PERI Board of Trustees Votes to Oppose OPERS COLA Proposal

OPERS Board Votes to Reduce and Cap COLA’s
October 19, 2017
PERI Begins Process to Urge Legislators to Say No to COLA Reductions
November 6, 2017

PERI Board of Trustees Votes to Oppose OPERS COLA Proposal

(October 25, 2017)  The PERI Board of Trustees met yesterday to discuss OPERS recent approval to cap retiree’s COLA at actual CPI not to exceed 2.25%.  After much discussion, your Board voted to oppose this plan.  PERI is in the process of planning action to address this situation and will inform retirees of steps they should take to assist us in our efforts to mitigate the decision by OPERS Board.  We will be communicating with you soon regarding our plans.  We encourage you to visit our website for updates and stand by for additional information and direction.

88 Comments

  1. Ginny says:

    The PERI Board has shown courage and strength in opposing this. I for one, as a member of PERI, applaud your opposition vote and upcoming efforts. I venture to guess most PERI members will wholeheartedly support this opposition and do all they can to stop OPERS railroading the proposed COLA cap through the legislature. Excellent decision!

    • Frank says:

      The survey was a sham and I let them know it. The end result was already decided by OPERS. They (OPERS) has still not convinced me that their actions were necessary and appropriate. I can not go back to work at my age and we all know that medical and prescriptions are adversely affecting us much more than the federal COLA indicates. Our only hope is that members of our General Assembly will see things differently than the OPERS board. We must convince the media that this is not a good path to take for the retirees who made life changing decisions based on our retirement formula. Most members of the General Assembly will be OPERS recipients, so the media will likely play the card that they can not be impartial.

      Please advise us of how to mobilize for best outcome.

    • Christie says:

      I am in full agreement with you!

  2. Johnny Miller says:

    Good job to our board for looking out for use.

  3. Len says:

    I echo Ginny’s sentiments…this strong step has restored my confidence in the process and in PERI as an organization that fights to protect its members. Thank you and good luck.

  4. Rick says:

    Excellent decision, thank you PERI you have my support, we stand a better chance together .

  5. Michael Roberts says:

    God bless and good luck. Just to say, I am available for marches, protests, research, such as digging into why there has been such a lose with these hedge funds and who profited from the retirees lose. Anything I can do I will help with.

  6. Jim says:

    I stand with PERI. I suggest not posting any contrary comments. I know OPERS has not posted any of mine. They also refused to tell me why or even respond to me. And I both called and emailed them.

  7. Jim says:

    I just attempted to post the following to the OPERS’ blog:

    “OPERI.org has announced that they will lead the opposition to this attack on our contractually obligated pensions.”

    Of course, it does not reflect their story line that these cuts are supported by the retirees. Therefore, I expect it to “Await Moderation” until they delete it.

    • Ginny says:

      OPERS does not have an honest and open blog. It allows the reader to view and share opinions that are either pro OPERS or thoughts and ideas which do not threaten OPERS agenda. Opposition by PERI and its members regarding the COLA cap need to be published in newspaper articles and other media in blitz like fashion so OPERS finally gets the message. All OPERS active and retiree population need to be made aware that PERI and many retirees do not agree with this OPERS Board decision.

  8. Michael Roberts says:

    Let me try, I copy and paste all my comments to a word document and then the ones removed I send to my state representative asking him to contact PERS and get unlined the section that does not meet their posting guidelines. They are getting pretty tired of this and so far they have not removed the posts after that.

  9. Jim says:

    Thank you, Michael. I will start sending my complaint about deleted comments to my elected officials, too.

  10. Dean says:

    Thank you PERI Board.

  11. Hilou says:

    I hope PERI will prepare some type of ” sample letter ” that retirees can send to the legislators who will be involved in passing the legislation that OPERS wants passed.
    I also hope PERI will provide their members with the names and mailing addresses of the legislators we should be contacting.
    I agree with a previous comment above that indicates that not all retirees are members of PERI, and we need to find a way to inform those retirees so they get involved.

  12. Marc says:

    Went to board meeting. Watched the railroading job. They wouldn’t even consider other options presented to discuss, such as a cap on a maximum cola. Or listen to john mauger or Trustee Toth who gave a great speech to no avail. At last minute a trustee lowered the cap on the cpi without discussion.

  13. Retiree says:

    Many thanks and kudos to the PERI Board! Your leadership is so very appreciated.

