance by Billirakis) said that he was an "active social studies teacher" at Perry High School......when in fact he had not set one foot in the school;

(2) Perry Local paid his STRS contributions for many years (reimbursed by NEA) to ensure he could fully protect his STRS retirement; and

(3) Until I yelled about it in 2003 in the Canton Repository, Perry Local was collecting substitute teacher reimbursements from STRS for STRS Board meetings Billirakis attended, when in fact there was no substitute teacher needed at Perry High School (because no teaching position existed there for Billirakis);

(4) NEA paid STRS back $35,000 for the substitute teacher reimbursements, which was an acknowledgement that the position never existed; and

(5) After I blew the whistle on this thing, I received a letter from the legal counsel representing the Perry Local Board of Education advising me to cease and desist my complaints (or face possible litigation) since NEA paid back STRS. It was unbelievable..........

Dennis Leone
STRS Retiree Board Member
2005-2009

Congratulations to Shirlee Zerkel

October 31, 2009

Shirlee's post (immediately below this one) has the honor of being post # 5000 on this blog. The blog also celebrated its fourth birthday on October 9; as of right now there are 154,784 hits. Thanks to all of "you guys" for keeping it going with all the stuff you come up with to fill its cyberpages. Keep up the good work. KBB

Shirlee Zerkel: All involved should have to give, too; it's only fair

From Shirlee Zerkel, October 30, 2009
Subject: Re: just a thought..and another way for STRS to save money...lots of it!

Dear Retirees,

I would like to add to John Curry's suggestion that the STRS associates should also have to give some when it comes to health benefits.

I realize that the staff is not on the self-insured plan that we retirees are, but they do get subsidies for both an individual plan and for a family plan. We retirees do not even have a family plan. We get a subsidy for ourselves but not for our spouses. STRS retirees who also work teaching at a public school in Ohio can not get insurance from STRS, they must get it from their present school system.

I would like to go one step further than John. He suggests that if an associate's spouse is employed, then the spouse must get his/her health insurance there. I agree with him, but STRS could save even more money if they did not subsidize the premium for any of the spouses. A family plan could be offered to the associate, just as a spousal plan is offered to the retirees who then must pay the full cost for their spouse. STRS could make plans available to the staff with only a subsidy for the staff member.

We are the reason that the associates have jobs. Now, when times are tough, it should not be just the retiree who gives us something. All involved should have to give too. That is only fair!

Shirlee Zerkel

An STRS flashback - 6 years ago

From John Curry, October 31, 2009

Canton Repository, June 26, 2003

‘Teachers’ on STRS board don’t have classroom duties

By PAUL E. KOSTYU
Copley Columbus Bureau chief

COLUMBUS — Michael N. Billirakis has not stepped foot into a classroom to teach since 1988.

Jack H. Chapman has been employed by the Reynoldsburg City Schools in Central Ohio for at least 30 years, but he doesn’t teach there.

Eugene E. Norris, under contract with the South-Western City Schools in Franklin County, hasn’t taught since January 2000.

Billirakis, Chapman and Norris represent active teachers as board members of the State Teachers Retirement System. All three meet at least one of six definitions of teacher spelled out by state law.

And if there should be any doubt, “the state teachers retirement board shall determine whether any person is a teacher and its decision shall be final,” the law says.

Norris is a “teacher on loan” to the Ohio Department of Education. His $75,000 position ends Monday, at which time he will return to the South-Western district.

Billirakis and Chapman have teacher union leadership jobs that keep them out of the classroom, but on school district payrolls. Both have used a new law pushed by the Ohio Education Association, the state’s largest teachers union, to boost their salaries and improve the benefits they receive from STRS, the very organization they are supposed to oversee.

Though he lives in Pickerington, southeast of Columbus, Billirakis is listed on the payroll of Perry Local Schools in Lake County, northeast of Cleveland. He moved his contract there from the Field Local School District in Portage County, where he taught from 1973 to 1988, when he became an OEA officer. The union paid his salary from 1988 to 2001 at the Field Local rate.

