Thursday, July 21, 2011

Here is the final SB 5 initiative is OFFICIAL....SB 5 WILL BE on the ballot

From John Curry, July 21, 2011
All 88 counties had over their necessary 3%...and we didn't even need 88 counties. Were there some invalid signatures...sure....but there were a whole lot more valid signatures! Click on this link:

Wednesday, July 20, 2011

The Case for Defined Benefits and Retirement Security!

From John Curry, July 20, 2011
Retired educators...please share this informative email with a fireman, policeman, municipal or county worker and any other public servant on your email list. Many of them don't have the slightest idea what a "defined benefit" or a "defined contribution" retirement is. It will be easy for them to be "snookered" into going along with a change in Ohio's pubic pension systems to a defined contribution model by some self-serving politicians. One of them, Lynn Wachtmann, has already shown an interest in doing such as he said "the state should move to a defined contribution plan." Others are thinking it if not saying it.
"Wachtmann agrees with some of Mayer's sentiments. He said final average salary should be based on a 30-year average, and that the state should move to a defined contribution plan." [The link for the above quote has been removed from the internet (imagine that) but the entire article is copied below the following email."
From Ryan Holderman, July 20, 2011
Subject: The Case for Defined Benefits and Retirement Security!
July20, 2011
By Willie L. Pelote Sr.
In America, anybody who works for a living should be able to afford to retire.

That's why shunting newly hired and/or existing civil servants into defined contribution or 401(k)-style plans to save taxpayers money, as a new report [4] by the Kellogg School of Management and the Simon School of Business suggests doing, is a bad idea.

Doing this will actually cost taxpayers more money and severely weaken retirement security for all Americans.

This is because 401(k)-style plans are inferior to, and less efficient than, traditional, defined benefit retirement plans or pensions.

Inferior because few individuals have ever saved enough money through stock market investments in a 401(k) to finance an adequate retirement.

Inefficient because 401(k)-style accounts are more expensive to maintain than traditional, defined benefit plans.

Money managers who administer 401(k)-style plans can collect commissions and administrative fees on the money sitting in the accounts, regardless of whether or not a trade or transaction occurs.

These practices routinely devalue 401(k) style retirement savings by at least 20 percent.

That's why individuals with 401(k)-style plans usually have less than half the benefits of traditional, defined benefit retirement plans.

Worse, taxpayers will have to subsidize these miscellaneous charges, and this will cost significantly more than maintaining traditional, defined benefit retirement plans.

Defined benefit retirement plans protect retirement security by pooling wealth.

The money stays in the system and is there to support surviving retirees.

A 401(k)-style plan will never have the advantages and efficiencies of traditional, defined benefit retirement plans and will never be able to provide the same high level of retirement security.

Retirement systems in other countries based on defined contribution or 401(k)-style plans, such as Chile's, which was imposed under dictatorial rule in 1973, are a complete disaster.

Requiring pension administrators to build up a reserve to meet their obligations to current and future retirees in the case of insolvency presents no imminent danger to taxpayers.

As long as employee and employer contributions continue to roll in, defined benefit retirement plans will be fine.

This is where the public pension plans administered by local and state governments have fallen down recently.

The Great Recession shrank the investment income of public employee retirement funds, and politicians failed to set adequate levels for pension contributions in good times.

Fortunately, defined benefit retirement plans for civil servants are now making a robust recovery, according to a recent report [6] by the National Conference of Public Employee Retirement Systems (NCPERS).

Retirement systems can cover more than three-quarters of their obligations now, and they are generally considered fully funded when they can cover more than 80 percent of their obligations.

Furthermore, the Center on Budget and Policy Priorities released a recent report [7] saying that, "States have adequate tools and means to meet their obligations [8]."

People are confusing immediate budget gaps with long-term deficits.

Taxpayers are right to be concerned about how our tax dollars are being spent, especially in light of the billions given to bail out the financial institutions responsible for our current economic crisis.

Given the fact that Wall Street is responsible for our budget deficits at the federal, state, and local level, it's Wall Street, not Main Street, that should bear the cost of cleaning up this economic mess.

Proposals aimed at shunting civil servants into 401(k)-style plans or converting traditional, defined benefit retirement plans into defined contributions plans will only benefit the same Wall Street banks that brought about the Great Recession.

