Saturday, December 16, 2023

Dan MacDonald to the STRS Board: Is the STRS Board's financial plan de minimis?

Dan MacDonald's speech to the STRS Board

December 14, 2023

Mr. Chair and members of the Board good morning and happy HOLI-DAZE. I am Dan MacDonald, an STRS retiree with 38 plus years of service. I am also the Executive Director of Local 279R, Northeast Ohio AFT retirees. 
I did say daze. I missed last month’s educational and planning meeting because I was requested to be in Washington, D.C. – where certainly they have their own problems – and right here, in this very place, news is being made. Since the STRS eUpdate didn’t report its own story, I had to rely on fake news agencies like newspapers and television stations. Continued STRS attitude of reporting no bad news, only glowing awards and successes. TRANSPARENCY. Where is it? 
More seriously, I want to thank the Benefits Department for their ongoing efforts to right medical situations that suddenly arise. You had a retiree that broke her leg. She needed a wheelchair and Aetna gave her many places to contact, but none could provide a chair for 9 to 12 weeks. The day after I sent her email concern to the STRS benefits department, she received a call, and the department went into action. Eight days later, last Friday, a chair was delivered. Facility charges are being added to retirees’ bills. Once again, the Benefits department has stepped in, corrected the ones presented, and in the near future, will have Aetna audit for this mistake and reimburse other retirees who didn’t realize they should not have been charged. Finally, the Benefits Department is preparing something to address programs like WellBe, AetnaCare, Signify Health. All these programs contact retirees, but with seniors being scammed, are worrisome to seniors, especially allowing someone into their homes. Kudos to the Benefit’s staff for their hard work. 
At October’s meeting Cheiron presented preliminary numbers on the condition of the general fund and healthcare fund. Improvement was shown. How long will we follow Cheiron’s, and now Board’s, de minimis plan to enhance benefits. So you know, de minimis is an adjective which means too trivial or minor to merit consideration. The Board and STRS staff need to redevelop a financial plan to reach a permanent COLA and 30-year retirement eligibility. I do not think there is currently one in place. The dashboard/scorecard was something put in place to test the fund and was part of pension reform, a plan. Actives and retirees did not like this plan, but it was a plan. Boards before you sought solutions, boards after you will seek solutions. All this is well and good, but you are the Board. What's your swipe at a solution? It appears to be the de minimis plan because that is what is being used. 
As always, actives need their benefits enhanced and retirees need their 3% COLA restored.

Dan MacDonald's report on the December 2023 STRS Board meeting

From Dan MacDonald

December 16, 2023


The December STRS Board meeting was a bit unusual. The meeting started on Wednesday December 13th with an Ad Hoc Legislative Commitee meeting. A number of topics were reviewed: preschool teachers, employer contributions, pending legislation, administrative code disability rule, STRS’s disability review panel, & health care fund impact changing to 30 years of service. Preschool teachers are currently covered by SERS. STRS is seeking to place preschool teachers into STRS.  In an informal opinion the Attorney General response was since the statute does not require licensure, preschool remains in SERS. STRS is pursuing legislation proposing an increase in the employer contribution rate to 18% phased-in over eight years. ORC states that a disability benefit is immediately terminated if the recipient performs any teaching service. OAC defines: “To perform any teaching service” includes all employment, contracted services, or volunteer work that relates to the work of educators, such as, but not limited to, writing curriculum, leading workshops, providing training, instructing students of any age, or directing teachers, student teachers or students.

The Board meeting then commenced upon the committee meeting closure. Consultant AON presented the survey results that the Board members were asked to complete. AON shared info and led discussion amongst Board members present.  Highest scores revolved around new Board member orientation, roles of Board and staff, and materials and information. The lowest scores were the Board's one voice policy, trust in each other, and teamwork.  AON did state that overall, the survey provided the lowest scores they have ever seen. Much interaction occurred.  Following the survey discussion, the implementation of the fiduciary audit recommendations/governance considerations-part 2 commenced. The Board adjourned at 5:15 p.m. 

