Ohio lawmakers propose increasing taxpayers' share for police and fire pensions

COLUMBUS, Ohio - Taxpayers in Cleveland and other Ohio cities could pay an increased share of retirement costs for police and firefighters if a new proposal from state lawmakers were to become law.

The proposal from Republican state Reps. Brian Baldridge and Cindy Abrams calls for increasing the share cities and villages pay for retirement contributions to the Ohio Police & Firefighter Fund, setting the new amount at 26.5%, compared to the current 19.5% for police and 24% for firefighters.

The change will help fill a projected $6.5 billion, long-term future deficit in the pension fund, according to staff for the OP&F, which provide and manage pensions for city police and firefighters, and are pushing for the law change. If passed, it would be the first change in employer contributions, which are set by law, since 1986. In recent years, employees have borne the cost of changes meant to shore up the OP&F fund through increased contributions and benefit cuts.

During a Thursday news conference in Columbus, Mary Beth Foley, the pension fund’s executive director, said that stable benefits are needed to recruit new police and firefighters, which has been a challenge given the recent coronavirus pandemic and social unrest.

Foley and other proposal supporters said municipalities currently are in a position of financial strength.

“The time to do this is now, but we are doing it ahead of time,” she said. “The funding status right now is good, so we are trying to do good governance and get ahead of this.”

But Kent Scarrett, executive director of the Ohio Municipal League, a lobbying group which represents cities, said he has major concerns with the proposal, estimating it could cost cities over $200 million. He said there’s a perception among lawmakers that cities are flush, thanks to federal stimulus money, but that funding is one-time money that eventually will go away.

The pandemic also accelerated the trend of white-collar professionals working from home, a change larger cities have estimated could cost them hundreds of millions of dollars because of lost “commuter” taxes from workers who no longer are driving to the office.

“There’s a lot of concern about how larger municipalities are going to be impacted by these new workplace dynamics, and add to that this new, unknown financial addition for police and fire, that’s something that hasn’t been studied, and it certainly would be a concern,” he said.

Foley said she hopes the bill could pass by the end of next year. To become law, it would require approval of the full House and Senate and Gov. Mike DeWine’s signature. The support from Abrams, a former police officer from the Cincinnati area who is a member of House Republican leadership, could give it a better chance of eventually passing.

Pension fund officials said they couldn’t immediately estimate how much money the changes would cost local governments in total. But local governments spent $530.6 million on OP&F pension contributions last year, compared to $312.6 million by employees, according to the pension fund’s 2020 annual report.

The pension fund has nearly 60,000 members, roughly half of which are retired, according to the 2020 annual report. Its members include 15,840 active police officers and 13,711 active firefighters. Its members are employed by municipal governments, with sheriff’s deputies, township firefighters and other first responders represented by different state pension systems.

Cleveland is the second-largest employer of OP&F members, with 2,737 police and firefighters working there.

Leadership for top state police and firefighters unions, including the Ohio Fraternal Order of Police and the Ohio Association of Firefighters, are backing the proposal and took part in Thursday’s news conference.