Ohio

Eye on Education

New Teacher Pension Plan Calls for Raising Teacher Contributions, Retirement Eligibility Ages

Eyton Z / Flickr

A new plan being pitched to legislators to ensure Ohio’s teacher pension system can meet its obligations would save the State Teachers Retirement System about $13.3 billion in future pension costs and other accrued liabilities.

But it would also have teachers “paying more and getting less,” the Columbus Dispatch reports.

The plan approved by the State Teachers Retirement System board earlier this month calls for:

  • Higher member contributions. Teachers would have to contribute an additional 4 percent of their salaries towards their pensions, with the increase being phased in at 1 percent per year starting in July 2013. That’s up from the 10 percent required now.
  • Higher retirement ages. To retire with a full pension, teachers would have to be at least 60 and have at least 35 years of service, with the change being phased in over time. Currently, teachers can retire with a full pension at any age as long as they have at least 30 years of service.
  • Lower cost of living increases. Retirees would not receive a cost of living increase in 2013. And teachers retiring after August 2013 wouldn’t get a cost of living increase for five years. And when that cost of living increase comes, it would be 2 percent rather than the current 3 percent.
The plan would also change how the pension fund calculates retirees’ earnings and the benefits formula.

Comments

  • John

    Unlike the compassionate Ohio Highway Patrol Retirement System, who also planned on a 1% COLA cut for their retirees but with an exception waiver for those troopers receiving less than $27,990, the State Teachers Retirement System threw all their lowest (and mostly oldest) retirees under the bus by not giving them the same consideration. Their STRS board accomplished this while the only two retireee representatives on the board gave lip service to a similar waiver but, in the interest of showing a united front (while still throwing the oldest {and lowest pensioned} retirees under the bus) caved in and voted with the heard rather than with their “lip service sympathy” for the least among their benefits recipients. All of this took place right under the nose of the Executive Director of the Ohio Retired Teachers Association while she never uttered a word to also impose such a waiver. So much for the poorest among the retired educators. Being a elderly retired OSP trooper has its benefits, doesn’t it?

    • Ellentimms

      Many of the comments above reflect my thoughts exactly. Recently, I have had over a $1000 in car repairs on a six year old car and not anywhere near done yet. Since I retired with 25 yrs service due to health problems, my “check” is nowhere near a 30 year retiree. But yet I get to watch retirees land the salaries of 35/88 and supposedly feel good about it? Oh yes, let’s not forget our loss of the COLA and its LONGTERM promise of going down the rabbit hole further. So STRS really, really does work for us??????? or really who do they work for????????

  • Nancy

    The STRS Board needs to hang its collective head in shame. The STRS Board
    has not protected those of its retired teachers who have the greatest need…the oldest, who retired with much lower pensions than today’s educators, much lower calculations of those same pensions and have faced continually rising health care costs and reductions of health care plan options. These educators need a common voice in Ohio to protect them, as many are not technologically active, nor do not have access to computers. They are also feel embarrassed to speak out for themselves. All Ohio educators need to contact their legislators and ask the legislators to “fix” this terrible injustice to Ohio’s poorest and oldest teachers.
    Demand that your legislator request “actuarial data” about these teachers so that the legislators may adjust the pension revisions to protect Ohio’s oldest teachers.

  • Debbie Rudy-Lack

    The inability of the STRS Board to protect it’s oldest retirees is appalling. The fact that OEA, particularly, Mr. Bill Liebspenberger believes that these recommendations are “fair”, indeed shows just how out of touch OEA leadership really is. As a former, 32 year member of OEA, I am truly disappoointed and ashamed of my former professional organization. As a 2nd year retiree, I am extremely glad I never paid $400 to become an OEA-R member. I truly do not believe that OEA cares about its retirees. Actions speak louder than words….OEA and ORTA’s lack of action indeed speaks volumes.

  • Carol Janes

    Teacher’s retiring now have much higher salaries than teacher’s who retired ten or more years ago….also those working for affluent school districts also have disproportionately large pensions compared to those who retire from smaller rural schools, especially in poorer areas of the state. OEA also pushed for a benefit that allows teacher’s who work for 35 years to collect 88% of their three highest earning years as a pension. Everyone is going to suffer because of these changes, but the oldest and poorest will really be in trouble. People over 60 need that 3% COLA as many are not in a situation where they can now improve their financial situation and the cost of living, especially health care is exploding.