These efforts must be seen for what they are and quickly placed in the circular file where they belong.

Here is the story where Wachtman concurs with the defined contributions model - the quote can be found near the end of the article and I have highlighted it in red.
Ohio pensions: Time bomb for state, local governments
BY JESSICA ALAIMO • July 26, 2010
The good news first: We're all living longer.
The bad: It's costing the state and local governments a ton of money.
Since the average person spends many more years in retirement than in years past, there is a looming question of how to pay for it.
Most private sector employers have responded by dropping the traditional pension plan in favor of a 401(k) system, in addition to Social Security benefits. However, public employees still pay a determined amount into one of Ohio's five public pension funds throughout their working careers. Then they are guaranteed a pension for the rest of their life, the amount based on their earnings and years in public service.
That guarantee comes at a price -- one that cash-poor state and local governments are struggling to pay for. Unless substantial changes aren't made to Ohio's pension systems, the funds will need to come from somewhere. For taxpayers, that could mean fewer government services, higher taxes or both. For retirees, it could mean working longer before they are eligible to retire, and lower payouts when they do.
State law dictates each pension fund should plan for the worst. In the event that government shuts down tomorrow, the funds should be able to pay off all outstanding promises within 30 years.
If a pension fund can't meet that threshold, it must submit a plan to the Legislature on how it will recoup costs.
Two of Ohio's pension funds, which cover public employees and school workers other than educators, meet this benchmark.
The other three, covering Ohio's teachers, police and fire and highway patrol employees, not only are below the threshold, they also have attained "infinity" status. That means they never will be able to pay off their existing obligations unless changes are made.
Given an aging and shrinking work force, increasing costs and a longer life expectancy, retirees will almost certainly get more out of the system than they and their employers pay into it, which means the state is slipping behind. The Ohio Retirement Study Council, made up of legislators and three gubernatorial appointees, asked all funds to come up with a plan to cut costs in coming years.
The pension funds and labor unions are now in agreement on plans that will cut costs down the line, but a battle is looming. The Legislature must approve any changes to the pension funds, and lawmakers have wide-ranging ideas as to what will bring more sustainability to Ohio's pension system.
The wake up call
In 2008, the financial earthquake hit. The stock market crashed and Ohio's pension funds lost billions. PERS, the largest pension fund, lost $24.4 billion, according to the fund's annual report.
There had been talk of pension reform before the crash, but when investments declined, public officials had a greater sense of urgency.
Last year was a better year. PERS made slightly less than half of its losses back.
The pension funds recently got another boost. Earlier this month, three of the state's pension funds reached a $725 million settlement with American International Group Inc., which the state had accused of fraudulent accounting practices and stock price manipulation, which caused the investments to plummet.
Now, the biggest problem facing Ohio's pension systems are an archaic system and "apocalyptic demographics," said Marianne Steger, director of health care and public policy for AFSCME Council 8.
"We never expected someone to retire at 65 and live another 50 years," Steger said.
To make ends meet, Ohio's public employees will need to work longer and contribute more to and expect less from their pension systems.
Public pension system officials have made various recommendations to the General Assembly to fundamentally change how benefits are administered. Officials from two of Ohio's biggest unions, the Ohio Education Association and AFSCME Council 8, said they support their respective systems' recommendations.
Three of the systems are recommending increased contributions from employees and taxpayers, although this recommendation is not likely to go over well in the Legislature. That's assuming the proposal even makes it into proposed legislation at all -- the lawmaker drafting the bill said he has reservations about contribution hikes.
All are asking that workers spend more time in public service. The Public Employees Retirement System wants to raise the normal retirement age to 67, or require that employees spend 32 years in public service.
Currently, an employee's pension is based on his or her highest paid years in public service. All pension systems want to change this to five years to better reflect a worker's salary throughout his or her career.
Retirees collecting pensions also get a 3 percent annual cost-of-living increase. All but one pension fund wants to either defer or lower this guarantee.
Chris DeRose, executive director of PERS, said his system's recommendations were made after consulting with a number of stakeholders, including retirees and labor unions.
He and Steger are involved in campaigns to explain the changes to their members. Both say members have questions about the proposals, but they generally accept the proposals once they see the need.
Bill Leibensperger, vice president of the Ohio Education Association, said he has faced challenges explaining to his members why the State Teachers' Retirement System must be fixed.
"We have to recognize the hard facts that real changes need to be made to preserve the system," he said. "In STRS we will have to work longer, pay more, and get less."
The hard truth
By law, Ohio must pay the promised retirement benefits for all employees.
However, the state does not have to provide retirees with health care, although all five pension systems do. This means if public pension funds start to run out of money, health care for retirees could be the first to go.
PERS currently has the assets to fund health care for 11 years.
The threat that retiree health care could go is the wake-up call some need to agree to the changes, DeRose said.
"We get strong feedback on the changes after explaining the need, that by making these changes we can continue to fund health care," DeRose said.
Right now the recommendations are being reviewed by the General Assembly's Retirement Study Council, chaired by Rep. Todd Book, D-McDermott.
Book could not go into detail about what will be included in the bill. However, he did say he has strong reservations about any proposal to increase employer contributions. The teachers, police and fire and highway patrol pension funds are seeking such increases.
Retirement council members Reps. Lynn Wachtmann, R-Napoleon, and Dan Dodd, D-Hebron, were more candid. Wachtmann said he would oppose any measure that will increase employer contributions. Dodd said he would use it only as a last resort.
Pensions, Wachtmann said, already are strangling local government budgets.
Dodd said he is also concerned about the formula for determining payments. Under the current system, a retiree's pension is based on the top three highest paid years. There is concern that some employees are loading up on overtime as they approach retirement so they can collect a higher pension. This "spiking" is legal but can add hundreds of thousands to a retiree's total pension payments.
Four of the five funds are recommending the average needs to be taken over the highest five years.
"The retirement needs to reflect the salary you were making," Dodd said.
Sen. Sue Morano, D-Lorain, also a member of the council, said another X-factor in the debate is how the new federal health care law will impact Ohio's public employees and retirees.
The opposition
Pooled pension plans used to be common in the private sector, but they were abandoned in favor of defined contribution plans, such as a 401(k).
Some conservatives are saying public employee retirement should mirror the private sector.
"The private sector has long said 'no' to defined benefit plans," said Matt Mayer, head of the Buckeye Institute, a conservative think tank.
The Buckeye Institute recently released a report calling for deep cuts to public employee pensions to save the state money. The institute calls for elimination of longevity pay, cost-of-living increases, a lower employer contribution, and a move to a 401(k)-like plan. The moves would save $2 billion in the next two-year state budget alone, the report concludes.
In Mayer's opinion, the proposed changes by the retirement system don't nearly go far enough, and he doesn't see the political will to do more in the Legislature.
"Politicians always do this nibbling on the margins to not address the real problem," Mayer said.
Wachtmann agrees with some of Mayer's sentiments. He said final average salary should be based on a 30-year average, and that the state should move to a defined contribution plan.
In California, a referendum campaign is under way to cut pension benefits.
"Taxpayers are starting to wake up to the (pension) issue," Wachtmann said. "Doing nothing could cause a couple people to fund a referendum, though I have not heard of an effort."
The Buckeye Institute's conclusion is that Ohio public employees' actual compensation is much higher than those in the private sector. However, a competing study says otherwise.
The National Institute on Retirement Security released a report this April also comparing public sector employment to private sector employment on a national scale. Its conclusion? Public employees do get better benefits, however their base pay is much lower, evening things out.
"Although the current recession calls for equal sacrifice, the long-term pattern indicates that state and local workers are not, on average, overcompensated," the study concludes.

