ORTA's silence at STRS meeting to cut our COLA

From RH Jones, April 25, 2012
 
In the ORTA Spring Quarterly 2012, an article by President, Dave Gynn, entitled “Use Your Teacher Voice”, Dave states in his last sentence: “We must continue to speak in a loud, clear voice for all retired teachers”. Dave, it has been years since any ORTA official has spoken in a loud and clear voice at any STRS meeting to protest their cuts for retired teachers. Our STRS HC/Rx fund was cut by the STRS from the 4% of the Employer Contribution down to 1% into the fund. One percent is now not enough to sustain our HC/Rx. ORTA officials were silent then, and are still silent now. The ORTA Executive Director, Ann Hanning was silent at the STRS April 19 meeting, as well. 

The OEA active teachers have been reportedly bombarding the legislature with requests in their interests but it seems just a few of us retired educators are contacting legislators.  Perhaps if Dave and Ann, as our primary leaders, would set a loud and clear example, more members would follow their example. 

Past ORTA presidents have informed me that they had been talking to legislators all across the state. If our present ORTA officials are doing this, please ORTA let the membership know specifics of these meetings so that we can extend proper accolades.

By the way, Ann’s article “ALPHABET SOUP” was good except that there was no mention of our STRS Scenario 8 COLA cut. Also there was no loud or clear voice of hers at the STRS meeting, either. That’s a fact! 

My opinion, 
RHJones

STRS featured in Dispatch

From John Curry, April 24, 2012

http://www.dispatch.com/content/stories/local/2012/04/24/teachers-plan-to-shore-up-pensions-has-them-paying-more.html 

Teachers’ plan to shore up pensions has them paying more, getting less 

By David Eggert 

The Columbus Dispatch, April 24, 2012 

ShareThis Ohio teachers would pay more into their retirement funds and retirees would get no cost-of-living increases in their pensions for a year under a revised plan being pitched to shore up educators’ statewide pension system. 

The reform package is the fourth version sent to lawmakers for their approval since 2009. The Ohio Senate finally could vote as early as May, though that is not certain, and the House is unlikely to do anything until after the November election. 

Teachers’ salary contributions to their retirement funds would rise from 10 percent to 14 percent over four years, more than the 13 percent rate proposed earlier. 

Another revision — requested by legislators and groups representing educators and employers —would smooth out a potential “cliff” to address concerns that eligibility requirements could have changed too drastically in a short period of time. 

Under the new plan, unanimously OK’d last week by the board of the 470,000-member State Teachers Retirement System, teachers could retire at any age until mid-2015 and get a full benefit if they have worked 30 years. The years-of-service requirement would gradually rise, though, so that after mid-2026, teachers could not stop working and receive a full benefit until they are 60 and have 35 years in. 

Annual cost-of-living raises in pension checks would drop from 3 percent to 2 percent, with retirees receiving no increase at all in the 2013 fiscal year. Teachers retiring in August 2013 or later would not get a cost-of-living raise for five years. 

“We know that every individual is not going to be happy with the results,” STRS spokesman Nick Treneff said yesterday. “But we think we have a good understanding among active teachers, retirees and employers that changes needed to be made to ensure our solvency going forward, and these changes are in the best interest of all the plan participants.” 

The new plan — designed to save $13.3 billion in accrued liabilities — is supported by Healthcare and Pension Advocates for STRS, a coalition of unions and employers that opposed earlier versions of the funding plan. 

“I think we really have found the sweet spot where the burden is being shared in an equitable way,” said Bill Leibensperger, vice president of the Ohio Education Association, the state’s largest teachers union. 

He applauded Senate President Tom Niehaus’ desire to pass pension reform before the summer break. 

“I would encourage all lawmakers in both the Senate and House to come together on this quickly. One of the greatest frustrations has been that the longer it takes to come up with a solution, the more expensive it gets.” 

Ohio law requires the state’s five pension funds to be able to pay off their obligations in no more than 30 years. The teachers’ system, however, currently cannot do so for nearly 38 years because of a number of factors, including retirees living longer, rising health-care costs and the 2008 stock-market collapse. 

Like other plans needing to meet the 30-year requirement, the teachers’ pension fund first submitted funding proposals to the legislature in 2009 that called for higher retirement ages, bigger deductions from employee salaries and lower cost-of-living adjustments. A proposal to also make school districts pay more was scrapped because of opposition from Gov. John Kasich and others. 

Angela Meleca, spokeswoman for Niehaus, R-New Richmond, said “considerable progress” has been made in talks among Republicans and Democrats and with the pension funds. But she said Niehaus is looking at whether there is enough time to have hearings and final votes by the end of May. 

“We’re trying to determine if we can get this done by the summer recess considering the volume of all the policy initiatives we are trying to work on moving through,” Meleca said. 

deggert@dispatch.com

John Curry: Thank you, Tom Rice and Highway Patrol Retirement System

John Curry to Tom Rice, April 23, 2012
Subject: Re: COLA cut 

Tom, 

Thank you so much for this information. My organization, CORE - Concerned Ohio Retired Educators - has also been pushing for some kind of protection for our retirees, with the lowest pensions, who can't afford to take a 1% COLA cut during their "golden years." To date, we have met with nothing but a stone wall.  Our STRS board didn't have the wisdom, desire and compassion that your board did in taking the time to care for these people. You are to be commended. 

