Board Report, November 2023

New actuarial study shows OP&F still complies with funding mandate

An independent actuarial firm presented its annual valuation of OP&F at the Board’s Nov. 1 meeting. The findings are as of Jan. 1, 2023 and show that, though not a reporting year, OP&F meets Ohio’s funding requirements for state retirement systems.

According to the study from Cavanaugh MacDonald, the funding period decreased from 28.07 years for the last valuation to 26.71 years. The funding period shows the time it will take to fully pay all pension obligations if assumptions in place are met. Ohio law requires state retirement systems to not exceed 30 years for the funding. The funded ratio increased from 69.7 percent as of Jan. 1, 2022 to 70.0 percent as of Jan. 1, 2023. The funded ratio is designed to show the amount of actuarial assets compared to the actuarial accrued liability. Without passage of House Bill 296 now under consideration, OP&F could exceed the required funding levels in 2025.

PORTFOLIO UPDATE

Board of Trustees Committee Notes

(Motions voted on by the Board are listed separately)

DISABILITY: The Committee conducted its scheduled reviews and appeal hearings.

FINANCE: OP&F’s independent actuary, Cavanaugh MacDonald, presented the Jan. 1, 2023 Actuarial Valuation and also the Jan. 1, 2023 Actuarial Solvency Projection of the Health Care Stabilization Fund.

INVESTMENT: In addition to a review and discussion of the investment portfolio, real estate consultant Townsend discussed the real estate and real assets performances and portfolio reviews for periods ending June 30, 2023.

ADMINISTRATION/AUDIT: The Committee reviewed the 2024 OP&F Communications Plan, and the Internal Audit Status Report. The Committee reviewed and approved the 2024 Audit Plan and changes to the Board Governance Policy. The Committee also received an update on OP&F’s Push-to-Paperless project aimed at employers who do not submit reports electronically.

Motions:

At its November 2023 meeting, the OP&F Board of Trustees approved the following motions:

• Approved 10 Initial Determinations of Disability.
• Approved one appeal hearing.
• Approved the Disability Reporting Waivers list.

NEXT BOARD OF TRUSTEES MEETINGS: Dec. 5-6, 2023