Thursday’s meeting started with the Audit Committee meeting.  STRS has internal and external audits happening every year. Every five years a Quality Assessment Review must take place by an assessor not in any way connected with STRS. She gave STRS exemplary status. Following the report, the Audit Department presented current audits and changes then had the Board approve its 2024 Audit Plan.  

The Board meeting then commenced with minutes approval and consultant Crowe, LLP on the results of the financial statement audit. Crowe found no “corrected” or “uncorrected” misstatements in the audit. 

Acting Director Lynn Hoover then gave her Executive Director’s Report which included the heads of the Benefits Department and Communications Department addressing the Board. Hoover addressed 7 areas. Most routine, but one not. The Fiscal 2023 Annual Comprehensive Financial Report (ACFR) has been completed.  During Benefits presentation it should be noted that appointments for consulting session has dropped from 12 weeks to 4-5 weeks.   Under Communications, Board members want to be notified when an STRS Town Hall meeting is taking place in their general area. Bias in Board member election cycle and misinformation was also discussed.  

Public Participation ranged from Neville to funding levels to KARMA to COLA to sustainability to offers to help to levers and assumptions.  Twelve speakers addressed the Board.  [By the way, on Thursday there was discussion on Public Participation.  One proposal was to have to sign up one to two weeks early to speak and present the topic.  Consideration and scheduling would then happen.  Davidson suggested some type of videoing so actives could speak.  Hunt thoughts address a Board meeting is for the Board which has to be held in public.  He implied no need for participation.  Fichtenbaum said it would be a mistake to alter participation.  Everyone had input.  AON will do some research] 

The Investment Department presented.  October’s return was a negative 1.90%.  November’s return was a positive 4.86%.  The preliminary FY 2024 total fund net return is estimated at a positive 1.10% with total investment assets at $89.2 billion, still lower than FY2023 ending by $800 million.  Consultant Albourne presented on fee validation processes.  STRS has 447 not in-house investments.  Net managements fees were $192,343,072 for FY2022.  [There is much more explanation to this such as operating expenses and interest expenses and paid carried interest. One should review the presentation on the site.] One Board member was delighted that this should “put to rest” the public outcry of what is paid in fees. Following Albourne, consulting CEM Benchmarking presented on the health of STRS general fund to its peers.  STRS performs in the top quadrant and its investment costs rank well against its peers. The low costs come primarily because STRS paid less than its peers for similar services. Returns, value added, and cost and cost effectiveness were all strong against peers.   Consultant Callan then presented on Alternative Investments. Again, Callan reported that STRS has done well. Finally, Callan reported on the fund’s overall performance against its peers. Like CEM’s report, STRS is one of the leaders of its peers.  

Routine Matters and Old/New business ended the meeting. Under Old business, Davidson, Jones, and Sellers reported on the trustees' conference they attended.  Under New business, Sellers moved to reduce years of service to 32 years at any age pending Cheiron’s February presentation that it would not materially impair the fund.  Foreman 2nd. Price overruled. The consultant Parliamentarian was called upon who ruled the motion was in order but suggested to Sellers to make it a Notice.  After much Board discussion, Sellers withdrew her motion and accepted the Notice which means it will be an agenda item on February’s meeting.  The Board does not meet in January.  [It should be noted that Bishop and Herrington were not attending the meeting so very possibly the vote would have been 5-4 with Sellers getting the vote if the recent elected Board members voted with her].  

The next Board meeting was not announced, but probably is February 15, 2024. [See Board meeting schedule here.]

Rob Walters & Dan MacDonald 

Robin Rayfield to STRS Board: ORTA stands ready to serve as a respected partner to the leaders of our pension system

From ORTA, December 16, 2023

STRS needs to build partnerships with organizations like ORTA

Members of ORTA were well represented at the December 2023 meeting of the STRS Ohio Retirement Board. Addressing the Board during Public Participation were Robin Rayfield (Executive Director), Dean Dennis (President), and Stephen Seagrave (President Elect). Here are their speeches.

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Robin Rayfield's Speech to STRS Board

December 14, 2023

ORTA stands ready to serve as a respected partner to the leaders of our pension system

Good morning. My name is Robin Rayfield. I am a retired STRS member and Executive Director of the Ohio Retirement for Teachers Association. 

