Molly Janczyk: Report on 5/31/06 meeting with OEA

From Molly Janczyk, May 31, 2006

Subject: Meeting at OEA: Wed. 5/31/06

Present were: Gary Allen, Dennis Reardon, Jim McGreevy, Patricia Frost-Brooks, Bill Leibensperger, Dave Parshall and Molly Janczyk. Mary Ellen Angeletti was too ill to attend.

The atmosphere was very congenial, respectful, candid, professional and forthcoming. We were made most comfortable and an ease of exchange prevailed. Dennis Reardon had to leave early. While present, he made sure to define terms/titles with which we may not be familiar.

I asked to open with a statement. I relayed that we were here in a serious minded collaborative mindset. I conveyed that there was some concern over being 'used' or on a mission for show and that we wanted assurance there was real promise exists of positive outcome for the HC legislation.

I sent the compiling of thoughts from CORE members regarding HC legislation to all attendees prior to the meeting so as not to waste time. I was impressed with the advance preparation and effort to address every concern and question with specific information. Nothing was asked to remain confidential.

Gary Allen headed the table and I felt it was he who ran the meeting effectively and efficiently. Some topics provided room for branching out and while he certainly allowed free discussion on all ideas, when the topic was completed, he steered us back to the questions and concerns I had provided to him which we wished addressed.

A. FUNDING FOR EDUCATION: Gary opened with this issue since many, if not all, feel this is at the heart of the issue. Also, one statement to them was OEA has the political and financial power to harness legislative support for both funding education properly and HC legislation.

The answer was interesting and layered:

1. LEGISLATORS:

Historically, OEA has made it a practice to contribute equal amounts of EPAC money to both Republicans and Democrats. But, with time, Republicans have become less education minded and OEA didn't feel it could keep giving money to those who would vote against education. OEA is solid with democrats and courts moderate Republicans. However, by not contributing to some legislators, it has closed doors once open. Also, there is a strong 'pay to play' atmosphere. The longer term limits is is affect, the more conservative it gets.

If Ken Blackwell is elected, OEA feels that the HC legislation proposal will be killed. OEA supports Strickland as a friend to education. Strickland WILL BE an advocate for education issues. Voters need to realize that conservative legislators running on platforms of abortion, guns, gays and which church one attends will not solve the HC problem. The Governor backing has already been completed with Strickland being the candidate of choice.

OEA will screen Senate and House legislators for those who support 'our issues' of fixing the funding for education and support of educators. Screening for statewide positions such as Attorney General and Auditor, etc. will be completed by Aug. 31.

There will be a list in September for all recommendations: statewide, House, Senate, School Boards (John Brandt is gone), Courts, etc. OEA can present this list to us as members and we can circulate but they are bound by law not to advertise per se. Legislators can say OEA supports them.

2. ENA (Equity N Adequacy): An EDUCATION COALITION : [See note below from Jim McGreevy]

Includes ALL education based groups: HCA except Higher Educ., School Boards, BASA, etc. WORKING FOR PROPER SCHOOL FUNDING.

-This coalition has been working for 2 years determining how to move forward for proper school funding. Funding is a huge issue and OEA pledges it is doing and will do all it can politically and financially towards this end. Electing education minded legislators is of critical importance as stated above.

-This plan mirrors the HCA plan to be presented to the Governor and legislators.

-This plan would take away the over reliance on the property tax. Real estate tax is extremely unpopular with the less well off and older property owners. This would push to put funding back on the State where it belongs.

-If it is not moved to put this on the ballot, OEA will mount a campaign to get it on the 2007 ballot.

-OEA will attempt to get Republican support for a bipartisan backing.

B. HC LEGISLATION: (being written; will present late 2006 or in 2007).

1. We hear the more vocal opposition for the increased contribution legislation. There are approximately 10 who oppose openly, Allen said. Mostly , they oppose employer increases.

OEA has met with ALL Senators and 30 Representatives thus far. They have met with the more receptive representatives. These legislators have stated they were impressed with the HCA's plan and that HCA are presenting solutions to the STRS HC crisis. Good questions have been asked regarding the 5% such as if it was enough, why that amount, etc. OEA would not be going forward if they were not hearing support for this proposal. There is no wish to be without HC.

Two legislators were adamant about HSA and it was explained that once one retires, they cannot save and no one can save for their HC projected costs of $230,000 just for premiums and out of pockets.

It was stated that OEA IS doing its job and meeting one on one with legislators as they expect. It was made clear that NOW is not the time for letter writing, emails, etc.

Some legislators feel and Wachtmann stated publicly in The Dispatch: front page 5/30/06, that "The system is already extraordinarily generous." "Public pensions are much more generous than most private employers." Some feel teachers make too much money with too much time off and too many benefits. ((MAKE SURE YOU KNOW HOW YOUR LEGISLATOR FEELS ABOUT EDUCATORS' BENEFITS WITH HC AND EDUCATION FUNDING)).

Wachtmann stated to Curry in his letter that he was working on legislation to ensure retirees had benefits. I wonder if that is the State Plan discussed where it is decided what would be good for us in quality and costs.

Allen went on to say he feels there are simply some with no social conscience. Dave Parshall stated 1/2 of STRS retirees live on $20,000 or less. Deduct all our HC costs and not much left.