    • Retiree says:

      Marc,
      Your comment suggests what I’ve thought all along. OPERS knew what their plan was from the very start. This talk of transparency and sending out surveys was just to make people think they had some say in this. I’m another person who has tried to post comments on OPERS’s blog with no luck. There was nothing in them that would have made them inappropriate to post. They did however point out inaccuracies in what OPERS was saying. They only want the blog to show positive comments so it makes people think that everyone is on board with this. I’m very grateful that PERI is going to take up this fight for us. If anyone thinks the fight isn’t worth it just look at what the CPI was over the last 10 years and do the math. I’m worried that some may think all OPERS is looking to do is lower it to 2.25%. The truth is you will only get that if that is what the CPI is that year. Some years we may only get 1% or 1.5% or even 0. I am open to some compromise only if It is proven to us that taking more away from retirees is really needed at this time. What I don’t want is to be tied to the CPI with no ability to know what my future increases will be if at all. If something has to be done to current retirees I personally would prefer it to be be a guaranteed percentage rather than fluctuating. Although I don’t think any decrease to those of us who retired with a guaranteed 3% is fair I could live with a guarantee of 2.5% if as I said it is proven to me that taking more away from us is the only option possible. The sad thing is, and I can’t believe I’m saying this, I do not trust OPERS. Not anymore.

      • Retiree says:

        Here’s an example of the math for what OPERS is proposing. If you retired in Jan 2007 with a retirement benefit of $30,000 and your first COLA was in 2008 you would now be earning $39,000. Using the CPI for those years, capped at 2.25%, you would be earning $33,510. Big change.

        • Ginny says:

          Retiree, I don’t think most retirees understand the actual concept of the CPI tied to the COLA cap as you have explained it so correctly. If they did, I’m certain they would be against what OPERS is trying to do. Some retirees think they will get 2.25% ever year instead of 3% and that this will be no big deal. When PERI communicates to its members this concept of CPI tied to the COLA, it needs to be explained as you have done. Perhaps then more retirees will be willing to oppose OPERS plans to once again slash benefits that our rightly ours.

  14. Len says:

    If you go on the OPERS website and read the responses that OPERS gives to the “select” posts you read the same “canned” responses over and over again and the pivotol questions are never addressed. They are not even smart enough to try to make themselves sound intellegent or is it that they just don’t care?

  15. Paul Golden says:

    OPERS CEO says the COLA voted on has to be approved by Ohio General Assembly. That’s not true.
    The state representatives and senators will not vote on this matter. The Ohio Retirement System Council
    Has authority over it.
    http://orsc.org/about/members-and-staff

  16. Bill says:

    Are there any attorneys that could interpret the following case to see if it applies to the COLA situation?

    United States Court of Appeals,Sixth Circuit.
    John J. MASCIO, Plaintiff-Appellee, v. PUBLIC EMPLOYEES RETIREMENT SYSTEM OF OHIO;  Richard E. Schumacher, Defendants-Appellants.
    No. 97-3314.
    Decided: November 04, 1998

    Some portions of the case:

    “The retirement benefits of Ohio public employees vest, by statute, at the time when the retirement allowance or pension is granted by the public employees retirement board.  Ohio Rev.Code § 145.561. The effect of this vested rights statute is “to make the engagement of public authorities to pay a pension, upon conditions fulfilled, a contractual obligation founded upon a valid consideration, giving to the pensioner a vested right in his pension which cannot afterwards be impaired or revoked.”  State ex rel. Cunat v. Trustees of Cleveland Police Relief & Pension Fund, 149 Ohio St. 477, 482, 79 N.E.2d 316 (1948), supplemented, 150 Ohio St. 377, 82 N.E.2d 743 (1948).”

    It seems to me that the promised COLA is a “retirement benefit” as mentioned above.

    “Article I, § 10 of the United States Constitution provides, “No state shall ․ pass any ․ Law impairing the Obligation of Contracts.”   The Supreme Court has promulgated a three-part test for determining whether a law violates the Contract Clause:
    Generally, we first ask whether the change in state law has “operated as a substantial impairment of a contractual relationship.”  Allied Structural Steel Co. v. Spannaus, 438 U.S. 234, 244, 98 S.Ct. 2716, 2722, 57 L.Ed.2d 727 (1978);  Energy Reserves Group, Inc. v. Kansas Power & Light Co., 459 U.S. 400, 411, 103 S.Ct. 697, 704, 74 L.Ed.2d 569 (1983).   This inquiry has three components:  whether there is a contractual relationship, whether a change in law impairs that contractual relationship, and whether the impairment is substantial.
    General Motors Corp. v. Romein, 503 U.S. 181, 186, 112 S.Ct. 1105, 117 L.Ed.2d 328 (1992).   See also, Linton v. Commissioner of Health and Environment, 65 F.3d 508, 518 (6th Cir.1995).   If all three components are present, a state may nonetheless avoid enforcement of the Contract Clause if it can demonstrate “a significant and legitimate public purpose behind the regulation, such as the remedying of a broad and general social or economic problem.”  Energy Reserves Group, Inc. v. Kansas Power & Light Co., 459 U.S. 400, 411-412, 103 S.Ct. 697, 74 L.Ed.2d 569 (1983) (citations omitted).”

    I feel that there is a contractual relationship, the change in law will impair that contractual relationship and the impairment is substantial. I don’t believe that PERS has proven a legitimate public purpose behind the new legislation such as the remedying of an economic problem. They have only presented the manipulation of numbers and misstatements.

