Tuesday, June 11, 2019

From Suzanne Laird: 403wise newsletter posts Dispatch article on STRS lawsuit

Retired teachers file class action lawsuit over state benefits cut

By Ben Deeter
The Columbus Dispatch
Posted May 24, 2019 at 12:41 PM
Updated May 24, 2019 at 12:59 PM
Dean Dennis and Robert Buerkle spent much of their lives in the classroom. Between them, the two have more than 60 years of teaching experience in Cincinnati Public Schools.
After decades of instructing, grading and mentoring a generation of students, they expected to join many of their colleagues in relatively comfortable retirement. Dennis and Buerkle had paid into the State Teachers Retirement System of Ohio (STRS) throughout their careers.
STRS is one of the largest public pension funds in the United States, serving nearly 500,000 active, inactive and retired public educators in Ohio.
Now, however, the two men are plaintiffs in a class action lawsuit against STRS.
In 2017, the STRS board effectively eliminated the cost-of-living adjustment for its beneficiaries indefinitely, lowering the increase rate from two percent to zero.
This means that pension payments for thousands of retired public educators in Ohio have been locked at the same level with no increase for nearly two years.
“Teachers generally don’t make much compared to others,” said Jeffrey S. Goldenberg, one of the attorneys representing the plaintiffs. “The pot at the end of the rainbow for them is their retirement.
“And now, they’re not getting the payments they were promised. Ultimately, if this continues into the future, it’s going to be a problem for them.”
The complaint filed in U.S. District Court for the Southern District of Ohio alleges that the board violated Ohio law in lowering the rate. Dennis and Buerkle are suing for themselves and on behalf of a class of more than 145,000 other public educators who would have received the cost-of-living adjustment.
The General Assembly amended the law governing STRS in 2012 to mandate that the state teachers retirement board increase the amount of any allowance or benefit by two percent every year after July 2013.
But the change also gave the board the power to adjust the annual increase if it is “necessary to preserve the fiscal integrity of the system.” If the board deems such an adjustment necessary, the law requires that the conclusion be set forth in the annual actuarial valuation or other evaluations.
The complaint alleges that while the board has the power to adjust the increase, it did not say in any report that eliminating cost-of-living adjustments was necessary to preserve the fiscal integrity of STRS.
“The board has chosen to try to bring stability to the fund on the backs of retired teachers,” Goldenberg said.
Dennis and Buerkle are seeking a ruling that would prevent the board from continuing to not pay the cost-of-living adjustment. They also seek damages equivalent to the benefits they have lost as a result of the increase’s elimination.
The teachers retirement system could not be reached for comment.
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