Among states where teachers are not covered by Social Security, Ohio’s employer contribution rate is the second-lowest, while Ohio’s teachers contribute at a rate that is the third-highest. We are working with the state legislature and encouraging members and other stakeholders to join us in these conversations.
Having additional resources would bolster the resiliency of the pension fund and allow the State Teachers Retirement Board to consider benefit changes sooner than would otherwise be possible. We look forward to partnering with our members on this important endeavor.
— Lynn Hoover, acting executive directorIn fiscal 2023, there were more than 536,000 members and benefit recipients.
A change from two active members for every one benefit recipient to one active teacher for every benefit recipient.
Sustainable Benefit Plan: Allows for an annual process for the State Teachers Retirement Board and its actuaries to incrementally change benefits if there is no material impairment to the fiscal integrity of the system
Pensions & Investments recently reported that over a ten-year period, STRS Ohio chalked up an annualized net return of 8.6%, the eighth highest return among 79 public pension funds it tracks (for the 10 years ended June 30, 2023).
It was projected in 2011 that without pension reform the pension fund would run out of money by 2040. The Ohio legislature approved changes needed to keep STRS Ohio’s funding period — that is, the projected time needed to reach a 100% funded status — within the State of Ohio’s 30-year target.
Key changes include:
Reforms proposed by STRS Ohio were supported by stakeholder groups. Support was received from the Healthcare & Pension Advocates for STRS; a diverse coalition comprised of professional employer, employee and retiree organizations supporting STRS Ohio’s stakeholders.
Over the past ten years, Ohio teachers have contributed at the third-highest rate among comparable systems in states where teachers are not covered by Social Security (averaging 12.8% compared to a median of 9.25%). At the same time, the employer rate in Ohio has been the second-lowest, averaging 13.4% compared to a median of 19.6%).
Funded ratio: STRS Ohio assets as a percentage of what it owes to current and future retirees
75%
80%
Funding period: Time STRS Ohio would need to fully fund benefits for current and future retirees
30.5 years
11.2 years
Increasing Ohio’s employer contribution rate will put benefit changes that can be sustained over the long-term back on the table for Ohio teachers.