I thank you for the opportunity to address the STRS Board and want you all to know that the opportunity to hear from the membership is important to not only the individuals that choose to participate but to the thousands that are unable to speak here.

I have been critical of the way STRS has operated in the past. Along with my critical comments I have also offered to work with the board and or leadership at STRS to address the concerns I have presented. Please know that the offer to work with STRS remains. Our goal is to improve the current conditions facing our retirement system.

To work with STRS leadership, ORTA must be considered a part of the solution, not the primary source of conflict for STRS. Our concerns are often rejected without consideration due to the animus that has grown between ORTA members and STRS. When our concerns or suggestions are simply rejected or ignored, it is difficult to build a working relationship. 

If the elections for board seats are any indication of the level of satisfaction of the membership, STRS needs to build partnerships with organizations like ORTA. 

Recently, ORTA communicated to STRS management our support for the employer increase being promoted by STRS. This increase, however, is not likely to gain support in the legislative arena without significant reforms by the board at STRS. Taxpayers will not support more money with the current state of things. 

We have voiced suggested reforms previously, but these suggestions have fallen on deaf ears on the slimmest of majority of the board. It is time that the suggestions from people like me, and people seeking reform that sit on this very board are examined and receive sincere consideration before being rejected because of personal differences of opinion or allegiance to another cause. 

Going on a statewide PR tour or posting ‘feel good’ videos have not moved the needle in the direction of satisfaction of the membership. 

ORTA’s goal is to improve and reform STRS. Retirees should get what they were promised or at least more of what they were promised. Actives should not face a future that includes working far longer than promised. 

Again, ORTA stands ready to serve as a respected partner to the leaders of our pension system.

Robin Rayfield, Executive Director

Ohio Retirement for Teachers Association

Dean Dennis to STRS Board: As a Board, you need to step up to the plate and make the needed managerial changes to gain the public's confidence

Dean Dennis' Speech to STRS Board

December 14, 2023

My name is Dean Dennis, 35 years Cincinnati Public, President of ORTA, Founder of the STRS Ohio Watchdogs, and member of the Ohio STRS Members Only Forum.

Driving home yesterday from our ORTA Executive Council Meeting I was able to catch some of the Board meeting. I listened to the Board talking about communicating and building trust with one another.  I listened to the conversation about public participation and I listened to the discussion about STRS adopting a "Strategic Plan." 

STRS members need a reliable pension plan; one that allows them to plan for the future. They don't have one.  If you were to ask members what is the current STRS's "Strategic Plan" they would probably say, STRS wants to be 100% funded and arrive there by withholding our benefits. 

I had a strategic plan, it was to work 35 years to optimize my promised pension benefits and I planned on putting 100% effort into my job to gain the respect and trust of my peers. I retired without regrets. I'm rich in relationships with my peers, which is something that no one can take away. What was taken away from me, were my pension benefits because I trusted that others were doing their job.

Dr. Fichtenbaum was right yesterday when he made the statement, while it's nice that we are trying to build trust with one another, but what we really need to do is to work on is building trust with our members.  Regarding the Board trying to develop a strategic plan with the consultant working with STRS management and the Board, what was left out is the obvious; does anyone think input was members might be important?  A strategic plan without member input is an exercise in futility.  

Let's talk about working towards a plan that will allow members to plan for their future. Lobbying for an Employer Contribution increase from 14% to 18% is a start. ORTA and others, have advocated for this at least 5 years ago. By the way, our current 14% Employer Contribution rate is less than half the rate of other non Social-Security states. 

Which brings me to this question, if our 30 year returns are truly 8.6%, why don't we increase the discount rate from 7% to 7.25%, or higher.  Is it because our auditors think that perhaps our  Real Estate and PE investments are inflated, or our stated fees aren't accurate?  Something seems amiss.  

Lastly, passing legislation for an Employer Contribution will not be easy. People will resist funneling  money to a pension system that has problems with transparency and stated fair values.  As a Board you need to step up to the plate and make the needed managerial changes to gain the public's confidence.  

