Ohio Public Employees Retirement System, Columbus, proposed reducing future cost-of-living adjustments for current and future retirees, a fund spokesman said.
The changes, which are expected to reduce OPERS' unfunded liability by about $4 billion, were approved by the pension fund board Wednesday. They require approval by the Ohio Legislature.
Under OPERS' plan, all future cost-of-living adjustments (currently a fixed 3%) would be tied to the consumer price index and capped at 2.25%, starting in 2019.
For members who retired between 2010 through 2012, however, the new inflation-based COLA would not take effect until 2021, said an announcement on the pension fund's website.
COLAs for future retirees would be postponed to two years after retirement.
Under current law, OPERS has a 30-year window to pay off its unfunded liabilities, which totaled about $20 billion in 2016. Should the pension fund not be able to meet that goal, COLAs would be frozen for the next calendar year. On the flip side, should inflation exceed 3% for an extended period of time, the board could increase the COLA to 3% if the pension fund's "funding is strong," the announcement said.
OPERS retirees were surveyed about potential COLA changes ahead of the pension fund's proposal.