STRS's Executive Director Mike Nehf writes write to the top....we have had our plans in place for months

From John Curry, October 10, 2011

http://blog.cleveland.com/letters/2011/10/ohio_public_pension_systems_fi.html

Ohio public pension systems' fiscally responsible plans await lawmakers' approval; what's the holdup?

Cleveland Plain Dealer, October 10, 2011
By Other Voices

I am writing in response to your Oct. 2 story "Public pension reform backers target overtime."

Each of the five statewide public retirement systems has its own laws in place regarding compensation increases that can be counted toward members' final average salary. For Ohio's public teachers, strict anti-spiking laws have been in place since 1991. The statute limits the amount of compensation increases during the educators' two highest years that can be included in their final average salary calculation. These prohibitions have helped ensure that the State Teachers Retirement System of Ohio pays benefits that are not inflated during the final years of a member's working career.

In January, the State Teachers Retirement Board passed a pension-reform plan containing five steps designed to strengthen the financial condition of the retirement system. The plan was sent to the Ohio legislature and is currently on hold. The passage of this reform would further tighten the anti-spiking laws. STRS Ohio recommended a change in calculating the final average salary -- going to the average of the member's five highest years of earnings rather than the three highest years. That would further mitigate the impact of pension spiking, but that is not the main purpose for our change in the rule, since the practice is effectively governed by statute.

This debate underscores the importance of the pension legislation that now rests before the Ohio House and Senate. All five retirement systems have submitted reform plans designed to preserve the financial security of more than 1 million public servants and retirees. These changes would also benefit Ohio's taxpayers, since the proposals would help make the pension funds more financially sound and able to continue to pay benefits that help stoke Ohio's financial engine. The revised benefits should also enable public employers to continue to recruit and retain a skilled work force. We urge the General Assembly to act on these plans, which have been before them for many months.

Michael J. Nehf, Columbus

Nehf is executive director of the State Teachers Retirement System of Ohio.