Dean Dennis, President

Ohio Retirement for Teachers Association

If you are unsure why active and retired teachers are upset with the STRS Board and management and have increasingly embraced the reform movement in the last several STRS elections, all you need to do is look at the decisions of this board

Stephen Seagrave's Speech to STRS Board

December 14, 2023

My name is Stephen Seagrave. I am a retired educator from the Liberty Center Schools in Henry County with 43 years in education. 

We have a lot of retired educators who have fallen far behind financially and are really struggling due to inflation in recent years as well as the many years without the promised COLA. Active teachers also are facing difficult decisions due to the changes in retirement that have upended their long term planning.

If you are unsure why active and retired teachers are upset with the STRS Board and management and have increasingly embraced the reform movement in the last several STRS elections, all you need to do is look at the decisions of this board.

When we see that the low-cost S&P 500 Index Fund went up 15.9% for the 12 months ending last June, and the STRS Investment staff got huge bonuses for achieving a gross 7.68% return, it does not make sense to us. Any teacher can tell you 7.68 divided by 15.9 equals 48.3%. In the real world of the classroom this would be graded as an F.

So, teachers are working longer and doing without the promised COLA while huge bonuses are paid to people who are underperforming what could be done if our member’s money was invested in a diversified selection of broad based, low cost, total market index funds.

Nevada’s STRS has two employees managing $55 billion seeking to match total market returns using mostly index funds. It is time for this board to follow their example.

Stephen Seagrave, President Elect

Ohio Retirement for Teachers Association

Friday, December 15, 2023

Important message from ORTA President Dean Dennis; see how ORTA is working to help all of us, and what you need to know

From the ORTA December 2023 Newsletter

December 15, 2023

Message from Dean Dennis, President 
Greetings Members! 
I hope everyone will be able to spend some quality time with loved ones this holiday season. 
As I reflect on this past year, I believe ORTA has laid the foundation for an optimistic future for our organization. When ORTA changed our name to the Ohio Retirement for Teachers Association, we were able to keep our 76-year-old acronym, ORTA, and update our logo. In an executive council meeting, it was noted that our old logo with the flame over the "O" was also being used by heating companies driving around in Ohio. We replaced the red flame with a mortarboard. The name change was made to let STRS members know that ORTA wasn't trying to exclude active teachers. ORTA understands that a healthy pension system benefits all members both active and retired. 
Planning for the future, ORTA leadership decided to completely revamp our website and social media pages. The website has been receiving high praise and is attracting a lot of traffic. For example, this November there were 9,253 hits. That's a lot for one month! Compare this to the entire 2022 calendar year, when we had a grand total of 1,781 hits. Read about the ORTA defense fund, where you can make donations to support ORTA's mission statement. You'll also find Member benefits available though AMBA and Passport that likely you never knew existed. ORTA now also offers a 3-year membership for only $75. Also new, through ORTA's partnership with AMBA, a classroom teacher, or someone who goes back into the classroom as a substitute, can now obtain $500,000 of classroom liability for only $75 a year. But the best part of the website is the blog, that keeps you up to date with news about your pension system. 
On the political side, ORTA has been seeking out and successfully working with other reform minded groups to elect Board Members to serve as strong fiduciaries. The last five candidates we supported have been elected to seats on the STRS board. On the legislative front, just this month, a piece of legislation initiated by ORTA, House Bill 78, passed the House and seems on track to become an Ohio code. House Bill 78 allows a rehired retiree who returned back to work for a school district the opportunity to run for a Retired Board seat. Previously, a rehired retiree was denied this opportunity under Ohio's codes. Representatives William Seitz (R) and Joseph Miller(D) sponsored this legislation. 
Here is another piece of legislation ORTA has initiated, which should be of great interest to all retirees living in Ohio. While the legislation has not been introduced, it has passed review by the Ohio Legislative Service Commission and forwarded for the next step. The context of the legislation would provide an Ohio personal income tax exemption for all members drawing a pension from one of Ohio's five pension systems. The exemption would be capped to match the Social Security maximum tax exemption which is roughly $42,000. So, if your pension is under $42,000, then 100% of your STRS pension would be tax free. Again, this legislation is in its early stage but I feel confident it will have the support because Social Security pensions are tax exempt in Ohio. ORTA is working with Representative William (Bill) Seitz on this legislation. 
Lastly, but importantly, you are likely hearing some buzz that the nearly 40 year old stagnant Employers Contribution needs to be raised. Here are my thoughts. It absolutely needs to happen. The reasoning is simple. The mess we are currently experiencing, such as teachers having to work longer by as much as 5 years, or until they hit age 65 for a full formula retirement, is too extreme. This has happened because the Employers Contribution has been stagnant since 1984. Ohio's Employer Contribution lags the other non Social-Security state by roughly 8%. Basically, when it comes to public pension systems, our teachers contribute the most while their employers contribute the least. This is why Ohio teachers have to work longer while they pay more. The stagnant Employers Contribution is also why teachers retire without any inflation protection. Ohio retirees know this better than anyone. 
Please know that the proposal, which has yet to be drafted as legislation, would increase the Employer Contribution from 14% to 18% over an eight year period. This phase-in would be doable for school districts. If this legislation were to be passed, the STRS auditors would be able to work the designated monies into their assumptions. In doing so, our Trustees would have more wiggle room to restore lost benefits. For instance, if older teachers are able to retire earlier then this would free up monies for hiring younger teachers at a savings for the district. The additional revenue would also open the door for possible inflation protection. 
Finally, after years of lobbying STRS that they needed to lobby the legislature for an Employer Contribution (ORTA has been bringing this up at Board meetings for at least 5 years), STRS has come around. STRS has drafted a letter and is asking ORTA and other stakeholders such as OFT, AAUP and OEA, for a letter of support for the Employer Contribution increase. ORTA has submitted a letter. ORTA believes that this is a missing piece of the puzzle to restore lost benefits along with more transparent investments. As always, my best to all of you.

