An update on the OMERS Sponsors Corporation’s review of Plan change proposals and the announcement of the Municipal Employers Pension Centre of Ontario.
a.) Sponsors Corporation – Plan Benefit Proposal and Contribution Rate Status: The Sponsors Corporation received five (5) proposals for benefit changes. The following four (4) were dealt with at the June 6th meeting. All of the following proposals failed to pass. The Sponsors Corporation will meet in early July to consider the contribution rate report based on the 2007 valuation as well as a proposal to place a cap on the level of incentive pay included in contributory earnings.

i) Early Retirement Subsidies on Termination: Proposal to remove early retirement subsidies from benefit entitlements of members who terminate employment prior to retirement eligibility; proposal would have applied to new members enrolling effective Jan. 1/09. Currently, the cost of any early retirement subsidies payable to members who terminate from the Plan prior to retirement eligibility is funded by required contributions. Eliminating these subsidies may reduce the required contributions of current members or reduce the need for contribution increases. (AMO proposal)

ii) Vesting: Proposal to provide 100% vesting after 2 years of Plan participation rather than immediate vesting; proposal would have applied to new members enrolled effective Jan. 1/09. Cost savings to the Plan would have been achieved when members terminate prior to completing two years of Plan participation. (AMO Proposal)

iii) Provide Paramedics with right to negotiate NRA 60: Paramedics wanted the right to convert from NRA 65 to NRA 60. Police and Fire are currently NRA 60 with an accrual rate of 2.33% (from 2.0%).

iv) Change the maximum accrual of pensionable earnings from 81.33% to 70% for NRA 60 supplemental plans for fire and police. The supplemental plan currently allows for a maximum accrual of pensionable earnings of 81.33%, reflective of a 2.33% accrual rate. (Ontario Police Services Board Proposal)

b) Municipal Employers Pension Centre of Ontario (MEPCO): AMO has set up this not-for-profit corporation to separate its legislative mandated OMERS responsibilities to represent OMERS municipal employers from its normal policy and advocacy activities since all of Ontario’s municipalities are not OMERS employers. We want to ensure that our OMERS employer representatives are well resourced with access to the appropriate expertise. Watch for MEPCO’s first newsletter that will introduce the Board of Directors and activities.