The Senate Retirement and Insurance Committee will study a House bill that would provide a 2 percent cost-of-living adjustment for state pension retirees contingent on the outcome of an actuarial review of the pension systems.
Sen. Dewayne Pemberton, R-Muskogee, wrote House Bill 2304, making sure the bill followed the Oklahoma Pension Legislation Actuarial Analysis Act (OPLAAA).
Among those requirements are for fiscal retirement bills to undergo an actuarial analysis before being passed into law.
The analysis covers how the raise will be paid for; the cost of the raise, and how it will affect annual employer certification.
The actuarial study will be returned to the Senate committee chair no later than December 1 of 2019.
After the analysis is received, a fiscal retirement bill is eligible for consideration by committee the following session, in this case, 2020.
Senate President Pro Tempore Greg Treat allowed the special meeting of the Senate Retirement and Insurance Committee for consideration of HB 2304. The bill was among the topics studied by a pension reform working group formed by Treat.
“Republican leadership has done great work over the past decade to save the state pension systems from fiscal ruin. Years of mismanagement prior to Republicans leading the Capitol left billions of dollars in unfunded liabilities for the state, threatened the retirement of public servants, and drove up the borrowing costs for the state, local governments, and school districts,” said Treat, R-Oklahoma City.
“OPLAAA is one of the crucial tools Republicans have used to shore up the state pension systems. We should follow laws like OPLAA that got us to this better position now. Public servants want and deserve a cost of living adjustment and HB 2304 can still deliver COLAs once the pension actuaries give the Legislature a report so that we have a complete picture of the costs and impacts of granting a COLA.”
Senator Pemberton said, “We don’t want to do anything to walk back the great progress Republicans have made in shoring up the state pension systems.
“Retired teachers, firefighters, police officers, and state employees deserve a cost of living adjustment. Laws like OPLAAA have been critical in the success story of state pension systems. We don’t know yet what the actuarial study will show, but it will give us a full picture when we consider to move forward with a 2 percent COLA without harming the funded liability of the pension systems.”
Despite the political rhetoric of House Democrats, Senator Lonnie Paxton said Senate Republicans are following the law and protecting the pensions of state retirees by sending a cost of living adjustment (COLA) bill for further study.
“Don’t believe the political hype of anyone who claims Senate Republicans are standing in the way of a COLA for state retirees. Republican reforms have been instrumental in saving the state pension systems from financial ruin. By following those pension reform laws, Senate Republicans are protecting the retirement of current and future state retirees by ensuring the long-term solvency of the pension systems,” said Paxton, R-Tuttle.
Recently, in accordance with the Oklahoma Pension Legislation Actuarial Analysis Act (OPLAA) and Senate rules, the Senate Retirement and Insurance Committee voted to send House Bill 2304 for an actuarial study. The results of that study will be returned to the Senate Retirement and Insurance Committee, and HB 2304 will be eligible for consideration by that committee in the 2020 session.
Paxton said Democrats seem to be glossing over decades of pension fund mismanagement by their predecessors at the Capitol. A volunteer firefighter for 27 years and the spouse of a public school teacher, Paxton said he and his Senate Republican colleagues understand how important a COLA is for state retirees.
“It’s incredulous for House Democrats to insinuate Senate Republicans are playing political games with state retirees. For decades, Democrats raided the state pension funds to balance the budget or pay for political pet projects. That left state systems severely underfunded and the state with billions in unfunded liabilities,” Paxton said. “Republicans ended that practice. Republicans have invested more than $3.4 billion since 2011 above and beyond the normal employer contribution to fix the Democrats’ past mistakes. Republicans, even during the economic recession, kept our commitment to invest in the pension systems. If we didn’t have to fix those past mistakes, we could have invested that money in any number of priorities like increasing teacher salaries, lowering class sizes, or investing more in our infrastructure. Senate Republicans take pension reform seriously, which is why we are committed to following the law.”