Molly Janczyk: Answers from Aristotle Hutras
From Molly Janczyk, December 4, 2009
Subject: Answers: Aristotle Hutras: Exec. Direc. ORSC: Pensions, Changing ORSC, Investments
Aristotle Hutras, Exec. Direc. of the Ohio Retirement Study Council (ORSC) which oversees all 5 pension systems contacted me today by phone with his answers to the 2 questions below. You can view the ORC sections on line and view all 5 pension systems overview by bringing up the ORSC online.
Ques. 1: Can the ORC be changed by legislation to reduce current pensions? Aristotle stated 3307.42 protects the vested rights of CURRENT retirees already receiving pensions. He stated the the ORSC and he interpret the ORC this way: 'Once granted this vested right (current pensions), can't be reduced or eliminated by subsequent legislation.'
Ques. 2: Who pays us should STRS go bankrupt? Aristotle again repeated, STRS is secure for the next 2 decades for paying our pensions. IF no changes occur, then, options would have to be on the table. NO ONE EXPECTS THIS TO HAPPEN!!!!! That is WHY all 5 pension systems are being proactive seeking changes NOW. Legislation should occur next year as early as Jan. but we all know legislation takes time. THAT is WHERE the discussion is being held and THAT is the appropriate venue for this discussion.
IF the worse case scenario occurs and STRS is unable to pay current pensions, (WHICH NO ONE AT STRS OR THE ORSC EXPECTS TO HAPPEN), then Aristotle and the ORSC interpretsthe ORC as follows: 'The state would have a hard time not standing behind the obligation because it was law when the pensions were issued.'
AGAIN, NO ONE at STRS or the ORSC expects anything like this to occur. PLEASE DO NOT TAKE ANY OF THIS OUT OF CONTEXT FOR INCITING RETIREES UNNECESSARILY!!!
Should this totally not expected disaster occur and the state cannot pay, Aristotle said that 3307.30 issues further protections for these vested rights to levy additional funds to pay the obligations of already vested pensions. Also, retirees would seek judicial relief as the were vested by law and received pensions under the law.
This is as secure as it gets and short of some type of state and federal financial implosion where all fails and no one can pay anything, we are vested and secure in our current pensions. None of this pertains to those not yet receiving pensions. The law can be changed to affect FUTURE pensions of those active educators NOT currently receiving pensions.
IF YOU ARE NOW RECEIVING A PENSION, YOU ARE PROTECTED AGAINST IT BEING REDUCED OR ELIMINATED PER STATEMENTS ABOVE.
IF you have questions or statements, direct them to STRS or the ORSC as I have depleted my efforts on this issue and feel most satisfied with Aristotle's answers that I am secure and my pension is safe.
See below for direct contact info for Aristotle who is most approachable and helpful. Thank you, Aristotle.
Molly J.
From Molly Janczyk, November 23, 2009
Subject: Aristotle Hutras: Exec. Direc. ORSC: Pensions, Changing ORSC, Investments
Dear Aristotle,
I wondered if you found the answers to the 2 questions below. Please advise.
Molly J.
From Molly Janczyk, November 12, 2009
Subject: Aristotle Hutras: Exec. Direc. ORSC: Pensions, Changing ORSC, Investments
I called Aristotle Hutras yesterday on the same question below: Aristotle is happy to take calls anytime from anyone: "We are here to serve." He was gracious and very openly communicative. He has an Education Degree but has served in Public Policy for his career after starting there as a page as a young man. I am copying Aristotle on this email for accuracy:
Direct number: 614-228-3574
Direct email: ahutras@ameritech.net
1. Aristotle : Can ORC be changed to reduce current pensions?
Aristotle feels this would be very difficult to reduce or take away pensions retroactively and would be seriously challenged opening the door for lawsuits due to Federal Trust and existing laws.
Aristotle IS checking further on this to be certain. He will get back to me on this question.
2. Should STRS go bankrupt (which no one expects) who pays us our pensions? The state would have a hard time not standing behind that obligation as it was law when the pensions were issued but he is checking on this for a clear answer.
On this issue:
STRS is strong as is OPERS with its investments and investment staff. Those staff members can easily go other places for jobs. I know there is a lot of talk about bonuses but they have done a remarkable job and this is a very difficult climate. Investment geniuses have lost money. For ex., Warren Buffet. The whole country has lost money.
The reason some plans have become unsustainable is because they used money for other things (discretionary payouts) vs. keeping the money in the funds for pensions. This is why STRS is proposing changes as without change, STRS will have to stop paying though that would be 10-20 years down the road. But, you don't want to wait for that to happen. Changes need to be made now to grow funds and meet mandatory 30 yr funding.
He believes in educating people for responsible decisions. Info should be factual. Giving misinformation not factual is not responsible and is a disservice to our readers and listeners. We want folks to have facts at hand or bad decisions and poor statements are made. If this happens with lawmakers, then they can't be responsible for decisions based on bad info. The legislators are seeking solid answers.
He was happy that we are seeking facts and opening communications for good dialogue.
Thank you, Aristotle for a most pleasant conversation and for seeking this definitive answers for concerned retirees.
