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Showing posts from April, 2012

March Board News

(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

March Board News

(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