Kathie Bracy: Thank you, Robin!
Hi Robin --
I have read your remarks in the May ORTA newsletter and wanted to commend you for them, and for speaking at the STRS Board meeting last month. I was unable to attend that meeting as I needed to be in NE Ohio at that time.
I'm glad you put a different slant on the need for retirees to see increases in their pension checks and asked for a road map with indicators of how the Board will determine when we can start seeing increases. Smart thinking! I'm glad (or at least I hope) you lit a fire under Mike Nehf in this regard. Don't let him drag his feet, though. There MUST be other ways to keep retirees' pensions from further sinking into the mire other than taking it out on them, particularly those with the smallest pensions.
When Nehf was hired at in 2008, we heard he had killed the COLA for retirees in his previous job in Georgia and were afraid it would happen to us. Well -- it did. Below is an article from my blog quoting the Atlanta Journal-Constitution in 2007. Perhaps it's not fair to put the blame on one person for the demise of a COLA, but I can't help wishing the STRS Board had been able to find an executive director who managed to save the COLA and other benefits for another pension system. Perhaps that's wishful thinking on my part.
Perhaps we need to keep our ear to the ground in case there is someone out there with a proven record of preventing the kinds of things that have been happening at STRS and who has the ability to turn things around. Such a person would definitely be worth a nice bonus. Mike's been here ten years, and retirees have lost too much in that time. Good luck in your dealings with him.
Thanks again, Robin, for speaking before the STRS Board. That in itself speaks volumes to retirees. Good start -- keep it up! And yes, I agree with you that we do need to see more ORTA members at STRS Board meetings. If each RTA could sponsor (at least in part) one representative to attend each month, what a showing that would be!
Kathie Bracy
http://kathiebracy.blogspot.com/
MONDAY, JUNE 22, 2009
Mr. Nehf may also CRUSH STRS COLA
From Mario Iacone, June 22, 2009
The Atlanta Journal-Constitution
Published on: 10/25/07
In 2007, Mr. Nehf, Executive Director of STRS Ohio, stabilizes the Employees Retirement System of Georgia by cutting COLA benefits.
Excerpt from the article:
"State retirees are up in arms because, faced with frightening projections about future liabilities, the system's governing board broke tradition this year and approved a cost-of-living adjustment for ERS retirees of 1.5 percent, half the customary 3 percent boost. After legislators started taking heat, the board added another half percentage point to raise the COLA to 2 percent. The cost of living, as measured by the consumer price index, has risen 2.8 percent over the most recent 12 months.
"Over seven of the past 10 years, Nehf said, the rate of inflation has been less than 3 percent. Yet the retirement system has continued to pay 3 percent COLAs. Continuing that practice will lead to a $17 billion funding shortfall that another generation will have to pay. Currently, ERS expects to have 94.5 percent of the assets needed to pay promised benefits, leaving a manageable $781 million gap between assets and liabilities.
If 3 percent annual COLA increases continue into the future, however, assets will sink to 48.6 percent of the promised benefits by 2039.
"At that time, Mr. Nehf was Executive Director of Employees Retirement System of Georgia."
I have read your remarks in the May ORTA newsletter and wanted to commend you for them, and for speaking at the STRS Board meeting last month. I was unable to attend that meeting as I needed to be in NE Ohio at that time.
I'm glad you put a different slant on the need for retirees to see increases in their pension checks and asked for a road map with indicators of how the Board will determine when we can start seeing increases. Smart thinking! I'm glad (or at least I hope) you lit a fire under Mike Nehf in this regard. Don't let him drag his feet, though. There MUST be other ways to keep retirees' pensions from further sinking into the mire other than taking it out on them, particularly those with the smallest pensions.
When Nehf was hired at in 2008, we heard he had killed the COLA for retirees in his previous job in Georgia and were afraid it would happen to us. Well -- it did. Below is an article from my blog quoting the Atlanta Journal-Constitution in 2007. Perhaps it's not fair to put the blame on one person for the demise of a COLA, but I can't help wishing the STRS Board had been able to find an executive director who managed to save the COLA and other benefits for another pension system. Perhaps that's wishful thinking on my part.
Perhaps we need to keep our ear to the ground in case there is someone out there with a proven record of preventing the kinds of things that have been happening at STRS and who has the ability to turn things around. Such a person would definitely be worth a nice bonus. Mike's been here ten years, and retirees have lost too much in that time. Good luck in your dealings with him.
Thanks again, Robin, for speaking before the STRS Board. That in itself speaks volumes to retirees. Good start -- keep it up! And yes, I agree with you that we do need to see more ORTA members at STRS Board meetings. If each RTA could sponsor (at least in part) one representative to attend each month, what a showing that would be!
Kathie Bracy
http://kathiebracy.blogspot.com/
MONDAY, JUNE 22, 2009
Mr. Nehf may also CRUSH STRS COLA
From Mario Iacone, June 22, 2009
The Atlanta Journal-Constitution
Published on: 10/25/07
In 2007, Mr. Nehf, Executive Director of STRS Ohio, stabilizes the Employees Retirement System of Georgia by cutting COLA benefits.
Excerpt from the article:
"State retirees are up in arms because, faced with frightening projections about future liabilities, the system's governing board broke tradition this year and approved a cost-of-living adjustment for ERS retirees of 1.5 percent, half the customary 3 percent boost. After legislators started taking heat, the board added another half percentage point to raise the COLA to 2 percent. The cost of living, as measured by the consumer price index, has risen 2.8 percent over the most recent 12 months.
"Over seven of the past 10 years, Nehf said, the rate of inflation has been less than 3 percent. Yet the retirement system has continued to pay 3 percent COLAs. Continuing that practice will lead to a $17 billion funding shortfall that another generation will have to pay. Currently, ERS expects to have 94.5 percent of the assets needed to pay promised benefits, leaving a manageable $781 million gap between assets and liabilities.
If 3 percent annual COLA increases continue into the future, however, assets will sink to 48.6 percent of the promised benefits by 2039.
"At that time, Mr. Nehf was Executive Director of Employees Retirement System of Georgia."
posted by Kathie Bracy at 4:31 PM
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