Want to go back to subbing....better not make too much money!

From John Curry, July 20, 2011
From: ContactUs
To: Mary Jordan
Sent: July 20, 2011
Subject: RE: re:STRS Rules on Retire/Rehire
Dear Ms. Jordan:
Reemployment of public employees is Ohio law and therefore part of the Ohio Revised Code. The information you have received is a proposed change to Ohio law. Please see below from our website:
· On April 13, Rep. Richard Hollington introduced House Bill 202. This bill includes provisions dealing with reemployed public employees. Basically, it would require anyone who is receiving retirement benefits from one of the Ohio systems, including STRS Ohio, to forfeit $1 of their retirement benefit for each $2 earned above an annual threshold amount of $14,160. This threshold amount, or “excess earnings base” as it is referred to in the bill, would be adjusted each year by the actual average increase, if any, in the consumer price index (CPI).
Here’s an example of how a reemployed retiree’s pension could be reduced: Assume a retiree is receiving a yearly pension of $38,000. This individual returns to work in a public position covered by one of the Ohio retirement systems and receives an annual salary of $35,000. This salary exceeds the threshold amount of $14,160 by $20,840. The retiree’s pension would be reduced by $10,420 (one-half of the excess amount). The bill’s language does not detail how this new rule would be implemented, monitored or enforced.
Thank you for the inquiry.
Mike Havens
Benefits Counselor

From: Mary Jordan
Sent: Tuesday, July 19, 2011
To: Knoesel, Sandy
Subject: re:STRS Rules on Retire/Rehire
Dear Sandy,
I am a retired teacher who does substitute teaching. I have heard from different sources that the STRS has new rules that go into effect this school regarding retire/rehires. I have been told it will affect substitute teachers also and that for every two dollars they earn one dollar will be deducted from their next STRS retirement check. Is this correct? If this is not correct, something should be published to correct this misinformation because many of the retired substitute teachers will not sub this year no matter how badly they are needed if this deduction does happen to their STRS Retirement check.
Mary Jordan

Monday, July 18, 2011

Approved minutes from the June 30, 2011 meeting of the Ohio Retirement Study Council.

