April 8, 2021
Town Hall with Rudy, Liz, and Ben

Watch this recording of the Town Hall on April 8th with Rudy Fichtenbaum, Elizabeth Jones, and Ben Pfeiffer, candidates for the STRS Ohio Retirement Board.

Rudy, Elizabeth, and Ben are endorsed by the Ohio Federation of Teachers (OFT) and the Ohio Conference of the American Association of University Professors (AAUP).

"We have been sold a false dichotomy that we cannot have the pension we were promised in order to have a pension at all. It's possible to keep promises to active and retired educators and still be good fiduciaries of the STRS system. As Board members, that's what we plan to do." - Rudy Fichtenbaum and Elizabeth Jones

STRS Ohio Systematically Overstates Its Returns 2021.4.1.pdf

April 1, 2021
STRS Ohio Systematically Overstates Its Returns

By Rudy Fichtenbaum

In this post I will discuss how STRS systematically overstates its returns. The incentive for overstating returns is clear: higher returns mean bigger bonuses for the investment staff.

If you elect me to the STRS Board, I will be your advocate and do my best to get you the truth about what is going on at STRS. In addition, I will fight to change the culture at STRS to ensure that it puts member’s interests first. That means reducing expenses, fighting to increase employer contributions and restoring the COLA.

How transparent is STRS Ohio 2021.3.28

March 28, 2021
How transparent is STRS?

By Rudy Fichtenbaum

Rudy Fichtenbaum is a Professor Emeritus of Economics at Wright State University. He has a Ph.D. in Economics from the University of Missouri-Columbia.

If you elect me to the STRS Board, I will be your advocate and do my best to get you the truth about what is going on at STRS. In addition, I will fight to change the culture at STRS to ensure that it puts member’s interests first. That means reducing expenses, fighting to increase employer contributions and restoring the COLA.

March 15, 2021
Ohio Legislators: Are you aware of what has been happening with STRS?

Nearly a half-million retired, active and substitute teachers have paid into STRS Ohio. The vast majority of these contributors will need to depend upon STRS for their retirement since Ohio is a Non- Social Security State.

In September of 2012, the Ohio Legislature voted on legislation that deeply impacted Ohio's retired and active teachers. This legislation became law on January 7, 2013. As of July 1, 2013, active teachers have been required to work more years and contribute more of their salaries to STRS. Teachers retired prior to that date have not received a single COLA that was promised to them for the past 9 years. Retirees complain that, “even Social Security pays a COLA”. Research shows that in the average Non-Social Security State, the Employer's Contribution is 12% higher than that of the Employee Contribution towards their Pension Plan. But in Ohio this isn't the case; the Employer Contribution is exactly 0% higher. In essence, in Ohio, our teachers pay the most while our employers are allowed to pay the least. The maximum Employer's Contribution hasn't been raised in nearly 40 years.

The harsh legislation also turned over control of the teachers' COLA to the STRS Board. That was a mistake. The Ohio Legislature gave STRS the authority to "adjust" the COLA. The STRS Trustees completely eliminated it. STRS retirees have seen nearly 30,000 of their peers die without receiving their promised COLA. This wasn't lost on Representative Bill Seitz who, in a strongly worded letter to the STRS Board, expressed his "support of a growing coalition of STRS retirees to request relief from the harsh decision made by STRS to reduce to zero for at least 5 years the COLA adjustment for all existing and new retirees". Imagine if the OPERS Board had been granted the power to eliminate the COLA for their retirees.

As members of the Ohio Legislature, you need to step up. The Ohio Legislature needs to take back control of the COLA. There is no equity among Ohio's pension systems and no intergenerational equity within STRS Ohio. The trust level of STRS members is so low that recently they raised $75,000 within three short months for an outside forensic audit of STRS. The forensic audit is currently being conducted by Edward Siedle, a former SEC lawyer and Forbes Magazine contributor.

In Ohio, an outside fiduciary audit is supposed to be conducted every 10 years. STRS has gone over 14 years without such an audit. Meanwhile, retirees go without their promised COLA.

