Kevin Kroskey's Ohio Faculty Advisor

(FROM the STRS Ohio eUPDATE) At the July 11 Ohio Retirement Study Council (ORSC) meeting, William "Flick" Fornia presented the results of the Pension Trustee Advisors (PTA) study of the pension plan design changes approved by the boards of Ohio's five statewide retirement systems. The PTA report recommended adoption of the systems' plans, but suggested that the retirement systems' boards be given authority to make further benefit changes in the future, if necessary, to remain within a 30-year funding period. The report also supported the continuation of defined benefit plans for Ohio's public employees, noting the efficiency and low costs of these plans. While some news outlets focused on portions of the report that point to the possible need for additional plan adjustments, PTA encouraged legislative approval of the plans because the boards' recommended changes will put the systems in a much more solid financial position. The PTA report called STRS...

(The text below is reprinted from the news release by STRS on 6/15/12.) Retirement Board Chair, Vice Chair Named During its June meeting, the State Teachers Retirement Board elected Dale Price (Toledo Public Schools, Lucas County) as its vice chair for the coming year. According to Board Policies, Mark Hill (Worthington City Schools, Franklin County), who is currently serving as vice chair, automatically moves into the position of chair. Hill and Price will assume their new responsibilities on Sept. 1, 2012. Retirement Board Accepts the Annual Investment Plan The Retirement Board voted to accept the Investment Plan for fiscal year 2013 (July 1, 2012 – June 30, 2013). The plan details staff's investment strategy for each asset class comprising the system's investment fund. STRS Ohio staff expects only modest growth in the capital markets during fiscal year 2013. With the threat of global debt problems having a harmful effect on the markets, STRS Ohio will c...

(The text below is reprinted from the news release by STRS on 5/18/12.) Ohio Senate Passes Pension Reform Legislation; STRS Ohio Hopeful That House of Representatives Will Take Action Executive Director Michael Nehf reported at the May Retirement Board meeting that the Ohio Senate passed STRS Ohio’s long-awaited pension reform bill (Sub. Senate Bill 342) on May 16 by a 31–2 vote, paving the way for the House to hopefully take similar action yet this year. Retirement Board Chair Jim McGreevy expressed appreciation to the Senate and to the bill’s co-sponsors, Senate President Tom Niehaus (R-New Richmond) and Senate Minority Leader Eric Kearney (D-Cincinnati) for taking action on pension reform. McGreevy also complimented STRS Ohio stakeholders for their work in support of the bill. On May 8, the co-sponsors introduced four pension reform bills that were assigned to the Senate Insurance, Commerce and Labor Committee. In testimony that afternoon, Nehf told Committee members that the ...

(The text below is reprinted from the news release by STRS on 4/20/12.) Retirement Board Amends Plan to Strengthen the Financial Condition of the Pension Fund; Pension Design and Contribution Changes Approved The State Teachers Retirement Board voted to amend its plan to further strengthen the financial condition of the pension fund at its April meeting and hopes to see legislative action on its pension reform plan in the coming months. The board’s plan is projected to save about $13.3 billion in accrued liabilities, maintains a 1% employer contribution to STRS Ohio’s health care fund and does not include any increase in employer contributions. The board vote followed several months of discussion and study — including conducting an asset-liability study and a three-year actuarial experience review. All changes contained in the plan require legislative action by the Ohio General Assembly and the governor to be implemented. Components of the plan include: ·    ...

(The text below is reprinted from the news release by STRS on 3/26/12.) Retirement Board Reviews Pension Reform Plan Design Changes As previously reported in   Board News , the pension reform proposal passed by the State Teachers Retirement Board in January 2011 no longer meets the 30-year funding period required by the Ohio Legislature. At its March 22, 2012, meeting, the Retirement Board discussed various revisions to the current proposal, aimed at reaching the 30-year amortization goal. Earlier this month STRS Ohio staff presented several scenarios to reduce the system's liabilities and funding period. The Retirement Board asked for further study — including a potential cap on the cost-of-living adjustment (COLA) that is paid in retirement, and/or a one-year COLA suspension. Staff was also asked to consider ways to smooth the transition to new retirement eligibility rules that will include a longer teaching career and an age requirement to qualify for retirement. All of t...

(The text below is reprinted from the news release by STRS on 3/6/12.) Board Approves Changes to Actuarial Assumptions At a special meeting on March 2, the State Teachers Retirement Board voted to approve changes to the actuarial assumptions used to calculate pension liabilities. In February, the board's actuarial consultant, PricewaterhouseCoopers (PwC), presented the results of a three-year experience review used to evaluate the economic and demographic assumptions. The experience review, conducted at the board's request, compared what actually happened during the three-year period versus what was expected to happen to the financial and demographic assumptions. Based on its review, PwC recommended adjustments to assumptions about mortality, service retirement, inflation, expected investment returns and salary growth. In total, these new assumptions have a negative overall impact on the system's funding. The most common ...