Excerpt from the Columbus Dispatch
There is no evidence of fraud or illegal activity in the State Teachers Retirement System of Ohio, but its system for staff bonuses warrants reform, according to the findings of a state audit released Thursday.
State Auditor Keith Faber conducted a "limited review (PDF)" of the pension fund in response to a critical report on STRS unveiled last year. The system oversees $94.5 billion invested for 500,000 Ohioans who do not participate in Social Security, making the state pension their primary retirement fund.
Faber's audit found that the structure and operations of STRS are generally sufficient and the fund saw better returns than many others across the country. At the same time, he said the system could be more transparent about its investments and failed to meet auditing requirements outlined in state law.
Faber also encouraged pension managers and lawmakers to rethink how bonuses are allocated for investment staff. The recommendation is a nod to anger among teachers over nearly $10 million in bonus pay awarded to about 100 employees who manage investments.
"If you are going to have bonuses, should they be predicated on things that are easily attainable or things that drive true performance?" Faber said.
