Ohio School Employees Retirement System says current contribution structure keeps plan on track

Richard Stensard, executive director of the Ohio School Employees Retirement System, told the Public Insurance and Pensions Committee that SERS serves non‑teaching school employees — bus drivers, custodians, food service workers, administrative assistants and school treasurers — and that the membership and benefit profile is modest.

"Engagement, transparency, accountability, and sustainability" are principles that guide SERS, Stensard said, and he summarized fast‑facts showing the average active salary is about $27,800 while the average annual retirement benefit is roughly $16,775. He said 46% of active members earn less than $20,000 a year and 47% of retirees receive less than $12,000 annually.

Stensard told lawmakers SERS manages about $19.6 billion in assets and currently has a funded ratio of about 79%. He said the system has about 163,000 active members and roughly 82,000 retirees and beneficiaries, yielding a roughly 2:1 ratio of actives to retirees that helps the system manage cash flow. "Our actuary has attested that the current contribution rates are sufficient to fully fund the pension benefits and pay off the unfunded liability within that 20‑year amortization period," he said.

On cost‑of‑living adjustments, Stensard described the board’s statutory authority: COLAs are benchmarked to the change in CPI‑W but capped at 2.5% and are set annually after public discussion and an actuary attestation about fund integrity. He said COLAs were suspended for three years and restarted in 2021 and have been provided at the maximum statutory 2.5% in recent years.

Committee members pressed for comparative numbers. Representative Brennan asked about the cost of a 1% COLA; Stensard estimated roughly $1.5 million annually for a 1% COLA and about $4 million for a 2.5% COLA for SERS. He offered to provide additional numbers comparing the fiscal impact of a COLA to a 1% salary increase.

Stensard also reviewed SERS’ sustainability practice, saying the board receives an annual actuarial sustainability assessment that stress‑tests investment returns, funded ratio projections, cash flow and other risks such as longevity and payroll declines. He said SERS’ investment program has performed in top decile nationally over multi‑year periods and that its retiree health care fund holds about $816 million with a solvency period he described as the longest in its history (about 45 years).

The presentation concluded with Stensard saying SERS has no current legislative 'ask' and that the board believes existing contribution structures and COLA authority provide the tools necessary to manage the fund's sustainability. He said he would provide follow‑up detail requested by members.