December 2019 OEA Retirement Systems Update
SERS Fills Employee-Member Vacancy
At its November Board meeting, the SERS Board elected Matthew King to fill a board vacancy for an open employee-member seat. King is the treasurer and chief fiscal officer at East Central Ohio Education Service Center. He has previously served as treasurer for the Barnesville Exempted Village School District and as an assistant auditor for the Ohio Auditor of State. King’s term for this seat will run through June 30, 2020. The same seat is up for election next year.
Additionally, members of the SERS Board will select someone to fill a vacancy for an open retiree-member seat on the Board. Three candidates have been selected to be interviewed for this vacancy. The candidates are Robert Hancock, Timothy Penton and Frank Weglarz. The Board will interview candidates and discuss their qualifications at its December meeting. The candidate who receives a majority vote of the Board will fill the open seat with a term running through June 30, 2021.
OPERS Board Considers Health Care Allowance Changes
The OPERS Board continues to consider changes in the health care plan that would take effect in 2022. At its November meeting, the Board heard a presentation from OPERS staff regarding future Medicare and pre-Medicare allowances for health care.
Regarding Medicare retirees, OPERS staff noted that the average balance of an OPERS retiree’s health reimbursement account is over $3,700. More than two-thirds of the Medicare eligible retirees are enrolled in a Medigap plan with premiums that range from $152-$240. Approximately 25% enroll in a Medicare Advantage plan with the most popular plan being the Humana Choice PPO with an average monthly premium of $155. OPERS staff is recommending
lowering the monthly base allowance for participants in the OPERS Medicare Connector from $450 to $350.
Regarding pre-Medicare retirees, the Board has been discussing converting to market-based coverage rather than continuing to sponsor health care coverage. Currently over 25,000 retirees are enrolled in OPERS-sponsored coverage. Most receive an allowance of 75% of the $1,306 premium, meaning they pay $327 a month. OPERS staff is recommending an initial base allowance of $1,200 that may decrease over time. It should be noted that premiums in Ohio range from $570-$1,235 with higher costs in rural counties.
The OPERS Board will continue its discussion on all components of health care in January in preparation for a vote early in 2020.
Click here to download a copy of this December 2019 Report to the OEA Board of Directors
OEA calls for sweeping changes to state report cards
Instead of a cookie-cutter approach to state report cards, OEA envisions a system that uses a performance dashboard and a student opportunity profile that have proven successful in other states, such as Oregon and Massachusetts, in informing educators, parents, elected officials and policy makers of how districts and schools are faring.
In a recent survey of more than 1,400 OEA members, 96% indicated they do not believe the current state report card system fairly assesses Ohio schools, and 89.4% support the elimination of A-F grades.
“Now is the time to end the destructive practice of rating schools and districts on misleading and punitive A-F letter grades that shame public educators for the poverty of their students,” said OEA President Scott DiMauro. “Studies consistently show that there is a direct correlation between ratings and wealth, and for too long, low ratings have been used as cover for diverting taxpayer resources to unaccountable charter and private schools and as an excuse to punish communities and educators by depriving them of local control and collective bargaining rights through state takeover schemes.”
OEA’s recommended reforms include information on the demographic and financial make-up of schools and districts, and a performance dashboard on how well students are learning that includes three-year trends and comparisons to district and statewide averages. A proposed student opportunity profile would provide detailed information on what students have been offered to enhance their success.
“Current report cards in Ohio are overly complicated, depriving parents, policymakers, and communities of understandable information that demonstrates how schools are really doing in providing opportunities for learning to students,” said DiMauro. “A new system is needed to ensure transparency, accountability, and fairness with the aim of identifying areas in need of improvement and empowering local stakeholders to make decisions that direct resources where they are most needed.”
* To read the details of what was approved by the OEA Representative Assembly, click here.