A message of importance to all STRS Ohio members, active and retired, from Robin Rayfield, Executive Director of ORTA

From the ORTA December 2023 Newsletter
December 15, 2023
Message from Robin Rayfield, Executive Director

Greetings ORTA Members!
As another year comes to a close with the STRS pension system continuing down its path of denying its members promised benefits and continuing to punish active educators, I remain optimistic that the efforts of ORTA and other groups (STRS Members Only Forum and STRS Watchdogs) are having a positive impact on reforming our pension system. It is easy to become bitter and frustrated that the system has treated its members so poorly for so many years, but we can see change on the horizon.
Looking back to 2017, the STRS board had two lone voices challenging the loss of promised COLAs for retirees, and the increases in contributions and service requirements for actives. One voice was that of Yoel Mayerfeld, appointed by Ohio’s treasurer. As soon as Ohio’s current treasurer (Sprague) was elected Mr. Mayerfeld was replaced by a status quo member weakening the calls for reform. The other voice was Wade Steen, the governor’s appointee. Over the last several years Wade’s voice calling for reform was strengthened by the addition of STRS board members Rudy Fichtenbaum, Jullie Sellers, Liz Jones, Steve Foreman, and Pat Davidson. Things were looking positive for the chance at real reforms to fix the STRS pension system. Then Governor DeWine moved to replace Mr. Steen with a person dedicated to the continued path of mismanagement of our pension system (Bishop). I am at a loss as to why DeWine would take such an action. I can only speculate that, somewhere in this move is the hope by DeWine that this will assist in his plan to destroy public education in Ohio. His actions are having a devastating effect on Ohio’s system of public education. Actions such as Vouchers for All that divert public dollars to private education; the elimination of Ohio’s independent Department of Education; and now his action to destroy our pension system, making teaching in Ohio a less desirable career.
However, with five of eleven STRS board members committed to reforming STRS the members of STRS (both active and retired) have a chance to elect an additional reform candidate this spring. ORTA is committed to assisting any candidate committed to reforming our pension system win this spring’s election.
To that end ORTA will take the following actions:
1. ORTA will assist candidates collect signatures on petitions to have their name on the ballot. 
2. ORTA will interview candidates and ‘endorse’ any candidate that the endorsement committee recommends.
I have been notified by one candidate that she is interested in running for the STRS board seat. Michele Flanigan from northeast Ohio is interested in serving as a STRS trustee. The seat up for election this spring is an ‘active seat’ meaning that retirees are not eligible to vote in this election. Retirees, however, can use their influence with active educators to support candidates. ORTA hopes to conduct its endorsement process by early to mid-January. For now, ORTA is helping candidates collect signatures to have candidate’s names placed on the ballot. You can print a petition and collect signatures using the form included in this newsletter.
[Click here to access the petition]  
We ask that you help Michelle collect the required signatures from your active teacher friends. You can collect the signatures and send them to:
250 E. Wilson Bridge Rd.
Suite 140
Worthington, OH. 43085 
From time to time, I am asked questions that are directed at getting to the bottom of what reforms ORTA would support at STRS. Listed below are reforms of STRS ORTA is working for: 
1. Increase transparency – STRS is not transparent. Despite accepting awards from some of their paid consultants or from other corrupt politicians, STRS remains opaque. Some examples of this lack of transparency include: 
