Dave Parshall reports on the STRS vote on the pension solvency plan that will go to the State Legislature

Dave Parshall to CORE members, January 27, 2011

This morning the STRS board approved a plan to send to the legislature that will over time pay down our unfunded liability to 30.00 years. Find the PDF attachment with a copy of plan that was passed. The only three board members voting no were Mr. Myers, Ms, Correthers, and Ms. Hayden.

This vote was preceded by a vote on a motion to eliminate the language that would have given the board the flexibility to increase the employee contribution to a maximum of 4%. The vote was spit 5 to 5 and the motion failed.

The importance of the failure of this motion can't be stressed too much. The board now has future latitude to increase the employee contribution without having to go back to the Statehouse and ask for the authority to permit the increase should it be needed. The danger of having to go back to the legislature is that it could open up an even bigger can of worms.

The language that was included in the approved plan was a very smart political decision. It shows that we are committed to solve our own problems. It also gives the board flexibility to increase and then also decrease the employee contribution. The board does not anticipate the need or has any plans to raise the increase to 4 %.

Our COLA was reduced to 2 % and believe me, it has been a fight these past months to hold it to this. Having watched this process unfold for the past two years, I can tell you that a ton of work by the STRS staff and our board members has gone into the final plan.

In view of the political climate at the Statehouse today and the pressure put on us by the vast media attacks these past two years, we are lucky that the plan is not more harsh. I am fully aware of those of us who have low pensions now and I have started to the process to help these people. Comments were made to me today that we need to find a way to help these people. A number of our retirees have taken a $1000 dollar hit each month to cover their health care cost. Several board members told me today that they are going to tackle health care next. CORE will be involved in this process.

What’s next? There is a chance that the passed STRS plan that will be sent over to the Statehouse may not be exactly what is in the actual bill. CORE will have to see what is in the bill and then develop some talking points and a lobbying strategy.

On February 2, I and several other CORE Officers will be attending the new STRS Champions meeting. I will let you know what comes out of this meeting. CORE members need to thank the STRS staff for their work and board members who voted for this plan.

Mr. Stein and Mr. McGreevy spoke strongly today with well reasoned comments and were a voice for reason. Dale Price, CORE-endorsed board member, likewise over the two day period helped the board make the final decision. Mr. Books also made numerous helpful suggestions and comments.

In my opinion, no board member has evolved more during this process since October than Mr. Hill. He did a lot of soul searching and questioning which eventually led to his vote for this plan. Once again, keep in mind that this plan will most likely not be the one we see in the new bill. Time will tell and CORE will be there.

Dave Parshall, Pres. of CORE