Dan MacDonald to STRS Board: As always, actives need their benefits restored and retirees need permanent living purchasing power, COLA, restored.

Dan MacDonald's speech to STRS

April 18, 2024  

SHORT TERM SOLUTION VS. LONG TERM PROBLEM 

Mr. Chair and members of the Board, good morning.   I am Dan MacDonald, an STRS retiree with 38 plus years of service.  I am also the Executive Director of Local 279R, Northeast Ohio AFT retirees.   

At last month’s meeting a big decision was made. Cheiron made its presentation and listedoptions.  During Public Participation amongst fifteen participants, 2 actives and 2 retirees addressed striking a balance and enticements for a teaching career. Personally, I am worried about the creation of a divide between contributing members and retirees.  Board members, you are being closely watched.  Two of you seated up there were not present during Public Participation. One departed toward the end of the Executive Director’s Report, and the other left 14 seconds into the Chair’s statement concerning Public Participation.  Both returned after the lunch break.  Emergencies happen. I hope handed statements are read.   

After lunch the sustainable benefits enhancement plan, the de minimis plan, was shared and, eventually, a vote.  34 years was established.  34 years until 2036 and a 1 percent COLA was really not discussed at all and mentioned only in passing.  Vote 11-0.  For balance, the Board needs to make clear retirees are not forgotten.  The de minimis plan will continue to give de minimis results which yearly will pit contributing members against retirees.  There needs to be developed a financial plan to address the fund’s shortage of funds.  Contributing members should not reach 30 years retirement at the expense of retirees.  Furthermore, contributing members will soon discover no COLA and being screwed by an increase in FAS, YOS, formulary and other reductions, their lesser amounts of pension without COLA will find them battling the same problem that now exists.  Your short-term solution is not addressing the long-term problem.  Add to that, if the legislature passes a 4 percent employer contribution increase spread over 8 years, the fund is still short, better, but short.  All of you are passing the buck down the road and if you truly look at STRS Members Only Forum and STRS Ohio Watchdogs, your constituents do not understand. 

As always, actives need their benefits restored and retirees need permanent living purchasing power, COLA, restored.  

[After Public Participation Board Member Davidson gave me a paper titled 

“STRS ACTIVE vs RETIREES BENEFIT RESTORATIONS.”  

ACTIVE:  

Spring 2022 – Eliminate Age 60 Requirement $0.9 billion 

Spring 2023 – Temporary 34-year Unreduced Eligibility Period $0.365 billion 

Total Restoration $1.265 Billion  

RETIREE: 

Spring 2022-One Time 3% COLA $1.6 billion 

Spring 2023-One time 1% COLA $0.460 billion 

Total Restoration $2.96 billion] 

[My add: ACTIVE $0.838 billion Spring 2024 Unreduced retirement at age 34 years permanent, reduced at 29 years. Pretty close keeping in balance, BUT this insight should have been brought up during the public Board meeting for all to know at least one member's thought process.]