What will an outside forensic audit or outside fiduciary audit find? That remains to be determined. A recent news article has drawn attention to an STRS investment that went bankrupt (https://www.msn.com/en-us/money/savingandinvesting/damschroder-ohio-teachers-pension-mauled-by-panda/ar-BB1ebNBd ). The Panda International investment raises the question: has STRS Ohio lost hundreds of millions of dollars? Panda International is only 1 of over 130 Alternate Investments STRS Ohio is showing in their CAFRs report. It is interesting, because Panda filed for bankruptcy in 2017 but STRS is still holding them as an investment. (see the Open Letter to STRS Trustees on the STRS Ohio Watchdogs website for more detailed information)

Another article that raises concerns is a recent article regarding the Pennsylvania pension system. This article brought up the practice of hidden fees often referred to as "carried interest". (https://www.inquirer.com/business/joe-torsella-treasurer-pa-pennsylvania-psers-pensions-teachers-lost-harrisburg-20210220.html). The Ohio Legislature needs to investigate and guarantee that this is not a practice of its five pension systems; in particular STRS.

Members of STRS are constantly told by STRS management how well the pension is run. Members are continually told that it is one of the top pension systems in the nation. If true, the STRS Ohio Watchdogs want to know why STRS cannot provide a simple COLA to their dedicated retirees while over 90 STRS investment staff members annually receive six-figure performance bonus incentives.

Ohio Legislators, are you aware of what has been happening with STRS?

Dean Dennis
March 15, 2021

March 11, 2021
Open Letter to STRS Ohio Trustees

Trustees,

John Damschroder's "Panda article" certainly caught my attention. Here it is, if you haven't already read it. https://www.thenews-messenger.com/.../damschr.../6883736002/

You may have also seen a recent article in the Columbus Dispatch titled, "Mismanagement or misunderstanding? The outside audit of Ohio's pension fund explained." I think there is a case for "mismanagement."

Below you will find some research on the Panda investment. I thought it was prudent to share; I hope you will find it of value.

http://www.orsc.org/Assets/Reports/816.pdf (see page 29, STRS invests at least $345,000,000 in Panda Power)

https://www.institutionalinvestor.com/.../yield-hungry... (STRS Ohio is first Pension System Mentioned)

https://www.powermag.com/panda-power-funds-rolls-on-with.../ (Risky Investment)

https://www.utilitydive.com/.../panda-temple.../442582/ (Panda goes bankrupt)

https://www.dallasnews.com/.../panda-energys-backing.../ (on the way to bankruptcy Panda invests in wrestling/daughter)

https://www.strsoh.org/_pdfs/annual-reports/50-143-19.pdf (see actual page 59. We still carry Panda as an Alternative Investment and have done so since we first got involved)

Panda is only one of our 130 plus Alternative investments. As retirees go more than half-a-decade without their promised COLA, the question needs to be asked, how much money can Trustees find in investments gone awry that likely have numerous hidden fees?

Trustees, let's diligently manage our outside auditors and guarantee to members they look at our Alternative Investments both painfully meticulously. We need to make sure all expenses and fees for every investment are accounted for.

Let's also diligently manage the STRS management regarding the Forensic Audit. The $75,000 members raised for this audit equates to less than one-millionth of our $80 billion investment portfolio. No one knows what the audit will find, perhaps nothing. However, when retirees are constantly told by STRS how great STRS is doing while they go year after year without a COLA, and as active teachers work longer and contribute more for less, I think you can understand why the forensic audit is a reality.

Additionally, realize that the outside State of Ohio required fiduciary audit that is supposed to occur every 10 years has now gone more than 14 years without happening. This key piece of information wasn't highlighted by the Columbus Dispatch when they were explaining the outside audit to their readers. That said, please make sure that STRS management is transparent when it comes to all public information requests related to the forensic audit.

My best and thank you for the time you commit,

Dean Dennis
March 11, 2021

March 3, 2021
Ohio Teachers Pension Mauled By Panda

The Ohio teachers’ pension was one of the first investors in Dallas-based Panda Power. Panda is a merchant generator building plants run by cheap shale gas to produce more profitable electricity. The business model collapsed when utility regulators did not approve anticipated rates. Panda’s bankruptcy filing showed debt of $400 million against cash on hand of $2,000.

