A plan to help relieve an under-funded statewide educators' pension system has potential, if passed by the Ohio legislature.
Recently, the board of the 470,000-member State Teachers Retirement system board approved a plan that would gradually increase the years-of-service requirement to 35 years by 2026.
Teachers would be able to retire until-mid 2015 at any age and get a full benefit if they have worked 30 years. After 2015, the years-of-service requirement would gradually go up, so that after mid-2026 teachers could not retire and receive full benefits until they are 60 years old and have at least 35 years in.
The teachers' salary contributions to their retirement funds would also increase from 10 percent to 14 percent over four years.
The new plan is designed to save $13.3 billion in accrued liabilities. State Teacher Retirement spokesman Rick Treneff was quoted in a Columbus Dispatch story as saying, "We know that every individual is not going to be happy with the results. But we think we have a good understanding among active teachers, retirees and employers that changes needed to be made to ensure our solvency going forward, and these changes are in the best interest of all the plan participants."
Changes do indeed need to be made. Taxpayers cannot afford to be shoring up public employee benefit funds which provide exorbitant benefits. Allowing teachers with 30 years-of-service to retire with full benefits in their early 50s when they could easily live 30 or more years, is too great of a burden for any system to fund.
The Ohio Senate could consider this plan as early as May, but the House isn't likely to move on it until after the November election.
We urge both the Senate and the House to move on this plan as early as possible. It sounds like a common sense way to solve a big problem looming in our future.