   a. Using gross of fees returns when calculating bonus awards for its investment staff
   b. Not sharing information regarding the fees charged or the expenses associated with over 20% of its investment portfolio ($20,000,000,000)
   c. Even in its recent public relations campaign to host town hall meetings STRS carefully screens its list of participants
2. Switch to passive investment strategies - Moving from active management to passive management in its investment strategy. STRS ‘losses to the market’ every year. The Auditor of State confirmed this in his investigation of STRS that was prompted by the grass roots funded forensic audit of STRS. AOS stated that since 2009 STRS investors lost $12 billion to a portfolio that included the same asset classes as STRS but was passively managed. 
Remember, a passive management strategy would not include lavish unearned bonus payments to investors that do worse than passively managed portfolios.
3. Provide a retirement that is commensurate with what people pay - Increase the employer contribution rate paid by employers of Ohio’s teachers. Currently, Ohio has the lowest employer contribution rate of public retirement systems and the second highest individual contribution rate. This means that teachers in Ohio pay the second highest rate in the country, their employers pay the lowest rate in the country, and we get less value than anyone in the country. In fact, STRS is the only public pension in the country whose participants receive less in value than what they are paying in contributions. 
There are other reforms that would strengthen STRS that could be discussed, however with these reforms everyone associated with STRS would be far better off. That is why it is so important to elect reform minded candidates as STRS board members. The current majority of STRS board members are committed to the current status quo of paying more, working longer, and receiving less in benefits than what was promised. 
One final note is an update on the Wade Steen situation. As you already know, Wade Steen served one complete term on the STRS board as an appointee of Governor Kasich and was reappointed by DeWine. 
After the election of May 2023 results were known by STRS and it became clear that the majority of the STRS board were reform minded, DeWine used his power to do what he has always done… hurt teachers and educators. This time he removed a powerful voice advocating for educators in Ohio (Wade Steen) from the pension board and replaced him with a wealthy donor. This move insured that the money flowing from our pension through Wall St. to the politicians in Ohio would continue to flow. A majority reform board would stop the corruption. 
Mr. Steen thinks, and I agree, that his removal by the governor is illegal. We are of the opinion, and the language in the Revised Code is clear, that Mr. Steen does not ‘serve at the pleasure of the governor’. Mr. Steen filed suit that his removal violates the law and has asked to be reseated on the STRS board. 
The defendants have stalled this challenge rather effectively; however, it appears that the legal maneuvers are at an end and the judge will rule. ORTA has assisted Mr. Steen in his legal challenge against DeWine. To date ORTA has collected approximately $45,000 to assist Wade in this battle. Mr. Steen and the ORTA leaders would like to thank everyone that has donated to this worthy cause. As former educators we all know that the deck is stacked against us. We are used to fighting uphill battles. 
This battle is no different. We are battling the most powerful political man in Ohio; whose friends (at least those that are not in jail, yet) have more money than we can imagine. Win or lose, I am proud to be a retired educator!

Thursday, December 14, 2023

Cathy Steinhauser to STRS Board: We need to clean house and get STRS back on track to be better than it has been the past several decades!

