(June 29, 2021) Early this morning, both the Ohio House and Senate overwhelmingly voted to adopt the Conference Committee report to provide the state with a new two-year budget, set to take effect on Thursday. The budget will not become official until it is reviewed and signed by Governor DeWine. We are pleased that legislators in both chambers listened to our concerns regarding both the need to forego any COLA freeze at this time and to grant OPERS the authority to make such decisions on their own, without the approval of the General Assembly.
Your PERI staff and Legislative Counsel were in frequent contact with key legislators to ensure that our concerns were addressed. Our members’ outreach with phone calls, emails and letters to their elected officials also had a significant impact on the final outcome. We thank you for your advocacy and want to remind you that there is strength in numbers! We appreciate you taking the time to let legislators know how important your COLA is to you.
PERI reversed its position in support of a freeze when it became clear that OPERS had two excellent investment years in 2019 and 2020, improving their funded status to 83% and lowering the important amortization period from 27% to 18%. These levels are indicators of good financial health. OPERS was previously close to the 30-year amortization level where mandatory plan design changes and reductions in benefits are required by law. Under these circumstances, PERI felt it could reluctantly agree to a two-year COLA freeze to potentially avoid a freeze of an unknown period of years much like that experienced by retirees of teachers and school employees pension funds. What changed was the substantial investment earnings windfall OPERS experienced as described above.
If OPERS wants to pursue the COLA freeze or take other action that might reduce retiree’s benefits, it will need to find a legislator to introduce a bill on their behalf. We have no indication that this action is pending but will continue to monitor the situation and report back to you with updates as they develop.