Oklahoma lawmakers reject veto over pension money siphoning

The Oklahoma legislature overruled the governor’s veto on the state budget proposal, which aims to divert money from state pension plans to fund education needs.

Governor Kevin Stitt vetoed the $7.7 billion budget for fiscal year 2021, as well as two additional state House bills that he said would take away tens of millions of dollars. teachers, law enforcement and firefighters.

“We’ve made great strides in strengthening our pension systems over the past few years, and now is not the time to undo that progress,” Stitt said in a statement. declaration.

“While I understand the importance of a balanced budget, it is fiscally irresponsible to do so at the expense of the solvency of these pension systems,” he added.

The governor argued that the budget measures would reduce the funded ratios of state pension systems to 2014 levels.

Unfunded liabilities for state pension plans were last reported at $6.5 billion, according to to the governor’s veto documents.

A proposal to cut funds from the state’s only teachers’ retirement system would increase unfunded liabilities by $186.2 million, the governor said. Oklahoma Teachers has a capitalization ratio of approximately 72%, as of fiscal year 2019.

Another proposal to reduce revenue dedicated to the state firefighter pension and retirement system, the police pension and retirement system, and the law enforcement retirement system would similarly increase unfunded liabilities. The Oklahoma Police Pension was fully funded in 2019.

Unconvinced by Stitt’s arguments, a large majority of lawmakers in the State House and Senate overruled the veto on the state budget measures. Stitt is a Republican, so the GOP-controlled legislature has broken with him on this issue.

Many argued that funds for retirement systems were needed immediately to support schools and teachers across the state. In addition, the reduced state funding would be repaid over a five-year schedule, according to to declare documents.

Others have sided with the governor on pension plans, including Democrats in the minority state Senate.

“While we agree that funding is needed to prevent education cuts, we do not believe taking funds earmarked for public pensions is the right way to do it,” it read. in a press release. declaration of Democratic Senate Leader Kay Floyd on behalf of the Democratic Caucus.

Senate Democrats instead advocated that the state legislature pass a cost-of-living adjustment (COLA) for retirees.

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Tags: Fiscal year, government budget, Oklahoma, Oklahoma City, pension