Click here to read John Damschroder's article in the Fremont News Messenger.

February 19, 2021

Forensic Audit: Game On!


Former SEC attorney and pension investigator Edward "Ted" Siedle has begun the forensic review of STRS Ohio which our Forum and the Watchdogs Forum coordinated with ORTA and ran through ORTA who commissioned the audit.


At the outset, it is clear to Ted that the pension is not as transparent as it needs to be. A tremendous amount of information regarding management of the investments has not been made public and he will need additional information from STRS. His first document request was sent today to STRS by attorney Marc Dann. Hopefully, STRS will recognize the value of the ORTA-sponsored review and choose to fully cooperate, rather than litigate.


Please take a moment to look at the document request to appreciate the depth of investigation required to determine whether our pension is being handled prudently.


Dean Dennis
February 19, 2021


Click here to view the public records request.

February 11, 2021

State Teachers Retirement System of Ohio Investigation Invites Whistleblower, Expert and Public Participation

The goal is to improve management of the massive teachers pension system and the retirement security of its participants. Click here to read the full article in Forbes.


February 10, 2021
Pension Health Update

The purpose of this article is to put the health of our pension in perspective.

As has been discussed before, STRS has about 51% of our monies invested in the stock market. One of the easiest ways to measure what impacts pension health is to look at what is happening to the stock market. The most conservative indicator is to use the S&P 500 index. The average annualized total return for the S&P 500 index over the past 90 years is 9.8 percent.

To review, other STRS investments such as real estate, hedge funds and venture capital investments are harder to quantify. It is the opinion of the Watchdogs that for the long term, not enough of STRS pension investments are in equities like the S&P 500 index.

A year ago, on 2/10/20, the S&P 500 stood at 3,318 points. However, the stock market took a tumble resulting from the COVID-19 quarantine and dropped to a low of 2,237. Afterwards, the market began a remarkable recovery. Since STRS Ohio is on a fiscal period that runs annually from July 1 through June 30, we will examine how STRS compared to the S&P 500.

On 7/1/19, the S&P 500 stood at 2,990 points. On 6/30/20, the S&P 500 stood at 3,130 points. This is a gain of 4.68%. For the same fiscal period, STRS Ohio gained 3.14%. This is roughly 33% less than the performance of the S&P 500. Calculated on STRS's $80 billion of investment monies, this means STRS Ohio underperformance to the S&P 500 cost our pension system roughly $1.2 billion.

Now, for some optimism. At the time of this update, the S&P 500 stands at 3,908 points. Using our STRS Fiscal Year starting point, on 7/1/20 the S&P 500 began at 2,971 points; this means the S&P 500 is currently up 25.4% during this STRS Fiscal Year. While we missed last year's Earning Rate Assumption by 4.3%, this year we could possibly be 17.95% above our 7.45% Earnings Rate Assumption. Let's hope STRS Ohio is investing our monies wisely and are close to what the market is giving us.

Lastly, we must fight this parity battle. When STRS pays its obligated pension benefits, roughly 50% are derived from the combination of Employer and Employee Contributions; the other 50% is derived from STRS investments. STRS needs to earn about $3.75 billion to cover pension costs. Over the last 40 years, Employee Contributions have risen to the point that they are among the highest in the nation. Our Employer Contribution Rates are among the lowest in the nation and haven't been increased in 40 years.

Please check this fact: Ohio is a non-Social Security State and Ohio lags behind the other non-Social Security States by an average of over 8% when it comes to the Employer Contribution.

Legislators, members of the STRS Ohio Watchdogs cannot support you if you are ignoring this important equity issue. STRS members pay more and receive less.

Dean Dennis
February 10, 2021

Click here for past Pension Health Updates

February 4, 2021
Ohio Retired Teacher Group Wants $78.4 Billion Pension System Audited

A coalition of retired teachers raised $75,000 to hire an outside auditor to comb through the books of the State Teachers Retirement System of Ohio.