Scott Oelslager
Charleta B. Tavares
Dan Ramos
Kirk Schuring
Lynn Wachtmann
Lora Miller
Seth Morgan
Karen Carraher
William Estabrook
Lisa Morris
Mike Nehf
Dan Weiss
Janyce Katz
Keith Faber
Doug Gillum
Aristotle Hutras
Anne Erkman
Glenn Kacic
There being a quorum present, Rep. Wachtmann asked the Council to review the minutes from the previous Council meeting. The minutes were approved as submitted, without objection.
Rep. Wachtmann called Laurel Nicholson and Steve Voss of Hewitt Ennisknupp to review the fiduciary audit of HPRS. Ms. Nicholson and Mr. Voss reviewed the audit. They concluded that HPRS has many good practices in place, but improvement is possible; addressing the recommendations made within their report will take time and dedicated resources; some recommended changes may be able to be implemented quickly, with little money, while others will take many months and sizable expenditures to complete. They encouraged HPRS to address the recommendations made in the report and either formally accept, modify, or reject them based on what is in the best interest of the members of the system and then report back to the ORSC on their progress within a reasonable amount of time.
(Rep. Ramos entered the meeting.)
(Sen. Oelslager entered the meeting.)
Sen. Tavares asked if the percentage of HPRS’ assets invested in real estate is the norm in the industry. Mr. Voss said 5-10% is the common allocation.
Sen. Tavares asked what percentage does HPRS hold. Mr. Voss said HPRS has 5% of its assets in real estate; it is more common for larger funds to have more exposure to real estate.
Rep. Wachtmann asked if it was a reasonable risk for two buildings to make up almost 25% of their real estate portfolio. Ms. Nicholson said HPRS’ two buildings make up 22% of their real estate portfolio, which is relatively high, but the remainder of their real estate holdings is within diversified funds. Mr. Voss said they look for diversification. Having two buildings as direct holdings is not unheard of, but it is not best practices. However, it is not a problem overall.
Rep. Tavares asked what the two properties are. Ms. Nicholson said one is the HPRS operational site and the other is a nearby building.
Rep. Tavares asked if it is unusual for a system to own its operational building. Ms. Nicholson said it is not unusual.
Rep. Wachtmann asked if HPRS takes up the entire building. Mr. Weiss said no, HPRS uses approximately 5,000 square feet of the 60,000 square foot building; the remainder of the building is rented by tenants.
Rep. Wachtmann said he would like to know the rental income history for the past two years.
Rep. Wachtmann asked if the number of recommendations is comparable to the recommendations they have made for other systems they have audited. Ms. Nicholson said it is not uncommon to have 75-100 recommendations. She said the division between high, medium, and low is typical to other projects they have completed.
Ms. Miller asked if the HPRS board has had an opportunity to fully review the recommendations. Mr. Weiss said the board has reviewed a draft report and has begun work on implementing a number of the recommendations. He said the board has already completed work on 6 of the 15 high recommendations.
Ms. Miller asked if the board rejected any of the high priority recommendations. Mr. Weiss said no, they believed they were excellent recommendations.
Rep. Wachtmann asked for further questions; there were none.
Rep. Wachtmann called on Paul Morgan of Evaluation Associates to review the investment performance of the five systems for the period ending 12/31/10. Mr. Morgan reviewed his report.
(Sen. Oelslager left the meeting.)
(Sen. Oelslager returned to the meeting.)
Rep. Wachtmann said, regarding Mr. Paul Morgan’s recommendation that the systems engage in dialogue regarding investments, that he assumed senior staff of the systems talk to one another. Mr. Estabrook said they do.
Mr. Seth Morgan said that SERS’ 25% allocation to alternative investments strikes him as a large number. Mr. Paul Morgan said he thinks it is a great idea and endowment funds have been doing it for a long time. He said it is another source of risk and statistics have shown that good private equity managers can provide significant excess returns.
Mr. Seth Morgan said it appears that investing in hedge funds is a new policy for SERS; he asked Mr. Paul Morgan to comment. Mr. Paul Morgan said investing in hedge funds can be done immediately or on a longer term, depending on prudence. Ms. Morris said SERS has invested slowly over the past three years.
Mr. Seth Morgan said that except for hedge funds and private equity, the report looks at gross of fee returns. He asked if they could see the net of fee returns. Mr. Paul Morgan said gross of fee is the typical industry pattern when comparing public funds so they can keep it on an apples-to-apples basis. He said net of fees is doable and a good idea. Mr. Seth Morgan said net of fees is reality.