In 2001, Billirakis was named to the executive board of the National Education Association, a full-time job that keeps him on the road across the country 20 days a month. Perry Local pays better than Field Local. Billirakis switched districts with the approval of Superintendent Scott Howard and his board. NEA pays Billirakis’ salary, the district’s retirement contributions and other benefits as if he was a full-time teacher. The arrangement doesn’t cost Perry schools a penny, Howard said.

Reynoldsburg employment records for the 2002-03 school year show Chapman missed 75 days for STRS business. Superintendent Richard Ross called that average.

Chapman also took close to 30 days for sick, personal or professional leave, meaning he was gone for 105 days of the 184-day school year.

Ross said he and the school board didn’t think it was fair to students to assign Chapman a class. Instead, Chapman handles in-school suspensions and intervention duties at the district’s junior high school “when he’s there.”

Like any district with an STRS board member on its staff, Reynoldsburg schools are reimbursed the cost of a substitute by STRS, while the employee receives full-time pay.

A couple years ago, Chapman approached the district about serving as a pass through for income he receives as president of the Central Ohio chapter of the OEA. Doing so would allow him to claim a higher salary for retirement purposes even though he wasn’t earning that salary from Reynoldsburg.

Ross and the school board refused to go along.

Chapman took the scheme to the Franklin County Educational Service Center, which agreed. The county board gets a check from the OEA to cover Chapman’s union salary and STRS benefits and even makes 5 percent on the deal, said Superintendent Fred Wolfe.

Both Wolfe and Howard say they like the arrangement.

“Our contract is with OEA,” Wolfe said. “We treat it like any other agency. They assigned Jack to the position. We didn’t want any appearance of impropriety. It’s squeaky clean.

“Jack may not be in a typical classroom, but he takes difficult kids and works with them.”

Howard said he and his district benefit from having access to a teacher with a national reputation. He said Billirakis has met with students and teachers in the district. Howard also said having him connected to the district helps the relationship between the administration and local union.

“He’s a good human being,” Howard said.

Rep. Michelle G. Schneider, R-Cincinnati, a critic of the STRS board and its executive director, said Chapman and Billirakis “are gaming the system.”

But Billirakis said he works “tirelessly” for NEA, OEA and STRS. “I want to make a difference for teachers and schoolchildren,” he said.

You can expunge it from the court records but...you can't expunge it from our memories!

From John Curry, October 31, 2009

$112,000-a-year job

Convicted ex-union leader gets state post

Saturday, October 31, 2009
By Catherine Candisky
THE COLUMBUS DISPATCH

Michael Billirakis, the former Ohio teachers-union chief convicted of ethics violations while on the State Teachers Retirement System board, has a new state job.

The School Employees Health Care Board hired Billirakis, 63, of Pickerington, as its executive director. He started the $112,000-a-year job Wednesday.

The board was created by the Ohio General Assembly in 2006 to study the feasibility of creating a statewide purchasing pool for all health-care benefits. The group released recommendations the following year that it said could save school districts up to $120 million a year in health-care costs.

Board Chairman Stephen Loebs said Billirakis was a unanimous choice. Billirakis disclosed the ethics violation in an interview for the job and told members that the conviction had been expunged from his criminal record, Loebs said.

"We did a complete vetting on Mr. Billirakis," said Loebs, professor emeritus with the Division of Health Services Management & Policy at Ohio State University. "We checked to make sure this was true (and learned) a court order expunged that from the record."

Loebs said Gov. Ted Strickland's office also reviewed Billirakis' record and approved the appointment. Amanda Wurst, spokeswoman for Strickland, said the governor's office did not approve the hire but merely verified that funds were available.

Billirakis could not be reached for comment.

In 2006, Billirakis and three other members of the State Teachers Retirement System board were convicted of ethics charges for accepting gifts from investment companies doing work for the board.

All four were fined $250, ordered to perform community service and pay back the money, and put on probation for a year.

Billirakis was charged with two counts of conflict of interest for accepting tickets to the musical Hairspray from one company during a 2003 trip to New York, and tickets to a 2001 Cleveland Indians game from another firm. He pleaded no contest in Franklin County Municipal Court to one count, and prosecutors dropped the second.

The panel's executive director and another board member were previously convicted.

Billirakis resigned from the board, which manages billions in a pension system, a few weeks before he was charged.