    District Judge Rosen wrote: “As indicated by the majority, retirement benefits of Ohio public employees vest at the time when the retirement allowance or pension is granted by PERS. Ohio Rev.Code § 145.561. The effect of vesting is to impose a contractual obligation on the State to disburse retirement benefits.”

    • David says:

      Bill,
      From a layman’s perspective it looks like good information you’ve shared here. Thank you for that.

      I don’t know if peri has attorneys available to assist members with this situation but I am hopeful they do. When the MPA commitment was revoked by opers I tried to see if there were attorneys locally who could advise. I was told by one of the largest law firms in town that they represent opers and could not represent retirees as well. The attorney general told me the same thing. It’s a big town, though and I’m sure there’s someone good
      out there.
      David

  17. Ginny says:

    I just posted this on the OPERS website, which I’m sure will be deleted.

    This is from the ssa.gov website that shows the year and percentage of cola given (based on the CPI). As you can see, from 2009 through 2017 the COLA for social security based on the CPI is abysmal. Look this up for yourself. The truth is out there, you just have to look.

    2005 4.1
    2006 3.3
    2007 2.3
    2008 5.8
    2009 0.0
    2010 0.0
    2011 3.6
    2012 1.7
    2013 1.5
    2014 1.7
    2015 0.0
    2016 0.3
    2017 2.0

    With the exception of 2011, not one of those years I mentioned hit the 2.25% mark. OPERS does not tell the whole truth about how the CPI will affect our COLA or impact our retirement expectations.

    • Jim says:

      Ginny,

      Your information concerning the CPI inspired me to crunch the numbers:

      Although my columns didn’t line up, I took a retiree receiving $1,000 a month for their pension from Social Security and OPERS now and OPERS with the new 2.25 cap. You can see how we lose more than $200 each month in benefits and fall behind a Social Security recipient even though they only paid 6.2% of their salary as opposed to our 10% rate.

      The columns are YEAR—CPI-W—Soc. Security Retireee—Current OPERS Retiree and a cut OPERS Retiree.

      YEAR CPI-W SOC. SEC. RETIREE CURRENT OPERS RETIREE PROPOSED CUT OPERS RETIREE
      2005 4.1 1,041 1,030 1,022.50
      2006 3.3 1,075 1,060 1,045
      2007 2.3 1,100 1,090 1,067.50
      2008 5.8 1,164 1,120 1,090
      2009 0 1,164 1,150 1,090
      2010 0 1.164 1,180 1,090
      2011 3.6 1,206 1,210 1,112.50
      2012 1.7 1,227 1,240 1,129.50
      2013 1.5 1,245 1,270 1,144.50
      2014 1.7 1,266 1,300 1,161.50
      2015 0 1,266 1,330 1,161.50
      2016 .3 1,270 1,360 1,164.50
      2017 2.0 1,295 1,390 1,184.50

      We end up more than $100 a month behind a Social Security retiree and more than $200 a month behind where we would be with no changes.

      A $200.00 a month reduction is a lot of money for my family.

  18. David Nysewander says:

    I now have been put on mute on Ohio Pers face book page, another option available to the so called face book administrators of this that site. They remove people’s posts, sometimes they ban people where there is no blank space to comment. Now they have muted me, to me everything looks normal and my posts are there, but if anyone else from their face book page looks at pers page, my post are not there. A way of tricking people who thought there posts posted but real they only show on there own face log in and no one else.

  19. Sue says:

    I agree with just about everything above but I have not seen anything about “future triggers “. Seems to me that this section pretty much sets opers up so they can do anything they want in the future. Is anyone else concerned?

    • Ginny says:

      Jim, thanks for the info, and yes $200/month is a lot of money for most of us. Also, OPERS retirees who also get social security from working in the private sector are also affected by the windfall elimination provision (which can cut your social security benefits significantly, even though you earned them). All of this compounded really affects retiree income. As you pointed out, OPERS CPI/COLA decision is very detrimental to retirees.

  20. Frank Zangara says:

    Thank you PERI for your support. This is a very big deal. I could list a half a dozen reasons why OPERS is wromg to want to adjust tbe COLA. First are less than 4 full years into the latest pension reform. You can not go to the statehouse and ask for the law to be changed just because you wsnt to circumvent the law. OPERS is financially strong and has mo reason to cut our COLA and if you take the sverage OPERS pension and apply the CPI-w many public employees with be eligible for punlic assistance before they die. The CPI-w is a rigged formula nut that said if OPERS gets their way we teirees will have a lesser COLA than Social Security because they both would be tied to the CPIw Social Security is compounded ours is and would remain simpl under the proposal. Take nothing off the table including a possible class action law suit against OPERS and the State of Ohio if necessary. They made a contractual agreement with us and if they could not meet that responsibilty due to financial reasons then l could see but tjey can and to yhe best of my kmowledge they have not shared any metrics to back the futue financial concerns they site.