John Curry

(Click image to enlarge.)

Compliments of KBB..................................................

John Curry: Ann...we, at CORE, are working to protect the least among our ranks.....

John Curry to Ann Hanning [Executive Director of ORTA]
April 23, 2012

....I am asking your organization to do the same. Stand up for these retirees with small pensions as the Ohio Highway Patrol Retirement System has already done (in this letter from retired Col. Rice) and that CORE has been pushing for better than one year now. 

Here is a statement of ORTA's "mission" as taken from your website. Note that it says "[ORTA] advocates and promotes the improvement of pensions." The protection of the 3% COLA for pensions for those most needy STRS retirees among us needs protecting....are you and your organization up to the task? 

"ORTA's Mission: The Ohio Retired Teachers Association is the voice of Ohio's retired public educators. ORTA advocates and promotes the improvement of pensions, benefits and services available to Ohio's active and retired public educators. The association represents and takes action on behalf of our constituents to STRS Ohio, the Ohio Legislature and other agencies dealing with retirement issues." 

John Curry

Here's an Ohio Retirement System that is protecting the least among their retired ranks with some compassion.....

Tom Rice to John Curry, April 23, 2012 
Subject: RE: COLA cut 

John, 

Good morning.  I saw your question regarding the qualifiers for older retirees and wanted to get back to you with an answer. 

Below is the proposed language contained in HB 69.  The 2012, Federal Poverty rate for a family of two is $15,130.00.  One hundred and eighty-five percent of: ($15,130.00 X 1.85) = $27,990.50. 

As it is proposed right now, OSP [Ohio State Patrol] retirees (age 65 years or older - see below) earning less than  $ 27,990.50 per year will continue to receive a 3% COLA. We feel pretty comfortable that this provision will remain in the proposed legislation. 

I hope this answers your question.  If not, please call me. 614-430-3553 or cell phone [xxx]. 

(a) For each person sixty-five years of age or older who is receiving a pension not greater than one hundred eighty-five per cent of the federal poverty level for a family of two persons, as revised annually by the United States department of health and human services in accordance with section 673(2) of the "Omnibus Reconciliation Act of 1981," 95 Stat. 511, 42 U.S.C. 9902, as amended, the board shall increase the pension by three per cent. 

(b) For persons other than those described in division (B) (1) (a) of this section, the board shall increase the pension by two per cent, except that for any calendar year in which the actuarial valuation required by section 5505.12 of the Revised Code demonstrates that a period of thirty years or less is required to amortize the state highway patrol retirement system's unfunded actuarial accrued pension liabilities, the board may increase the pension to not more than three per cent. 

Take care, 
Tom 

Col. (ret.) Thomas W. Rice, Consultant 
Highway Patrol Retirement System 
614.430.3553 
trice@ohprs.org 

John Curry to the Ohio Highway Patrol Retirement System (OHPRS), April 21, 2012 
Subject: COLA cut 

I praise your organization for the compassion you have for retirees among you with the smallest pensions. I note that your April 12, 2012 posting says, and I quote, "1. Reduce the annual cost of living adjustment (COLA) from three percent to two percent with limited exceptions for our oldest retirees who receive very limited benefits." My question is, what are the qualifiers for those retired troopers to be sheltered from the COLA cut. 

Thank you, 
John Curry

From John Curry, April 26, 2012

Thanks, Tom...am clear on this issue now. It is based on their "current" retirement income rather than their initial retirement annual amount.

I think you find it interesting to know that in previous discussions with the STRS leaders by this retiree and others it was brought to the attention of myself and my fellow retirees that STRS retirees also may very well have "additional income sources" as well as their pension and that was one of the reasons given to not allow an exemption to our lowest benefits recipients. I would surmise that some your lowest pensioned retired troopers would also have additional sources of income but that your compassionate retirement system didn't use that as an excuse to ignore them.

John

From Tom Rice, April 26, 2012

John,

The $27,990.50 is the product of: $15,130.00X 185%. The 2012 Federal Poverty rate for a family of two is: $15,130.00. $15.,130.00X 1.85= $27,990.50. If our proposed legislation passes, our retirees, 65 years or older earning less than $27,990.50, would receive a 3% COLA increase.

PROPOSED LANGUAGE:
(a) For each person sixty-five years of age or older who is receiving a pension not greater than one hundred eighty-five per cent of the federal poverty level for a family of two persons, as revised annually by the United States department of health and human services in accordance with section 673(2) of the "Omnibus Reconciliation Act of 1981," 95 Stat. 511, 42 U.S.C. 9902, as amended, the board shall increase the pension by three per cent.

Col. (ret.) Thomas W. Rice
Consultant Highway Patrol Retirement System
614.430.3553
trice@ohprs.org

From John Curry, April 25, 2012

Thomas,

I do have one question. It involves the $27,990.50 amount. Was this the amount of the "original pension" of the retired trooper or is this the current amount of their annual pension? Thank you.