Previously, he led the Ohio Education Association, the state's largest teachers union.

In his new position, Billirakis will help oversee implementation by school districts of four best practices recommended by the health-care board, Loebs said. For example, districts are being urged to implement wellness programs and to review policies to make sure that employees and their independents are eligible.

The board is to issue a report at the end of 2010 detailing how much progress the districts have made.

The governor, Senate president and House speaker make an equal number of appointments to the 12-member board and an 18-member advisory council. The board operates on an annual budget of $800,000.

ccandisky@dispatch.com
http://www.columbusdispatch.com/live/content/local_news/stories/2009/10/31/billirakis.ART_ART_10-31-09_B1_QGFHFC2.html?sid=101

So...who are the members of the "School Employees Health Care Board?" Just click on this link [below] below TO SEE WHO APPOINTED THEM! You might want to let them know how you feel!

John

http://sehcb.ohio.gov/Portals/0/pdf/SEHCB%20Reports%20and%20Publications/Board%20&%20AC%20Members.pdf
[You may also click this image to see the list]:

Kathie Bracy to Mike Nehf: How many and how much?

From Kathie Bracy, October 30, 2009
Subject: Healthcare coverage for spouses of STRS employees

Dear Mr. Nehf:

How many STRS employees' spouses are covered by the STRS employees' healthcare? What does this cost STRS? Do the STRS employees pay any portion of the spouse's coverage? If so, how much?

Thank you.

Respectfully,
Kathie Bracy

John Curry: Just a thought..and another way for STRS to save money...lots of it!

From John Curry, October 30, 2009

Retirees,

Do you remember when STRS eliminated the spousal subsidy many years ago? I do!

Currently, STRS pays no subsidy toward health insurance of your pre-65 years of age spouse. Currently, and a growing trend, is the FACT that many employers are requiring employees, whose spouse works at "another" job, to NOT medically insure their spouses IF their spouse is employed and healthcare benefits are available to their spouse at the spouse's workplace!

Gee, I wonder how many STRS associates' spouses we are currently covering under the STRS associate health insurance program.....spouses who are covered at a time when spouses of STRS retirees receive no subsidies for their healthcare insurance. We could save a bundle if we required spouses of current STRS associates to obtain healthcare insurance at their workplace....other employers do! Why can't we?

John

Click to enlarge.

Molly Janczyk's response to Mario Iacone

From Molly Janczyk, October 30, 2009
Subject: Re: Dennis leone's opinion

Dennis and John Lazares have feared ability to pay benefits and poor investments for a long time. For ex., they warned of Fannie Mae and Freddie Mac downturns and were dismissed by the 'experts.' Now, ability to pay benefits is at infinity and yet both wanted these issues (along with many of us) addressed years back. STRS stays stuck on its customary plan within their comfort zone. They are like the legislators who only act with in crisis mode vs. planning ahead. Now, STRS has made 'slight' changes in a commanding challenging time. Strong recommendations suggest removing the 88% SOONER, upping age for retirement SOONER and making the changes for new retirees SOONER vs. 2015 to get a start on reducing the liability and increasing ability to pay closer to 30 yrs.

Once again RETIREES are reduced in 2011 not 2015! Retirees had NO WARNING AND HAD TO BEAR CATASTROPHIC changes virtually overnight. One can hope the ORSC demands quicker implementation as who knows what kind of market the next years will bring.

But, remember who we have on the board: OEA board members, Puckett who votes with them and others among them who are influenced by OEA and STRS attorneys and staff who have not changed their tactics or verbiage saying the same stuff to bring board members under their line of thinking.

The 'dissenters' are gone and the majority of Board members follow STRS, OEA protocol. Even if one stands up, no hope of going against the once again majority in place. Of course, that would matter not to Leone or Lazares who always voted for retirees no matter what always asking : "How does this impact retirees?"

