“It’s been seven years since teachers in Ohio have received a cost-of-living increase to their pension, income that many of them are depending on in their retirement years.
“About 150,000 retired Ohio teachers thought they had a cushion that would help them live on their fixed income, but in July 2017, the State Teachers Retirement System took the annual increase away, and teachers said they are fighting for answers while struggling to make ends meet.
“While the average retired teacher receives about a $42,000 pension each year, staff members at STRS have raked in nearly $7 million in bonuses in 2020 alone, according to the Ohio Checkbook. Former Franklin County treasurer Wade Steen, part of the 11-member STRS board, said these bonuses show that the $98 billion pension system is failing in its mission.
(Colleen Marshall and Maeve Walsh. “Ohio retired teachers fighting pension fund over failure to pay cost-of-living increase.” NBC 4. https://www.nbc4i.com/news/state-news/ohio-retired-teachers-fighting-pension-fund-over-failure-to-pay-cost-of-living-increase/. February 14, 2022.)
State and local government workers are raising their voices to call-out mismanagement of their retirement savings. State Teachers Retirement System confirmed a special audit and cooperated with the Auditor's office. Tasked with leading the investigation into STRS was Ed Siedle, a pensions forensic auditing expert with a bestseller titled Who Stole My Pension? He said he identified “serious deficiencies” in the pension fund’s finances.
Siedle revealed …
“The pension money was being squandered, that there were all kinds of investments that raised serious questions, and that the fees that the pension was paying were extremely high.”
As about 150,000 retired teachers in Ohio demand answers over the absence of a COLA, Seidle said staff members at STRS are making six-figure salaries.
Of the top ten highest-paid employees in Ohio’s five public pension systems, eight work for STRS, according to the Ohio Checkbook.
In 2020, the top-earning employee at STRS – a regional director – made a $294,550 salary and a bonus that doubled his salary for a total compensation of $587,554. The average Ohio teacher’s salary is $61,406.
(Colleen Marshall and Maeve Walsh. “Ohio retired teachers fighting pension fund over failure to pay cost-of-living increase.” NBC 4. https://www.nbc4i.com/news/state-news/ohio-retired-teachers-fighting-pension-fund-over-failure-to-pay-cost-of-living-increase/. February 14, 2022.)
The State Auditor found the information obtained supported a reasonable basis for conducting a special audit. In fact, in a letter dated October 11, 2021, Keith Faber, the Auditor of the State of Ohio informed the Executive Director of the State Teachers Retirement System of Ohio that his Office had received numerous complaints evolving from a report issued by my firm, Benchmark Financial Services, Inc. titled “The High Cost of Secrecy: Preliminary Findings of Forensic Investigation of State Teachers Retirement System of Ohio, Commissioned by the Ohio Retired Teachers Association.”
The findings of the Benchmark report included that STRS had long abandoned transparency; legislative oversight of the pension had utterly failed; Wall Street may have been permitted to pocket lavish fees without scrutiny as to legitimacy; disclosure of investment costs and performance may have been misrepresented, as billions that could have been used to pay teachers’ retirement benefits had been squandered.
(“The High Cost of Secrecy.” Benchmark Financial Services, Inc. https://www.scribd.com/document/533993670/Siedle-High-Cost-of-Secrecy/ June 2021.)
In October 2021, Siedle reported …
“As absurd as it seems, participants in pensions historically have had virtually no say in how their retirement savings are invested. When concerns regarding reckless risk-taking and revelations of avoidable losses arise, there is little pensioners can do to stop the bleeding. Underfunded state and local government pensions, not covered by the federal law protecting pensions (ERISA) or any other comprehensive law, are especially at risk.
“It’s no secret that public pensions are grossly mismanaged. What’s surprising is to learn that concerned active and retired school teachers in Ohio successfully banded together to commission an expert investigation of their state pension and were heard by legislators, as well as other government officials.”
(Edward Siedle. “Ohio Teachers Investigation Of State Pension Spurs Special Audit By State Auditor.” Forbes. October 22, 2021.)