2. **OEA will present a campaign plan when it is time. There will be a need to be disciplined and on target. A strategic time line exists. First to plant seeds of support and then to lobby. NOTHING WILL BE DONE BEFORE THE NOV. ELECTIONS.

What YOU CAN DO NOW:

Focus on your own legislators and those you know. Plant seeds of support:

-Tell them you support the HCA's proposal for increased HC contributions.

-Tell them we really need HC in retirement.

-Ask them where they stand on the proposal

-Ask them what problems they have with the proposal

-Give feedback to HCA for their consideration

3. School Board Opposition:

-John Brandt, the biggest opposer, is gone.

-Pushback is due because School Boards don't want to be mandated as that is a block of money taken off the table for bargaining.

-Missing the point: Discuss with School Boards and legislators when the time comes or if you know some of these individuals personally that HC ISSUES WILL NOT GO AWAY by defeating this legislation BECAUSE it is a STATE ISSUE FOR THE UNINSURABLE.

SOMEONE has to pay for HC. If school boards won't help, the State will have to pay as a result of ER use in lieu of insurance.

-If this legislation fails, there will be NO HC when the HC fund runs out. Those able will leave increasing the risk pool and only those who cannot obtain HC or afford it will remain. The funds will be depleted and the poor and the ill will have to use ER's as their only HC. The state will have to pick up the tab.

-Some much time is being spent on this and that is time taken away from education issues.

-MOST IMPORTANTLY: The legislators would only be giving STRS permission to do this. STRS can change if conditions allow.

4. WHY MUST THERE BE ONLY PLAN A?

1. Actives have been surveyed. There is NO support for any other plan options. Reasons: The actives will see NO result for themselves in lesser amounts are approved. For ex., if 3% from actives only is approved, it would keep the fund alive a while longer but not long enough for most educators to realized benefit. Therefore, they will not support it.

2. 5% is the figure researched and well thought out to keep the fund solvent. OEA and HCA had to be convinced that STRS was doing ALL it could and that a plan existed to solve the problem. 5% will solve this crisis and this is part of what the legislators were specifically questioning with is it enough to solve this problem and will it keep the fund alive, etc.

3. Will raising the age requirement, sliding scales, etc., reduce unfunded liability. Age restrictions will not change matters as 58 is now the average age for retirement. The 35 yr. incentive is working to keep educators active longer already. Plus, these areas are STRS related not HCA issues.

Furthermore, speaking to these unpopular issues now will hurt the HCA proposal as educators do not want to hear more stipulations on them AND have to pay more from their salaries as well. The key is FOCUS and keep disciplined about what is needed: HC.

When we get off track, this hurts everyone and what everyone needs is HC. The key is keeping disciplined and on target for HC.

4. If Plan A fails, it will be discussed among HCA if any other viable options exist to help all in some way. For the present, to save HC and keep it going, 5% is the determined amount resulting from careful research.

I asked Bill L. about John and Joanne Bos's thinking on this: It still amounts to 5% but in a more deferred manner for School Boards.

Active contribution increases: Year 1: 1% Year 2: add'tl 1%

Active/ School Board contribution increases: Year 3: actives addt'l 1/2%/school boards 1/2 %

School Board increases: Year 4: addt'l 1% Year 4: addt'l 1%

They feel this would allow School Boards time to adjust and preplan.

Bill L. said it may be something for consideration by the HCA in the future.

The meeting ended with talk of collaboration. Allen initiated this stating that former STRS board members used poor judgement and most were gone. It is time to bind together and work for the common goal of all of us: HC. Dave and I concurred and Dave spoke to all of us getting on board for a common cause as the only way of helping us all. Going on in critical mode is not productive for us and we all need HC. (paraphrased).

Dave ended by suggested that we be represented on the HCA Board -- not to vote or be more than a sit in guest/member who can see first hand the workings and planning. Of course, issues needing to remain private to HCA would be so done. Perhaps, a question might be asked of a representative for members upon occasion. I remember sitting at such a meeting a few feet away when Jack Chapman asked the HCA how retirees might feel about something. We were right there. If a rep for us was present and allowed to respond, it may give some insight. Also, notes could be taken and perhaps points or ques. could be addressed at an determined appropriate time so not to distract.

Gary wrote the request down and said he would present it to the HCA for consideration.

Jim McGreevy and I spoke after for a bit. He was most agreeable and earnest in working together offering whatever role he might be able to play.

Please correct any point not felt to be accurate. This is based on notes and memory.

Before and after, we greeted and shook hands stating we were glad to have met. I thanked them for having us and they thanked us for coming.

Please forward to Gary Allen, Patricia Frost Brooks, Dennis Reardon.

Molly J.

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From Jim McGreevy, 6/1/06: A correction

Molly -

I'll forward your emails to all parties at the meeting.

I didn't take the volume of notes you did, but I thought you accurately captured what I heard in the meeting. The only "factual error" I noticed was the timeline of OEA's involvement with the Equity & Adequacy Coalition that pushed the DeRolph case beginning in the early 1990's. OEA was one of the founding members of that coalition and had contributed hundreds of thousands of dollars since then to fund legal costs and other coalition expenses.

I will do what I can to promote some role for CORE in the HCA process.

- Jim