House Bill 3350 (Rep. Avery Frix & Sen. Roger Thompson)
Effective July 1, 2020
OPERS and URSJJ members, who were receiving a benefit as of June 30, 2019 and who continue to receive benefits on or after July 1, 2020, will receive a cost of living adjustment (COLA). The COLA is an increase based on the number of years retired.
|Number of Years Retired as of July 1, 2020||COLA Adjustment|
|Less than two years||No adjustment|
|At least two years, but less than five years||2% increase|
|Five years or more||4% increase|
Communication will be sent to retirees eligible for the COLA in late July, and the increase will be effective for the benefit deposit on July 31, 2020.
Hazardous Duty – Deputy Sheriffs & County Jailers
House Bill 2272 (Rep. Josh West & Sen. Paul Rosino)
Effective Nov. 1, 2020
This bill created a new group of “hazardous duty” members in OPERS. Deputy sheriffs and jailers who are hired by a participating county as deputy sheriff or jailer for the first time on or after November 1, 2020, will participate in the hazardous duty plan. This plan is open only to members who have not worked as a deputy sheriff or jailer prior to November 1, 2020.
Quartz Mountain Transfer
House Bill 2753 (Rep. Jon Echols & Sen. Roger Thompson)
Effective Oct. 1, 2020
This bill transfers Quartz Mountain to the Oklahoma Tourism and Recreation Department. An employee transferred under this act, who is a member of the Teachers’ Retirement System of Oklahoma or the Oklahoma Law Enforcement Retirement System, may elect to remain a member of the applicable system or may elect to become a member of the OPERS or Pathfinder system, depending on their eligibilty. Employees will need to complete a form by Nov. 1, 2020, to indicate which system they select.
COLA Being Studied for 2020
HB 2304 proposes a two percent (2%) COLA for members who were retired as of December 31, 2018, and still receiving a benefit as of January 1, 2020.
HB 2485 proposes a four percent (4%) COLA for members who were retired as of December 31, 2018, and still receiving a benefit as of January 1, 2020.
House Bill 1340 (Rep. Randy McDaniel and Sen. Greg Treat)
Effective October 1, 2018
This bill provides a one-time stipend for members of OPERS who have been retired for five years as of October 1, 2018. The stipend is based on the funding level of the system. OPERS members will receive the lesser of 2% of their gross annual retirement amount or $1,200. Retirees with a minimum of 20 years of service will receive a payment of at least $350. This stipend will be paid in October.
To read HB 1340, click here.
House Bill 2516 (Rep. Randy McDaniel and Sen. Adam Pugh)
Effective November 1, 2018
OPERS requested this bill to clarify certain plan provisions.
- This bill allows OPERS to bill employers for actual months of sick leave after rounding was eliminated for members who joined the system on or after November 1, 2012. Current language only allows OPERS to bill employers when sick leave rounds an employee up to an additional years of service.
- The bill clarifies language regarding early retirement for elected officials. Current language regarding early retirement conflicts with the eligibility for normal retirement.
To read HB 2516, click here.
Senate Bill 527 (Sen. Gary Stanislawski and Rep. Randy McDaniel)
Effective November 1, 2018
A statewide elected official or legislator who is first elected or appointed on or after November 1, 2018, and who has participating service in the OPERS defined benefit plan prior to November 1, 2015, shall be a member of the defined benefit plan.
To read SB 527, click here.
SB 242 (Sen. Adam Pugh and Rep. Ryan Martinez)
Effective August 25, 2017
This bill adds the Oklahoma State Treasurer, or his/her designee, to the OPERS and Teachers’ Retirement System Board of Trustees.
To read SB 242, click here.
HB 1704 (Rep. Randy McDaniel and Sen. Bill Brown)
Effective November 1, 2017
OPERS requested this bill to clarify certain plan provisions for members of the Uniform Retirement System for Justices and Judges (URSJJ), Elected Officials, and Public Safety Officers under the Grand River Dam Authority.
- URSJJ Retirees Returning to Work – Amended language treats retired members of the Uniform Retirement System for Justices and Judges (URSJJ) similarly to OPERS members. Judges who return to work for a URSJJ employer must participate in URSJJ by paying retirement contributions. If the judge returns to work for at least 36 consecutive months of full time service credit, they would be eligible to retire a second time and have their benefit recalculated. If the judge returns to work for less than the 36 consecutive months of full time service credit, they would not be able to retire a second time but would have their benefits reinstated upon leaving office and receive service credit for the additional months.
- Elected Officials – Currently if an elected official chooses the maximum option with a ½ survivor annuity, the surviving spouse will only receive the survivor annuity if he/she does not remarry after the elected official’s death. The amended language removes the prohibition against remarriage.