Results
According to Dean Dennis, founder of the STRS Ohio Watchdogs – a grassroots organization of active and retired teachers in Ohio – who also moderates the Facebook “Ohio STRS Member Only Forum” (25.6k members) …
After a decade of watching their pensions erode, members of STRS Ohio watched and listened during the March 2022 Board meeting as the Trustees voted to provide a 3% Cost Of Living Adjustment (COLA) and remove the age 60 requirement for full retirement benefits after 35 years.
Eleven years ago, retired teachers received a simple (non-compounding) 3% COLA.
Eleven years ago, active teachers received a pension with full benefits after 30 years. Active teachers contributed 10% of their salaries to STRS. Retired teachers received a COLA one year after they retired.
Eleven years ago there weren't any petitions complaining about STRS, any Facebook groups complaining about STRS, any protest signs at STRS meetings, and no one in Ohio knew Edward Siedle conducted forensic audits. So, what changed?
Around 10 years ago, a nightmare was about to be dropped on STRS members.
Active teachers would learn that they were heading towards having to work 35 years and be at least age 60 to receive a pension with full benefits.
Their employee contribution would increase to 14%, while their employer's contribution remained unchanged.
They would learn that there would not be a 3% COLA for them when they retired, but only a simple 2% COLA. They would also have to wait 5 years after retirement to begin receiving this COLA.
Retirees would learn that the language in ORC 3307.67 that stated they "shall" receive a 3% COLA was meaningless. Their COLA was reduced to 2%, would be frozen a year later and then, in 2017, completely eliminated.
(Dean Dennis. "Age 60 Requirement Lifted and 3% COLA Granted. So, Why Aren't We Happy?” Ohio STRS Member Only Forum. https://www.facebook.com/groups/OhioSTRSMemberOnlyForum/permalink/1671548319875989. March 22, 2022.)
Active teachers now understood that they would not have any financial security in retirement. Why did this happen?
Dennis writes …
“Around 2010, STRS management began painting a dire picture to the STRS Trustees. They convinced the Trustees that their Earnings Rate Investment Assumption (projection rate on investments) was too high. Starting in 2012, Trustees would reduce the investment assumption from 8% to 7.75%, then to 7.45%, then to 7%. At every reduction, tens of billions of projected liabilities would be added to the STRS balance sheet.
“Management could have presented a plan to the Ohio Retirement Study Council as to how they were going to address the new projected liabilities created by the drastic Earnings Rate Investment Assumption reductions. But they didn't. Instead, STRS management convinced our Trustees to renege on the promises made to members and make drastic cuts to teachers’ retirement benefits. The retiree's COLA was targeted and active teachers would work longer for less.”
(Dean Dennis. "Age 60 Requirement Lifted and 3% COLA Granted. So, Why Aren't We Happy?” Ohio STRS Member Only Forum. https://www.facebook.com/groups/OhioSTRSMemberOnlyForum/permalink/1671548319875989. March 22, 2022.)
And what proactive changes have been made since the Draconian cuts?
The Earnings Rate Investment Assumption reduction was cut from 8% to 7%. And what have we earned on our investments over the last 10 years? The answer is 9.84%.
What proactive changes have been made over the past 10 years? The answer is, nothing significant. Members assumed all the risks and they still do. The employer contribution rate is still the same after 38 years.
A major change suggested by the 2006 outside independent audit was how STRS awards bonuses to the Alternative Investment staff as they pertain to their benchmarks. To this day, this remains a problem.
The 2006 audit also suggested that the STRS staff grossly needed more internal auditors. STRS management disagreed and none were added.
Ten years later, management fees are still a controversy. Members aren't clear as to how much money is going to Wall Street. Members aren't clear as to what our actual investment costs are.
There haven’t been any real changes in how we do business. Our investments are still under an "active" management model. The forensic audit cast a shadow as to whether this is a cost for members, or a savings for members.
Dennis concludes:
“Still, after 10 years, our Trustees voted to provide a 3% COLA and remove the age 60 requirement for a full retirement after 35 years. So why aren't members celebrating?
“Members were pillaged and are still living a nightmare. There has been some relief because something has been returned to us, from that which was taken. Members haven't seen any real changes at STRS. It seems to be the same business plan.