The Ohio Association of Retired Teachers will hire Edward Siedle, a former Securities and Exchange Commission attorney, to conduct a forensic audit of STRS. Click here to read the article.

February 3, 2021
John Damschroeder: Collective Action Still Works

"The Ohio Retired Teachers Association (ORTA) raised $75,000 in donations to pay attorney-author Edward Siedle to conduct a forensic audit of the State Teachers Retirement System. ORTA wants to know why retiree cost-of-living-adjustments were cut in 2012 and eliminated in 2017, with no plans to resume the COLA payments for at least 15 years." Click here to read the article.

Action to Audit STRS, See How You Can Help!

By Dean Dennis

Cincinnati, OH, United States

NOV 13, 2020 —

STRS Ohio has not had an audit in over a decade. STRS contracts with an outside firm named Clifton Larson Allen (CLA), thus they become a paid client of STRS. CLA then only "verifies" if the numbers, provided by STRS, are "accurate." So one can see, there is no auditing on the $80 billion dollars being used for investments. These monies were provided to STRS Ohio by active teachers contributions, retired teachers contributions and employer (public) contributions. This is unacceptable. What can be done?

The Ohio STRS Members Only Forum, STRS Ohio Watchdogs and the Ohio Retired Teachers Association (ORTA) have teamed to hold STRS accountable. ORTA has set up an account to raise monies for a Forensic Audit of STRS. You can help by clicking this link https://www.orta.org/donations and donating $20 (active teachers and members of the public please scroll down to the bottom of the page when you click the link). So who will conduct the audit?

One of the top, if not the top, Forensic Auditors in the United States, Edward 'Ted' Siedle, has agreed to perform this audit for $75,000, monies we need to raise. Edward Siedle is the principal of Benchmark Financial Services and author of Who Stole My Pension. He is also a former U.S. Securities and Exchange Commission attorney and globally recognized as one of the top experts in pensions. His firm, Benchmark Financial Services, Inc., has conducted well over $1 trillion in reviews of pensions on behalf of pension plan sponsors and pension participants.

Forensic audits look for many things including mismanagement of funds, conflicts of interests, misappropriations of assets, and financial statement fraud. Edward Siedle's audit of STRS Ohio will take many months and will produce an understandable nearly 100 page report stating the problems he sees with how STRS is conducting business. Hopefully this will put STRS on a path that will benefit retirees, active teachers and the public. Thank you if you decide to contribute.

Note: If for some reason the donation levels do not reach the required levels to engage Mr. Siedle ($75,000 needed), donations of $45 or more to the forensic audit account will be returned to the person making the donation. Donations of less than $45 will be converted to ORTA memberships. If donations exceed the fees needed to pay to Mr. Siedle, the remaining funds will be deposited into the ORTA Foundation. ORTA will closely monitor donations to try to keep this from happening.

The Time Has Come! ORTA Announces Effort to Review STRS Finances

By Dr. Robin Rayfield, Executive Director

Ohio Retired Teachers Association (ORTA)

October 27, 2020

The ORTA Board recently voted to serve as the fiscal agent for an effort to engage Edward Siedle to conduct a forensic audit of the STRS pension system. Edward ‘Ted’ Siedle (principal of Benchmark Financial Services) is a former U.S. Securities and Exchange Commission attorney and globally recognized expert in pensions. His firm, Benchmark Financial Services, Inc., has conducted well over $1 trillion in reviews of pensions on behalf of pension plan sponsors and pension participants.

Click here to learn more about Mr. Siedle.

This decision did not come easily. Throughout ORTA’s 73-year history of advocacy for the retired educators, ORTA has strived to ‘keep peace’ with STRS and avoid controversy. However, since the promised benefits to STRS retirees have been steadily reduced since 2013, and there is no planned return of these promised benefits, it is time for a review of what is taking place with our pension fund. STRS is in the best financial shape of the 5 public pension systems in Ohio, however, STRS retirees have gone at least 4 years without receiving the benefits they were promised. Some retirees have gone 8 years without an increase in retirement benefits! The loss of COLA, despite being promised by STRS and guaranteed in Ohio law at the time of retirement has no end in sight. When pressed for answers, STRS leadership simply states, ‘STRS will only consider providing a COLA after the pension system has reached a funding level of 85%’. Keep in mind that in over 100 years of existence STRS has only been at funding level of 85% or above a handful of times and has not been at 85% or more in the past decade. At the October STRS meeting the paid financial consultant for STRS (Cheiron) indicated that STRS is not likely to reach the 85% funding threshold for many years.

