April 12, 2012 To: Attention: From: Active and Retired Ohio Highway Patrol Retirement System members

Ohio Highway Patrol Retirement Board Trustees and Staff Colonel John Born, Chairman of the Ohio Highway Patrol Retirement Board of Trustees

As you know, public pension reform is a topic of interest throughout the United States. In Ohio, discussions and examinations continue at the Ohio General Assembly regarding all Ohios public pension systems including the Ohio Highway Patrol Retirement System (OHPRS). Ohio Senate leadership has recently communicated that action to largely adopt the OHPRS Board plan may occur this year before their summer recess. Continued collective support by both active and retired members is critical to positively impacting our ability to shape our systems future. On August 27, 2009, the OHPRS Board passed its proposal for reform. That plan was widely supported by both active and retired HPRS members and presented to the Ohio Retirement Study Council. The plan has five key points: 1. Reduce the annual cost of living adjustment (COLA) from three percent to two percent with limited exceptions for our oldest retirees who receive very limited benefits. Grant the Retirement Board the discretion to reinstate the three percent COLA when conditions improve. 2. Increase the amount that each member contributes to the retirement system by 1 percent (from 10 percent to 11 percent) 3. Increase the Final Average Salary (FAS) calculation period from 3 to 5 years for members retiring after 2014. 4. Increase the COLA eligibility age from 53 to 60 after the legislative effective date. 5. Reduce the allocation of contributions to the health care fund by 1 percent of employer payroll. In both 2009 and 2010, the Retirement Board proactively implemented the fifth point of its plan by redirecting 1% and 1.75% respectively, of employer payroll from health care to pension benefits (a total reallocation of 2.75%.) The assistance of the Ohio General Assembly is needed to enact the other four points of the plan. Although our original proposal before the Legislature brings us into compliance with the 30-year funding period, it is anticipated negative 2011 returns will require the Board to take additional action. The Board will meet on April 19, 2012, to discuss additional measures. These steps may center on the legislature providing Board flexibility in adjusting employee contributions (allowing an annually set range of 10-14 percent) and adjusting retiree COLAs (allowing an annually set range of 0-3 percent). Increasing the retirement age for new hires only will also be discussed. These additional measures, if granted by the legislature, would only be triggered and enacted by the Board if required to gain compliance with the 30-year funding period as mandated by ORC 5505.121. Retired Colonel Rice has been successfully leading a broad and equally representative group of active and retired members in developing a strategic plan to adjust for expected changes. Progress, plans and future meetings can be found at http://www.troopertotrooper.com/OSHPRS-Strategic-Planning.html. The next OHPRS strategic plan meeting date is May 2, 2012, at the Patrol Academy.

6161 Busch Boulevard, Suite 119, Columbus, OH 43229-2553 T 614.431.0781 F 614.431.9204 www.ohprs.org