October 12, 2011

“Now is Perfect Time to Visit with Legislators”

We might be a few months away from the official February start of the 2012 legislative session, but now is the perfect opportunity to spend some quality time with your state representative and senator.

Legislators are making their way to the state Capitol intermittently to participate in a variety of scheduled interim studies, including a series dealing with state pension issues.  Like teachers returning to school in the fall with renewed energy and enthusiasm, many legislators are eager to begin forming their views on needed legislation for the coming session.  Unlike the regular session, they actually have the time to sit and visit with their constituents.

Why not take advantage of the opportunity by contacting your legislators to schedule meetings in the lawmakers’ home districts?  Armed with the 2012 OREA legislative goals, and accompanied by a few fellow members, you could find visiting with your legislators both pleasant and productive.  Contrary to some opinion, many legislators really do want to please their constituents.  A candid exchange of views on issues affecting retired educators is possible.

What leads us to believe this is a good time for visits?  Well, we see meetings going on all around the state, right now.  Many OREA local units are meeting with legislators to discuss OREA’s 2012 goals (posted on this website or attached to this e-mail).  In some cases, there have been pleasant surprises.  Lawmakers who previously were mostly negative regarding the potential for much needed and deserved cost-of-living benefits adjustments (COLAs) have begun to show a change of attitude.

Legislators are taking note that retired educators and other retired state personnel have not seen a COLA since 2008.  They’re beginning to appreciate that the cost-of-living really has risen significantly in the last three years, fueled particularly by high energy and health care/insurance costs.

They’re also beginning to realize that passage of HB 2132 during the 2011 legislative session will virtually prevent the possibility of Teachers’ Retirement System COLAs in the near future, unless dedicated revenues can be found to pay for improved benefits.  HB 2132 prohibits any COLAs in the future unless accompanied by concurrent (upfront) funding provided by the legislature.

Let’s take advantage of favorable conditions to schedule meetings with legislators.  The work we do now just might pay real dividends come February.

If you have questions or comments regarding the OREA legislative program, please contact Executive Director Norman Cooper (405.523.4371 or 800.310.2230 toll free) or Legislative Coordinator Terry Ingmire (405.269.5740).

By the way, once you’ve had meetings with your legislators, give Norman or Terry a call to tell how things went.

May 24, 2011

 “Legislature Reaches Final Adjournment (Almost)”

Legislators Could Come Back

Both houses of the Oklahoma legislature completed work for the 2011 session on Friday, May 20, beating the constitutional final adjournment date by one full week.  By mutual agreement between House Speaker Kris Steele and Senate President Pro Tem Brian Bingman, both bodies could return to session this week if necessary to consider possible overrides of gubernatorial vetoes.  That, however, is unexpected.

Will Governor Fallin Sign All Bills?

Governor Mary Fallin has 15 days to sign bills into law that were sent to her within the last five days of the session.  Failure to act within the allotted time on each bill will result in its veto.  Of course, the governor could veto outright any bill with an accompanying message of rationale.

Tough Session for OREA Bills, but Most Remain Alive for 2012

A significant change in the political landscape, a still-subpar Oklahoma economy, and a $500 million shortfall in the state’s budget for Fiscal Year 2012 (beginning July 1), made for a challenging session for all of Oklahoma, but also for OREA’s legislative program on behalf of retired educators.

Every OREA-sponsored bill introduced at the beginning of the session failed to receive meaningful treatment, with none reaching either the House or Senate floor.  Fortunately, most of the bills remain technically alive, eligible to be heard during the 2012 session.

A Review of Important Bills

Following is a short report on bills of interest to OREA from the 2011 session:

House Bills:

HB1002 (McDaniel/Mazzei) – Eliminates two obsolete TRS funds and descriptive language, and provides for a local employer payment schedule to TRS.  Employers not meeting the payment schedule will be subject to payment of interest on obligations to TRS.  Passed both houses and sent to the governor on May 18.  OREA supported.

HB1005 (McDaniel/Mazzei) – Would have provided for seven-member task force to study the various state retirement systems.  Passed the House, failed in Senate Retirement and Insurance Committee. OREA supported.