From Cathy Steinhauser

December 14, 2023

Cathy Steinhauser – 35 yrs., satellite teacher w/Pickaway-Ross CTC in the Circleville City School District – Family & Consumer Sciences.

I found it very interesting that as part of the November 2023 STRS Board mtg. there was education for you about being a fiduciary.  Do you remember being told by, I think her name was Ms. Decker, she said that you can be removed for breaching fiduciary duties??  How many months have I been stressing to you about the seriousness of your responsibility of being fiduciaries…I will tell you…11 meetings so far!  And YES, I’m going to remind you again, so now the total is 12 meetings!!

FIDUCIARY - “A person who acts on behalf of another person or persons, putting their client’s interests ahead of their own, with a duty to preserve good faith and trust.  Being a fiduciary requires being bound both LEGALLY AND ETHICALLY to act in others' best interests.”  You are now being more carefully scrutinized as you attend, participate, and make critical decisions for this teacher pension. Putting STRS staff and the investment group before considering the effects on the teachers will come with consequences. You have been schooled in how you are to conduct yourselves as proper fiduciaries so you must consider how you are going to take care of us teachers when you cast your vote on critical issues.  STRS exists to pay benefits because teachers are the top priority in this pension but have not been treated as such for over 20 years. Get your priorities straight – teachers come first!  One thing that really bothers me is when many of us teachers discovered that the executive director wrote his own contract and it was approved by only the chairman of the board.  I have seen a copy of these contracts and this single signee by the chair has happened too many times!! My husband sits on the Scioto Paint Valley Mental Health Board in Chillicothe, and he informed me that ALL board members of any institution are to approve the contract by their signatures and if all signatures aren’t there, the contract is renegotiated!! For one board member to be the sole signee is a breach of fiduciary duty and those board members currently serving who have done so should resign immediately.  Don’t accept the position or run for the position for serving our board if you don’t know what is involved in being a fiduciary.

As I listened to last month’s meeting virtually, I was sickened to hear that our STRS leader was allegedly accused by several STRS staff members for inappropriate behavior. Colleen Marshall, Channel 4 has reported on the mess going on at STRS for a few years now.  Despicable behavior of our leadership in this pension is unacceptable! Inflicting verbal abuse, harassment and violence on staff sounds like a seriously disturbed individual who needs to resign or be fired.  There is no place in this pension for such a narcissist. “He does not have the best interest of the members at the forefront of his decision making”. I am sorry that staff members had to endure this but I am extremely grateful for their courage in speaking up.  There should be a completely anonymous survey of 100% of the staff to determine the percentage of those who endured this treatment over the years.  If the investigating authority in charge of this case isn’t screening the staff, they should be.  We need to clean house and get STRS back on track to be better than it has been the past several decades!  

Where has the ORSC been through all this? They seem to meet very irregularly because the chair keeps canceling and if this group gets compensation from STRS, they need to return it because they aren’t doing their job. Just because the other pensions are doing better than STRS doesn’t mean they don’t have to meet. 

Robin Beebe: Some words of wisdom for the STRS Board

From Robin Beebe

December 14, 2023

Michelle Flanigan to STRS Board: The time to return to 30 years for full retirement benefits is now.

From Michelle Flanigan

December 14, 2023

Suzanne Laird to STRS Board: Make that your New Year’s resolution: earn our trust.

Suzanne Laird's speech to the STRS Board

December 14, 2023

Good Morning, Members of MY Board: 

