Bob Buerkle minces no words: the scenario he predicted a dozen years ago is now a reality, and it isn't pretty; teachers, actives AND retirees, pay attention to this one! And guess who has no skin (or money) in the game! Read on.

From Bob Buerkle

April 26, 2025

Since the STRS Pension reform that began in 2013 I have stated several times that the way it was designed would cause friction between actives and retirees, and even disagreement inside of these two groups. That's where we are now.

Was/is it fair that mid-career teachers would be forced to work 5 more years? No! Was it fair that they, nor retirees were not grandfathered? No! Remember, only one career length year has been permanently lopped off so far. The temporary 32 year requirement is only valid through May 1, 2030 and the cost to fund this temporary improvement is One Billion, One-Hundred and Seventy-Seven Million Dollars. It only provides an earlier retirement opportunity for those few teachers with 27 or more years of service.

For less than the money the Board chose to spend, the actives could have had a 33-year retirement option for the next 22 years, leaving all of the teachers with careers between 11 and 26 years wondering, "why weren't you thinking about us?" This is a disagreement inside the actives group.

Can we now talk about the Retirees? Whenever a COLA is not received retirees suffer a permanent loss, meaning that their pensions will forever be smaller by the amount of, and the number of COLAs they were not paid. For instance, August 1, 2013 - June 1, 2014, retirees have now been denied COLAs in 10 different years and pre-2012 retirees have been denied COLAs worth over 26% of what they were promised! With the COLA changes starting on 07/01/2013, the STRS Actuary stated that this will save about $12 billion dollars. What does that mean? It means STRS will retain this $12 billion instead of paying it to the retirees who were told they would get it when they signed their retirement contract.

Now we get to the Board's April 17, 2025 decision. They decided to award only a 1.5% COLA, even though the Statute, ORC 3307.67, clearly states that a COLA of 2% SHALL BE PAID if the Actuary says it is affordable. Since over $2 billion was available, and a 2% COLA cost was only $882 million, that should have been the Board's decision. The Board could have still paid for a temporary 32-year retirement window, but only for four years instead of five.

This is the kind of friction that my first sentence referred to. I think the reform Board is trying to do what they can afford for as many as possible, but STRS Management knew this kind of conflict would happen when they proposed their draconian changes and without any grandfathering. And what do they care, they have no skin, or money, in the game!