Thus, ORTA has agreed to participate in the collection of donations from STRS members to pay the fees associated with this external and independent review of STRS. To collect these donations ORTA has established an account at our partner Education First Credit Union. All donations collected for this purpose will be deposited into the Forensic Audit Account. There will be several ways that you can donate towards our goal of raising the $75,000 required for this forensic audit.

Click here to go to the ORTA website and make your donation.

To: ALL Ohio Legislators
From: Ohio Retired Teacher Association (ORTA) & Supported by the STRS Ohio Watchdogs

July 23, 2020

Greetings Ohio Legislators!

The Ohio Retired Teachers Association (ORTA) has been advocating for Ohio’s STRS retirees since its creation in 1947. Despite our best efforts, Ohio’s STRS retirees have experienced a loss of these promised benefits beginning in 2013 with a one-year freeze of our 3% COLA, followed by a three-year, 1% reduction of our COLA to 2%, and then followed by 5 fiscal years of total COLA elimination since 2017; unless Ohio's Legislators intervene. This has created a significant financial burden on retired educators. Since Ohio’s Legislators handed over control of STRS COLA decisions to the STRS Board of Trustees, our retirees have witnessed pension cuts that were guaranteed by Ohio Revised Code. While STRS retirees have lost the value of 7 promised cost of living adjustments, other Ohio public employee retirement systems have been more faithful to the promise that was made to their retirees, even though the financial strength of STRS equals or exceeds all of the other Pension Plans. Please review the information compiled by two ORTA members below:

Comparing Ohio’s Five Retirement Plans
by Bob Buerkle and Dean Dennis

The most recent Ohio Retirement Study Council (ORSC) Annual Report, issued March 4, 2020, is interesting. The report shows the 30-year funding plans for all five systems required by the Legislature. If a plan exceeds 30 years, they must develop a plan to lower their funding level to 30 years or below in the future. An indicator of the strength of a system is how many years the unfunded liability is from becoming fully funded. So, the lower the number of years (the closer to zero), the stronger the pension plan. The ORSC Chart indicates the following:

  1. STRS is best at 16.6 years, averaging about 10 years ahead of the other four plans.

  2. PERS is at 27 years

  3. OP&F is at 29 years

  4. SERS is at 25 years

  5. HPRS is at 23 years

Also, in the latest ORSC Annual Report, are the 10-year averages for the investment returns for all five plans. The report also lists the Earnings Rate Assumption of each of the five plans. This is important because it helps determine if each plan is exceeding what they expect to earn or is falling short. This is measured in Basis Points (bps). A Basis Point (bps) is one hundredth of 1%. So, if a pension plan is expected to earn 8% (Earnings Rate Assumption) but earned 9%, they would have earned 100 Basis Points (bps) more.

  1. STRS is best, earning 10.31% (averaging nearly a full percent ahead of the other four plans)

  2. PERS earned 9.69%

  3. OP&F earned 10.24%

  4. SERS earned 9.42%

  5. HPRS earned 8.77%

It is important to note that all 5 of Ohio's pension plans earned more than their expected Earnings Rate Assumptions. Over the 10-year period, STRS again performed the best, earning 286 bps over their Earnings Rate Assumption. In fact, STRS performs the best in every financial performance category rating except in "Funded Ratio" ,where they are at 76%, second to PERS at 77%.

