Dave Parshall's speech to STRS board May 20, 2010

It has been some time since I last spoke to you publicly, but having listened to you since the first Longterm Fiduciary planning meeting in 2009, I can no longer remain silent. I and other CORE members have always asked for fairness in any planning. Please allow me to introduce some pertinent realities you need to understand.

From the first LTF planning meeting, Mr. Slater and other STRS staff members have been correctly pointing out that the combined increased contributions by active educators and school boards is the keystone to any successful plan. It is the biggest cost driver, and without it everything else collapses.

I do agree that teachers' welfare should be part of any school board's responsibilities as the cost of education. However, one has to wonder if you have been reading the headlines. Cleveland has laid off 546 teachers; Columbus, 116; Lorain, 183; and the list grows longer every day. In the best of times, an increase by school boards would be a hard sell. Remember what the OSBA did to House Bill 315? Even "grandfathering" the increase to 2020 is still fantasy.

There have been statewide media attacks on our pensions, painting educators as greedy, overpaid public servants. Candidates are running for office with a platform to do away with our defined benefit pension, in favor of some kind of 401 plans. This is an attempt to direct the public's attention away from what has happened to the private sector pensions that have been replaced by hopeless dreams of a good retirement based on what is left of 401k plans. Have you forgotten the "Buy Ohio" attempt?

There are some realities about the COLA, or our so-called "Cost Of Living Allowance," that need to be pointed out. First, the cost of goods and services in Ohio goes up the same real dollars for all residents, no matter what a person's income. So why continue the unfair practice of figuring out COLA based on a percentage of our final average salary? In real dollars, the amount of COLA paid is far greater for those with the largest pensions. The COLA dollar amount is much less for those with pensions of $35,000 or less. Not only is this unfair, but it costs STRS needless dollars. Your current plan is still unfair and costly.

You need to listen to Mr. Brooks and his 3% for the first $30,000. This would be fair across-the-board. I am sure there could be other fair plans as well. It is time to rethink your position on the COLA. Many of the most conservative states have grandfathered current retirees. Why haven't you?

Please understand that ORTA does not speak for or even understand what most retirees are thinking. They never ask. In other states, the retired teachers associations are leaders for reform, but not in Ohio. They never speak at STRS board meetings and almost totally ignored Dennis Leone and his landmark findings. Clearly, they were asleep at the switch then, and still are. Go along to get along is not leadership.

Mr. Brooks and the STRS staff have been telling you all along that some of the changes can happen overnight. The changes to current retirees sure did. When you are in your sixties or seventies, there is little you can do to improve your financial picture. All the grandfathering for future retirees will be a red flag to the legislature. I base this on firsthand experience with them.

Please face some of these realities. If you don't, then when your time comes to leave the board and you are asked the inevitable question, "What will you do next," you can't say the usual "I am going too Disney World," because you will have already been there.

David K. Parshall