"Everything is Beautiful" Laura speaks to the ACRTA
http://www.limaohio.com/news/percent-63905-ecklar-teachers.html
STRS: Proposed changes a must
Lima News, April 7, 2011
BETH L. JOKINEN - 419-993-2093
BETH L. JOKINEN - 419-993-2093
“If the board doesn't make changes, there would be a time in the future where we couldn't pay pensions.” — Laura Ecklar, STRS director of communication services
LIMA — The State Teachers Retirement System board freely acknowledges that no one is all that happy with proposed changes to the retirement system.
After all, it is the first time in its 90-year history that benefits could be reduced, said Laura Ecklar, STRS director of communication services.
“This is a big change and we appreciate that,” Ecklar told the Allen County Retired Teachers Association on Thursday. “But at the end of the day, the board and the staff can't sit idly by and just kick this can down the road and let some other board or legislators do what they think needs to be done.”
Bills currently in the Ohio House and Senate include plans from the state's five retirement systems. The hard work has been done by the groups, Ecklar said, but Gov. John Kasich's proposed state budget could impact the plan.
The change is needed, Ecklar said, to ensure the system's future and to be able to pay off liabilities over a 30-year funding period.
“The funding period does not even have a number attached to it. It has a word, infinity,” she said. “If the board doesn't make changes, there would be a time in the future where we couldn't pay pensions.”
The STRS proposal calls for increasing years of service requirements in 2015. Currently, teachers can get benefits if they put in 30 years, regardless of age. The proposal adds an age requirement, starting at age 56 with 31 years. That would eventually increase to age 60 with 35 years of service.
Member contributions would increase by 3 percent. It would be phased in 1 percent per year beginning July 2012. It does not change school district contributions currently at 14 percent. Members pay 10 percent. Under Kasich's proposal, 2 percent would shift, requiring teachers to pay an additional 2 percent. Both sides paying 12 percent would not meet STRS's 30-year funding goal, Ecklar said.
Pensions are also determined by employees' final average salaries. Right now, it is based on the top three highest salaries. The proposal changes that to five.
The benefit formula would also change under the proposal. The current 35-year enhanced benefit formula would be eliminated. Teachers retiring with 35 years of service at age 60 or older would receive 77 percent of their final average salary as a pension.
“It still provides a reliable and reasonable pension. ... It is still a good pension,” she said.
Of concern to retired teachers is the proposed reduction of the cost-of-living adjustment. Beginning July 2012, current retirees would receive an annual 2 percent adjustment. Currently, it is 3 percent. While not popular, Ecklar said it has the biggest impact on liabilities.
LIMA — The State Teachers Retirement System board freely acknowledges that no one is all that happy with proposed changes to the retirement system.
After all, it is the first time in its 90-year history that benefits could be reduced, said Laura Ecklar, STRS director of communication services.
“This is a big change and we appreciate that,” Ecklar told the Allen County Retired Teachers Association on Thursday. “But at the end of the day, the board and the staff can't sit idly by and just kick this can down the road and let some other board or legislators do what they think needs to be done.”
Bills currently in the Ohio House and Senate include plans from the state's five retirement systems. The hard work has been done by the groups, Ecklar said, but Gov. John Kasich's proposed state budget could impact the plan.
The change is needed, Ecklar said, to ensure the system's future and to be able to pay off liabilities over a 30-year funding period.
“The funding period does not even have a number attached to it. It has a word, infinity,” she said. “If the board doesn't make changes, there would be a time in the future where we couldn't pay pensions.”
The STRS proposal calls for increasing years of service requirements in 2015. Currently, teachers can get benefits if they put in 30 years, regardless of age. The proposal adds an age requirement, starting at age 56 with 31 years. That would eventually increase to age 60 with 35 years of service.
Member contributions would increase by 3 percent. It would be phased in 1 percent per year beginning July 2012. It does not change school district contributions currently at 14 percent. Members pay 10 percent. Under Kasich's proposal, 2 percent would shift, requiring teachers to pay an additional 2 percent. Both sides paying 12 percent would not meet STRS's 30-year funding goal, Ecklar said.
Pensions are also determined by employees' final average salaries. Right now, it is based on the top three highest salaries. The proposal changes that to five.
The benefit formula would also change under the proposal. The current 35-year enhanced benefit formula would be eliminated. Teachers retiring with 35 years of service at age 60 or older would receive 77 percent of their final average salary as a pension.
“It still provides a reliable and reasonable pension. ... It is still a good pension,” she said.
Of concern to retired teachers is the proposed reduction of the cost-of-living adjustment. Beginning July 2012, current retirees would receive an annual 2 percent adjustment. Currently, it is 3 percent. While not popular, Ecklar said it has the biggest impact on liabilities.
posted by Kathie Bracy at 7:53 PM
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