  21. Dale Harmon says:

    I recently joined PERI just because of the OPERS COLA issue. Effective 1/7/2013 the COLA was specifically removed from ORC 145.561 as a vested right. As a result, I believe it is quite reasonable to believe that everyone who retired prior to 1/7/2013 have not only a vested right in a COLA, but as ORC 145.561 reads: “…at the rate fixed at the time of granting such retirement allowance, annuity, pension, or other benefit.” I paid into OPERS for just shy of 35 years. During those 35 years that I was working, retirees were enjoying their 3% simple interest “COLA” and FULL heath care benefits. Now, when it is my turn, I and my fellow retirees are getting shafted. The 3% simple interest “COLA” is not some used car salesperson verbal promise, it is written in LAW. To change to COLA, for those who retired before 1/7/2013, is both a breach of contract and a retroactive change. Both are illegal.

    OPERS has been dishonest. The “survey” was a push poll. The proposed cut in our COLA is illegal.

    • Ginny says:

      Dale, perhaps PERI needs a very good lawyer to represent its members in this fight against this breach of contract and retroactive change to our COLA. When OPERS instigated the changes for future retirees, I assumed it would be only a matter of time before they went after current retirees. So much for trust in OPERS and the individuals who are in charge.

      • Dale Harmon says:

        US Constitution, Article 1, Section 10 in part: “No State shall.., pass any ex post facto Law, or Law impairing the Obligation of Contracts,…” Section 28 of the Ohio Constitution: “The General Assembly shall have no power to pass retroactive laws, or laws impairing the obligation of contracts;…” I don’t think it should take a very good lawyer to point out that if the COLA was not a vested right, then why was section B added effective 1/7/2013: “(B) This section does not apply to an increase made under section 145.323 of the Revised Code for a recipient whose benefit effective date is on or after the effective date of this amendment.”? Rolling back the amount of the COLA after it was granted certainly seems to me to be a change after the fact. Also, we have a defined benefit retirement. In a sense it is a contract. Changing the benefit after the fact is a breach of contract, which is also illegal.

        I think it is clear that seven members of the OPERS board think it is okay to ignore the law. OPERS sent out a Push Poll disguised as a survey to attempt to influence opinion. However, it is up to the Ohio Legislature to decide whether to pass a clearly illegal change in the COLA.

  22. Daniel says:

    I appreciate the position PERI is taking on this issue . Every graph see from OPERS compares a “ compounded CPI “ to a fixed 3% like it’s the same thing. We all know the % from year the year decreases because it’s based off the amount from when you retire not the previous year. That’s why there are retirees out there that there buying power is less than 85% under the current CPI calculations.

    I didn’t like the graph presented to us as it was not a good comparison between the CPI and fixed COLA. I didn’t think the survey letter was written well, it was written more like these are your choices and we can take your health care coverage away.

    I have not seen any financial figures that convinced me that any further changes are needed . It almost appears to me as if they are doing this because retirees before 2013 will be calculated different then the retirees after 2013 . Maybe the two different calculations are too difficult for them?

    What the COLA changes are proposing will take hundreds of thousands of dollars away from each retiree over time.

    I appreciate PERI looking into the “True Facts” and the “True condition” of “Our retirement”. Glad to be a member and thank you.

    Thank You!

  23. Len says:

    It is indeed unfortunate that an organization that like OPERS that boast in its vision statement to be a “trusted retirement partner, delivering responsive, high-quality service” and in its mission statement “to provide secure retirement benefits for our members” has with a single decision negated all that it claims to stand for. It is even more distressing that OPERS has formed an adversarial relationship with those that it has pledged to protect, and it appears that we are on the brink of a “civil war” to determine who will emerge victorious…not a good situation for retirees. Fortunately, we have an organization like PERI that is willing to lead the charge to protect those benefits that are legally ours, but that fact remains why must we even go into this battle with an organization whose very own vision and mission statements profess to strive to secure our retirement benefits?

    What is even more disturbing is the strong resolve that OPERS appears to have in pursuing this decision which seems to be a flagrant violation of not only its vision and mission statements but also federal and state law. My fear is that if OPERS’s resolve is this strong will going into this battle put retirees and PERI in a situation where though we may “win the battle” and retain our legally vested 3% COLA we will “lose the war” by having OPERS drop health care for all members…a strategic move that we cannot legally counter? I would hate to think that this scenario would transpire but after seeing what has occurred over the past several weeks it appears that the resolve on the part of OPERS to recoup this money is so strong that it is indeed a distinct possibility which would be far more disastrous to retirees financially than losing the 3% COLA.

    This being said, I am not proposing that we stop fighting for what is legally ours, but I am saying that we must prepare a strategy to deal with the potential ramifications. Perhaps we also need to work on restructuring the leadership of OPERS so that the organization truly upholds those principles that are reflected in its vision and mission statements and revert back to the organization that I trusted and believed in when I started my public employment some 47 years ago. I am not sure how we would go about this, but I think that as long as we are in an adversarial relationship with the very organization that manages our fiscal future we will constantly be living in the fear of what tomorrow will bring.