October 2019 OEA Retirement Systems Update
STRS Shows Modest Improvement in Funding Status
At its October Board meeting, the STRS Board received the results of the annual actuarial valuation of the pension plan for fiscal year 2019. The report showed actuarial liabilities (the value of benefits owed to retirees and active employees) of more than $97.8 billion and assets of $74.4 billion. The result is $23.4 billion in unfunded liabilities and a funded ratio of 76.1%. This represents a slight improvement from the previous year when it was 75.5%. Likewise, the amortization period (the amount of time needed to pay off the unfunded liabilities) was reduced to 16.6 years. This period was 17.8 years according to the FY 2018 valuation.
STRS continues to work toward improved funding of the pension plan. Keeping pension benefits secure for the long term is in the interests of OEA members and this has required shared sacrifice. Active teachers have had to work longer, contribute more and see formula reductions, while retired teachers have been dealing with frozen cost-of-living adjustments. However, as financial conditions improve, OEA supports restoration of COLA benefits as well as a reduction in the employee contribution rate.
The STRS Board also received the actuarial valuation of the health care plan. That report showed that health care benefits are more than fully funded with a funding ratio of over 174%. However, this figure is based on design changes to the plan that include elimination of the Medicare Part B premium reimbursement and freezing the subsidy amount for non-Medicare retirees at 2020 levels. These changes have yet to be implemented and the STRS Board is expected to review health care plan design in February 2020.
SERS Board Receives Preliminary Funding Report
On Thursday, October 17, the SERS Board received a report from the actuarial firm of Cavanaugh Macdonald Consulting on the anticipated funding levels for the annual actuarial valuation. Based on the preliminary analysis, it appears that the funding ratio of the pension plan will be 71.0%; an increase of 0.3% from the prior year. The amortization period would decrease by one year to 25.
According to the SERS funding policy, if the funded ratio of the pension plan is between 70% and 80%, the Board has the discretion to allocate up to 0.5% of the employer contribution to the SERS Health Care Fund. However, based on a review of year-to-date and projected investment experience and other factors, the Board opted not to contribute additional funds to health care and dedicate the full employer contribution towards funding pension benefits.
OPERS Board Votes to Develop “Group D” for New Hires
On Wednesday, October 16, 2019, the OPERS Board of Trustees voted to have staff develop a legislative proposal for a new tier of pension benefits (“Group D”) for employees hired after January 1, 2022. As initially proposed, this new tier would include a reduced calculation of pension benefits, increased age and service requirements, an increased employee contribution and a reduced cost-of-living allowance.
OEA and four other labor organizations sent a joint letter to the OPERS Board expressing opposition to the proposal. However, the OPERS Board voted 7-4 to develop a legislative proposal creating the new tier of benefits. Board members Julie Albers, Randy Desposito, Tim Steitz and Steve Toth voted against the motion. All other Board members voted in favor. OPERS Executive Director Karen Carraher stated that staff does not plan to pursue legislation for another year. The implication was that OPERS staff will continue to refine the proposal and work with stakeholders before coming back to the Board with a final proposal.
Click here to download a copy of this October 2019 Report to the OEA Board of Directors. Previous Retirement Systems Updates can be viewed under the Affiliate Resources tab on the OEA website.
OEA Pres. DiMauro: Your Feedback on State Report Cards Needed
October 15, 2019 | VBlog By OEA President Scott DiMauro
Please take a few minutes to view my latest weekly update on things happening in and around OEA.
This week, I have an important ask for feedback to help guide us in our efforts to design a plan for a better state report card system.
I also have information to share regarding the 21 days we have left before the 2019 election as well as updates on how we’re preparing for 2020. (Please be sure to respond to an invitation to attend an FCPE Reorganization meeting near you.)
I hope you can join us on Twitter tonight at #OEA2020 to weigh in with your reactions to the presidential candidates.
Also, if you haven’t done so yet, please pledge to be an Education Voter by clicking on this link: https://educationvotes.nea.org/presidential-2020/2020pledge/
I welcome your feedback. Please contact me if you have questions, would like an officer to visit your local, or have anything to share.