Message from CORE president Dave Parshall

CORE members and supporters:  Some thoughts from CORE president Dave Parshall

By now you have had a chance to review the plan passed last week by the STRS known as Scenario "8", and its financial impact on all of us. Some additional information may help us all deal with the changes. First, since 2009 I have been telling CORE members and others who would listen that if all that happened to our pensions was a 1% reduction in our COLA, we would be lucky.  There was and is a severe financial crisis at STRS.  If deep corrective measures are not enacted then by 2040 or 2050, STRS would not be able to pay pensions. Due to politics, the first plan sent over to the Legislature via the ORSC [Ohio Retirement Study Council] was never enacted, which made our financial problem even deeper. 

All five state pension systems have been given a final opportunity to resubmit their plans for reform.  The Senate wants this done by early summer.  Yes, I know this is another in a series such deadlines STRS has been asked to meet since 2009.  This will likely be the last one. The staff at STRS came up with ten different scenarios.  Scenario "8" was the most fair to all stakeholders of the STRS membership, both actives and retirees.  I personally supported this plan, but only if an adjustment could be made for older, 30 year teachers with low pension at or below $30,000.  I, Marie Fetters, and Dennis Leone made impassioned pleas last Thursday during Public Speaks at STRS. There was little support for this change to the plan, and it passed unanimously "as is" by the board and now is on its way to the legislature. 

Our two retiree board members, Mr. Stein and Mr. McGreevy, made comments before the vote pointing out the hardships to older retirees.   Dennis Leone during his address to the board pointed out that if the "board was made up of all retirees then the vote would be different". However, this is not the current reality.  Maybe someday there could be at least an even split on the board.  Now that Scenario "8" is the plan, more information may help you come to grips with cuts to our COLA. 

First you need to know that both Bob Stein and Jim McGreevy have been working behind the scenes since 2009 to come up with a plan to help protect our older retirees from the cuts.  But there was no consensus of like support from fellow board members and or especially the members of Health Care Pension Advocates.  OEA and the university representatives by sheer numbers control the HCPA and have the power to influence the board.  ORTA, as we know, is a "go-along-to-get-along" organization and has never taken a stand on any issue truly affecting retirees.  That is why CORE has been needed all these years.  It was reported to HCPA via ORTA that retirees were fine with the changes to COLA and because few if any questions were asked at RTA presentations. 

HCPA and the STRS board could have found a way to account for the older retirees, but lacked the will or support from their membership.  It's easy for all of the stakeholders to look at the plan and concentrate on their own status.  I had hoped that money could have been found to help the older retirees by tweaking some of the other aspects of the plan, like reducing the phasing in the change of the retirement age and years of service.  However, it was reliably reported to me that it was the legislature that pressured for this perk for actives because actives have been ringing their phones off the wall.  So this was off limits and I am sure OEA would have a hard sell with actives for a shorter phase in period. 

We need to remember that actives are taking a hit also.  They will be paying 14% of their salary into STRS over their remaining career and they will work until 60 or beyond to have 35 years of service. They will not have a COLA for 5 years after retirement, and then it will be a 2% COLA.  Actives will never see a 3% COLA that we have had since our retirement. Also keep in mind that when the 88% rule was enacted, current retirees also got a boost that refigured our pension above the 2.2 factor that actives will now have.  The FAS will be figured over 5 years instead of 3 as ours was.  I see this as not that big a deal because most of them will have been at the top of the salary scale for many years before retirement. 

How many times, after reading the headlines about how public education and teachers are under attack, have we all said "boy I am glad I am no longer in the classroom"?  I know I have.  The move to end public education and privatize it has teacher morale at an all time low.  Many teachers are planning on leaving the profession as soon as the economy picks up.  Just this week Cleveland, Cincinnati and Columbus announced that they will be cutting hundreds of teachers. Class sizes are growing making their jobs more difficult and teacher evaluation is becoming a nightmare. This will affect the STRS retirement fund and eventually our pension. 

So, what do we do now?  We as retirees need to go to our RTA meetings and ask the leadership why members' input about the plan was not requested via their website or maybe even a mailing to all members.  They sure can mail us information about membership renewal. 

Next we need to wait and see what happens to the plan once it gets to the Senate.  CORE will keep you posted.  Certainly, when it goes to the House, we will need to meet with members of the House. I still say that if all that happens to our pensions is the 1% COLA reduction, then we will be lucky.  Keep in mind that we may have to reluctantly get behind Scenario "8" because there still are members of the legislature who have not given up on the Defined Contribution plan for future retirees which will really drain the pension fund.  As of now we have preserved our Defined Benefit pensions. 

One last thing: when you can, thank Bob Stein and Jim McGreevy for trying to fix the problem.  CORE will be making plans for action as the new issues develop. 

Dave Parshall

Teachers -- are you thinking of retiring soon? This is what you have to look forward to when you DO retire!

This is how much you will lose.

(Click image TWICE to enlarge.)

Chart based on $75,000 pension

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 From John Curry, April 22, 2012