Pension plan gives out $9.6M in bonuses

The State Teachers Retirement System of Ohio board on Thursday approved $9.66 million in bonus pay for about 100 investment staff, over the objections of retired teachers.

The Ohio Retired Teachers Association asked the board to reject the bonus pay, citing $3 billion in investment losses and high inflation rates.

The bonuses were approved on a 9-2 vote with board members Rudy Fichtenbaum and Wade Steen opposing it.

A spokesman for the state's second largest pension fund said bonus pay helps attract and retain top talent. Bonuses are based on how the system performs over one-year and five-year windows compared to benchmarks.

Although STRS lost money in the last fiscal year, it outperformed its benchmarks. STRS suffered a 3.61% loss while is peers lost 5.62%.

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STRS operates on a fiscal year that runs July 1 to June 30. Its total portfolio dropped from $98.1 billion on June 30, 2021 to $90.6 billion on June 30, 2022 - a $7.5 billion loss. The fund pays out about $7 billion in benefits each year and takes in $3 billion in contributions so even if its investment return were zero, the fund would drop by $4 billion.