Rep. Wachtmann asked if Mr. Paul Morgan was concerned that the systems’ 10-year rates of returns were substantially lower than the assumptions the systems were using. Mr. Morgan said that number is subject to end point sensitivity. For example, he said 2001 and 2002 were bad years that were followed by five good years and next year they would lop off 2001 so the numbers would increase. He said there is more than meets the eye when looking at the assumed rate of return. He said the assumed rate of return uses actuarial standard practice number 27, which suggests that the future is uncertain and actuaries must use their best estimate that encompasses a range, not a specific number. He said they look at the expected return of the portfolio, standard deviation, and the measurement period. Mr. Paul Morgan added that 8% is a bit high, but reasonable.
Mr. Nehf said that STRS’ 20-year rate of return is 8.2%; their 25-year rate of return is 8.8%; and their 30-year rate of return is 9.5%. He said the longer period tells the whole story.
Rep. Wachtmann asked if there is any measurement that actuaries use to reflect the uneasiness of future markets. Mr. Paul Morgan said no.
Mr. Paul Morgan informed the Council that Mercer bought Evaluation Associates and sold its public fund clients to Callan. He said that because Callan advises STRS they cannot advise the ORSC. He said Tim Price of Milliman will take over as lead consultant for the investment performance review until the Council decides what it wants to do.
Rep. Wachtmann thanked Mr. Morgan and told him he appreciated his professionalism and his work.
Rep. Wachtmann called on Tim Price of Milliman to introduce himself. Mr. Price told the Council he worked in the San Francisco office, which was established in 1984 and that Milliman would like to retain the Council as a client. He proposed assigning the contract to Milliman and keeping everything else the same.
(Mr. Morgan left the meeting.)
Rep. Wachtmann recommended that the Council consider reviewing whether it should retain Milliman or issue an RFP for a new investment consultant.
Rep. Wachtmann called on Rep. Schuring to report on the Subcommittee’s work on the RFP for an actuary and policy advisor. Rep. Schuring moved, seconded by Sen. Oelslager, to approve the RFP reported by the Subcommittee with the amended language to include a scoring method in the RFP, as suggested by staff and the Attorney General’s representative.
Rep. Wachtmann asked for comments.
(Mr. Morgan returned to the meeting.)
Mr. Nehf said STRS welcomes oversight and transparency with a proper scope and reasonable costs. He said the boards as fiduciaries developed reasonable plans in 2009 to sustain the systems into the future and would prefer the next step to be for the General Assembly to enact those plans into law and study future changes. He requested the Council look at the scope and anticipated cost of the review and asked for the inclusion of a pre-bid conference where bidders could ask questions.
Sen. Tavares asked why a pre-bid conference is better than having individuals ask questions and providing those answers to all known potential bidders. Mr. Nehf said it provides bidders an opportunity to ask questions and find out the Council’s expectations before they put their bids together. For example, he said bidders might ask if the Council is expecting them to actually recalculate the actuarial valuations or just review the work of the systems’ actuaries.
Rep. Tavares said she has participated in pre-bid conferences and has found they are a better way to ensure bidders have a good understanding of the scope and are responding to the same scope.
Rep. Wachtmann asked Ms. Katz her legal opinion regarding a pre-bid conference. Ms. Katz recommended that language stipulating there would be a pre-bid conference should be included in the RFP.
Rep. Wachtmann asked the Council to be at ease while language was drafted to be included in the RFP.
Rep. Wachtmann called the Council to order.
Sen. Tavares moved to amend the RFP, seconded by Rep. Ramos.
Rep. Wachtmann asked Ms. Erkman to read the language to be included. Ms. Erkman said the following language would be inserted after the first sentence of section 1.2: “A mandatory pre-bid conference will be held between July 11 and August 11, 2011.”
Rep. Schuring said he supported the language.
Mr. Morgan asked what the significance is of July 11, 2011 as the issue date. Rep. Schuring said the Council is placing an ad in the July 11, 2011 issue of Pensions and Investments so the issue date corresponds to the publication date.
A roll call vote on Sen. Tavares’ motion to approve the amendment to include a pre-bid conference was taken. The motion passed 7-0.
Sen. Oelslager
Sen. Tavares
Rep. Ramos
Rep. Schuring
Rep. Wachtmann
Ms. Miller
Mr. Morgan
A roll call vote on Rep. Schuring's motion to approve the RFP as amended was taken. The motion passed 7-0.
Sen. Oelslager
Sen. Tavares
Rep. Ramos
Rep. Schuring
Rep. Wachtmann
Ms. Miller
Mr. Morgan
Rep. Wachtmann said he found some of Mr. Nehf’s comments ridiculous. He said he was speaking for himself and the Speaker of the House when he said they are intent on keeping the defined benefit plans in place. He said they want to keep the systems financially strong and feel strongly that they make sure they have the best chance for keeping health care available to Ohio’s public retirees.
Rep. Wachtmann asked for further questions; there were none.
There being no further business to come before the ORSC, the meeting was adjourned at approximately 10:30 a.m.