    • Dean says:

      Len,

      Health care is doomed to fail. OPERS investment goal for tle health care fund fund is 4%. The annual health care inflation rate is greater than 5%. .OPERS is pay $14000 a year for retirees under 65. That is 50% of many retirees pension amounts.

      • Hilou says:

        Len’s statement is correct.
        As long as the existing executive director and board members are in charge of OPERS, current retirees are in trouble.
        They came after cureet retirees benefits in 2012 and again in 2017.
        As long as retirees do not fight back, they will continue to come after our benefits every four years if not sooner.
        The executive director is in charge of managing the pension fund, and if the director and the board cannot make the proper investments while paying their investment director and deputy investment director more than a million dollars a year, maybe it is time for a management change. The solution to the problem cannot always be on the backs of the retirees.

    • Jim says:

      Len,

      I think cutting down on healthcare is already a foregone conclusion. I just don’t know if it will be next up or whether they will go after future retirees.

      It seems to fit their pattern. Groups A, B, C; cut healthcare; current retirees’ COLAs. Next up Groups X, Y, Z; cut healthcare; current retirees’ current retirement amounts.

      This pattern will continue, as long as OPERS employees are allowed to help themselves to $100,000.00 annual pay raises.

  24. Ginny says:

    Jim, this is my fear also, that OPERS will cut healthcare altogether and then our pension amount. I never would have thought they could do this, but to me the assumption is OPERS management can do anything they want to our pensions and healthcare.

  25. Jim says:

    Ginny,

    They want to act as if the Pensions that we paid into for decades is some sort of welfare program, as they keep syphoning off more and more for their pay raises.

    They go after one group at a time–divide and conquer. I guess that is why some are pushing for the swallowing of these pension systems into Social Security.

  26. Len says:

    This is all true but “at the end of the day” it will all boil down to what strategy PERI will take to counter this and more importantly how effective it will be or is it already a forgone conclusion? It will be interesting to hear some response from PERI.

  27. Jim says:

    Len,
    I’ve already sent letters but I’m waiting for PERI to let us know what we each need to do. I would hope that they will let us know soon.

    OPERS indicates that their next step is to find sponsors for this bill. I know that anyone who signs up as a sponsor, I’ll be contributing time and money to their opponent–regardless of whether they’re in my district or not. I suggest everyone do the same. They’ve already indicated that this is not the end of their cuts to our vested pensions.

  28. Len says:

    Thanks Jim….I will do the same. Are you saying that they can actually cut our monthly retirement income?

  29. Jim says:

    Len,
    I think it is definitely coming. Just like changing the COLA it would require a legislative change, but what would stop them?

  30. Len says:

    Your right…pretty scary.

  31. Jim says:

    They say cutting our COLAs will boost the pension fund by 4 billion. Watch them take huge bonuses for themselves, as if it had come from their investment decisions.

  32. Dean says:

    Beginning in 2011, the OPERS Board to increased fees to outside managers 300%. 2.4 billion thru 2016 wasted.

  33. Jim says:

    It must be nice for them to be able to lower assumptions about their investment returns from 8% to 7.5% and then gut our COLAs. This should produce great bonuses for them.

    All OPERS employees should have their wages set to a fixed-rate. Then any increase should be tied to the CPI. There is no reason for there wages to exceed inflation.

  34. Retiree says:

    I tried once again to post a comment on OPERS’s blog. It remained awaiting moderation until today and now it’s been deleted. It was in response to an innacurate statement they have made several times in their blog. I’m going to try to post their statement and my response here.

    Julie Graham-Price
    October 22, 2017 at 1:22 pm
    Since 1970, there have been 2 years where the CPI-W has been zero or less, in 2009 and 2015. If CPI is less than zero, the COLA will be zero. It won’t decrease.

    Julie, OPERS

    Reply

    Julie,
    This is factually incorrect. The CPI was 0 in 2009, 2010 and 2015. In fact, in the last 10 years it has been well below your proposed cap of 2.25% in all but 2 years. Those 2 years were well above it at 3.6 and 5.8 neither of which we would receive. We will continue to be penalized when it is low and will never reap the benefits when it is high. I do hope you post my comment. Thank you.

    What disturbs me about my comment not being posted is that they don’t seem to want the truth out there. There was nothing inappropriate in my comment. This just makes me trust them even less.

  35. Ginny says:

    Retiree, I did a similar post on OPERS and noted the 3 years there was no social security cola increase. OPERS deleted mine as well. They don’t want retirees to know the truth. You can’t fight if you have no control.

  36. Jim says:

    Many of my comments were deleted the same way. They will be able to point legislators to their website where most posts will be positive.

  37. Retiree says:

    I hope PERI is taking note of this to make the legislators aware. I also hope PERI realizes that many retirees aren’t aware of or don’t read these blogs and, as someone else pointed out earlier, they should send a letter out to all current retirees giving them the full and accurate implications of these changes. Maybe they should even do another survey. One in which retirees can give real feedback that isn’t skewed to come up with predetermined results.

