Republican lawmakers are looking for way to increase teacher pay.
One plan, by Rep. Michael Rogers, R-Broken Arrow, would phase in a $6,000 teacher pay raise over three years and boost Oklahoma teachers to the highest paid in the region.
Rogers, the chair of the House Common Education Committee, said a phased-in approach would allow the Legislature to manage the current revenue downturn while keeping its promise to boost pay for teachers.
House Bill 1114 would include a $1,000 pay raise for teachers during the 2017-18 school year, another $2,000 raise during the 2018-19 school year and a final $3,000 raise during the 2019-20 school year.
Oklahoma already has the third-highest statutory starting minimum teacher pay in the region. Rogers’ plan would give Oklahoma teachers the highest average teacher pay of surrounding states and would raise Oklahoma teacher pay from 48th in the nation to 27th based on recent data from the National Education Association (NEA). When paired with the state’s low cost of living, the plan would move Oklahoma to 13th in the nation for average annual teacher pay at $56,804 (adjusted for cost of living). Oklahoma’s cost of living ranks behind only Mississippi for the lowest in the nation.
Sen. David Holt has introduced Senate Bill 316, which would provide a $10,000 raise to all Oklahoma classroom teachers over a four-year period beginning this fall. Holt has further introduced 12 separate measures to provide funding options for the raise.
It is estimated a $10,000 raise for all 42,000 classroom teachers could cost approximately $550 million. Holt’s 12 funding measures cumulatively provide at least $744 million in funding options, with the option of adding another $261 million, bringing to over $1 billion the total defined funding options from which to choose. Holt’s proposals also include other revenue raising measures with undetermined values. Holt also authored an income tax exemption for teachers equivalent to an $1,850 average raise.
State Rep. Mark McBride filed a measure that would transfer funds from the Tobacco Settlement Endowment Trust (TSET) to use as a recurring revenue stream that school districts could use to pay teachers and staff.
House Bill 1245 would transfer 50 percent of “the moving ten-year average earnings amount” from the TSET fund, which would then be allocated to school districts to “promote the health and quality of life for students in pre-kindergarten through twelfth grade.”
“My goal is to find an ongoing revenue stream that we can use to compensate certain teachers involved in health and wellness, while freeing up funds to pay other teachers,” said McBride, R-Moore. “Not only would this provide those teachers and support staff a funding stream for compensation every year, but it would also indirectly help us reduce smoking among students. Studies show that better educated youth are much less likely to smoke. Increasing pay helps us attract and retain quality teachers, which helps improve our entire education system.”
McBride said the amount transferred could be anywhere from $15 million to $25 million annually, depending on how well the TSET investment portfolio performs. In 2016, the investments produced a return of $26.3 million, but produced $46 million the prior year. TSET has an endowment of more than $1 billion, and receives an additional amount annually from the tobacco settlement agreement with tobacco companies.
Robert Romines, superintendent of Moore Public Schools said the bill would allow school districts an additional revenue stream to compensate some teachers while freeing up funds from the distric’ts general fund to compensate others.
“Mental health services is a growing and on-going expense for public schools,” said Romines. “For example, the Moore School District employs several individuals in the mental health profession. Salaries for these individuals are paid from our general fund and or special education funds. The proposed bill would offset part of these expenditures and would allow savings to the general fund.”
Two pieces of legislation to modernize and strengthen the Oklahoma Teachers’ Retirement System have been filed by Rep. Randy McDaniel, R-Edmond, chairman of the House Banking, Financial Services and Pension Committee.
The Retirement Freedom Act of 2017, HB 1172, would implement an optional defined contribution plan for prospective educators. With defined contribution plans, annual costs are predictable since contribution requirements are clearly defined and paid up front.
“Many new teachers value occupational freedom and desire a transferable retirement plan. Plus, the new plan would limit unfunded promises,” McDaniel said.
McDaniel, a proponent of increasing teacher pay, realizes that as teachers retire in record numbers, reforms to the existing pension system are necessary to ensure long-term sustainability.
The Pension Protection Act, HB 1162, would increase the retirement age for prospective educators by two years. The retirement provisions for career educators would rise from 60 years of age to 62. The normal retirement age would increase from 65 to 67. Through the years, retirement age qualifications have not kept pace with longevity gains, he said.
Leaders across the country struggle with the rising costs associated with an aging population and early retirement laws. Consequently, educators are reaching retirement in historic numbers and are projected to continue doing so for decades.
Democrats are offering to fund teacher pay hikes by raising taxes. Oklahoma voters in November rejected a proposal to raise a one-penny state sales tax for public education.
State Rep. Jason Dunnington, an Oklahoma City Democrat, filed legislation that would raise taxes by more than $500 million in recurring revenue. Dunnington is a member of the House of Representative’s Appropriations and Budget Committee for the 56th Legislature.
House Bill 1279 would raise income tax rates to what they were more than a decade ago. In addition, Dunnington’s bill will remove the Oklahoma Capital Gains Deduction for businesses. House Bill 1279 will also require companies to combine profits from both the parent company and its subsidiaries in one report and pay taxes on all the profits earned in Oklahoma.
“For four of the last twelve months, the state has paid more in business tax credits than it received in corporate income tax. We can’t let this trend continue,” Dunnington said.
The 2017 legislative session begins on February 6.