Now that we have established the strength of Ohio's 5 pension plans, let’s compare the COLA policies:

  1. STRS- no one has received a COLA since 2017, nothing is in sight. Retirees were not grandfathered.

  2. OPERS-pays a 3% COLA to all pre-2013 retirees and the lower of CPI or 3% to post 2013 retirees.

  3. OP&F- pays a 3% COLA to pre-2013 retirees and future retirees who had 15 or more years of service in 2013

  4. SERS-plans to restart their COLA at the lesser of CPI or 2.5%, in 2021, after a 3-year suspension

  5. HPRS-reviews actuarial reports each year to determine their COLA. In recent years it has been around 1.5%.

ORTA asks that all elected representatives and senators place this issue as a high priority in the next legislative session. Over the next couple of months, ORTA will offer suggestions as to how this issue might be addressed. With the STRS Board ignoring our plight, the only place STRS retirees can turn is to you, our elected officials. A pension that doesn't have a growth component, such as a COLA, is not a pension; it essentially amounts to an annual stipend. Teachers were promised a pension with a COLA for their decades of service, not a stipend.

Prior to the November election, ORTA plans to issue a survey to all Ohio Legislators. The survey will ask for a simple “YES” or “NO” response as to whether or not you will vote to support providing Ohio’s retired educators with what they were promised (a pension that grows annually throughout retirement).

We will share your support on our website, and other websites we support, that will reach over 50,000 STRS Members along with their families and friends.

Please respond to this email that you have received our correspondence at rrayfield@orta.org

Robin Rayfield, Executive Director
Ohio Retired Teachers Association
250 E. Wilson Bridge Road
Suite 150
Worthington, OH 43085

July 2, 2020

Pension Health Update
By Dean Dennis

The purpose of this article is to put our pension plan in perspective with the other Ohio pension plans. The most recent Ohio Retirement Study Council (ORSC) Annual Report issued March 4, 2020 is interesting. The report shows the 30-year funding plans for all five systems required by the Legislature. If a plan exceeds 30 years, that pension plan must develop a plan to lower their funding level to 30 years or less in the future. An indicator of the strength of a system is how many years the unfunded liability is from becoming fully funded. So, the lower the number of years (the closer to zero), the stronger the pension plan. The ORSC Chart indicates the following:

1) STRS is best at 16.6 years, averaging about 10 years ahead of the other four plans.

2) PERS is at 27 years

3) OP&F is at 29 years

4) SERS is at 25 years

5) HPRS is at 23 years

Also, in the latest ORSC Annual Report is the 10-year averages for the investment returns for all five plans. The report also lists the Earnings Rate Assumption of each of the five plans. This is important because it helps determine if each plan is exceeding what they expect to earn, or is falling short. This is measured in Basis Points (bps). A Basis Point (bps) is one hundredth of 1%. So, if a pension plan expected to earn 8% (Earnings Rate Assumption) but actually earned 9%, they would have earned 100 Basis Points (bps) more.

1) STRS is best earning 10.31% (averaging nearly a full percent ahead of the other four plans)

2) PERS earned 9.69%

3) OP&F earned 10.24%

4) SERS earned 9.42%

5) HPRS earned 8.77%

It is important to note that all 5 of Ohio's pension plans earned more than their expected Earnings Rate Assumptions. Over the 10 year period STRS again performed the best earning 286 bps over their Earnings Rate Assumption. In fact STRS performs the best in every financial performance category rating except in "Funded Ratio" where they are at 76%, second to PERS at 77%.

Now that we have established the strength of Ohio's 5 pension plans, let’s compare the COLA policies:

1) STRS- no one has received a COLA since 2017, nothing is in sight. Retirees were not grandfathered.

2) OPERS-pays a 3% COLA to all pre-2013 retirees and the lower of CPI or 3% to post 2013 retirees.

3) OP&F- pays a 3% COLA to pre-2013 retirees and future retirees who had 15 or more years of service in 2013

4) SERS-plans to restart their COLA at the lesser of CPI or 2.5%, in 2021 after a 3-year suspension

5) HPRS-reviews actuarial report each year to determine their COLA. In recent years it has been around 1.5%.

WHAT’S WRONG WITH THIS PICTURE AND WHEN WILL THE LEGISLATURE HELP STRS RETIREES?

Pension Health Update

June 1, 2020
By Dean Dennis

The purpose of this article is to put the health of our pension in perspective after the stock market tumble resulting from the COVID-19 quarantine. My April 29, 2020, letter explained that while our pension certainly took a hit, it is also certainly safe and remains healthy.

