Retirement systems present 2025 budgets to ORSC; OPERS proposes $125.2 million operating budget

OPERS presented its 2025 operating budget of $125,200,000 at the March 13 Ohio Retirement Study Council meeting, a 4% increase from its 2024 budget of $120,400,000, Director Karahar said.

Karahar said the increase is driven primarily by a $5.1 million rise in the personnel category tied to merit-based pay adjustments and insurance costs, plus an $800,000 increase in professional services. The computer technology operating budget is expected to decline by about $1.2 million after the recent migration off the mainframe; Karahar said that migration now produces approximately $2.3 million in annual savings.

The proposed 2025 capital budget for OPERS increased to about $19.4 million from $15.2 million in 2024. Karahar outlined planned IT investments, including approximately $4 million for pension-system enhancements, $2.6 million for savings-system work, $2 million for a refund system, $1.8 million for a health-care system project and about $1.4 million for IT security.

Karahar said the budget assumes a 4.5% merit pool (merit-based, not an automatic cost-of-living adjustment) and that OPERS expects to employ 518 staff in 2025, down six positions from the prior year. He said evaluations determine individual increases, with higher ratings receiving larger increases.

Representative Plummer asked about the merit process; Karahar described an outside consultant that recommends market targets and an internal evaluation and calibration process run by HR and directors.

Representative Brennan asked whether the systems had considered combining health-care purchasing to realize economies of scale. Karahar said systems share some services but that health care is harder to consolidate because plans and populations differ; some entities do piggyback on others’ plans in limited cases.

John Danesh, speaking for OP&F, presented Ohio Police & Fire’s calendar-year 2025 operating budget of $30,300,000, a 3.1% increase from the prior year. He said personnel costs rose roughly 3.1% while health-care experience produced a decrease in health costs. OP&F’s capital budget is $3.9 million, largely carryover related to pension system upgrades.

Director Rorick presented the HPRS 2025 administrative budget, noting an internal operating increase of about 4.21% (roughly $106,000); he said personnel costs were the primary driver for that increase and that HPRS evaluates staff pay against association benchmarks for small staffs.

These budget presentations were received for council review; the chair reminded members that the council’s role during budget presentations is oversight and deliberation, not approval.