Oklahoma Pension Commission adopts reforms
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Published: 29-Apr-2011

Facing more than $16 billion in unfunded liability in the state’s public pension systems, the Oklahoma State Pension Commission on Thursday adopted recommendations listing key reforms that will be presented to state leaders in the closing weeks of the legislative session

“The recommendations adopted by the Pension Commission, if enacted by the Legislature and approved by the Governor, will set us on a course to recovery,” State Treasurer Ken Miller, commission chair, said. “We are, in effect, trying to stop the bleeding with these changes. Longer term solutions will need to be worked out in the coming months.”

The commission adopted eight recommendations to correct the immediate problem:

• Eliminating unfunded Cost of Living Adjustments on state pension systems.

• Establishing a minimum age of 65 for retirement eligibility for all new public employees, except those who are public safety first responders. This would also apply to all elected officials.

• Dedicating a portion of future surplus revenues and one-time funds to the fiscal restoration of the state’s pension systems.

• Maintaining employee and employer contribution rates that meet actuarially required contributions.

• Creating and maintaining a uniform minimum vesting period for all public employees and elected officials of at least eight years.

• Increasing the final average salary period for calculating benefit payments from three years to five.

• Preventing the use of transferrable tax credits to offset revenue dedicated to funding state pension systems.

• Reducing the percentage multiplier for calculating retirement benefits for elected officials from the current four percent to the two percent used for all non-public safety employees.

Miller said in future meetings of the commission, he will push for consideration of longer term reforms to implement a cost-effective pension system designed to meet the demands of a modern workforce and a leaner government. 

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