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Proposals balance individual’s funding and systems’ viability

Posted on | March 16, 2011 | 2,737 views | 5 Comments

As you may know, the Ohio legislature is considering several proposals to maintain the solvency of the state retirement system’s defined benefit plans, including the State Teachers Retirement System (STRS) and the Ohio Public Employees Retirement System (OPERS). We believe it’s important that you understand the current proposals and how these changes may affect you.

Currently, legislation is pending that would make changes that are required to maintain the long-term viability of the state’s pension programs. STRS and OPERS have made recommendations that cover areas such as pension contributions, retirement eligibility, and cost of living adjustments. Detailed information about the recommendations is available on pages 6 and 7 of this issue of onCampus, as well as on the STRS and OPERS web sites. The contact information for each organization also is listed below.

It is important to note that these are recommendations and not officially adopted plans. Changes are still possible in the ongoing legislative session, and we will share them with you as they are known to us.

It’s not possible to make generalizations around the individual impact of these proposed changes. Because STRS and OPERS have different member demographics and are funded at different levels, each retirement system has developed its own recommendation. Also, the recommendations address a variety of situations and affect each individual differently based on his or her specific circumstances.

I encourage you to take time to fully consider your options before making any decisions about your longevity with Ohio State and your retirement. We anticipate this legislation will be approved by June 30, 2011, and go into effect 90 days later. Each recommendation has details about when the specific changes will be implemented.

One component of the proposed changes affects the Alternative Retirement Plans (ARP). Faculty who are members of the ARP might see changes in their contribution rates, depending on legislative outcomes. If employee contributions are increased per STRS recommendations, the faculty in the ARP also will see an increase in their contribution.

While these changes may affect our faculty and staff, I firmly believe careful thought was given in developing the recommendations, and there is a strong balance between an individual’s retirement funding and the long-term viability of the state’s retirement systems’ defined benefit plans. Ohio State’s leadership has been watching the legislation closely and is actively advocating for defined benefit pension plans while also keeping the defined contribution options.

We will continue to monitor the proposals through the legislative process and communicate with you as the legislation progresses. You can always obtain current information by visiting the STRS and OPERS web sites.

If you have questions about how these changes may affect you, please contact STRS or OPERS, or your personal financial advisor; these experts are best able to offer advice about your specific circumstances.

Contact Numbers

State Teachers Retirement System of Ohio (STRS)
Web: https://www.strsoh.org/
Phone: 1-888-227-7877

Ohio Public Employees Retirement System (OPERS)
https://www.opers.org/News/ORSC/index.shtml
1-800-222-PERS (7377)

Related stories

♦ OPERS members could see new age requirements
♦ STRS proposal: Teacher contributions rise to 13 percent

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