Bob Buerkle to Representative Rick Carfagna: Stop the rhetoric and find out why STRS can't afford a COLA for its retirees

From Bob Buerkle

To Representative Rick Carfagna

Sent: Wed, Jul 28, 2021 

Subject: STRS Funding Goal met; still no COLA

Dear Representative Carfagna,

You were quoted in the Columbus Dispatch on March 6, 2021, that "We are the envy, I believe, of the nation when it comes to managing our five retirement systems...," also saying, "Things get double and triple checked constantly.  You have different layers of independence that serves as checks and balances.  I feel very confident in the integrity of how all of our systems are governed and regulated."

Rep. Carfagna, please stop the rhetoric which only serves to put a political spin on a very serious situation. Instead, find out why a system like STRS, which just made over $20 billion dollars for the last FY, still cannot afford a COLA for its retirees.

Over the last 10-years STRS has averaged returns of over 10%, while they have purposely reduced their "Discount Rate" in three steps, from 8% to 7%, a move which has added about $30 billion of debt to our unfunded liability.  During this same 10-year period, STRS Investment Employees averaged $7 to $10 Million dollars in bonuses annually, while no STRS Retiree has received a COLA in over 5-years and no 2012 or earlier Retiree has received the COLA that they were promised for the last 9 years.  Do you find this equitable for our retired teachers?  I think you can understand why STRS Retirees are so upset, as they have every right to be.

Even after these discount cuts that created massive new debt, STRS has still improved its current "Funded Ratio" to over 86%.

The STRS Actuary has also recently stated that the cost of a permanent 2% COLA for all retirees for the next 30-years would only cost $12.79 billion, or about 57% of the investment returns made in the 2021 FY.

Do you also know that the STRS Defined Benefit Plan requires active teachers to make 14% contributions into a plan that the STRS Actuary says is only worth 10.6% in value?

We are not the envy of the nation but we might be the most delusional.

Please respond to my concerns.

Thank you,

Bob Buerkle

[Phone number]

Retired Cincinnati Teacher

CFT, OFT and AFT Life Member as well as a member of ORTA