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 OPERS Statement

UPDATE
Union helps get pension reduction off table

July 8, 2009 - Gongwer News Service is reporting that the proposal to cut state employee retirement is off the table. According to the news source, Rep. Todd Book and Sen. Keith Faber both are saying the proposal to reduce the state’s OPERS contributions from 14 to 8 percent is dead.

Proposed State Budget Cuts Threaten OPERS’ Pension and Health Care Funds

June 23, 2009 - The governor’s proposal last Friday to reduce contributions to state worker pensions threatens the funding status of the Ohio Public Employees Retirement System (OPERS) including its ability to offer health care to retired Ohioans.

While the severity of the state’s budget crisis is unprecedented, reducing contributions to pensions has ramifications far beyond the current fiscal emergency. Reducing contributions immediately puts OPERS outside the 30-year period required by law to fund pensions and reduces the solvency of the fund that pays for all retiree health care. The result not only hurts current retirees, it threatens the security of retirees for years to come.

As part of the governor’s $2.4 billion in additional state budget cuts, it was proposed that contributions to state worker pensions be reduced from 14 to 8 percent over two years with the potential of reimbursing OPERS over a 10-year period. In addition, more state jobs would likely be eliminated, further reducing revenue to OPERS used to fund current and future pensions.

The general economic downturn has reduced the funds previously set aside for health care. Further reduction in contributions would diminish OPERS’ ability to provide health care to its retirees.

OPERS has begun discussions with the State Office of Budget Management and legislative leaders to understand the full details of the governor’s proposal.

OPERS plays a critical role in supporting the state of Ohio, infusing billions of dollars into the state’s economy in the form of benefit payments, health care payments and investments in job-creating businesses through the Ohio-Midwest Fund.

For every $1 of taxpayer contribution to OPERS investments and employee contributions plus other sources of revenue return $2.58 back into the Ohio economy. As these dollars ripple through the economy they generate additional economic activity and have an even greater beneficial impact.

With assets of approximately $60 billion, OPERS is the largest state pension fund in Ohio and the 12th largest state pension system in the U.S.

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OPERS Contact:     
Julie Graham-Price, APR
Ohio Public Employees Retirement System
614228-0388

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