Important message from ORTA President Dean Dennis; see how ORTA is working to help all of us, and what you need to know

From the ORTA December 2023 Newsletter

December 15, 2023

Message from Dean Dennis, President 

Greetings Members! 

I hope everyone will be able to spend some quality time with loved ones this holiday season. 

As I reflect on this past year, I believe ORTA has laid the foundation for an optimistic future for our organization. When ORTA changed our name to the Ohio Retirement for Teachers Association, we were able to keep our 76-year-old acronym, ORTA, and update our logo. In an executive council meeting, it was noted that our old logo with the flame over the "O" was also being used by heating companies driving around in Ohio. We replaced the red flame with a mortarboard. The name change was made to let STRS members know that ORTA wasn't trying to exclude active teachers. ORTA understands that a healthy pension system benefits all members both active and retired. 

Planning for the future, ORTA leadership decided to completely revamp our website and social media pages. The website has been receiving high praise and is attracting a lot of traffic. For example, this November there were 9,253 hits. That's a lot for one month! Compare this to the entire 2022 calendar year, when we had a grand total of 1,781 hits. Read about the ORTA defense fund, where you can make donations to support ORTA's mission statement. You'll also find Member benefits available though AMBA and Passport that likely you never knew existed. ORTA now also offers a 3-year membership for only $75. Also new, through ORTA's partnership with AMBA, a classroom teacher, or someone who goes back into the classroom as a substitute, can now obtain $500,000 of classroom liability for only $75 a year. But the best part of the website is the blog, that keeps you up to date with news about your pension system. 

On the political side, ORTA has been seeking out and successfully working with other reform minded groups to elect Board Members to serve as strong fiduciaries. The last five candidates we supported have been elected to seats on the STRS board. On the legislative front, just this month, a piece of legislation initiated by ORTA, House Bill 78, passed the House and seems on track to become an Ohio code. House Bill 78 allows a rehired retiree who returned back to work for a school district the opportunity to run for a Retired Board seat. Previously, a rehired retiree was denied this opportunity under Ohio's codes. Representatives William Seitz (R) and Joseph Miller(D) sponsored this legislation. 

Here is another piece of legislation ORTA has initiated, which should be of great interest to all retirees living in Ohio. While the legislation has not been introduced, it has passed review by the Ohio Legislative Service Commission and forwarded for the next step. The context of the legislation would provide an Ohio personal income tax exemption for all members drawing a pension from one of Ohio's five pension systems. The exemption would be capped to match the Social Security maximum tax exemption which is roughly $42,000. So, if your pension is under $42,000, then 100% of your STRS pension would be tax free. Again, this legislation is in its early stage but I feel confident it will have the support because Social Security pensions are tax exempt in Ohio. ORTA is working with Representative William (Bill) Seitz on this legislation. 

Lastly, but importantly, you are likely hearing some buzz that the nearly 40 year old stagnant Employers Contribution needs to be raised. Here are my thoughts. It absolutely needs to happen. The reasoning is simple. The mess we are currently experiencing, such as teachers having to work longer by as much as 5 years, or until they hit age 65 for a full formula retirement, is too extreme. This has happened because the Employers Contribution has been stagnant since 1984. Ohio's Employer Contribution lags the other non Social-Security state by roughly 8%. Basically, when it comes to public pension systems, our teachers contribute the most while their employers contribute the least. This is why Ohio teachers have to work longer while they pay more. The stagnant Employers Contribution is also why teachers retire without any inflation protection. Ohio retirees know this better than anyone. 

Please know that the proposal, which has yet to be drafted as legislation, would increase the Employer Contribution from 14% to 18% over an eight year period. This phase-in would be doable for school districts. If this legislation were to be passed, the STRS auditors would be able to work the designated monies into their assumptions. In doing so, our Trustees would have more wiggle room to restore lost benefits. For instance, if older teachers are able to retire earlier then this would free up monies for hiring younger teachers at a savings for the district. The additional revenue would also open the door for possible inflation protection. 

Finally, after years of lobbying STRS that they needed to lobby the legislature for an Employer Contribution (ORTA has been bringing this up at Board meetings for at least 5 years), STRS has come around. STRS has drafted a letter and is asking ORTA and other stakeholders such as OFT, AAUP and OEA, for a letter of support for the Employer Contribution increase. ORTA has submitted a letter. ORTA believes that this is a missing piece of the puzzle to restore lost benefits along with more transparent investments. As always, my best to all of you.