“Everyone knows that STRS balanced their books on the backs of its members. There's nothing noble about withholding monies promised to members and reneging on payouts to balance books in order to reach a self imposed 85% funding goal.
“Doling out a pittance, doesn't make members happy, it reminds them of what they have lost.”
(Dean Dennis. "Age 60 Requirement Lifted and 3% COLA Granted. So, Why Aren't We Happy?” Ohio STRS Member Only Forum. https://www.facebook.com/groups/OhioSTRSMemberOnlyForum/permalink/1671548319875989. March 22, 2022.)
Part Of the Blame
Siedle says …
“While for over two decades I have implored unions to get actively involved in scrutinizing the management of pension investments – serving a watchdog function which pension boards are ill-equipped to perform – rarely have I been successful in persuading these unions that the best way to preserve pensions is to expose and address problems, not hide them. Unions tend to believe that any criticism of pensions will only lead sponsors to no longer offer them to workers.”
But where the unions failed, Facebook filled the gap. Although Facebook is criticized for the harm it does including failing to stop the spread of extremism and disinformation, Facebook groups can be a powerful force to combat looting of America’s pensions by Wall Street. In Ohio, two Facebook groups – Ohio STRS Members Only Forum and the STRS Ohio Watchdogs are vigilantly exposing gross mismanagement at STRS Ohio identified in the forensic investigation.
(Edward Siedle. “Facebook Pension Groups Are Doing Work Unions Should Be Doing To Protect Retirement Savings.” Forbes. January 11, 2022.)
The Last Word
This important investigation and its outcomes are crucial for Ohio educators. Not only retired teachers but also active teachers are victims of this abuse. We all know that active teachers are working longer and receiving less for their contributions. So, all Ohio teachers need to take responsibility to get control of their retirement security and not rely upon unions to watch over their pensions.
The pittance afforded retired teachers for costs of living is shameful. Social Security and Supplemental Security Income (SSI) benefits for approximately 70 million Americans will increase 5.9 percent in 2022.
The 5.9 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 64 million Social Security beneficiaries in January 2022. Increased payments to approximately 8 million SSI beneficiaries will begin on December 30, 2021. (Note: some people receive both Social Security and SSI benefits)
(“Cost-of-Living Adjustment (COLA) Information for 2022.” Social Security. https://www.ssa.gov/cola/.)
As far as unions go, Ohio Education Association President Scott DiMauro said this of the 3% Cost of Living Adjustment (COLA) to eligible retirees for the 2022-2023 fiscal year …
“Like many of our members, OEA’s ultimate wish is to have the COLA permanently restored when the fund is able to manage that. Unfortunately, at this point, that would add more than a $13 billion unfunded liability and would put future benefits at risk. Active teachers could again be asked to work longer, pay more and receive less in retirement, and that would not be fair, OEA has high hopes for continued growth in the fund that will allow adjustments that benefit both active and retired teachers.”
(Katie Olmsted. “Ohio Education Association celebrates STRS Board decision to restore some benefits.” Ohio Education Association. March 17, 2022.)
“High hopes”? This deserves a big old Appalachian “Shut my mouth and slap my grandma!” For whatever reason – for one, much of the public blames unions for protecting ineffective teachers – the Ohio Education Association faces a tremendous uphill climb in securing better benefits for Ohio teachers.
So many teachers choose to join, pay their dues, and remain indifferent to supporting reform and crucial issues. It's a “two-way street” in many respects – unions push their own big agendas while teachers refuse to become dedicated activists. The result is stagnation. So many times, local issues become secondary to the State union players while, in truth, most members join just because unions are recognized negotiation agents with local boards of education.
Teaching is an honorable profession and still attracts wonderful, dedicated people. But, the profession has changed drastically in the 21st century. I hear so many present teachers complain of large amounts of time spent in testing and in record keeping as taking away from instructional time. At any rate, anyone considering a career should thoroughly research the requirements, the good and the bad aspects of the profession, and be prepared to accept the low salary. At present, it is very evident that part of that investigation should include seeking information on retirement benefits.
