COLUMBUS State seeks to reform oversight of pension systems

Serious problems in two retirement systems have come to light.
By JEFF ORTEGA
VINDICATOR CORRESPONDENT
COLUMBUS -- Amid well-publicized problems connected to two of Ohio's five public-employee retirement systems, the state is moving to reform oversight of them.
Pension-fund reform bills are being developed in both chambers of the Legislature. Gov. Bob Taft is also pushing for reforms.
Two state lawmakers say they expect a bill to be enacted by year's end.
Sen. Lynn R. Wachtmann, a Napoleon Republican and chairman of the Ohio Retirement Study Council, which has oversight over public pensions systems, is close to unveiling a reform bill in the Senate.
Sen. J. Kirk Schuring, a Canton Republican and also a member of the retirement study council, said he expects the bill will be a combination of ideas.
The bill, which lawmakers said is still being developed, comes after a couple of highly publicized problems in two of the state's public retirement systems.
What happened
Earlier this year, Herb Dyer resigned as executive director of the State Teachers Retirement System after criticism was leveled at him and the STRS board amid news reports of large bonuses and what some have called lavish spending at the pension system, which has more than 400,000 active and retired members.
At the same time, STRS investments lost at least $12 billion in value, while health benefits for retirees were also cut.
In addition, the Ohio Police and Fire Pension Fund has come under fire after recent reports revealed that it spent more than $612,000 since 1998 on board-of-trustees travel and expenses in and out of state.
Wachtmann said his bill will deal with issues including board-of-trustees governance, which pension officials have to file disclosure statements with the Ohio Ethics Commission and also possibly taking the attorney general's office off the pension fund boards to be replaced possibly by the state treasurer's office.
Asked for change
Ohio Attorney General Jim Petro, a Republican, has asked legislators to change the law requiring the state attorney general and state auditor to sit on most of the public pension-fund boards because they provide legal and auditing services to the boards.
Auditor Betty D. Montgomery, also a Republican, doesn't support taking the attorney general and auditor off the boards.
"I think it's absolutely vital to have a statewide officeholder on the board," Wachtmann said.
Wachtmann said his bill will be referred to the Health, Human Services and Aging Committee, of which he is chairman.
Similar reform efforts are also ongoing in the House.
"There's going to be ... as I understand it a comprehensive pension reform package put together," said state Rep. Charles Blasdel, an East Liverpool Republican and the chairman of the House Banking, Pensions and Securities Committee.
Blasdel, who was unsure who would be the main sponsor of the House bill, is also on the Ohio Retirement Study Council. "We're trying to make sure the pension funds have proper oversight," he said.
In a letter this month to legislative leaders, Taft pressed for a reform bill that touches on accountability, ethics and oversight.
The other public retirement systems are the School Employees Retirement System, the Public Employees Retirement System and the State Highway Patrol Retirement System.