First and foremost, I must say how sorry I am that employees of this organization had to endure the temper tantrums and alleged perverse behavior of the former Executive Director. Let’s all agree on one thing, though, there must be no golden parachute.
If even one allegation is proven, the Executive Employment Agreement should be invalidated.
We cannot allow any more of our hard-earned benefits to be squandered.
Our future is now in the hands of the Interim Director and the current Board: (God forbid I should say anyone’s actual name), yes, some of us were listening to the discussion yesterday with AON.
The nice woman from AON thinks we should sign up to speak a week in advance? How could I reply to the ridiculous suggestions I heard only yesterday? Such as cutting BACK on our 15 speaking slots?!
One of you claims he doesn’t hear any productive comments.
I’ll say it a little louder:
Cut the bonuses.
Freeze the salaries.
Restore the COLA.
Reduce the actives’ years of service.
And that asinine rule about not allowing us to use real names? Be careful what you wish for. If you are on this Board, you should be accountable for your actions, by name. If not, I’ll continue to to find creative ways to identify you. Accountability is the only way out of the mess at STRS.
Right now, we have the most embarrassing pension system in the state:
Our Director is on suspension, we can’t pay a permanent COLA, we give crazy raises and bonuses out like Christmas candy……
BUT, we have an opportunity to overhaul this entire corrupt system.
Wouldn’t it be ironic if the female Interim Director, appointed after the Executive Director was accused of disparaging women, turned this Titanic around?
And what if the Board actually began earning the respect and trust of the membership?
At 4:45pm yesterday someone smart said (I’m not allowed to say who), “If we don’t have the trust of our members, we have nothing.”
Make that your New Year’s resolution: earn our trust.

Bob Buerkle to STRS Board: The Current STRS Board should reverse the 2015 policy called “Closed Funding.”

Bob Buerkle’s Speech to STRS Board

December 14, 2023

The Current STRS Board should reverse the 2015 policy called “Closed Funding.”

First of all, only two elected and no appointed Board members from 2015 are still on this Board. Nine of you were not. You need to forge your own policies, which reflect the actual known investment returns of the last 10 years, for the benefit of all current and future retirees. Perform your sworn “Fiduciary Duty” to them, not Callan, not Cliffwater and not STRS Management. You have no “Fiduciary Duty” to them. None of them will ever draw a pension from STRS. They are not our members. Look out for our members, not STRS Management or their hired help.
Look at what has happened over the last 10 years. Management had the Board vote to lower the “Discount Rate” three times, dropping it from 8% all the way down to 7%. Was that necessary? The STRS Investment Department report from October 19th, 2023 shows that we averaged over 8.6% for the last 10 years. That decision to move to a “Closed Funding” system has forced this new board, who had no input on that previous Board decision, to take on the $20 billion of projected debt with a self-imposed directive to reach 100% funded status, ASAP. By following this Closed Funding policy, it has been nearly impossible to restore any lost pension benefits. Also, in 2015 our unfunded liability period was at 29.5 years, which satisfied the 30-year Legislative funding mandate.
Now, eight years later, the STRS unfunded liability period is down to just over 11 years, by far the lowest of all five Ohio Public Pension Systems. Should we be proud of that, when this progress was made on the backs of our active and retired teachers? All four of the other Ohio Pension Plans are paying annual COLAs, and all but OP&F have not raised their contribution rates, unlike the 40% STRS increase, nor have they drastically changed their years of service requirements, or excessively punished those who cannot reach full service retirement; and they have not changed their 3-year FAS requirements to 5-years, like STRS has done.
The numbers game perpetuated by STRS Management and their hired mercenaries financially benefited them, not our members. “These Are The Plunderers,” which is also the title of Pulitzer Prize winner, Gretchen Morgenson’s latest best seller. They received annual raises to their base salaries every year. The investment staff also received bonuses every year, whether they were deserved or not! Did anybody responsible for losing a half-billion dollars on Panda and other real estate disasters ever lose their bonuses, or their jobs? In fact, according to the Ohio Treasurer’s checkbook, it looks like STRS Real Estate Employees receive most of the largest bonuses.
Finally, Ohio Police and Fire continued to use an 8% discount rate until 2021, 10 years after STRS stopped using 8%. They had to do this to stay under the 30-year funding mandate. I’m not saying STRS should have done that, but did it harm OP&F? No. In fact, they earned less than STRS for the decade but they still beat their 8% assumption rate, so they are OK and their members continued to receive their COLA every year. Today, OP&F uses a Discount Rate of 7.5%, while STRS uses 7%. Maybe there is some room between these two figures that could be used to safely restore some of the lost benefits to our members, without taking undue risk.

Larry KehresMount Union Collge
Division III
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