Molly Janczyk and Mario Iacone on managing risk

From Molly Janczyk, October 30, 2009
Subject: RE: Dennis leone's opinion

Dennis and John Lazares have feared ability to pay benefits and poor investments for a long time. For ex., they warned of Fannie Mae and Freddie Mac downturns and were dismissed by the 'experts.' Now, ability to pay benefits is at infinity and yet both wanted these issues (along with many of us) addressed years back. STRS stays stuck on its customary plan within their comfort zone. They are like the legislators who only act with in crisis mode vs. planning ahead. Now, STRS has made 'slight' changes in a commanding challenging time. Strong recommendations suggest removing the 88% SOONER, upping age for retirement SOONER and making the changes for new retirees SOONER vs. 2015 to get a start on reducing the liability and increasing ability to pay closer to 30 yrs.

Once again RETIREES are reduced in 2011 not 2015! Retirees had NO WARNING AND HAD TO BEAR CATASTROPHIC changes virtually overnight. One can hope the ORSC demands quicker implementation as who knows what kind of market the next years will bring.

But, remember who we have on the board: OEA board members, Puckett who votes with them and others among them who are influenced by OEA and STRS attorneys and staff who have not changed their tactics or verbiage saying the same stuff to bring board members under their line of thinking.

The 'dissenters' are gone and the majority of Board members follow STRS, OEA protocol. Even if one stands up, no hope of going against the once again majority in place. Of course, that would matter not to Leone or Lazares who always voted for retirees no matter what always asking : "How does this impact retirees?"

From Mario Iacone, October 30, 2009
Subject: Dennis leone's opinion Date: Fri, 30 Oct 2009 11:22:35 -0400

Molly,

Let the others know that while we concerned ourselves with the type of assets STRS is supposedly using to manage risk, we missed the most significant point.

(Molly's analysis expressed the following concerns and questions indicated in blue)

My concerns is the 'slight' adjustments in stock weight, 'slight' changes in asset allocations translating to 'slight' increases to alternate investments.

How much protection can this slight shift possibly provide if another downturn comes every few years or if our current market becomes more of a standard market never returning to the more extreme highs we have basked in over the past decade?

Only goes to show the more heads involved, the more is learned.

On a more serious note, wonder what Dennis Leone's opinions are on all of this as he knows far more about the investment strategy at STRS than we will probably ever know.

Especially with concerns that he expressed in the past well in advance of the current losses.

Refer you to

Dennis Leone Urges STRS Board to Prepare for Significant Stock Market Downturn

The following excerpt is taken from.

Ohio Retired Teachers Association (ORTA)

QUARTERLY REPORT*

By Dennis Leone,

STRS Retiree Board Member

March, 2007

Among a number of items Dennis reported and discussed in his quarterly report was,

………………..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 charts below:……………………….

………………………….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………………………

http://kathiebracy.blogspot.com/2009/05/ohio-retired-teachers-association-orta.html

Molly Janczyk and Laura Ecklar: Questions and answers

From Molly Janczyk, October 28, 2009
Subject: RE: Response to E-Mails

Laura, I have read all the material and compared it to other systems as well. I understand that 8% seems necessary and I worry that we have brought this on without in depth planning to soften downturns. I understand the cash flow problems. My concerns is the 'slight' adjustments in stock weight, 'slight' changes in asset allocations translating to 'slight' increases to alternate investments.

How much protection can this slight shift possibly provide if another downturn comes every few years or if our current market becomes more of a standard market never returning to the more extreme highs we have basked in over the past decade?

There are other not popular ways to curtain some costs and possibly deal with our unfunded liability issues and cash flow. I and others have long advocated for more extreme changes in STRS planning and benefits. Retirees have struggled with saving the HC fund for over 6 yrs resulting in catastrophic attacks on our incomes and finances. We were given no notice and told and or made to sell our homes, cars, use our personal funds, eat out less and stop vacations, cut and or stop meds, treatments and Dr. visits.

Who cared about out dilemma? We were told 'hard decisions' had to be made to save HC and the task become ours to bear on our backs. Now, some other hard decisions need to be made. While some cuts have been proposed, others can easily be included:

1. A more immediate cut to the 35 yr rule (88% of FAS). I understand that waiting till 2015 will probably allow Bill L. & Co. to retire under his (OEA's) precious rule but at what cost to current retirees? I understand allowing this year and the next but actually, all those actives have the ability to plan options-the ability WE never had nor anyone cared about for us. They can work a year or so longer-we would have loved that opportunity IF only OEA, STRS, ORTA, OFT had warned their then actives of impending crisis which they did know was coming. As said numerous times, Endry warned of it in the early 90's and legislation to mandate HC was proposed back then to secure funding for HC and OEA and STRS said it was not necessary. Dyer said he wanted out of the HC business. All facts and never disputed.

