Skip to main content

August Board News

(The text below is reprinted from the news release by STRS on 08/15/2014.)

STRS Ohio Reports +16.8% Total Fund Return for Fiscal Year 2014
During the August meeting of the State Teachers Retirement Board, Investment Department staff reported that STRS Ohio’s total fund return for the year ending June 30, 2014, was +16.8%, and the market value of assets at fiscal year end was $74.8 billion. The strong return exceeded the fund’s assumed actuarial return of 7.75% and followed a +13.7% return in fiscal year 2013.

The Retirement Board’s investment consultant, Callan Associates, noted that STRS Ohio’s fiscal year 2014 returns ranked above the median of the Callan Public Fund Sponsor database, but an overweight to liquidity reserves detracted from returns. Following two years of solid market returns, STRS Ohio’s 2015 Investment Plan calls for only moderate growth in the capital markets in fiscal year 2015. 

      STRS Ohio’s assumed actuarial rate of return     +7.75%
      Total fund return (five years)                                  +13.6%
      Total fund return (10 years)                                     +8.0%
      Total fund return (20 years)                                     +8.3%
      Total fund return (30 years)                                     +9.6%
 
Fiscal 2014 Operating Expenses Total $4.5 Million Under Budget
Final figures for fiscal year 2014 show that STRS Ohio’s operating expenditures were approximately $4.5 million less than budgeted for the year. Less than expected expenditures for salaries, performance-based incentive payments and professional and technical services accounted for much of the savings. Each month, STRS Ohio posts approved administrative expenses on its website.

CEM Study Reflects Higher Service Level Score for STRS Ohio
Results of the CEM Pension Administration Benchmarking report for fiscal year 2013 showed improvement in STRS Ohio’s service level score. Jan Hartford, a partner at Cost Effectiveness Measurement, Inc. (CEM) shared the study results at the August board meeting. STRS Ohio’s service score was the second highest among its peer group of 14 systems and also ranked second overall of the 55 plans that participate in the study, and STRS Ohio’s Call Center ranked first among all participating systems. STRS Ohio is on track to improve its overall service score again next year as more online services have been initiated.

The report also measures each plan’s administrative cost per member and annuitant. STRS Ohio’s cost per member remained steady — higher than the peer average, but below the cost of all participating systems. Hartford told the board that STRS Ohio’s costs per member and annuitant have decreased by 1.7% between 2010 and 2013, while the average costs of the peer group increased by 1.5% per year.

Retirements Approved
The Retirement Board approved 2,241 active members and 210 inactive members for retirement.

Other STRS Ohio News

NIRS Report Details Positive Economic Impact of Defined Benefit PensionsA new report from the National Institute on Retirement Security (NIRS) found that public and private retiree pensions provide important support to the U.S. economy, including more than $943 billion in total economic output and 6.2 million jobs. The full report is available on the NIRS website, along with state-by-state fact sheets. STRS Ohio has a link to the report on the retirement system’s website.

Australian Pension Administrator to Visit STRS Ohio Call Center in September
First State Super, an Australian pension system with 775,000 members, will visit STRS Ohio in September to gain a better understanding of how the retirement system operates its Call Center. CEM Benchmarking recommended STRS Ohio to First State Super based on high service scores coupled with average-per-call costs.

Popular posts from this blog

STRS Ohio June Board News

Retirement Board Approves Health Care Premiums For 2018; Approximately 80% of Enrollees Will See No Premium Increase At the June meeting of the State Teachers Retirement Board, the board approved 2018 premiums for all plans offered through the STRS Ohio Health Care Program. A complete list of these premiums is posted on the system’s website , or can be obtained by calling STRS Ohio’s Member Services Center toll-free at 888‑227‑7877. Additional information about the 2018 Health Care Program will be provided in upcoming newsletters and on the STRS Ohio website. In late October, all plan enrollees will receive personalized health care plan information in preparation for the fall open-enrollment period that extends from Nov. 1‑21, 2017. When determining premiums, the Retirement Board and STRS Ohio staff consider the claims experience of plan enrollees, annual health care cost trend rates and administrative expenses for the program. Factors that proved favorable for 2018 rate setti...

Pension Legislation Update

(The text below is reprinted from the news release by STRS on 5/13/11.) ORSC ANNOUNCES PLANS TO HIRE ACTUARY AND POLICY ADVISOR TO REVIEW PENSION LEGISLATION During the May 12, 2011, meeting of the Ohio Retirement Study Council (ORSC), Sen. Keith Faber, who chairs the committee, announced that he is creating a subcommittee to develop a request for proposal for an independent actuary and policy advisor in regard to pension reform issues. This consulting expert will be asked to help the ORSC members analyze the plans the five public pension systems have developed to strengthen the solvency of their pension funds and other potential retirement-related changes. Faber noted he wants someone who can advise on reform trends in other states and the private sector. Through media reports, Faber indicated the Senate is not likely to proceed with any pension legislation until this review is completed. It is expected that this process will take pension reform discussions into the fall. The me...

January Board News

( The text below is reprinted from the news release by STRS.) Board Discusses Options to Reduce Amortization Period for the Pension Fund During the State Teachers Retirement Board’s annual retreat, board members reviewed several options to reduce the retirement system’s funding period. Ohio law requires the statewide retirement systems to amortize unfunded liabilities over a period of not more than 30 years, otherwise they must submit a board-approved plan to the Legislature to reduce the funding period to 30 years. STRS Ohio’s current funding period is 40.2 years. Pension reform laws passed in 2012 reduced STRS Ohio’s accrued liabilities by $15.7 billion and improved the system’s funded ratio to 66.3% from 56.0%. These reforms also reduced the retirement system’s funding period from infinity — but have not yet resulted in a 30-year amortization period. The board-approved plan to reach the 30-year target is due to the Ohio Legislature Feb. 21. During the funding discu...