January 20, 2009 (PLANSPONSOR.com) - Citing
"extraordinary times", the board of the Ohio State Teachers
Retirement System has voted to cut back on bonuses for the
system's investment officers.
According to the Columbus Dispatch, the board voted 6-3
to suspend the bonus payments from February through June.
After that, the bonuses will be cut in bad economic times,
but enhanced when pension investments do well, according to
The board had decided to study the matter of the bonuses
last fall (see
Investment Losses Lead STRS Ohio to Review Allocation, Pay
Under the STRS Ohio Performance-Based Incentive (PBI)
Program, eligible investment associates are able to receive
an additional percentage of their base salary through a PBI
payment, depending on both total investment fund
performance and their individual goals over the previous
Last year, the pension system paid nearly $6 million in
performance bonuses to 89 investment officers, with 10
receiving $200,000 or more, according to the Dispatch.
The system's investment staff manage about 80% of the
"In these tough economic times, I wouldn't think they
would expect these kinds of bonuses," said Marie M.
Fetters, a retired teacher from the Miami Trace Local
Schools in Fayette County said, according to the report.
However, pension board Chairwoman Mary Ann Quinter
Cervantes, a Lucas County teacher, voted against suspending
the bonus payments.
"We need to be a reliable employer," she said, according to
the Dispatch. "This is a switch on our word."
On the other hand, board member Jeff Chapman, a retired
teacher, responded "I'm also sensitive to the fact that
it's a promise, but these are extraordinary times."