Now that the executive director of the State Teachers Retirement System has been sent packing, maybe it's time for the board whose policies he was carrying out to hit the road, too.
The STRS board, after all, is responsible for the sweetheart deal that allows Herbert Dyer to bail out of his job in a cloud of mismanagement, distrust, and ill will, but with a handsome $550,000 golden parachute from the pension fund.
Mr. Dyer had been under well-deserved criticism for paying big bonuses to staff while STRS assets eroded, and for excessive spending on refurbishing the fund's headquarters and out-of-state travel.
After it became apparent that the fund's 424,000 members would pay for those mistakes in the form of higher pension contributions and benefit cuts, Mr. Dyer infamously suggested that retired teachers should take fewer vacations and eat out less often.
Such a cavalier attitude suggested gross insensitivity toward not only teachers and retirees but also Ohio taxpayers. Sixty percent of the $2 billion that went into $47.2 billion STRS last year was public money.
Mr. Dyer apologized but a call for his ouster was backed by 80 percent of the General Assembly.
To her credit, STRS chairman Deborah Scott seemed to accept blame, saying, “I feel [the board is] just as responsible for the erosion of confidence.”
Good. Now Ms. Scott, a teacher from Hamilton County, can prove it by resigning, along with the other educator-members of the STRS board.
The same, however, cannot be demanded of Attorney General Jim Petro, state Auditor Betty Montgomery, and Susan Tave Zelman, superintendent of public instruction. They remain as ex officio members of the nine-person board.
That's a fancy way of saying that they're on the STRS board according to state law but almost always send representatives to board meetings. They can't resign.
In any case, the entire board is responsible for the terms of the contract under which Mr. Dyer was employed as executive director.
Although he negotiated the $550,000 “separation agreement,” Mr. Dyer must have been daring the board to fire him. Had STRS terminated him under his board-sanctioned contract, the tab would have been as much as $921,000.
Such severance terms are clearly excessive, sounding more like the unwarranted perks being paid these days by some Wall Street firms.
Mr. Petro and Ms. Montgomery, along with Ms. Zelman, voted against the settlement, with Ms. Montgomery saying she was “not comfortable” with the amount.
But where were the auditor and attorney general when Mr. Dyer's current three-year contract was approved in 2002? They voted for its outrageous severance provisions, which gave him the leverage he needed to walk away generously compensated despite his mistakes in running the pension fund.
In addition to new leadership, STRS would benefit from revisions in state law to allow for replacement of pension-board members when serious problems arise and to bar excessive severance agreements. The General Assembly should get busy and make those changes.