COLUMBUS, Ohio — A new report released by the Equable Institute and Opportunity Institute has shed light on the impact of teacher pension debt on education resource equity in Ohio. The study, entitled “Pension Debt Challenges for Equity in Education: The Effect of Teacher Unfunded Liability Costs on K–12 Education Funding in Ohio”, found that Ohio’s unfunded pension liabilities for teachers and school employees have been eroding the state’s ability to improve education outcomes and perpetuating inequities, especially in low-income communities.
The report revealed that spending on retirement benefits by Ohio school districts has increased at a rate more than three times faster than the rate of total K-12 education spending. It also showed that pension spending as a share of state and local K-12 education spending has increased by 45.5% between 2001 and 2020 and that as of 2020, Ohio’s school unfunded liability amounts to $18,725 per student and accounts for 77.62% of total K-12 funding per student.
Furthermore, Ohio has used up its means of covering the growing costs for teachers and school employees, as active teachers and retirees have been paying for the growing retirement costs. The unfunded liabilities are projected to reach nearly $50 billion by 2031, requiring increased contribution rates.
Opportunity Institute and Equable Institute have emphasized that the current distribution of contribution requirements is already inequitable, with economically disadvantaged communities paying a portion of the retirement costs of educators in wealthier districts. If the state has to raise school district costs for retirement benefits, it will exacerbate these inequities and reduce resources for students who need them the most.
This report is one of four reports detailing the impact of pension debt challenges facing state education budgets in the US. The reports for California, Texas, and Florida can also be found at pensionequityineducation.org.