2. Age 60 for full retirement with any amount of years for anyone several years out. We are living longer and Soc Sec makes full retirement for my generation at 66 yrs. The younger generations go up a year for each generation. This would help STRS will its problem of pay outs and keep educators working longer.

3. 20 yrs for early retirement and realization of benefits with HC (costs significantly higher for ALL out of pockets, not just premiums) unless disabled which is a completely different category.
10 yrs for any ability to realize a pension ck with no HC.
5 yrs is simply not enough time to realize any benefits and either one can afford to not work, worked at something else or just is padding their pension.

4. Eliminate inactives after 5 yrs. This allows time to stay at home with small children until K age. Why does a group of people have the capability to vote on how I live when they have quit or moved on to other careers which will pay them benefits and retirements? No pay outs for this group after 5 yrs.

5. 2015 IS TOO LONG for all current benefits to be paid to retirees. We need changes now or in immediate future.

This plan clearly again punishes the current retirees and Bill L. still thinks his actives are being too heavily impacted and the current retirees should take on more when current retirees have had their retirements destroyed already. The only consideration we were given is .5% COLA retaining it at 2% vs. 1.5%.

Concerns we have: Has STRS done enough to preserve and protect funds? Can other considerations be made to conserve money and provide more stability? Has STRS researched thoroughly all possibilities or stayed to the comfort norm too heavily?

We need protected and history now has proven how fragile the comfort norm is to current retirees. IF another crash occurs, how are we to survive? Then, further changes? Why not now when it will ensure a more stable future for all.

Molly J.

From Laura Ecklar, October 28, 2009
Subject: Response to E-Mails

Dear Ms. Janczyk,

Steve Mitchell has asked me to respond to you following his review of your e-mails. As you know, the Retirement Board and staff have been engaged in a long-term planning process for many months, with the purpose of developing a plan that will help ensure the long-term solvency of the pension fund for current and future retirees. As I am sure you and your colleagues have read in our newsletters and on our Web site, the pension fund was already being impacted by economic and demographic factors before this most recent unprecedented decline in the global markets and the accompanying recession that has universally impacted both public and private investors. The plan that the board unanimously approved on Sept. 1 was presented to the Ohio Retirement Study Council on Sept. 9 and we anticipate that the legislative process will begin soon. All the details of the board’s proposed plan have been included in our newsletters and are posted on the STRS Ohio Web site.

As part of that planning discussion, one of the first things the board did was conduct an Asset Allocation Study over a period of several months during its public meetings. Return and risk forecasts were updated and the board adopted a slightly different asset allocation in May 2009. As reported to the membership at that time, the stock weight was reduced slightly and allocations to Alternative Investments were increased. This adjustment was made with the intent of providing some downside protection to the investment fund during future equity bear markets. However, a diverse investment fund portfolio has been prudently and intentionally maintained. (This new asset allocation is included in the “2009-2010 Annual Investment Plan” that was posted on the STRS Ohio Web site following its adoption by the board in June 2009. This report also includes a section on risk management.)

The projected long-term return for the asset allocation adopted earlier this year is +8.1% per year. As we have repeatedly stated, STRS Ohio cannot “invest” its way out of the challenge it faces; an 8% return over the long term on its own is not enough to address the projected growth in unfunded accrued liabilities. That is why changes in contributions and pension plan design have been proposed.

I hope this information is helpful to you.

Laura Ecklar
Director, Communication Services

RH Jones: HB 318 - Income tax rate freeze

From RH Jones, October 28, 2009
Subject: HB 318 -- Freeze of the income tax rates

To all:

According to a message sent out by the E & A Coalition Weekly update of Oct. 23, 2009, the Ohio “HB 318 passed the House on Oct. 21 with all the Democrats and two Republicans voting for it. The two Republicans--Representative Ross McGregor and Representative Matthew Dolan—both gave impassionate House floor speeches in favor of HB 318.