The previous article explained that STRS has about 51% of our monies invested in the stock market and one of the easiest ways to measure what happened to the stock market is to utilize one of the best stock market indicators, the S&P 500 index. Again, as a way of review, using the S&P 500 index, the S&P 500 fell from a high of 3,386 points on February 19, 2020, to a low of 2,237 points. This equals to a drop of about 33%. However since the drop, the market has recovered substantially.

Previously explained, the STRS fiscal year began on July 1, 2019 and will end on June 30, 2020. On July 1, 2019, the S&P 500 was at 2,942 points. At the end of April the S&P 500 was at 2,836 points.

Now for some good news, at the time of this update, the S&P 500 is at 3,056 points. During the past 30 days, the S&P 500 has gained 220 points for a 7% increase. This gain puts the S&P 500 up 114 points from where the STRS Fiscal Year began for an overall 3.8% increase. This is positive news because a month ago the S&P 500 was down approximately 3.5% from where STRS began their Fiscal Year. Let's hope STRS is matching the S&P 500.

There is another reason this is positive news. When STRS pays its obligated pension benefits, roughly 50% are funded by the combination of the Employer and Employee Contributions and the other roughly 50% is funded from STRS investments. STRS began the year with approximately $77 billion for investments. Annually, STRS needs to earn about $3.75 billion to cover pension costs. If STRS investments are mirroring S&P 500 results, then STRS should be near covering these costs.

Pension Health Update

April 29, 2020

By Dean Dennis

I wanted to put the health of our pension in perspective. It is understandable that members are wondering if our pension system is safe after the COVID-19 quarantine and all the news about the stock market tumbling. The answer is "yes." While our pension certainly took a hit, it is also certainly safe and remains healthy.

Let's put our pension's financial health into perspective. Many of you have heard the news that the stock market had huge losses. First, know that STRS has only about 51% of our monies invested in the stock market. One of the best ways to measure what happened to the stock market is to look at one of the best stock market indicators, the S&P 500.

The S&P 500 on February 19, 2020, when the virus news started to break was at 3,386 points. By March 23, 2020, the S&P 500 had fallen to 2,237 points, which is 1,149 points or about 33%. This is certainly a huge loss, but let's put this into perspective. The US economy was strong when the virus hit and the stock market was significantly up for the 2019 year. For our purposes, we have to remember that this years' STRS fiscal year began on July 1, 2019. It will end on June 30, 2020. On July 1, 2019, the S&P 500 was at 2,942 points. Since the significant drop to 2,237 points, the S&P 500 has since rebounded to 2,836 points. So, for the STRS fiscal year which ends on June 30, 2020, we began the year at 2,942 points and now are at 2,836 points (at the time of this article) for a loss of only 106 points. This means we are not down the whooping 33% that many of you might be worrying about. Instead we are down only about 3.5% from where we began our fiscal year. Also, remember that we have another 60 days left before our fiscal year ends.

Lastly, from the COVID-19 market lows, the stock market has rebounded over 20% in slightly over 30 days. Let's see what happens the next 60 days. While it is possible we might not hit the STRS 7.45% Earnings Rate Assumption, it's also possible we might. Also, since we were ahead of the 7.45% Earnings Rate Assumption (significantly for the 10 year period at 10.44%); no matter what happens in the remaining 60 days, we will remain significantly ahead of the STRS 10 year target.

I hope this puts the Corona speed bump into perspective.

Susan Sullivan letter to ORSC 2019.pdf

November 21, 2019
"This proposal is equally illegal and unconstitutional"

Susan Sullivan, former retired Principal Attorney to the Ohio Attorney General, sent this letter to the Ohio Retirement Study Council (ORSC), stating that taking away the cost-of-living adjustment (COLA) retroactively for members of OPERS is illegal.

Although Sullivan's letter focuses on OPERS, her argument applies to STRS as well.

Pay particular attention to the six individuals who are listed at the end of the letter in support of Susan Sullivan's statements about the COLA.