January 7, 2013 (PLANSPONSOR.com) – The Ohio Public Employees Retirement System (OPERS) has seen an uptick in retirements since pension reforms were passed in September.
Applications poured in during December, when OPERS received 1,486 retirement applications, according to figures provided by spokesman Mike Pramik, the Marion Star reports. By comparison, OPERS fielded 814 applications in December 2011.
Since September, 6,268 applications for retirement came into OPERS. Applications overall in 2012 were up about 10% compared to 2011.
Other state pension systems are not seeing the same employee exodus since they do not have pension reforms coming into effect. A spokesman for the OPERS said retirements have been running higher during the past several months, but their pension changes do not take effect until 2017, according to the news report. None of the remaining three public employee pension systems reported any unusual number of retirements.
OPERS members who stopped working before the new year avoided a change to their cost-of-living-adjustments. The adjustment gives retirees a 3% annual bump to maintain the buying power of their pensions. Starting this year, it will be tied to the consumer price index (CPI), the federal government’s broad-based measure of inflation, up to a maximum of 3%, and inflation has run at about 2% during the past 12 months. The newspaper explained that might not seem like a big difference, but if the CPI were to consistently run even just a half-percentage point shy of 3%, that would equal tens of thousands of dollars less over the life of the pension. In 2011, a similar trend happened in Wisconsin as teacher retirements doubled prior to pension reforms taking effect (see “WI Teachers Choose Retirement Over Paying More for Benefits”).