HB1007 (McDaniel/Mazzei) – Provides that the State Department of Education transfer on a monthly  basis funds from  the Teachers’ Retirement System Dedicated Revenue Revolving Fund to TRS for purposes prescribed in law.  Passed both houses, signed into law by the governor on April 18.  OREA supported.

HB1011 (McDaniel/Dorman) – Would create TRS COLA fund out of a portion of revenues from oil and gas revenues of Commissioners of the Land Office.  Passed out of the House Economic Development, Tourism, and Financial Services Committee.  Not heard on the House floor.  OREA supports.

HB1267 (Sears/Ford) – Began the session as a measure appropriating $35 million to TRS for payment of retirement “credit,” but was changed to become the Teacher and Leader Effectiveness Evaluation System for the public schools.  Passed both houses and signed into law by governor on May 9.  OREA – no position.

HB1423 (Casey) – Would provide for increase in TRS health insurance subsidy.  Not heard in the House A&B Committee.  OREA supports.

HB1566 (Jordan/Brown) – Would permit retired educators to reacquire health coverage in state health plan under certain circumstances.  Not heard in Rules Committee.  OREA supports.

HB1584 (Martin, Scott) – Would provide for increase from 5% to 6%, over a four-year period, the amount of income, sales and use taxes dedicated to TRS.  Not heard in Rules Committee.  OREA supports.

HB1617 (Banz) – Would increase, over a period of years, retired educator beneficiary death benefit from $5K to $7.5K.  Not heard in House Economic Development, Tourism, and Financial Services Committee.  OREA supports.

HB2004 (Dorman/Shortey) – Clarifies law regarding tax responsibility of funeral service when named as beneficiary of retired educator’s $5,000 death benefit.  Passed both houses and signed into law by governor on May 9.  OREA supported.

HB2132 (Steele/Bingman) – Removes cost-of-living benefits adjustments (COLAs) from Oklahoma Pension Legislation Actuarial Analysis Act; prohibits use of COLA assumptions  in retirement system actuarial studies; and requires legislature to provide concurrent funding for COLAs.  Passed both houses and signed into law by governor on May 10.  OREA opposed.

Senate Bills:

SB74 (Barrington) – Would provide for equal COLA assumptions in all state retirement systems.  Not heard in Senate Retirement and Insurance Committee.  Purpose of bill conflicts with final language in HB2132, which eliminated COLA assumptions from state statutes.  Not heard in Senate Retirement and Insurance Committee.  OREA supported.

SB77 (Ellis) – Would provide for non-voting member, designated by OREA, for service on TRS board of Trustees.  Not heard in Senate Retirement and Insurance Committee.  OREA supports.

SB81 (Bass) – Would provide one-time stipend for retired educators living below poverty level.  Not heard in Senate Retirement and Insurance Committee.  OREA supports.

SB183 (Brown/Jordan) – Would permit retired educator to reacquire health coverage in state health plans under certain circumstances.  Not heard in Senate Retirement and Insurance Committee.  OREA supports.

SB196 (Coates) – Would provide for increase in TRS health insurance subsidy for retired educators.  Not heard in Senate Retirement and Insurance Committee.  OREA supports.

SB307 (Sparks) – Would increase retired educator beneficiary death benefit from $5K to $7.5K.  Not heard in Senate Retirement and Insurance Committee.  OREA supports.

SB377 (Mazzei/McDaniel) – Sets age 65 for retired educator joining TRS on or after November 1, 2011 to receive unreduced retirement benefit, except that Rule of 90 member may draw unreduced benefit as early as age 60.  Passed both houses, and signed into law by governor on May 10.  OREA supported maintenance of Rule of 90, but lobbied for age 58 rather than 60.

SB782 (Mazzei/McDaniel) – Changed from November 1 to December 1 the date for submission of fiscal analysis by legislative actuary on retirement bill.  Passed both houses, and sent to governor on May 20.  OREA monitored.

SB787 (Mazzei) – Would create TRS defined contributions retirement plan.  Passed Senate Retirement and Insurance Committee, but not heard on Senate floor.  OREA opposes.

