Plain Dealer editorial: A chance to mend STRS

Editorial in the Cleveland Plain Dealer, December 17, 2006

A chance to mend STRS

Sunday, December 17, 2006 The State Teachers Retirement System has developed a constructive response to the looming bankruptcy of its health care fund, but school districts are balking at the price tag. The cost concerns are real, but the General Assembly cannot let them derail this proposal. Rising health care expenses have forced employers nationwide to change employee benefits, and the teacher retirement system is no exception. Yet premium hikes and other adjustments only go so far; by the agency's estimate, its health care stabilization fund faces bankruptcy by 2021. Worse, every delay in action increases the amount that will be required to ensure the fund's long-term solvency.

After months of work among labor and management organizations, the retirement system came up with a plan that splits the burden of a dedicated health care fund evenly between employers and teachers. The proposal calls for the cost to be phased in annually at 0.5 percent of employee salaries for five years. True, many Democrats around the nation promised action on health care during this year's congressional campaigns, and Ohio Gov.-elect Ted Strickland has vowed to tackle the broad issue of school funding in Ohio. Those issues may affect STRS policies down the road, but resolution of either is neither certain nor likely to happen soon. Better to act now and be able to lower fees later than to wait and endanger tens of thousands of retirees. Bearing the new costs won't be easy for anyone, but this proposal is as fair as it is desperately needed; lawmakers should embrace it.