Our STRS Board Members have adopted an Investment-Return-Assumption far under what STRS manage claims they have historically earned. This results in an unnecessary liability which has severely penalized both active and retired teachers.

Note:  The Forensic audit of STRS Ohio by Edward Siedle has been completed. If you are a friend of a teacher or an active teacher for more up to date information please visit this link:  https://www.strsohiowatchdogs.com/home 

STRS BOARD MEMBERS, WHAT'S GOING ON?

In Ohio the State Legislature wants each of Ohio's five retirement systems to be able to pay off their retirement liabilities within a 30 year funding period.  This requires each retirement system to understand what they historically earn over a 30 year period and project what they will earn over future 30 year periods. Each of the five retirement systems has the autonomy to project what they think they will earn.  This projected rate is called the Investment Earnings-Return- Assumption (ERA) or Discount Rate.

The Ohio State Teachers Retirement System has claimed they earn over 8.0% for each 30 year period. A responsible (ERA), would be to project a little less than what is actually earned to build in a margin of safety. When you project less than what you actually earn, you are by definition creating a paper liability.

Currently, Ohio STRS has roughly $90 billion to invest. So adopting a realistic (ERA) is important as it will have a huge impact on both retired and active teachers. In 2003, the (ERA) was set at 8%. This wasn't unrealistic because STRS was earning over 8.5%.   However, in 2012  the STRS Board lowered their (ERA) to 7.75%.  This .25% decrease (.25% is also called 25 basis points) created approximately an additional $15 billion in liabilities over the mandated 30 year funding period. In 2016, STRS again lowered their (ERA) from 7.75% to 7.45%,  thereby creating approximately another $15 billion in liabilities.  In 2021, the STRS Board further lowered their ERA to 7% creating yet more liabilities.  How did the actions of the STRS Board impact you? 

If you are a retired, or active, teacher they took away your promised COLA to help offset the huge liabilities they created on paper.  If you are an active teacher you now must work at least 5 years longer, plus they increased your employee contribution from 10% to 14% (a 40% increase).  Note, they didn't increase the 38 year old stagnant employer contribution. Active teachers probably have the worst pension deal of any teachers in the United States in terms of how much they are paying for what they will receive.  What can be done?

Active and retired teachers need to demand answers from STRS Board Members.  STRS Management claims they are actually earning over 30 year funding periods. If true, they why does management keeps approaching our Trustees to keep lower the earnings-rate-assumption? STRS Management keep telling members they are a top pension system as they reduce member benefits.  They are far from a top pension system.  STRS Management can't have it both ways.  Something is wrong and it is up to STRS Board Members to find out exactly what. It's time our Trustees quit rewarding them with millions of dollars in bonuses every year when sometime they lose billions.

The current (ERA) which is set at 100 basis points below what STRS Management claims it earns over the 30 year funding period is extreme and unacceptable. Let's demand that our Board hold STRS Management accountable.