Government relations update

OPERS staff working with legislators on several bills related to OPERS

By Michael Pramik, Ohio Public Employees Retirement System

March 14, 2024 – OPERS continues to work with state legislators on a series of pending bills that could impact the system.

State bills on which OPERS has advocated for or against include:

• House Bill 94, which would allow Ohio Police & Fire Pension Fund members to transfer service credit to OPERS even if they contributed most of their time to OP&F. OPERS has concerns with the proposal and has delivered testimony to the Ohio House of Representatives Pensions Committee on HB 94. The bill, as drafted, would eliminate the service credit transfer requirement for OP&F members into OPERS (i.e., cannot transfer unless the member has more time in OPERS than OP&F and will retire within 90 days of the transfer).

OPERS staff have met with committee members to urge them to consider a more efficient solution – that is to eliminate the requirement impeding active OPERS members with fewer years of service credit in OPERS to transfer service credit to OP&F to be eligible for a retirement benefit. OPERS’ testimony on the bill was centered around the active-duty requirement issue, though OP&F opposes the proposal. OPERS will continue to work with the General Assembly to bring about a reasonable solution to a legitimate issue.

• House Bill 261, a bill that proposes adding EMS workers to the OPERS LE/Public Safety Division. OPERS testified to the House Pensions Committee as an interested party. It is OPERS’ position that the integrity of the LE Division should remain intact by not adding classifications outside of the realm of peace officers.
  
• House Bill 296, increasing the employer contribution rate for OP&F police officers from 19.5% to 24%.

The OPERS Board of Trustees acted last year to authorize OPERS staff to enact the system’s first statutory maximum employer contribution rate increase in nearly 50 years. The legislation would increase the maximum employer contribution limit for state and local members to 18 percent and grant the Board authority to raise the Law Enforcement statutory contribution to the same rate as that of the Ohio Police & Fire Pension Fund.

Contributions is one of the four components of a pension system’s retirement funding equation: Contributions + Investment Earnings = Benefits + Expenses. Successful passage of legislation to increase the employer contribution rate statutory maximum would enable OPERS to pay down its debt sooner, which is important because of decreasing active-member-to-retiree ratios.

OPERS believes if the General Assembly agrees that employer contribution rate increases should be considered for one system, it should give equal consideration to all pension systems.

• House Bill 4, which would prohibit Ohio’s public retirement systems from entering certain contracts with entities that the Treasurer of State identifies as engaging in economic boycotts. OPERS has voiced its concerns about the proposed language and will continue working with the sponsors.
• House Bill 257, which would allow OPERS Board members to adopt a policy that would authorize members to attend meetings remotely under certain circumstances. OPERS supports the proposal. The bill overwhelmingly passed in the House of Representatives and has received an initial hearing in the Senate Government Oversight Committee.
• Senate Bill 6, which would restate the fiduciary responsibilities of OPERS regarding our investments and corporate governance activities. OPERS has taken a neutral position on SB 6, as it already complies with the language of the bill.