System Presents Funding Report to ORSC

On March 10, 2004, STRS Ohio Executive Director Dr. Damon Asbury presented the following report to the Ohio Retirement Study Council. The report is in response to statute that requires the State Teachers Retirement Board to provide the ORSC with a report in any year that the funding period for the unfunded actuarial accrued liability of the pension fund exceeds 30 years. 

The first part of the document is an executive summary, which is followed by a more detailed report.  The report points out that the Retirement Board understands that its first and foremost priority is to protect pensions and other promises in state law. The board has taken steps in the past to ensure the security of pension benefits. The effectiveness of these actions has been confirmed by both the pension system’s actuary, as well as Milliman USA, who provides actuarial services to the ORSC. As noted in a Feb. 13, 2004, letter to the ORSC, Milliman USA stated:  Our reports confirmed that all of the retirement systems remain financially secure to pay all mandated pension benefits when they become due well into the future. In short, pensions are secure.

Going forward, the Retirement Board remains committed to maintaining the security of the pension fund. However, the board also realizes that a guaranteed pension without some affordable health care is not truly a secure retirement package for present or future retirees. The board is looking at a wide range of possibilities to address both issues.

Most importantly, the board believes that it is not prudent to make drastic pension benefit changes in response to short-term market fluctuations. Benefit changes should be done in the context of long-term policy horizons. There are currently no discussions under way at this time to change the benefit formula and/or increase the age and service requirements for retirement.

The Retirement Board will continue to monitor the situation; build consensus with employees, employers and retirees on any needed future changes; and work with the ORSC and the General Assembly to formulate appropriate policy decisions for the future.

View the executive summary of the STRS Ohio report to ORSC (PDF).

View the detailed report STRS Ohio gave to ORSC (PDF).

Return to the list of past STRS Ohio news releases and reports.