  38. Dean says:

    PERI is preparing a mailing that will go to every OPERS retiree.

  39. David says:

    I worked in a position 31+ years contributing to opers. I retired and then returned to work in a position that also contributed to opers but this time in a separate money-purchase annuity (MPA). After being promised a fixed annuity pension payment for years, when I was within one year of eligibility, OPERS revoked its commitment and offered a much-reduced benefit instead. I never saw this change in writing prior to the time they announced it and was told they did it “in the spirit of” pension reform changes passed by the legislature.

    Any new requests by opers for legislative approval deserve some suspicion. They now have a track record for walking back commitments made during my career and may well be looking for legislative ways to start chipping away at vested benefits for current retirees as well.

    Thanks to PERI for taking a strong stand against the COLA change proposal.

  40. Donna says:

    Thank you PERI for opposing the cuts to our COLA. I am very grateful. Please let us know how we can help.

  41. Diane Miller says:

    In mid-September I posted the following paragraph to the OPERS blog. Evidently it was considered too strident and/or negative for OPERS to leave posted more than a couple of hours, after which it disappeared. I considered it to be frank and telling it like it is. Though it may be somewhat dated now that another month has passed, I think it’s still worth the light of day and appreciate having this PERI venue to add it to the conversation. Throughout my working years I always felt OPERS to be an organization that genuinely cared about the well-being of its members. No more… :

    OPERS vision statement: Our vision is to be your trusted retirement partner delivering responsive, high-quality service every time, all the time.

    OPERS mission statement: Our purpose is to provide secure retirement benefits for our members.

    Based on the OPERS FAQ sheet, it really is apparent that administrative minds are already made up to reduce current retirees’ COLAs in some fashion or other, rather than consider either grandfathering or the survey input. Based on the OPERS promise of 3% COLAs made just a few years ago to employees who retired before a certain date, nothing less than OPERS integrity is on the line in this exercise. Employees, who are now retirees, calculated their future finances and/or scheduled their retirement dates based on that very OPERS promise. To renege on it now, to backpedal in the middle of the game, so to speak, would essentially trash OPERS integrity going forward. How could any future pronouncement of OPERS be believed, if all are subject to reduction at any given moment? Absent a dire and imminent fiscal crisis, benefits promised to retirees need, at minimum, to be left as promised at time of retirement. Being satisfied with the gradual progress to be made by grandfathering / holding current retirees harmless from COLA reduction is the only option that would retain OPERS reputation as an organization of integrity, i.e., standing behind what they’ve said, which formed the basis upon which believing people retired. Current OPERS employees, as well, will plainly see whether they can anticipate OPERS will keep its word to them in their future retirements, or renege at will.

    • David says:

      Diane,
      Well-said, in my opinion. Thank you for putting to words what others feel. This is now a question of trust with opers and we’ll have to see if they listen.
      David

  42. Dean says:

    Diane, One of the concerns OPERS expressed at the annual PERI meeting was new workers opting out of the defined plan, self directing, their pension if the defined benefit was reduced further for new workers. Why they they think people would opt into a plan that defaulted on the current retirees is rather baffling.

  43. Ginny says:

    Diane, well said. I for one, will never trust OPERS again. They sucker you in to make a decision for your retirement years, then pull the rug out from under you. They are not trustworthy or honest and I question whether they are really good stewards of OPERS investments.

  44. Michael Roberts says:

    Kasich was with Lehman Brothers talking to all the state retirement systems and getting them to invest in 2008 and when Lehman Brothers went down all the retirement systems in Ohio lost 427 million. He became governor in 2011 and I think this article says the rest – http://www.thenews-messenger.com/story/opinion/2016/08/24/column-opers-hedge-funds-grew-zero-billion-years/89209436/ We need a total and complete audit of the OPERS system, the amount of money they lost while the stock market soared and the commissions paid would pay COLA’s for 3 more years and that is if they had not lost the money, if the money was invested in solid assets instead of hedge funds, maybe that would have been enough for COLA for 10 or 15 years. A total and complete investigation is needed of this operation.

    Then there is the position that OPERS will not consider other options, like stopping, delaying, or making double dippers pay into the system, other states say double dipping is draining their public pension, remember they do not pay into the system take a job away from a paying member. capping salaries eligible for a PERS pension at say 150,000. Capping COLA at 3 percent up to the average wage in Ohio around 53,000 or more, nothing after that or maybe 1/2 percent on anything above. Using live actuarial tables for beneficiaries of joint and multiple pension plans. They certainly use the live actuarial table when they tell us we live too long. Stopping QEBA, which is pension paid above what is required under IRS law, I think it is for paying pension above 215,000 per year. They sneak the funds out of the retiree health funds to pay the extra under law they are not required to pay, so they passed QEBA to pay it. And there are so many other cost saving features we were not asked about how we might want to cut expenses, we were told a freeze or reduced COLA.

