Changes Coming to Ohio Public Employees Retirement System Benefits

After months of discussion, the Ohio Public Employees Retirement System (OPERS) will institute a “freeze” to its annual Cost of Living Adjustment (COLA) in 2022 and 2023.  OPERS has stated that the elimination of the COLA for this two (2) year period will assist in sustaining the healthcare benefit for OPERS retirees. 

Under the current benefit structure individuals who retired prior to January 7, 2013 receive an annual 3 percent COLA.  Individuals that retired after that date have their COLA based upon the Consumer Price Index (CPI) capped at 3 percent.  Once the freeze is eliminated in 2024, individuals will be returned to the status they held prior to the freeze being implemented.

In addition to the proposed COLA changes, OPERS is considering additional changes that will impact future retirees hired on or after January 1, 2022.  Known as Group D, these individuals would be impacted by the following changes:

COLA Freeze – A retiree’s first COLA would be delayed until the 2nd pension anniversary (24 months) after retirement.

Higher Member Contribution Rate – The Member Contribution Rate would be increased to 11 percent (currently 10 percent).

Benefit Eligibility – The prosed change would increase the Age and Service requirement needed to receive an unreduced benefit; currently age 55 with 32 years of service OR age 67 with 5 years of service.

Under the NEW eligibility requirement an individual would had to have reached one of the following thresholds:

  • Age 62 with 35 years of service.
  • Age 67 with 25 years of service.
  • Age 70 with 5 years of service.

Final Average Salary (FAS) – The amount of years used to calculate benefit would increase to 10 years (currently 5 years).

Reduction in Multiplier – The multiplier currently used to calculate retirement currently set at 2.2 percent would be reduced to 2 percent.

AFSCME Ohio Council 8 does not currently support the Group D plan because in our view, it places more of the burden on the backs of workers while threatening the overall financial stability of the system.  As OPERS continues to develop this plan we will keep members update to it status.

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