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OPERS supports portability reforms in House Bill 424 to ease transfers among Ohio retirement systems
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Summary
House Bill 424 would remove obstacles to fair intersystem transfers of service credit; OPERS’ executive director told the committee the bill would restore equity among Ohio’s retirement systems by removing an active-service restriction and improving portability for members who change systems.
At the committee’s next item, Karen Caraher returned to provide OPERS’ support for House Bill 424, which would amend intersystem-transfer rules to improve portability among Ohio’s retirement systems and the Cincinnati Retirement System.
Caraher described the background of transfer rules dating to the 1950s and changes made in 2014 that created asymmetries among systems; she said the active-service restriction in Ohio Police and Fire (OPNF) law creates inequitable outcomes for members who move between systems and can trap workers in "limbo." As an example, she said a member with 18 years in OPNF who later works seven years under OPERS can be prevented from transferring service credit fairly under current law; she called that an "actual problem" for members.
OPERS urged redrafting House Bill 424 to remove the active-service requirement in OPNF statute so transfers could occur on the same terms used elsewhere, minimize subsidization between systems, and preserve equitable allocation of unfunded liabilities. Caraher said OPERS and stakeholders previously implemented a temporary 90-day window to address transfers and that a permanent statutory fix would better serve portability goals.
Committee members asked about how to make transfers actuarially fair, whether one system’s rules should prevail and how to avoid subsidization. Caraher suggested working with OP&F to remove the active-service requirement and, if necessary, to adopt transfer rules that preserve actuarial neutrality and protect system funding. She said the goal is to achieve consistent transfer conditions across systems so members are treated equitably and not disadvantaged when they move roles.
Members thanked Caraher for testimony and requested written materials and analyses; the committee adjourned after completing the item.