  45. Len says:

    Isn’t it true that OPERS retroactively cut the benefits to beneficiaries by basing their benefits on the retirees base salary minus any accumulated COLA? I have been retired for 14 years and have been told that my wife who is entitled to 90% of my benefits will have her benefits calculated on my base salary only. I was told when I retired her benefits would be calculated on my current salary…again another retroactive change. Does anyone know when this change occured? Won’t this change save OPERS a considerable amount?

    • Ginny says:

      Len, I hope this isn’t true, this will be devastating for surviving spouses/beneficiaries. Where is this documented? I would like to read it as this is the first time I’ve heard this.

  46. Len says:

    When I logged into my OPERS account it showed my beneficiaries benefits and it didn’t look right so I called and this is what I was told. Take a look at your account on the OPERS site and see if your beneficiary benefits look correct…I hope I am wrong…does anyone know if this is true? Like I said I called OPERS after I became suspicious and this the explanation they gave me.

  47. Hilou says:

    I called OPERS in June when I was doing some financial budgeting to verify what my wife’s benefit would be based on.
    I was told at that time that it would be based on my base pension amount at retirement plus the accrued Colas.

  48. Len says:

    Hilou and Malcom…did you check on your OPERS account to see amount that is shown for the beneficiary? Do the numbers seem correct? How long have you been retired? I hope your are correct.

    • Len, Opers don’t add the colas on the base amount for the retiree or spouse for some reason on their web site. Of course we never know what the future will bring. As it stands now if you pass before your spouse they get the percentage you leave them plus the accumulated colas.

  49. Len says:

    Malcom, thanks for the clarification. Evidently the person that I spoke with at OPERS was confused when I called about that but that doesn’t surprise me. Again thanks for responding.

  50. R J says:

    I received a notice from OPERS, dated October 20, 2017, that announced that OPERS Board of Trustees approved COLA changes. I was surprised to read Item 2, Delaying implementation for some retirees: “The new COLA formula will delayed two years for OPERA members who retired from 2010 through 2012. This provision was included based upon feedback from our recent survey of OPERS retirees.”

    I am just wondering if this is some acknowledgement by OPERS that those retiring during those years were told that the COLA was guaranteed to retirees in their literature, seminars and videos, if they retired prior to 2013? I also think this is also an attempt to further “divide and conquer” retirees from one another. I think it is important that we do not let this happen and all retirees who retired prior to 2013 should receive the COLA as promised to them by OPERS.

  51. Ginny says:

    Thanks Malcolm, relief on this issue is an understatement.

  52. Jerry says:

    Kudos to P.E.R.I. to oppose the Opers c.o.l.a. reduction. I do think Opers will encounter push back in the general assembly also.

    • Jerry, as far as the push back goes that maybe true or maybe not. Earlier this year STRS of Ohio ram the Cola freeze for five years through the general assembly in nothing flat. Sers of Ohio got a three year cola freeze. I hope your right though.

      • Dean says:

        The General Assembly gave the STRS Board the authority to reduce Cola in 2012. The GA did not need to approve. A cut to the SERS COLA was supported by SERO (the SERS retiree group), so the change was unopposed except for AFSME.

  53. Jerry says:

    It seems the general assembly will rubber stamp the Opers c.o.l.a. reduction proposal. I hope i am wrong. This would be the time for p.e.r.i. to consult with attorneys. I feel retirees are going to take a hit this time.

  54. Like i said before retirees are already taking a hit with the increase in spouse healthcare. For the 35 years that i worked under a Opers job me and every member was subsidizing the previous retirees spouses and other family members through employers 14% contributions to the pension system. Now after we are retired several years they tell us we are living to long and now they want to nip the Cola. Such B.S.

  55. Retiree says:

    Thank you PERI Board and Staff for your willingness to provide the leadership needed to address this injustice. It saddens me greatly to see the suffering caused by OPERS to so many who relied in good faith on what was promised. Changes to retirement public policy need to be thoughtful, measured, and provide accurate advanced information to persons considering whether or not to choose or continue to choose a career in public service. All current and future retirees need to unite around the principle of no retroactive changes for retirees. Otherwise no public employee can ever retire without feeling his/her retirement is in constant jeopardy.

    OPERS posted a chart in 2012 that provided to persons considering whether or not to retire, an opportunity to weigh his financial status over 15-20 years if he either: 1) continued to work and received annual work place cost of living adjustments of 2% per year, or 2) retired and received a 3% annual COLA payment over the same time period. The clear implicit message was that those who were active retirees anytime before 01-07-13 would continue to receive a guaranteed 3% COLA. It sounds as though, from reading the comments, there have been several other changes quietly made by OPERS to adversely impact career employees who counted on information they were initially given. It would be well worth it for retires to pay higher PERI membership fees or pay one-time membership surcharges so PERI has the resources (for example to obtain legal counsel, buy ads, mass mailings, etc.) It needs to maintain the 3% COLA and preserve benefits promised. It sounds from comments posted that many of us are willing to help under PERI’s direction (eg to educate fellow retirees via stuffing envelopes for mailings; encourage non-PERI members to join PERI, etc). Persons retiring after the 01-07-13 deadline will benefit from this precedent in that the principle of OPERS not making retroactive changes will be set for them when future issues affecting them arise. If these retroactive COLA changes are enacted, it sets a catestrophic precedent for current and future retirees.

