The State Teachers Retirement System of Ohio needs a new fiduciary governance adviser. The $92 billion retirement fund for 500,000 Ohio teachers was effectively fired by Aon Fiduciary Services over the chaos on the STRS board.
When the 10th District Court of Appeals ruled that Gov. Mike DeWine acted outside his constitutional authority in firing his appointed investment expert Wade Steen, there suddenly was a 6-5 board majority in support of reforms first advocated by Mr. Steen.
STRS Board Chairman Dale Price, a Toledo Public School teacher, abruptly ended the April 18 meeting without the procedural norms of a motion to adjourn and a vote that supports the motion. The reform majority on the STRS Board was left to sputter in outrage as Mr. Price raced out of STRS headquarters.
“When it became apparent that I was unable to conduct the meeting in an efficient and effective manner, I decided to conduct the necessary business and adjourn the meeting. I plan to have the Retirement Board consider the remaining items from today’s agenda at the regularly scheduled May Board meeting,” Mr. Price said in a statement from STRS.
It must have been jarring to Aon consultants attempting to get consensus on board meeting standards to assure “deliberation will be timely, fair, orderly, and thorough.”
Aon had been attempting to lead STRS to new board governance standards and creation of a strategic plan. The Chicago-based financial services giant got off to a bad start on that mission with a recommendation to severely curtail public comment at the STRS board meetings.
Teachers from around Ohio attend the board meetings in large numbers for the opportunity to comment on STRS, and the Aon suggestion was never seriously considered.
Not all of Aon’s ideas were bad. The consultants called for creation of key performance indicators the STRS board could use to track progress on the implementing the pension’s strategic plan.
Aon has been badly burned by public pension controversy, so it’s not a surprise they are quickly exiting the STRS deal. The Pennsylvania Public School Employees Retirement System fired Aon and received a $1.5 million settlement for a mistake that overstated the Pennsylvania fund’s
investment returns.
The STRS effort to increase taxpayer contributions by 28.5 percent to bring in an extra $540 million annually could not come at a worse time. State lawmakers would be foolish to raise taxes before an election for a pension fund that can’t even run a meeting under parliamentary procedure.
May 4, 2024 The Blade Editorial Board
Read this editorial online at https://www.toledoblade.com/opinion/editorials/2024/05/05/editorial-strs-got-fired/stories/20240502009.