As of February 26, 2022, the average annual pay in the U.S. for master's degree jobs is $70, 689 with occupations like nurse anesthetists ($146,354), financial officers, engineering, and pharmacy leading the way. As teachers know, a master's is necessary these days.
If you are planning on pursuing a degree in teaching in Ohio, here is what you can expect:
According to the Ohio Department of Education, teacher salaries vary widely across the state. Data collected by the education department for statewide salaries showed that teachers generally earn less in rural school districts than in urban and suburban districts. In addition, teachers who take on extra responsibilities outside the classroom earn more annually. For example, teachers who also serve as coaches earned more.
How much does a Public School Teacher make in Ohio? The average Public School Teacher salary in Ohio is $59,333 as of February 25, 2022, but the range typically falls between $51,793 and $68,511. Salary ranges can vary widely depending on the city and many other important factors, including education, certifications, additional skills, the number of years you have spent in your profession.
In order to earn an initial teaching license in Ohio, teacher candidates must successfully complete the following certification requirements, according to the Ohio Department of Education:
Complete an approved teacher preparation program
Earn your bachelor’s degree from an accredited institution college or university
Pass a content area exam(s) and a professional knowledge exam
Pass a criminal background check
Apply for initial licensure, called a four-year resident educator license, through the Ohio Department of Education
Engage in continuing education to advance or renew your teaching license
These requirements are mandated by the Ohio Revised Code and Ohio Administrative Code. They are subject to change.
Ohio has a four-tiered licensing system:
The state issues the 4-year Resident Educator License to new teachers who are graduates of an in-state accredited teacher preparation program
The state issues the 4-year Alternative Resident License to individuals pursuing an alternative certification route.
When either of the 4-year resident programs is completed successfully, the teacher receives a Professional Educator License (5 years, renewable).
The Senior Professional Educator License (5 years, renewable) is issued to teachers who have earned an advanced degree, taught successfully for 9 years (at least 5 of those years under a Professional Educator License), and completed a Master Teacher Portfolio.
The Lead Professional Educator License is issued to teachers who have met the requirements for the senior license AND earned a Teacher Leader Endorsement.
And, Just In Case You're Wondering
The average annual in-state four year college tuition in Ohio was $20,694 for the 2020-2021 academic year.
For academic year 2021-2022, the average tuition & fees for Colleges in Ohio Graduate Programs is $10,305 for in-state and $26,518 for out-of-state.
And, don't forget about all of those so-called "unexpected costs" of going to college.
Hold on to your butts, kids. I love that you want to teach. However, just understand that you face a long, hard climb to qualify for those retirement benefits. Be sure to fight like hell to make them the “sweetest” possible. By the time you rely upon them for income, you will surely say you earned every penny of the pension and the benefits provided.
Oh hell, I can't lie. You will likely claim you deserve much more. One thing I do know – people will still be calling you “paid babysitters” and “part-time workers.” You will still face many challenges because the truth is a teacher can never be “good enough”: You have entered a job requiring continuing education and attention to detail.
Misconceptions of the true nature of the job often prevail … that is, until Mom and Dad face the reality of the complicated and extremely delilcate mission of your career choice. I know the time you spend in your classroom actually “teaching” will be blissful, but the time you spend in preparation and in other related educational activities outside your classroom will wear on your physical and mental health. I know the pressures of the job well. You will be compensated most by the appreciation of the students, not by the paychecks that come much too infrequently. Bless this stress and please, take time to breathe.
An Instructor's Dream
Many decades after graduation
the students sneak back onto
the school-grounds at night
and within the pane-lit windows
catch me their teacher at the desk
or blackboard cradling a chalk:
someone has erased their youth,
and as they crouch closer to see
more it grows darker and quieter
than they have known in their lives,
the lesson never learned surrounds
them: why have they come? Is
there any more to memorize now
at the end than there was then—
What is it they peer at through shades
of time to hear, X times X repeated,
my vain efforts to corner a room’s
snickers? Do they mock me? Forever?
Out there my past has risen in
the eyes of all my former pupils but
I wonder if behind them others
younger and younger stretch away
to a day whose dawn will never
ring its end, its commencement bell.
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