Ohio Retirement Study Council. Bethany Rhodes, Director and Legal Counsel

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1 Ohio Retirement Study Council Bethany Rhodes, Director and Legal Counsel

2 Voting Members Representatives Kirk Schuring, Chair Rick Carfagna Dan Ramos Senators Steve Wilson, Vice-Chair Edna Brown Jay Hottinger Governor s Appointees Lora Miller Dr. Thomas Pascarella Chris Potts OVERVIEW Function of the Ohio Retirement Study Council (ORSC) Pension Facts for Ohio s Public Retirement Systems Health Care Facts for Ohio s Public Retirement Systems

3 Function of the Ohio Retirement Study Council Created in 1968 Assist in the formation of sound public pension policy Provide legislative oversight Advise and inform the state legislature Benefits Funding Investments Administration of the five state retirement systems in Ohio

4 Review of Legislation- Process Introduction of Bill and Committee Referral First Hearing Actuarial Analysis (Retirement System and ORSC Actuary) ORSC Staff Review and Recommendation ORSC Recommendation to the General Assembly General Assembly action

5 Review of Legislation- Standards Effect on Funding Status Intergenerational Equity Previous General Assembly and ORSC Actions 1978 ORSC Principles Governing Pensions Pensions are a statutory obligation; health care is not

6 Five State Retirement Systems in Ohio Ohio Public Employees Retirement System (OPERS) State Teachers Retirement System (STRS) Police and Fire Pension Fund (OP&F) School Employees Retirement System (SERS) State Highway Patrol Retirement System (HPRS) ORSC does NOT have oversight of the Cincinnati Retirement System

7 OPERS covers the widest range of employees, including all state and local government employees, members of the General Assembly, and certain non-municipal law and safety personnel. Examples of membership include: Ohio Public Employees Retirement System Sheriffs Township Police Librarians Ohio Department of Transportation City Sanitation ORSC Staff and Staff of the State Retirement Systems State Highway Patrol Dispatchers Amortization Period Pension Facts Funded Ratio Total Membership Assumed Rate of Return % 1,081, %

8 STRS is composed of teachers at public schools, colleges, and universities. State Teachers Retirement System Amortization Period Pension Facts Funded Ratio Total Membership Assumed Rate of Return % 326, %

9 OP&F is composed of full-time police and firefighters. The following members are excluded from OP&F: Township Police (members of OPERS) Troopers (members of HPRS) Sheriffs (members of OPERS) Ohio Police & Fire Pension Fund Amortization Period Pension Facts* Funded Ratio Total Membership Assumed Rate of Return % 56, % *OP&F recently updated their assumptions, including reducing the return assumption to 8.00%, which will alter the table.

10 SERS is composed of all non-teaching school employees. Examples include: School Employees Retirement System School bus drivers Custodians Food service providers School treasurers Amortization Period Pension Facts (Pre-COLA suspension) Funded Ratio Total Membership Assumed Rate of Return % 200, %

11 HPRS is composed of state troopers and officers. Highway Patrol Retirement System Amortization Period Funded Ratio Pension Facts Total Membership Assumed Rate of Return % 3, %

12 Health Care Health care is not a statutory benefit and subject to change Administered and controlled solely by the discretion of the retirement system boards Must be financed solely by employer contributions (federal law) Health Care Facts Retirement System Funding (in millions) Employer Allocation to Health Care Solvency Period OPERS 11, % Indefinite STRS* 3, % 2035 OP&F % 2025 SERS %** 2023 HPRS % (2017) 0.00% (2018) 2028 **Does not reflect subsidy changes going into effect January 1, *Excludes employer surcharge for health care. Ohio law permits SERS to impose a surcharge on employers of up to a statewide average of 1.5% of employee payroll for health care coverage of retirees.