Dean Dennis to STRS Board: You are not fulfilling your part of the agreement

Dean Dennis’ speech to STRS Board

March 21, 2019 

My name is Dean Dennis. I am the STRS Chair for the CFT-Retirees Chapter and spokesperson for the Ohio STRS Member Only Forum. 

Today, I want to address our elected trustees regarding the goal of being 100% fully funded. Was this initially your goal, or management's? 

Are you aware of the financial and emotional harm being done to your OFT and OEA union brothers and sisters? The goal of being 100% funded should have been a marathon, not a sprint. Those retired, or only a few years away from retirement, never should have been caught up in this sprint. 

Many teachers retired abruptly to avoid the financial harm of having to wait 5 years without a COLA. They got sucker punched. Many weren't in a position to avoid the 5 year wait, now retired, they're watching the years tick by. As individuals all of you are better than that, can you be better collectively? 

I've heard statements that maybe when STRS becomes 80% or 85% funded, STRS might consider a COLA again. 

STRS started paying a COLA in 1971, 42 years ago when STRS was 59% funded. In the 42 years since, STRS has only been funded above 79%, 7 times. If 80% funding were to become the COLA standard, retirees would only average about 4 COLA's in their lifetime. Does this sound fair after a lifetime of service and COLA promises? 

Here's a question; wouldn't being at 100% fully funded require having the monies set aside to cover the liabilities for the pensions of both retired and active teachers? How are you going to do that? The average active teacher in Ohio still has another 20 years of contributions to make. 

I hope you see it's normal for a public pension system to be around 70% to 75% funded being that active teachers are still paying in to their pensions. It's abnormal for a public pension system to be 100% funded.
To move towards being 100% funded requires:

            • Excellent investments, over decades.

 • Making incremental adjustments - STRS should try to make incremental adjustments only to those yet to enter the system. Adjustments made after people enter, erodes trust in the system. Abrupt changes should not be made to those close to retirement. Stealing promised monies away from those after they retired, should never happen. 

• Cutting internal costs - Awarding bonuses 5 times the average teacher's pension in times when you can't provide a COLA also erodes trust in the system and makes you appear disingenuous. 

In closing, moving towards being 100% funded must be done ethically. 

Remember who you serve. We are very much aware that becoming 100% funded is a goal of management. Only make it your goal if you can move towards it ethically. 

Lastly and importantly, remember the concept of a Collective Bargaining Agreement. When a teacher retires they have fulfilled their part of the agreement. However, STRS is not fulfilling their part. It's undeniable that in all the STRS literature a COLA was promised upon retirement. 

As Trustees, as individuals, what are you going to do?
Thank you.