The current budget is out of balance in the range of $850 million. With postponement of the income tax rate reductions or an alternative increase in state revenue, public K-12 education will be reduced 10% in FY 2010 and 15% in 2011. Other areas of state government have been cut to the bone already.

Senate deliberations on HB 318 begin the week of October 26. It is time to express our views to our respective senators.”

Every educator both active and retired will be hurt if this does not pass the House. The OEA, OFT, ORTA and CORE are asking all members to contact your state senators now. We cannot depend on Ohio voters voting for the upcoming gambling (Issue 3) on the November Ballot to help fund education. Personally, I think Issue 3 will not pass. The voters want a better bill crafted.

By the way, the two brave Republicans, Reps. McGregor and Dolan deserve accolades from all Ohioans. Such positive thinking will save our Ohio economy.

Educators, without HB 315 the public, the state, the children, and us will be severely hurt: For with a curtailed funding situation in education, Ohio’s future economic condition will, again, I say only worsen. This is not an opinion. This is a fact.

RHJones, retired teacher member of OH STRS

Congratulations to Dennis and Nikki Leone, who became proud, first-time grandparents on October 27 when daughter Lindsay presented a healthy 8-1/2 pound baby boy, Jacob. Welcome to the world, little one, and best wishes to all!

10/28/09
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RH Jones: Robin Hood thinking not always good

From RH Jones, October 25, 2009
Subject: Robin Hood thinking not always good
To all:
Here in Ohio (OH) geographic income thresholds are uniquely different. So, in the consideration of the redistribution of the STRS COLA, as in Robin Hood taking from the rich to give to the poor, is not always a valid goal. Why not, you may ask? The answer is that each county the purchasing power of the dollar varies. For instance, in my Summit County a home is more expensive to purchase than just south of me in Stark County; but, to the west of me, in Median County, homes are more expensive to purchase than here. This is true with many other costs and purchases even including Health Care HC). In other words the dollar goes further, or not so far, depending on where you may live. Therefore, if the retiree in Medina gets cut to add to my COLA here in Summit County, it is not equitable, nor fair; and I would end up living better than he or she. Conversely, the retiree in Stark County would be better off than me here in Summit County.
Note: The federal and state governments have Geographic Means Test Thresholds published that support my contention. They include geographic scales for median income for one individual, spouses, and other dependents.
To keep the OH STRS 3% simple COLA simple, it is best just to leave it as is. The 3% COLA, until the supplemental (13th check) can be again offered, was, and will still be, very fairly distributed -- or even better yet, I might add, is a legislated compounded COLA based on our monthly pension check.
And, by the way, is it not strange that the STRS officials and board are declaring the our STRS will be nearly amortized – by their recent recommendations to the ORSC for legislated changes that would extend STRS funding until it will almost reach its 30-yr. funding goal – when legally a 13th check can only be issued when this 30-yr. goal is reached. A coincidence, I wonder?
The above are some thoughts that could be considered.
Robert Hudson Jones, a retired teacher STRS member, & proud to be a CORE member

Minutes of the October 15, 2009 CORE Meeting

Note: As relayed by Dave Parshall, the distribution of these minutes were delayed due to computer problems with an email client server.

Minutes of the October 15, 2009 CORE Meeting

The Oct. 15^th Concerned Ohio Retired Educators (CORE) meeting was opened in the Sublett Room in the STRS Building by President Dave Parshall at 12:15. Dave’s first order of business was to convey Dennis Leone’s thanks for the gift of a check, as well as the cards from CORE membership. Dave then turned the meeting over to Kathie Bracy so that she could give those in attendance an update on John Lazares’ health.

After surgeries and hospital stays, according to Kathie, John is currently back home recuperating, but definitely improving. Both Dave and Kathie thought that he’d appreciate cards. (His address will be put on Kathie’s blog.)

CORE minutes – done last month by Jill Fetters – were moved to be approved by Mary Ellen Angeletti; Nancy Boomhower seconded the motion. The group of 18 members in attendance voted approval.

Due to the absence of Herman Fisher, our treasurer, there was no treasurer’s report this month.

