Good morning. My name is Robin Rayfield. I am a retired STRS member and Executive Director of the Ohio Retirement for Teachers Association.
Over the last several years our membership has waited for the STRS board to address our dissatisfaction with the pension system and the way our pension has been managed.
Specifically, retirees of our system have suffered from the decision to reduce, then eliminate, our guaranteed annual benefit amount. We have also observed the erosion of benefits promised to our active members and the loss of value of our pension contributions. We have offered specific examples of these concerns and data to support our charges.
In any conflict or difference of opinion, each side of the disagreement ought to carefully consider the opposing side's argument. Indeed, we can become 'married' to a position and this makes us incapable of seeing the other side's perspective.
Today is yet another opportunity to consider the other side's perspective. I have reviewed the draft agenda and I am troubled by the side that contains the Fiscal 2023 Final Results. The first bullet point states that the total return was 7.68%. The second bullet point states that this is an outperformance of the total benchmark return of 7.62%.
As I continue to read the smaller (less emphasized) points show that the 7.68% 'out performance' is not really out performance of NET results. Our net results are actually reported to be under performance of 7 basis points. After all, if we made 10% but it cost us 5% to make that rate, we really only made 5%. That is the rate of return available to pay benefits or to reduce the number of years of service required to earn full retirement benefits. STRS management constantly remind us that the performance data are 'net of all fees and expenses', yet here the data are presented gross of fees and stating that the performance exceeds the benchmark.
This is why it is so difficult to carefully consider what STRS presents to its members and attempt to balance what is provided. I recall something stated by my professor in grad school about data. The bottom line with data and stats is that 'Figures lie, and liars figure'. As board members, I find it incomprehensible that a small majority of you trust the data provided by STRS management and ignore the membership that are skeptical of what we are told. How is it possible that, regardless of what the data show, and regardless of what many 'experts' tell us, STRS management is never wrong, never underperforms, and always exceeds their benchmark.