Frix Hosts Study on Cost of Living Adjustment for State Pensioners

Frix Hosts Study on Cost of Living Adjustment for State Pensioners

OKLAHOMA CITY (Friday, Nov. 15th, 2019) – State Rep. Avery Frix (R-Muskogee) today hosted a bipartisan interim study examining Cost of Living Adjustments (COLAs) for those in Oklahoma’s seven pension plans. Several lawmakers from both sides of the political aisle joined today’s study, which was held before the House Banking, Financial Services and Pensions Committee.

Frix ran legislation last year that would have given state retirees a COLA. The legislation passed the House overwhelmingly but was not picked up in the state Senate. Instead, the Senate requested an actuarial analysis to see how the state’s retirement systems would be affected by a 2% COLA. The House made a request for an analysis of 4%. Those reports are due Dec. 1.

“My hope is to show that our state retirement systems have improved dramatically over the past decade, and we are now in a position to give our retirees the COLA they deserve and have been promised,” Frix said. “This remains a priority for the House, and we hope our colleagues in the Senate also recognize a cost-of-living adjustment is long overdue.”

State retirees last received a COLA in 2008. Since then, inflation has increased 19.5%, according to the U.S. Bureau of Labor Statistics.

State Rep. Kyle Hilbert (R-Depew) added, “Our public retirees spent their lives and careers dedicated to serving our state, and after 11 years of waiting, they deserve the long-term stability that a COLA would provide. The strength of our retirement systems is vastly improved compared to 11 years ago and I hope today's interim study will move us one step closer to delivering results for these state retirees.”

State Rep. Mickey Dollens (D-Oklahoma City) said, “House Democrats are appreciative of House Republicans for acknowledging retired public employees, including teachers, firefighters, and police officers deserve a long over-due cost-of-living adjustment. We look forward to continuing to work with our colleagues across the aisle to find a long-term solution for COLAs going forward.”

State Rep. Chelsey Branham (D-Edmond) said, “On the surface, the low unemployment rate in Oklahoma seems like a testament to our success, but in reality the number of underemployed and multi-employed Oklahomans turn that statistic on its head. Cost of living continues to go up and our minimum wage continues to be stagnant, which is forcing Oklahomans to have two and even three jobs to keep up. This is especially true of our retired state employees, who are struggling to balance the benefits of retirement from a life of service with post-retirement employment just to make ends meet. This COLA will be a big lift for the state, but ensuring that Oklahomans have a high quality of life is our duty. I am thankful for my colleagues on both sides of the aisle, who understand the COLA is a smart investment in moving our state forward.”

Both Hilbert and Branham serve on the House Banking, Financial Services and Pensions Committee.

The heads of all of the state’s pension and retirements systems – state firefighters, police, justices and judges, law enforcement, teachers and public employees’ – were invited to take part in the study.

Presenters gave a financial status report of the retirement systems, a history of how they are funded and the impact a 4% COLA would have on the systems’ funding ratios. Tyler Bond, research manager with the National Institute on Retirement Security, also spoke on the economic impact of retirees across Oklahoma. Tom Spencer, executive director of the Oklahoma Teachers Retirement System, also spoke on the Oklahoma Pension Legislation Actuarial Analysis.

Frix urges the state Senate to take up the legislation to grant state retirees a COLA in the upcoming legislative session. He said the state is in much better financial shape today than the last time a COLA was given. Teachers have been given a pay raise two years in a row as have other state employees. The state’s financial rankings also have improved. Several of the state’s pension plans are now more than 100% funded and most are 80% funded, which is indicative of solvency.

Frix said retired state employees are every bit as concerned about the overall performance of their benefit plans as anyone.

“Retirees don’t want to harm their own benefit plan, but they want the COLA they were promised when the plans were established,” he said. “Some retired employees have seen health insurance premiums rise at a rate that has outpaced their retirement benefits. Retirees have to pay into the plan just to pay their premiums.”

During the study, Frix also discussed retirees’ loss of buying power since they last received a COLA and the many retirees who do not receive Social Security.

House Dems call for Senate to increase state employee pay, pensions

House Dems Call on Senate to Act on State Employee Pay and Compensation

OKLAHOMA CITY – House Democrats called on Senate Republicans today to reconsider legislation that gives state employees a $2,500 pay raise, and for both House and Senate Republicans to accept and pass an amendment for a 4 percent cost of living adjustment.

“Our state employees have waited for the legislature to act on these issues long enough,” said Minority Leader Emily Virgin (D-Norman). “It is time for Senate Republicans to stop playing political games with the financial wellbeing of state employees.”

Although both pieces legislation addressing state employee pay raises (HB2763) and pensions (HB2304) are currently inactive, there are still options available to accomplish the raise and cost of living adjustment.

A state employee pay raise could be reconsidered through the Joint Committee on Appropriations and Budget, and a 4 percent COLA could be realized through the amendment process.

“Both of these goals can be accomplished,” said Rep. David Perryman (D-Chickasha). “This is a matter of will and priorities. If we can find a way to legalize alcohol being served on a golf course, surely we can carve out a little time and dedication to the thousands of Oklahomans who have and are serving our state as public employees.”