    Once we achieve success in preserving the promised COLA, it sounds as though from posted comments, there are a number of other concerns that have emerged to be systematically addressed.

  56. Dale Harmon says:

    As “Bill” above posted, the case of “United States Court of Appeals, Sixth Circuit. John J. MASCIO, Plaintiff-Appellee, v. PUBLIC EMPLOYEES RETIREMENT SYSTEM OF OHIO;  Richard E. Schumacher, Defendants-Appellants. No. 97-3314. Decided: November 04, 1998″ decided in part that “The retirement benefits of Ohio public employees vest, by statute, at the time when the retirement allowance or pension is granted by the public employees retirement board.”

    Further the court ruled that, “Ohio Rev.Code §145.561. The effect of this vested rights statute is “to make the engagement of public authorities to pay a pension, upon conditions fulfilled, a contractual obligation founded upon a valid consideration, giving to the pensioner a vested right in his pension which cannot afterwards be impaired or revoked.”

    The simple interest COLA was removed from the ORC §145.561 as a vested right effective 1/7/2013. It should be obvious that pursuant with John J. Mascio v. Public Employees Retirement System of Ohio (11/4/1998) that the COLA of those who retired prior to 1/7/2013 is a vested right which cannot afterwards be impaired or revoked.

  57. Hilou says:

    Dale,
    Very interesting information in your comment .
    Are retirees who retired prior to 1/7/2013 going to need a lawyer to protect our vested rights per ORC 145.561 prior to the1/7/2013 removal?
    If your information is accurate how can OPERS think they can make the change in COLA to all current retirees?

    • Dale Harmon says:

      OPERS cannot do more than recommend to the legislature the change in the COLA. It is the legislature which might make changes to the law. Hopefully, our position will be taken into account and the resulting changes in COLA will be for those who retired on or after 1/7/2013. The Mascio case text can be found here: http://caselaw.findlaw.com/us-6th-circuit/1274694.html

      There is no certainty that a court would find that a change in state law to reduce our COLA would be a substantial impairment of a contractual relationship. I think it would be. As to your question, the answer is yes. If the Ohio Legislature passed the changes in the COLA that OPERS is recommending, then the likely result will be a class action lawsuit which could take years to resolve.

  58. Deab says:

    Unfortunately this is one case. When a public pension can show there is a compelling public interest, the courts have ruled a COLA can be voided.

  59. Michael Roberts says:

    Don’t the courts and public officials also not want to know why OPERS has lost so much money in hedge funds? I want to know why OPERS is paying investors hundred of thousands of dollars to lose money. The stock market has soared since the downturn in 2008, yet OPERS invests in a money in a losing proposition while paying the hedge funds managers millions. I do agree that the courts across the country have ruled in favor of reducing or stopping COLA’s and only one State have the employees won against a reduction. But like I said before, we need every bit of dirt we can dig up on OPERS, and a start is the money lost on hedge funds. We need to know all the employees employed by OPERS, their salaries and who they are friends and why this money losing hedge funds was even invested in. Sounds to me someone made money off those investments and it wasn’t in the interest of the retirees.

  60. Hilou says:

    Michael,
    If you want to know who is employed by OPERS and what they make it is public record on the Ohio Treasurers ” Office of Ohio Treasurer” web site.
    Look where it says “Treasurers Transperancy Project”.
    Press the blue button that is marked “Pension Fund Salaries”.
    Press the drop down box and check ” Ohio Public Employees Retirement System “.
    Hit the search button and below will appear a listing of 654 names ans salaries listed on seven pages.
    You will find 150 people earning over $100,000 a year in 2016.

  61. Michael Roberts says:

    Also the double dipping. CalPers – California Public Retired employees Reinstatement from Retirement
    If you return to work for a CalPERS employer in a permanent, part-time or full-time position, you must reinstate from retirement into active employment. This means:

    You become an active CalPERS member again.
    You can retire again later.
    You resume earning retirement service credit.
    Your retirement benefits stop. So the biggest public pension in the world about 4 times the size of OPERS will not let you double dip? Hello Ohio – There are exception – such as Limited work such as Department emergency and the rate of pay and the max hours are 960. All those restriction must be meet to even return part time to work. They realize double dipping is draining their system as it ours. https://www.calpers.ca.gov/docs/forms-publications/employment-after-retirement.pdf Again ways to save our there, OPERS is just stubborn of course all those high paid people want to retire and return to work the next day.

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