Sunday, July 17, 2011

A well-deserved promotion for Rich and....some behind the scenes fun!

From John Curry, July 17, 2011
(Click images to enlarge)
CORE readers...we should be honored. One of our former guest speakers at a previous CORE meeting will soon move to an even higher consumer protection position in the federal government. I wish him the best of luck and want to say that we will be in good hands with this move. At the same time, those who make a livelihood of screwing the public should be put on notice.....this guy will track you down! Please see the additional note at the end of the article for a full belly laugh!
Cordray is Obama's choice to lead Consumer Financial Protection Bureau
Columbus Dispatch, July 17, 2011
Jessica Wehrman and Jack Torry
President Barack Obama will nominate former Ohio Attorney General Richard Cordray to head a powerful new consumer protection agency, White House officials said.

At a White House event Monday, Obama will announce his choice of Cordray, 52, who is currently serving as director of enforcement for the new agency called the Consumer Financial Protection Bureau.

By picking Cordray, Obama hopes to avoid a bruising Senate confirmation battle that would have occurred had he selected Elizabeth Warren, the Harvard law professor who came up with the idea and ultimately helped to set up the agency.

"Richard Cordray has spent his career advocating for middle class families, from his tenure as Ohio's Attorney General, to his most recent role as heading up the enforcement division at the (bureau) and looking out for ordinary people in our financial system," Obama said.

Sen. Sherrod Brown, D-Ohio, called the selection of Cordray a "great move. There's no question of Rich's qualifications."

He predicted the Senate will likely confirm Cordray for the post "unless they get to be hyper-partisan. My only fear is Republicans don't think we should have consumer protection rules."