  • Linda

    STRS should be ashamed of its proposed plan for changes to the retirement plan Those already retired should have been grandfathered from the COLA cut . If the Board was not willing to do that, they should at least have made provisions to exclude those retirees with a pension under $28,000 a year. But no, the Board, including the 2 retiree representatives, voted to hit everyone with the cuts. Compassion is definitely lacking in the Boards’ action

    • George Milo

      Linda: I would like to thank you for your comment about lack of compasion from the board. I might add I have written several emals to Mr Nehw and a few to Chairperson McGreevy Nehf remains silent and Mcgreevy doesn’t respond.

  • Ryan

    Ohio’s older STRS members, those who retired prior to the implementation (after 1999) of “enhanced benefit” retirement opportunities, will be impacted by the COLA freeze and proposed 1% cut immediately once this legislation is passed. Their pensions are significantly lower than those of current retirees or those who will retire in the next few years. They have few prospects for making up for this loss of income and yet no provision was made to protect them from economic hardship. The OEA dominated STRS Board has crafted a proposal that favors their membership by phasing in changes to retirement regulations over several years. Dr. Dennis Leone was the lone voice speaking passionately for protecting older STRS retirees while the leadership of OEA and ORTA abandoned those receiving the smallest pensions in favor of those who receive the most.

    • Gbmilo

      Welcome to thye new STRS division of the State of OHIO residents of BOHICA! Translated it means Bend over here it coms again

  • kovach447

    It becomes increasingly difficult to make ends meet as we age. Even though, we make cut backs in every area of our lives that we possibly can, medical and living expenses continue to increase. Because of this the cost of living aspect of our retirement needs to stay in place at the current (very low) 3% annual increase. Please keep this in place for current retired educators and continued for future retirees.
    Sincerely, Nancy Kovach, Stow, OH

    • Gbmilo

      Folks: Us older STRS retirees are being victamized by the selective clumping of us older with less pension $’s than the current STRS retirees. For example as of June 1, 2012 the CPI is 2.1%, but we will get a zero % increase in or COLA’s 2013 for one year. Next, we received a lowerSTRS factor of 2.0 & 2.1 x number of years in the OHIO system as a percentage of our final three years in the Ohio system , While the current retirees receive a factorial of 2.2 x the no. of years inthe system. A few years ago my health care costs for Health care from the STRS system to cover my wife was $ 360 a month . I moved my wife to AARP for $ 174.00 per month. Why is STRS management singling us older retired Ohio teachers out for economic abuse? I thought gov was suppose to play on a level playing field ? How do we convince the Fedral agency that is suppose to protect Seniors from this type of selective financial abuse to sue STRS? Anyone?

      • John

        OPERS avoids doing this by already having in place a 3-tier premium schedule. Those oldest retirees pay far less than recent retirees. OPERS has a heart. STRS was approached with a plan to reduce the premiums for those oldest and least able to pay and they thumbed their nose at this plan. So much for compassion, eh?

  • ITeachGrade2

    I watched throughout my career as younger and younger people entered the nonteaching workforce around me exceeding my 20,25, 28, etc year salary within a few years. “Don’t worry. As a teacher you’re going to get a great retirement!” I was told. Well, I’m at year 33, age 56, 3 cancers, and am stuck with STRS as a diminishing return. I guess they’re ‘taking care of me’ in a vastly different way than I thought.

  • Gbmilo

    Here is an isue hat STRS and the STRS dirctor are sidestepping with no response nor any comment on, either on the STRS site or the ORTA site. Apparently, as reportedin Columbus Business 1st onor about July 17 th the State of OHIO AG Dewine is suing Chase Bank, Mellon bank and OH BP fifnancial investment divisoins of the parent financiall companies for alleggedly funishing STRS investemnt division wih alleged fraudulent investent information ergo STRS loss several million $$$$ of our investment $’s therefore along with the State Legislative delay ,delay,delay in passing the STRS investment plan our COLA’s went 3 to zero $ for one fiscal year- summer od 2013 into 2014 . In additiion, , the State of Ohio Treasurer appointed a Chase organization high level executive to the STRS board in a role as a contrbuter to future STRS investemnts after Chase duped the present STRS investors by urnishing them with false investment information. In my opinion that is a State of Ohio Political Tsunami lbeled as a political conumdrum

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