RH Jones: In defense of the popular 13th check

From RH Jones
Sent: Wednesday, January 25, 2006
Subject: In Defense of the Popular 13th Check.

To all:

Once again, I feel compelled to defend the beloved & very popular Supplemental Benefit Check (13th ck.) and to refresh everyone's memory of an outstanding Dave Travis speech made to the STRS BD. on 10/19/01:

"As Executive Director of the Ohio Retired Teachers Association I'm here this morning to respond to the action you took yesterday in voting not to provide a 13th check to the retired teachers of Ohio this year. Representing the 36,159 ORTA members and speaking on behalf of the 100,000 retired teachers of Ohio I urge you to reconsider this action.

The very first Supplemental Benefit Check was paid out to 47,964 STRS Ohio benefit recipients in 1980. The check was for $10 for each year of service and $10 for each year in retirement and cost STRS $17.4 million. Supplemental Benefit checks have been paid every year since then for a total of 21 consecutive years. The smallest unit value was $7 in 1987. Even during the drastic recession of the 80's a supplemental check was paid to the retired teachers of Ohio. Over the past 21 years Ohio's retired teachers have come to depend on this check not just as a bonus but as a necessity to pay bills. Even with increases that Senate Bill 190 provided there are retired teachers in Ohio still living at or near the poverty level.

At one of our Chapter meetings in Huron County just last week I talked with a little lady who was in her late 80's. She asked me if I thought there would be a 13th check this year. I told her I didn't know but hoped there would be one and we would probably know this month. She was very concerned, as she didn't know how she was going to pay her utility bills, especially her gas bill, this winter, without the money the 13th check provided.

There are countless retired teachers of Ohio who are not as fortunate as most of us in this room today. Teachers today earn salaries that seem enormous to those who retired 25 or 30 years ago. The pensions of those retired teachers have been drastically eroded over time even with the 85% restoration of buying power the Senate Bill 190 provided. Many of these retired teachers don't eat at fancy restaurants, take nice trips or buy all the electronic toys that most of us have. Their outing is to a senior center for a $2 meal, or to a retired teacher's luncheon for a $5 meal. Their standard of living is much different than most of us in this room.

I urge you to reconsider your vote of not provided a Supplemental Benefit Check for the first time in 21 years to the retired teachers of Ohio. Even $7 per unit at a total cost of $28 million would help those in need. Retired teachers sometimes wonder if they are as important as this building on which you recently spent over $90million.

Even with an actuarial rate of return of 6.7% which is not up to the actuarial assumption rate of 7.5%, you, as fiduciaries of what we all like to refer to as the "Premier Pension System", can be fiscally responsible in granting a benefit this year. I urge you to do so.

Thank you."

To me, Dave's speech was masterfully on target. The STRS Ohio News, July 2005, pg. 5, tells us that: "Investment earnings must go toward funding pension liabilities versus the 13th check." Therefore, most certainly, a pension liability is honoring the intent the legislature to give the STRS retired members this unique yearly award. This is a most noble attempt to fulfill #3307.15 of the ORC! Thank God for those past union leaders, STRS BD members, and employees, who knew the spirit of this significant benefit for retirees: to give retirees the help they need. Can those of the present rise to that height of stature? As in they did for those 21-years, just execute today what is just and proper, and resume the 13th ck. once again. Please do not try to explain away or make excuses.

Robert Hudson Jones, Retired Teacher serving on CORE & SummitCRTA CMTES