Molly Janczyk
STRS Retiree
Subject: Answers: Aristotle Hutras: Exec. Direc. ORSC: Pensions, Changing ORSC, Investments
Aristotle Hutras, Exec. Direc. of the Ohio Retirement Study Council (ORSC) which oversees all 5 pension systems contacted me today by phone with his answers to the 2 questions below. You can view the ORC sections on line and view all 5 pension systems overview by bringing up the ORSC online.
Ques. 1: Can the ORC be changed by legislation to reduce current pensions? Aristotle stated 3307.42 protects the vested rights of CURRENT retirees already receiving pensions. He stated the the ORSC and he interpret the ORC this way: 'Once granted this vested right (current pensions), can't be reduced or eliminated by subsequent legislation.'
Ques. 2: Who pays us should STRS go bankrupt? Aristotle again repeated, STRS is secure for the next 2 decades for paying our pensions. IF no changes occur, then, options would have to be on the table. NO ONE EXPECTS THIS TO HAPPEN!!!!! That is WHY all 5 pension systems are being proactive seeking changes NOW. Legislation should occur next year as early as Jan. but we all know legislation takes time. THAT is WHERE the discussion is being held and THAT is the appropriate venue for this discussion.
IF the worse case scenario occurs and STRS is unable to pay current pensions, (WHICH NO ONE AT STRS OR THE ORSC EXPECTS TO HAPPEN), then Aristotle and the ORSC interpretsthe ORC as follows: 'The state would have a hard time not standing behind the obligation because it was law when the pensions were issued.'
AGAIN, NO ONE at STRS or the ORSC expects anything like this to occur. PLEASE DO NOT TAKE ANY OF THIS OUT OF CONTEXT FOR INCITING RETIREES UNNECESSARILY!!!
Should this totally not expected disaster occur and the state cannot pay, Aristotle said that 3307.30 issues further protections for these vested rights to levy additional funds to pay the obligations of already vested pensions. Also, retirees would seek judicial relief as the were vested by law and received pensions under the law.
This is as secure as it gets and short of some type of state and federal financial implosion where all fails and no one can pay anything, we are vested and secure in our current pensions. None of this pertains to those not yet receiving pensions. The law can be changed to affect FUTURE pensions of those active educators NOT currently receiving pensions.
IF YOU ARE NOW RECEIVING A PENSION, YOU ARE PROTECTED AGAINST IT BEING REDUCED OR ELIMINATED PER STATEMENTS ABOVE.
IF you have questions or statements, direct them to STRS or the ORSC as I have depleted my efforts on this issue and feel most satisfied with Aristotle's answers that I am secure and my pension is safe.
See below for direct contact info for Aristotle who is most approachable and helpful. Thank you, Aristotle.
Molly J.
From Molly Janczyk, November 23, 2009
Subject: Aristotle Hutras: Exec. Direc. ORSC: Pensions, Changing ORSC, Investments
Dear Aristotle,
I wondered if you found the answers to the 2 questions below. Please advise.
Molly J.
From Molly Janczyk, November 12, 2009
Subject: Aristotle Hutras: Exec. Direc. ORSC: Pensions, Changing ORSC, Investments
I called Aristotle Hutras yesterday on the same question below: Aristotle is happy to take calls anytime from anyone: "We are here to serve." He was gracious and very openly communicative. He has an Education Degree but has served in Public Policy for his career after starting there as a page as a young man. I am copying Aristotle on this email for accuracy:
Direct number: 614-228-3574
Direct email: ahutras@ameritech.net
1. Aristotle : Can ORC be changed to reduce current pensions?
Aristotle feels this would be very difficult to reduce or take away pensions retroactively and would be seriously challenged opening the door for lawsuits due to Federal Trust and existing laws.
Aristotle IS checking further on this to be certain. He will get back to me on this question.
2. Should STRS go bankrupt (which no one expects) who pays us our pensions? The state would have a hard time not standing behind that obligation as it was law when the pensions were issued but he is checking on this for a clear answer.
On this issue:
STRS is strong as is OPERS with its investments and investment staff. Those staff members can easily go other places for jobs. I know there is a lot of talk about bonuses but they have done a remarkable job and this is a very difficult climate. Investment geniuses have lost money. For ex., Warren Buffet. The whole country has lost money.
The reason some plans have become unsustainable is because they used money for other things (discretionary payouts) vs. keeping the money in the funds for pensions. This is why STRS is proposing changes as without change, STRS will have to stop paying though that would be 10-20 years down the road. But, you don't want to wait for that to happen. Changes need to be made now to grow funds and meet mandatory 30 yr funding.
He believes in educating people for responsible decisions. Info should be factual. Giving misinformation not factual is not responsible and is a disservice to our readers and listeners. We want folks to have facts at hand or bad decisions and poor statements are made. If this happens with lawmakers, then they can't be responsible for decisions based on bad info. The legislators are seeking solid answers.
He was happy that we are seeking facts and opening communications for good dialogue.
Thank you, Aristotle for a most pleasant conversation and for seeking this definitive answers for concerned retirees.
Molly Janczyk
STRS Retiree
posted by Kathie Bracy at 7:52 AM
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