The Ohio School Employees Retirement System board voted unanimously in September to grant a 2.5% cost-of-living adjustment for 2027, the maximum that Ohio law allows the board to award. The increase falls short of the 3.5% rise in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) between June 2025 and June 2026. Retirees will not see it all at once on Jan. 1: it is applied on each recipient’s own retirement anniversary, and members who retired recently face a wait of several years.
A 2.5% vote taken against 3.5% inflation
SERS announced the action on Sept. 24 in a notice headlined “Board Approves Maximum COLA for 2027”. The notice says that by statute the SERS COLA is influenced by the year-to-year change in CPI-W from June to June, which was 3.5% for the latest period, and that the board settled on 2.5%. The page names no individual trustee, so the vote is attributed to the board as a body.
The gap is one full percentage point. On a hypothetical annual pension of $30,000, a 2.5% raise adds $750 a year, while a raise matching 3.5% inflation would add $1,050. The difference of $300 is the amount by which purchasing power slips even after the board acts at the top of its authority. The 2026 adjustment also sat at the 2.5% ceiling, so 2027 marks a second consecutive year at the maximum.
Why 2.5% is the ceiling and not a choice
The limit is written into Ohio Revised Code section 3309.374. Before 2018, the section directed annual increases of three percent. The current text caps increases at two and one-half percent and says the retirement board “may annually increase” benefits, tying the amount to the percentage increase, if any, in the consumer price index over the twelve months ending June 30.
SERS’s own COLA information page lays out the same structure: a floor of 0% and a cap of 2.5%, with the board able to adjust the figure if the actuary determines that it will not materially impair the funded status. For 2027 the actuarial firm CavMac confirmed that the 2.5% “will not materially impair SERS’ funded status,” according to the board notice. The prior year followed the same pattern, as the COLA page records a 2.5% increase approved Sept. 19, 2025, when CPI-W stood at 2.6%.
Anniversary dates instead of a January raise
The 2027 adjustment does not arrive on one date for every retiree. Both SERS pages say the COLA takes effect on the benefit anniversary of each recipient’s retirement effective date, not on Jan. 1. A retiree whose benefit began in June, for example, would see the raise in the month of that anniversary…