Dean Dennis to STRS Board: Some key points to consider

Dean Dennis' speech to the STRS Board

December 13, 2018

My name is Dean Dennis, I retired with 35 years from the Cincinnati Public Schools.

I want to start by reiterating some previous key points related to the COLA:

1) The stock market's 30 year rolling periods average is nearly 10%. Even in the 30 year period which included: Black Monday, Desert Storm, the Savings and Loan crisis, wars in Iraq and Afghanistan and three recessions, the market earned 9.99%. The Board should be comfortable in adjusting the earnings assumption upwards from 7.45%. We average 8.6% over the 30 year funding period and have always earned above 8%.

2) The Board should seek legislation to change the STRS funding period from 30 years to 35 years to better coincide with the present work requirement.

3) The Board should seek an increase in the employer contribution. Ohio Revised Code 3307.14 states that if STRS Ohio cannot meet its financial obligations, the burden falls on the employer, not the employee. The Ohio teacher contribution rates have increased multiple times and are now the highest in the United States for any teacher; all the while, employer contribution rates haven't increased a penny in 35 years.

This is a prime time to approach the Legislature. Ohio House Bill 413 is on the radar screen of legislators and they know that Ohio's employers have been receiving roughly a billion dollars annually from Worker Compensation surplus rebates.

Not only is it a prime time to approach the Legislator, it could be considered an obligation from reading the recently revised Ohio Board Policies. Under the Policy Titled: Board Member Education, it states, "the topics Board Members need to be knowledgeable about include, but are not limited to, the following," listed #2 is, Legal framework of the Retirement System. The above mentioned code, ORC 3307.14 addresses STRS and how financial shortcomings need to be made up by an additional employer rate of contribution.

Regarding more Board Policies:

Under Member Benefits which includes health care; I'd like to suggest that since 10% of retirees receive an annual $5,000 benefit related to Medicare Part A, of which 90% of retirees are not receiving, and since our Health Care Reserve is 170% fully funded, that the Trustees explore creating a Medical Benefit Bank for the 90%. This could be done by utilizing the 70% from the 170%. The Health Care Reserve could still remain 100% fully funded. This seems both fair and doable. I'm not suggesting anyone lose any benefits. I am suggesting you create an additional benefit with the excess money in the Health Care Reserve. It is our money and without a COLA it is a way to create a useful benefit.

Last, but not least, the policy under Public Participation at Board Meetings. The Board only allots 45 minutes to a maximum of 15 speakers granting 3 minutes to each speaker.

I hope the Trustees can see how ridiculous this is. Within about 90 seconds after stating your name, who you represent, your number of years of service, you are being interrupted to be told that you only have a minute left.

You can't send a more clear message that we aren't important. It would be appreciated if this policy could be reviewed. Some of us are making round trips totaling over 200 miles only to have to rush through a 3 minute presentation.

We'd like to think that you think we have something of value to say.

Thank you.