February 11, 2016 Legislative Update
“Some Good and Some Not-so-Good Bills Emerge in Session’s Second Week”
Committees Consider Bills
Most work took place in House and Senate committees this week. A few hundred of the more than 1,700 total bills and resolutions introduced will be considered in committee before February 25 in the Senate and the day after in the House. The rest will be dead for the session.
OREA has identified several dozen bills that would likely have either positive or negative impact on retired educators. Most deal with either retirement or health insurance. OREA will attempt to report on some of the more important of the bills today and in the weeks ahead.
Pension Improvement Revolving Fund
SB 1128, by Sen. Patrick Anderson (R, Enid), is an OREA-sponsored bill that would establish the Pension Improvement Revolving Fund, out of which COLAs for state retirees could be paid if sources of funding are identified. It passed unanimously out of the Senate Pensions Committee on Monday. Its next stop will be the Senate floor sometime in the next few weeks. A similar OREA request bill, HB 1538, by Todd Thomsen (R, Ada), remains to be heard in the House Business, Labor and Retirement Laws Committee.
Enhancing the Retired Educator Voice
SB 1419, by Sen. Jason Smalley (R, Stroud), also an OREA-sponsored bill to enhance the voice of retired educators on the Teacher’s Retirement System Board of Trustees, passed out of the Senate Pensions Committee with an amendment deemed unsatisfactory to OREA. It could be heard in the full Senate soon.
Blended Premium Protection
HB 1711, by Glen Mulready (R, Tulsa), may be considered soon in the House Government Oversight and Accountability Committee. The measure was held up in committee twice during the 2015 session because of OREA opposition. The bill’s last 2015 version would have eliminated the blended insurance premium protection for under age 65 retirees, resulting in drastically higher insurance premiums. The measure is now the subject of negotiation involving OREA aimed at forging compromise language to help the Employees Group Insurance Department achieve its goal of designing alternative insurance plans for the under-65 market, while maintaining retiree premium protection.
Pay Retired Educators More, Relieve the Teacher Shortage
HB 2247, by Randy McDaniel (R, Edmond), is an attempt to provide flexibility to school districts to pay more money to retired educators returning to the classroom to help deal with the current teacher shortage. It would raise the current $15,000 annual cap on permissible earnings for newly retired preK-12 certified educators to $18,000. To offset the anticipated negative fiscal impact such a move would have on the Teachers’ Retirement System, the school district employer’s required payroll contribution would be raised from 9.5% to 11.0% of employee pay. With OREA’s support, HB 2247 passed unanimously out of the House Business, Labor and Retirement Laws Committee last week.
Increasing Death Benefit can’t get Past Restrictive Rules
Reports from House leadership indicate that HB 2494, by Gary Banz (R, Midwest City), will not be considered in committee. It is an OREA-sponsored bill that would raise the current death benefit payable to the beneficiaries of retired educators from $5,000 to $6,500 over a three-year period. An almost identical measure, HB 1808, by the same author was not considered in the 2015 session and was not referred to the legislative actuary for analysis of its potential negative fiscal impact on the Teachers’ Retirement System. Thus, both bills are technically ineligible to be considered during this session. HB 2494 would rely on funding from the Oklahoma Education Lottery to offset a financial cost to TRS.
Stopping a Tax Cut during a Revenue Shortfall
SB 1073, by Mike Mazzei (R, Tulsa), has yet to be heard in the Senate Finance Committee. It would delay implementation of the one-quarter of one-percent reduction in the state personal income tax that became law on January 1. The author has stated his rationale that the tax cut was never intended to take place during a year in which the state experienced a revenue shortfall, such as is currently occurring. Official estimates predict a shortfall of approximately $1B for the 2017 fiscal year beginning July 1 and almost $200M for the present fiscal year. OREA supports SB 1073.
Next Week: Report on Potentially Harmful Health Insurance Bills
Several bills that would bring significant change to the state’s health insurance program for state and education employees have been introduced this session. We will report on some of these beginning next week. Generally speaking, some of the proposed changes could result in serious harm to the current insurance offerings for active employees and retirees. Dramatic changes in how insurance might be made available to active employees, in addition to the amount of state funding provided, could bleed over and have a dramatic negative effect on the availability and cost of insurance offerings to retired educators. OREA will closely monitor this legislation.
Thanks for Contacting Your Legislators and for Sending Petitions!
Thanks for reading this legislative update, and thanks for your support for the OREA legislative agenda. Have you been in contact with your state senator and/or representative lately to voice your support for OREA legislative goals? You can find the goals on the OREA internet website at www.orea.org. And you can get contact information for members of the Senate and House in the latest issue of the OREA News Bulletin, which all members recently received in the mail.
Have you returned your signed petitions to OREA, urging Governor Mary Fallin and state legislative leaders to take action on a needed and deserved benefits improvement for retired educators? You can find the petition on page 7 of the recent winter issue of the OREA News Bulletin, and at www.orea.org. February 15 is the deadline to return all petitions.