The Cordray selection places pressure on Sen. Rob Portman, R-Ohio, who has voiced objections about some of the powers of a new agency. Brown said, "I fully expect Rob Portman to support Rich Cordray."

Obama acknowledged Warren's leadership in a statement announcing Cordray's nomination, thanking Warren "not only for her extraordinary work standing up the new agency over the past year, but also for her many years of impassioned leadership, and her fierce defense of a simple idea: ordinary people deserve to be treated fairly and honestly in their financial dealings.

"This agency was Elizabeth's idea, and through sheer force of will, intelligence, and a bottomless well of energy, she has made, and will continue to make, a profound and positive difference for our country," he said.

Warren, who hand-picked Cordray to serve in the agency shortly after his loss in last November's elections, expressed support for his selection.

"Rich has always had my strong support because he is tough and he is smart-and that's exactly the combination this new agency needs," she said. "He was one of the first senior leaders I recruited for the agency, and his work and commitment have made it clear that he will make a stellar director."

If confirmed by the Senate, Cordray, a Grove City native and former "Jeopardy" champ, will lead a new, independent agency tasked with acting as a watchdog for American consumers. The bureau's mission is to prevent abusive and deceptive financial practices and ensure that consumers have the information they need to make the financial choices that are best for them.

Though the bureau is set to open its doors Thursday, it's been active in the year since its creation, pushing initiatives aimed at making credit card providers simplify their forms so consumers can better understand the fees and costs associated with credit; working to simplify the forms that consumers receive when they shop for a mortgage so they have easy-to-understand information that helps them compare different mortgage offers and find the one that's best for them; and policing abuses in consumer financial products like credit cards and mortgages and for making sure people have the information they need to make the decisions that are best for them.

In an interview with the Dispatch last month, Cordray said his credo is "simplifying and clarifying" complex financial agreements so average consumers can understand what they are buying. For example, all too often, credit card agreements were so complex that even college graduates could not figure out the interest rate that would be charged and how the financial penalties would be imposed.

"If we are enforcing the law against the dishonest businesses, the ones that are competing unfairly and illegally with the honest businesses, then that's better for all concerned," Cordray said. "It cleans the markets."

Cordray has been considered a leading contender for the Democratic gubernatorial nomination in 2014. It is unclear whether his nomination to head the bureau will change his future political plans.

Dispatch public affairs editor Darrel Rowland contributed to this report.

* * * * *

Now...for our little COR(E)ner of the world..last year, Rich came to visit with CORE members and speak before our CORE meeting at the STRS building. When the administration at STRS discovered that Rich was going to address our CORE meeting (and long after we had these arrangements made) they asked Rich to address the entire board instead. (They wouldn't want to take the wind out of our CORE sails, would they?) Well....being the genius that Mr. Cordray was, he told them he would, in fact, address the STRS Board (during their lunch) AND THAT HE WOULD, AS PREVIOUSLY PLANNED, address our CORE meeting separately. gets even better. You see, two STRS security officers were waiting to greet Mr. Cordray from the second he stepped foot through the revolving glass STRS main entrance door (after supposedly arriving via his "state vehicle" at the STRS parking garage) so that they could usher him up to meet with the hierarchy upstairs. Little did they know that Rich was not going to arrive by vehicle but instead arrived by foot at another entrance door that was not being carefully watched by security for his arrival.

Here's where the fun friend (who at the time worked for Mr. Cordray and help arrange this meeting) advised me that Rich would arrive at the "other" door and so we would hang around the lobby and "meet and greet" long before the security detail discovered him and ushered him away. Rich walked through the "other" door, talked with us first should have seen the security boys make a rapid U-turn and head for us. Problem was, they had to wait till Rich got finished talking to my friend and I so ..... they couldn't get first "dibs." Was there a little "political gamesmanship" involved here? I think it would be fair to say that and..... we won!


P.S. A lesson to be learned by STRS security....if you see others (like my friend and myself) hanging around the reception area when all the "heavy hitters" are upstairs to attend the meeting, you might just want to keep a closer eye on the small group in the lobby.... they might just be up to something!

Above is a picture of Rich Cordray taken with CORE President, Dave Parshall at that meeting (June 2010).

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