Have a good week!
Scott DiMauro
President
Ohio Education Association
Shaping a Vision for Accurate, Meaningful State Report Cards
Dear OEA Member,
Ohio’s current system of using flawed report cards to measure the performance of school districts and school buildings needs to be revamped. Legislation is being discussed in Ohio legislature.
OEA is calling for an end to the use of arbitrary letter grades and questionable methodologies that are biased against low-income districts.
Our goal is to make report cards easier to understand so that they are more useful for parents and the community.
Here’s where we need to hear from you. As an educator, what do you think should be included in measuring student success? What do you think would be useful for the public to know about Ohio’s schools? Input from you will help greatly in shaping a vision for a more accurate and meaningful report card for Ohio’s schools.
You can review your school district’s current report card through the Ohio Department of Education’s website: https://reportcard.education.ohio.gov.
Thank you!
OEA Pres. Scott DiMauro: Local Presidents’ Handbook and Important Member Surveys
October 8, 2019 | VBlog By OEA President Scott DiMauro
Dear Colleagues,
Please take a few minutes to view my latest weekly update on things happening in and around OEA.
This week, I’m excited to congratulate an OEA member who has been named the 2020 Ohio Teacher of the Year, summarize the work of members who came to Columbus last week as part of our All Committee Weekend, and provide a heads-up to all of you on a couple of important surveys we’re conducting with members.
I also want to highlight the great work of our Local Development and Training Committee and our local presidents’ cadre who have collaborated on a fantastic new Local Presidents’ Handbook. We’ve been getting rave reviews on it. If you haven’t seen it yet, or to share it with local presidents you know, please see the attached document or go to this link on the members-only section of the OEA website: https://www.ohea.org/presidentshandbook/.
Have a good week!
Scott DiMauro
President
Ohio Education Association
Norwood T.A.’s Leila Kubesch Named 2020 Ohio Teacher of the Year
State Superintendent of Public Instruction Paolo DeMaria surprised students and staff at Norwood Middle School this week by announcing that Leila Kubesch was selected as Ohio’s 2020 teacher of the year.
Kubesch teaches Spanish and English as a second language at Norwood Middle School.
School officials also said Kubesch encourages students to participate in service learning projects to build confidence and grow their desire to learn. For example, students have worked for a local cable television station to create a talk show involving community members who discuss various topics with the students.
Kubesch and her students were awarded the Ohio Education Association Media Award for Public Service for that project. They also received a grant to expand their studio.
During the 2017-18 school year, Kubesch secured a grant for a performing arts project. They created a display, laminating their dreams and hanging them on burlap sacks, with cutouts of hands forming a border. The display stretched more than 100 feet, and a special exhibit featuring the project opened at the National Underground Railroad Freedom Center in Downtown Cincinnati. A poster by the exhibit explained how burlap was used in North Africa – as clothing, rugs and sacks.
Click here to learn more about Kubesch and the Ohio Teacher of the Year Program.
October/November 2019 Ohio Schools
- COVER STORY: Culture of Caring — ReynoldsburgEA, Using Restorative Practices
- FEATURE: OEA 2019 Summer Academy
- MAKING THE GRADE:
- NEA Foundation names Columbus educator (and OEA Educational Foundation recipient) as an awardee.
- LovelandEA teacher selected as a 2020 NEA Foundation Global Learning Fellow
- Ohio’s new ‘Stop Bullying’ license plate
- 2019 OEA Minority Leadership Training Program
- OEA support of Crayons to Classrooms effort
- LEGISLATIVE UPDATE: State report cards continue to mislead
- RETIREMENT SYSTEMS UPDATE
Moved recently? Contact the OEA Member Hotline to update the address on file at 1-844-OEA-Info (1-844-632-4636) or email, membership@ohea.org. Representatives are available Monday-Friday, from 8:30 a.m. to 6 p.m. | OhioSchools — Past Issues
Oh Yes, We’re Social — Join the Conversation!