It has been 11 years since state retirees have seen a cost of living adjustment. House Bill 2304, authored by Republican Rep. Avery Frix, passed through the House 91-3.

“Whatever drama is happening on the Senate side, I know Oklahoma retirees aren’t the cause,” Rep. Monroe Nichols said. “Yet, for more than a decade they keep getting hurt by the pettiness in this building. Through the amendment process, we are going to give the legislature another chance to get this right. For the sake of the thousands of retirees in Tulsa County and the many more throughout the state, I hope we do.”

Senate committee amends COLA bill, sends to actuarial study

Senate Retirement committee passes amended COLA bill

OKLAHOMA CITY – The Senate Retirement and Insurance Committee in a special meeting on Thursday acted on a House bill that would provide a 2 percent cost of living adjustment for state pension retirees contingent on the outcome of an actuarial study of the pension systems.

Senator Dewayne Pemberton, R-Muskogee, is the Senate author of House Bill 2304 and filed a committee substitute to ensuring the bill followed the provisions of the Oklahoma Pension Legislation Actuarial Analysis Act (OPLAAA).

Among OPLAAA requirements are for fiscal retirement bills, which HB 2304 has been declared, to undergo an actuarial analysis before being passed into law. The analysis covers such topics as:

• the unfunded actuarial accrued liability which will result from the bill;
• the dollar amount of the annual normal cost which will result from the bill;
• and the dollar amount of the increase in the annual employer certification which will be necessary to maintain the system in a sound condition.

The Retirement and Insurance Committee approved sending HB 2304 for an actuarial study. Per OPLAAA, the actuarial analysis shall be returned to the Senate committee chair no later than Dec. 1 of the year it is requested. After the actuarial analysis is received, a fiscal retirement bill is eligible for consideration by committee (in this case the Senate Retirement and Insurance Committee) the following session, and should it pass out of committee, would be eligible for consideration by the entire Senate.

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 Senate President Pro Tempore Greg 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.”

Treat appoints senators to pension working group

Pro Tem Greg Treat appoints senators to pension working group

OKLAHOMA CITY – President Pro Tempore Greg Treat appointed seven senators on Monday to serve on a pension working group to study long-term pension reform as well as make recommendations to his office on pending pension reform legislation.

Pending in the Senate is a House bill that would provide a 4 percent cost of living adjustment (COLA) to retired public employees at a price tag of $850 million to the retirement systems. Pro Tem Treat said the working group would review that legislation, as well as study how to protect and further the gains made to improve the financial stability of state pension funds.

“When Republicans took over in 2010, many of the state pension systems were in poor financial shape after years of mismanagement by previous leaders at the Capitol. Not only did that threaten the retirement of future state employees, it negatively affected the state’s bond rating and made it more expensive for schools, local governments, and the state to borrow money for important capital projects,” said Treat, R-Oklahoma City. “Republican leaders made considerable progress in reforming pensions, most notably requiring COLAs to be fully funded. Senate Republicans understand public employees, who have served the state admirably, want a COLA; however, it’s important we take prudent fiscal action to ensure we don’t threaten the progress made in making our pension systems more stable. The working group will help us gain a fuller picture of current pension legislation and other potential issues that need to be addressed moving forward.”

Pro Tem Treat gave the working group an April 4 deadline, one week before the April 11 committee deadline, to report recommendations to his office on pending pension legislation. The members of the pension working group are:

• Senator Jason Smalley, R-Stroud
• Senator Marty Quinn, R-Claremore
• Senator Gary Stanislawski, R-Tulsa
• Senator Lonnie Paxton, R-Tuttle
• Senator Dewayne Pemberton, R-Muskogee
• Senator Tom Dugger, R-Stillwater,
• Senator John Michael Montgomery, R-Lawton

Frix's COLA Bill for State Retirees Passes House Floor

COLA Bill for State Retirees Passes House Floor

OKLAHOMA CITY (March 11th, 2019) – The House of Representatives passed a bill today that would grant an increase in retirement benefits to retirees of Oklahoma’s six retirement systems.

House Bill 2304, authored by State Rep. Avery Frix, R-Muskogee, would give a permanent 4 percent cost of living adjustment (COLA) to all retirees of the Teachers’ Retirement System of Oklahoma, Oklahoma Firefighters Pension and Retirement System, Oklahoma Police Pension and Retirement System, Uniform Retirement System for Justices and Judges, Oklahoma Law Enforcement Retirement System and Oklahoma Public Employees Retirement System. The increase would take place January 1, 2020.

Frix said the issue was brought to his attention in 2016 by a constituent who is a retired teacher and whose health insurance cost more than her retirement check.

“Our state’s former public servants haven’t had a cost-of-living increase in 11 years,” Frix said. “After dedicating their lives and careers to our state, they deserve the long-term stability a COLA would provide. I was glad my colleagues in the House voted overwhelmingly to support this bill and provide for our public retirees.”

HB2304 passed the House with a 98-3 vote and now heads to the Senate for consideration.

The bill also amends the Oklahoma Pension Legislation Actuarial Analysis Act to include a safe harbor clause that allows the bill to be treated as a nonfiscal retirement bill in the legislative process.