Dan MacDonald reports on the November 13 STRS Board Education and Planning meeting

From Dan MacDonald

November 17, 2025

ELECTIONS TO BE HELD; NO 13TH CHECK!

I attended the STRS Board Education and Planning meeting on November 13th. I could not attend the Governance Committee meeting on November 14th because of an occupational therapy session.

This was not a regular Board meeting. No Public Participation, no Director’s Report, no Investment Report, no Routine matters or Old/new business. The meeting was called to order by Chair Dr. Rudy Fichtenbaum at 9:01. After some minute approval and small tasks, the meeting started with reports from the Finance Department. Outside consultant Cheiron presented the cost of COLAs [1%, 2%, 3%] for 2027 and the cost of reducing permanently the number of years of service, eligible at 30, 31, 32, 33. [Actives and retirees should not get their hopes up.] Although under the Sustainable Benefit Plan (SBP) there should be some de minimis money available for FY 2027, the cost of most of these is more than the money available. The fund is still approximately 21 billion dollars below being fully funded. Although the fund experienced a return on investments of 10.4% for FY 2025, it experienced a loss of basically 749 million dollars because of salary increases, retirement experience, new entrants and retirees. Much discussion around earning 10.4% and still experiencing an overall loss. [When given time and explained, and then re-explained, and then numbers shown, it begins to make sense against original assumptions.] A de minimis amount will be presented in April 2027 and could be used in the 2027 Budgeting process to maybe make some changes.

[What might this mean? A COLA might be possible for FY 2027; 33 years might be made permanent at a projected cost of 695 million; or nothing happens around benefit changes. I know this is confusing, but your current elected Board members are doing their best to balance actives/retirees while appointed Board members want to “slow things down” and “let time pass” before any additional benefit changes.

Remember there is a lawsuit regarding the Board’s composition and another that Dr. Fichtenbaum didn’t fulfill his fiduciary responsibilities and should be removed from the Board.]

A Supplemental Benefit Payment was discussed and dismissed. No motion was made.  [Think 13th check that would have been paid to retirees in February]

Actuary outside consultant Cheiron [think SBP and de minimis] contract is ending. A new RFP (Request for Proposal) must be issued. The Board motioned, agreed, and the request will be made.

Before lunch and an Executive Session, outside consultant Global Governance Advisors had a strategic planning session where the Board went over mission and vision statements along with guiding principles, themes, risk management and objectives, observations and oversight with proposed objectives, engagement and objectives, and sustainability and objectives. The Board was reminded that “Bad execution is where good strategy dies.” [This is the company that I accused of having a circus barker in my last report. This month when push-back came from Board members on certain wordings or items, Global fell back on “their years of experience” and a whole we know better, which might be true, but, to me, very arrogant, and at times, demeaning.]

After lunch/executive session, Executive Director Toole shared that market researcher Saperstein and Associates will be conducting a survey of actives and retirees and their thoughts, feelings and general impressions of STRS. [Please, if you get an email or call, be truthful and share your feelings, thoughts and concerns.] Surveying is to be completed before Christmas.

Also announced, there will be Spring elections held for a retiree seat and a contributing member seat [think active]. Depending on court rulings and appeals, the elected might never be seated, but the election proceeds because of court’s current ruling. A petition and information to run is available by calling STRS, 614-227-4090. Signatures must be presented to STRS by February 2026.

A benefit comparison was made with Ohio against 8 other non-social security states regarding contribution rates, net cash flow, 10-year investment returns, investment return assumptions, and new member eligibility: multiplier, FAS, age, COLA, Unreduced age/YOS. [Think California, Connecticut, Illinois, Kentucky, Louisiana, Massachusetts, Missouri, Texas.]  STRS was all over the place, as were they all.

The STRS Disability Program was then discussed in relationship to ORC (Ohio Revised Code).  According to STRS’s interpretation of the law, you are disabled until you are not. You are disabled under a specific disability.  Even after 25 years, your specific disability might suddenly become terminated from your doctor's reporting follow-up.  Elected members had issues with this. For instance, the “act of teaching” means if you are disabled do not teach Sunday School, professional development, gardening instruction, etc. We’re talking volunteer or paid. [What district desires to hire a teacher after years of disability?] There is much more to this sad situation in which elected members become dismayed of consultant doctors' and STRS staffs’ conclusions. [The answer must be something other than to start the process over with a new disability and proving it.] Follow-up discussion is to occur in December.

The meeting adjourned after Global Governance Advisors went over the 2022 Funston Audit Recommendations and Board decisions. As appointed Board member Allison stated, when can we put this to “bed?” [He is correct.] Many decisions were thrown into standing committees or challenged.

The meeting adjourned about 4:50 p.m. Next meeting dates December 10, 11, 12, 2025.