OEA Pres. Scott DiMauro: Pledge to be an Education Voter
October 1, 2019 | VBlog By OEA President Scott DiMauro
Pledge to be an Education Voter
Dear Colleagues,
Please take a few minutes to view my latest weekly update on things happening in and around OEA.
This week’s message includes reflections on a fascinating new Ohio State University study on student learning, early opportunities to support pro-public education candidates from both parties in 2020 (including as convention delegates), and a reminder on OEA-RA delegate election deadlines.
Please click on this link (https://educationvotes.nea.org/presidential-2020/2020pledge/) to pledge to be an education voter and then share with your fellow members.
I welcome your feedback. Please contact me if you have questions, would like an officer to visit your local, or have anything to share.
Have a good week!
Scott DiMauro
President
Ohio Education Association
Related Reading
- 09.28.2019 | Columbus Dispatch: Kids in poor schools show same academic growth as others, Ohio State study finds| “It confirms the fact that we’ve got a lot of really good teachers who are doing really good in our high-poverty schools,” said Scott DiMauro.
Sept. 2019 OEA Retirement Systems Update
STRS Investment Returns Slightly Below Assumed Rate
STRS posted an investment return of 7.13% for fiscal year 2019 which ended on June 30, 2019.
This rate of return fell slightly below both the actuarial assumed rate (7.45%) and the total investment benchmark return of 7.30%.
The FY 2019 return followed two positive years of 9.57% in 2018 and 14.29% in 2017.
The total impact on the pension fund will be reported at the STRS Board’s October meeting with the annual actuarial valuation. This report takes into account investment returns, other economic factors and demographic changes such as retirement rates and mortality.
SERS Board Focuses on Sustainability of Pension and Health Care
During a Board retreat in July, the SERS Board focused its discussion on future sustainability of the pension plan and retiree health care benefits.
The sustainability of the pension plan is the primary goal of the SERS Board and discussions will focus on making sure the plan is in a position to withstand changes in member demographics, investment experience and economic pressures. Discussions on the topic will be ongoing with an initial focus on issues such as the SERS actuarial assumptions and risks presented by factors such as demographic changes in Ohio’s educational system.
Discussions on sustainability of health care benefits focused on a review of the SERS health care program over the last ten years. As SERS has made changes to health care benefits over that period of time to extend the longevity of the plan, changes to premium subsidy levels were identified as having the most significant impact. Currently, premium subsidies provide $95 million a year in benefits to retirees. 52% of premium subsidies go to non-Medicare retirees despite being only 12% of the enrollees due to the higher cost of coverage.
OPERS Board To Consider Changes to COLA, Pension and Health Care Benefits
The OPERS Board is considering a number of changes to pension and health care benefits that will be discussed in the coming months.
In order to reduce the unfunded liability of the pension plan, OPERS is considering changes to the cost-of-living adjustment (COLA) benefit for retirees. The proposal would result in a two-year freeze of the COLA for all retirees in 2022 and 2023 and delay future COLAs to two years after retirement for future retirees.
If recommended by the OPERS Board, these changes would require passage of legislation as well. Additionally, the OPERS Board is having initial discussions of creating a new tier of pension benefits for future employees, hired in 2022 or afterward.
Creation of a new “Group D” would also require passage of legislation. Changes could include changes in contribution rates, benefit and eligibility levels, and creation of retiree medical accounts. While discussions are preliminary in nature, OEA is concerned that creating a different tier of benefits for new hires may reduce their expected pension benefits without providing any discernable impact on the overall health of the pension system.
The OPERS Board has also discussed a number of proposals dealing with health care benefits. Changes are likely to include increased years of service required for pre-Medicare enrollment, replacing non-Medicare coverage with an open market model and reduced base allowances for all health care plans. Unlike changes to COLA and pension benefits, modifications to health care benefits are at the discretion of the OPERS Board and a vote could come as soon as November
Click here to download a copy of this September 2019 Report to the OEA Board of Directors