Much discussion ensued about retirees’ ability to refute the anti-retired teacher, misinformation about benefits, which is occurring in the non-teaching sector. In fact, Nancy Boomhower stated that most people don’t even realize teachers do not pay into Social Security.

The group agreed that the best starting point was a committee (still without a formal name) whose job it would be to put important points into written form for CORE members to have and use. Any member who does have some ideas or comments should send the information (or questions) to Dave Parshall (advisor of the committee) or committee members Jill Fetters, Kathie Bracy, George Justice, Carole DePaola, Marie Fetters, or Mary Ellen Angeletti. (Lou D’Orio will also be helping with this group.)

People continued the discussion about pensions by noting that it’d be helpful if all five Ohio pension systems were “on the same page.” It was suggested that when CORE is completed with its committee work, and has the points written out, we should share them with the other pension groups.

President Dave broke from the pension dialogue in order to welcome “new faces” to our CORE meeting. Rose Phillips had come with Liz Ebbing and Tom Price accompanied George Justice.

After those brief introductions, Dave reminded the group – especially those not at the STRS Board meeting – to call and order CDs of the meeting. (Sandy Adams has taken Joyce Baldwin’s place as the contact person for this.)

Dave redirected those in attendance to think about educating legislators via e-mail, snail mail or face to face. George Doyle indicated that we all should also be working with and talking to younger teachers – especially those who were our former students – so that we could bring them up to date on the situation.

President Parshall closed the meeting by reiterating that we need more active members, workers. Meeting was adjourned at 1:05 p.m.

Respectfully submitted,

Marie M. Fetters

CORE Secretary

Tom Curtis to ORSC: Scrap the 88.5% rule now

From Tom Curtis, October 25, 2009
Subject: 102509 Curtis To ORSC Board Members, 35 Year Rule, SB190

Hello ORSC Board Members,

To help reduce the unfunded liability of the STRS, it is my recommendation that one of the first considerations be the elimination of the STRS 35-year rule (SB190), at the end of this 2009-2010 school year. This rule, according to SB190, offers a person with 35 years service, an 88-1/2% pension benefit for life. This is not sustainable.

It would appear that this rule should never have been legislated, for numerous reasons, here are two.

(1) It created a two-tier retirement system. Those having 35 years of service prior to 1999 were not permitted the 88-1/2% benefit and his/her multiplier is 2.1%, not 2.2%, as it is for those after 1999.

(2) The cost of SB190 has never been cost neutral, as has always been advocated by the STRS board and management. STRS CFO Robert Slater recently reported to the board that the cost of this program has to date cost the STRS $1 billion dollars.

Because the 35-year rule is not cost neutral, the cost to the fund and the unfunded liability will both continue to increase the longer this rule remains in place. Please stop it now and not in 2015 as recommended by the board, many of which will personally benefit from the extension. No other pension system has the 88-1/2% rule and it is overly excessive, especially in the eyes of the taxpayer or anyone else.

Any 30+-year educator would need to retire at the end of this school year to qualify for the increased percentage in benefits according to SB190. Everyone with 30+ years will still benefit.

Beginning 2010, a flat 2.2 per year multiplier should be used. A consistent 2.2 multiplier would seem to permit for a far more accurate actuarial determination of the unfunded liability.

A great added benefit of ending it this year would be that the number of educators at the top of the pay scale would diminish greatly for the next school year, thus freeing up much needed funds for each and every school district.

The 88-1/2% rule should NOT be extended, period!

Thomas Curtis
STRS retiree
North Canton, OH

P.S. I have been actively involved in the attempted reform of the STRS since 2003. I would be more then willing to talk with each and/or everyone of you concerning the many issues that have caused this collapse in value of the STRS retirement system.

Can you make 8% over the long term with just Treasury Bonds?

From Mario Iacone, October 22, 2009

The return of this fund is 8.22% since 1986, a 23 Year Period.

[Click image to enlarge]

Please notice that the performance of this one example, Vanguard Fund, is slightly below the index, Barclays US Long Treasury Index.

Will bonds outperform risk equities or vice versa in the future?

Nobody knows!

Therefore, a balanced asset allocation including both might be the most prudent way to invest.