SB795 (Aldridge) – Would increase from 5% to 6% the amount of income, sales, and use taxes dedicated to TRS.  Passed Senate Retirement and Insurance Committee.  Not heard in Senate Appropriations Committee.  OREA supports.

SB809 (Jolley) – Would transfer profits from property within State Capitol Park to TRS.  Passed Senate Retirement and Insurance Committee.  Not heard on Senate floor.  OREA monitoring.

SB891 (Mazzei/McDaniel) – Provides that local school district employer (and other employer agencies)  pay 7% compensation contribution to TRS on the post-retirement income of retired educators, as well as applicable payroll tax obligations currently being paid.  Passed both houses, signed into law by governor on May 18.  OREA supported.

We Want to Hear from You!

Members with questions or comments regarding the OREA legislative program are encouraged to contact Executive Director Norman Cooper at (405) 523-4371 or (800) 310-2230 toll free.  His e-mail address is ncooper@okea.org.

The Importance of Defense

OREA leaders and staff extend sincere thanks to the hundreds of members who gave of their time and talents throughout the legislative session to lobby on behalf of the association’s agenda.  Unfortunately, most of our labor had to be devoted to defense of gains made in previous years, and very little toward new achievements.  Clear victories certainly were few, but we believe our individual and collective efforts will yield future successes.  We must continue to work together.

Let’s Find Our Friends!

In the legislative interim, we’ll take the time to reflect, retool and rededicate ourselves to even greater efforts in the 2012 session.  We’ll assess the performance of every state legislator, as we seek to embrace our friends and target our enemies.  Like it or not, it has to be done.

May 12, 2011

 “Governor Fallin Signs HB2132”

 

Over the objections of OREA and many of its members who contacted her office in recent days, Governor Mary Fallin Tuesday signed retirement measure HB2132 into law.

OREA sincerely thanks members who sent messages to the governor on HB2132, informing her that the bill’s requirement for concurrent (up front) funding of cost-of-living benefits adjustments (COLAs) for retired educators and state employees really amounts to a long term sentence of no COLAs at all.

In our opinion, it could be many years before legislators see fit to appropriate enough funding for even a minimal COLA.  In fact, it may very well have been the legislative leaders’ intent to discontinue altogether the practice of COLAs for retired educators and state employees.  If we’re right, that’s too bad.

At the signing ceremony attended mostly by Republican legislative leaders from both the House of Representatives and Senate, Governor Fallin and others touted the positive fiscal impact HB2132 will have on the underfunded Teachers’ Retirement System and other state pension plans.

They were certainly right in saying removal of COLA assumptions in current law and requiring concurrent funding for all future COLAs will have a positive fiscal effect on TRS, but they did not acknowledge that all of that improvement will come by denying current and future retired educators of any chance to keep up with the incessant rise in the cost-of-living, particularly the annual doses of double-digit increases in health care costs.

Interestingly enough, something not acknowledged by legislators throughout the session and at the signing ceremony was the other half of the state’s retirement systems funding dilemma.  Nothing in HB2132 – or any other retirement “reform” bill this session – focuses on adequate pension system  funding.  It’s simple: you can solve fiscal problems by denying or limiting benefits to retirees, or you can actually pay for much-deserved benefits for former employees who have given long careers of service to the children and other citizens of the state of Oklahoma.  It’s pretty obvious Governor Fallin and legislative leaders are taking the cheap way out.

The goal of financially healthy state retirement systems is a good one.  We can all agree on that.  It just depends on how you go about accomplishing it.

At the same signing ceremony, Governor Fallin signed SB377, which establishes age 65 as the normal date of retirement for public educators, but maintains the Rule of 90 allowing career employees to begin drawing unreduced retirement benefits as early as age 60.  The provisions of SB377 will apply only to educators who become contributing members of the Teachers’ Retirement System on or after November 1, 2011.  OREA would have preferred age 58 for retired educators to begin drawing unreduced benefits, but recognized overwhelming legislative support for SB377.  Like HB2132, SB377 will have a positive fiscal impact on TRS, but it won’t provide any additional funding.