- GRDA Public Safety Officers – The statutory cite for hazardous duty exemptions in Pathfinder needs to be updated to include GRDA officers under 74§902 as a result of 2016 legislation.
To read HB 1704, click here.
The OPERS staff has prepared this summary for our members of 2016 retirement legislation. The following is a description of new legislation affecting members of the Pathfinder Plan administered by the Oklahoma Public Employees Retirement System.
HB 2264 (Rep. Randy McDanial and Sen. Jason Smalley)
Effective November 1, 2016
HB 2264 is a request bill from OPERS which amends the recently created defined contribution system, the Pathfinder Plan. The change allows participants to change their voluntary contribution levels once per month instead of only once per year. This change allows more flexibility for the participants. OPERS does not anticipate any burden on the agency or the recordkeeper in administering these changes.
There were no bills that directly impacted the OPERS defined benefit plan.
HB 1376 (Rep. Randy McDaniel)
Effective November 1, 2015
House Bill 1376 further clarifies and defines aspects of the new Defined Contribution (DC) plan set forth in HB 2630. HB 2630 was signed by Governor Mary Fallin on May 30, 2014. It directs OPERS to establish a tax-qualified defined contribution retirement system for those members who join the system on or after November 1, 2015, including statewide elected officials and legislators. The following is a summary of key provisions of the bill:
Only those employees who are employed on more than a part-time basis are eligible to participate in the new Defined Contribution (DC) plan. Eligibility is tied to the receipt of benefits, which only those employees who work more than part-time are eligible to receive.
Enrollment dates for both the 457(b) plan and the 401(a) plan will begin the month following employment, not the entry date. This alignment allows for ease of administration. The IRS requires the delay for the 457(b) plan.
Employees who begin employment on or after November 1, 2015, with an employer who is excluded from the DC plan and then later go to work for a DC employer will join the DC plan upon employment with the DC employer. The exclusion does not follow the employee. This does not affect anyone first hired before November 1, 2015.
- Session Employees
Session employees will have the option to participate in the DC plan. That option is irrevocable.
Employees will contribute a minimum of 4.5% of their salary and the employer will contribute a 6% match. Alternately, employees can also contribute 7% of their salary and receive a 7% match from their employer.
An employee who leaves the DC plan, but then returns to employment, will receive credit for previous service and be vested at the same percentage as when they left employment. All employer contributions will remain in the plan to offset administrative costs. Statute already includes the forfeiture language, but HB 1376 clarifies the existing language and adds the vesting language.
- Qualified Domestic Relations Orders (QDROs)
Language that was only relevant to the Defined Benefit (DB) plan was deleted. Alternate payee distribution will not be tied to the distribution or death of a member in the DC plan. This language was previously signed into law in Senate Bill 462 (please see below).
SB 462 (Sen. Rick Brinkley)
Effective November 1, 2015
Senate Bill 462 relates to qualified domestic orders. More specifically, Senate Bill 462 allows benefits to be paid under a qualified domestic order to an alternate payee before the Pathfinder participant has started to receive benefits and allows the benefits to continue to be paid to an alternate payee after the participant has died. To qualify as an alternate payee, a former spouse is required to have been married to the participating employee for a period of not less than thirty continuous months immediately prior to the proceedings from which the qualified domestic order is issued.
HB 2630 (Rep. Randy McDaniel)
Effective November 1, 2015
House Bill 2630 directs OPERS to establish a tax-qualified defined contribution retirement system for those members who join the system on or after November 1, 2015, including statewide elected officials and legislators. The following is a summary of key provisions of the bill:
The provisions of this bill are not applicable to hazardous duty members, district attorneys, assistant district attorneys or other employees of the district attorney’s office. Further exclusions are provided in Senate Bill 2120 (see below).
- Employee contributions
Participating employees will contribute a minimum of 3.0% of compensation up to a maximum rate of 7.0% (Rate choices: 3%, 4%, 5%, 6%, and 7%). The initial 3% contribution is mandatory and will be placed in a 401(a) or 457(b) plan. Any contributions over that will be voluntary and placed in a 457(b) plan. Participants will elect their initial contribution rates at enrollment and may only change the rate once per calendar year during an option period determined by the OPERS Board. All employee contributions shall be made by salary reduction.
- Pick up provisions
The mandatory 3% employee contributions into the 401(a) are “picked up” by the employer, which means there are no taxes paid at that time. Voluntary amounts over the 3% go into the 457(b) plan and are also not taxed at that time up to the annual IRS maximums.
- Employer match
Participating employers will match the employee contribution rate in the same percentage and those funds will be placed in a 401(a) plan. The employer match may be increased or decreased at any time by the Legislature without affecting the then-existing rights of the employee, but shall not be less than 3.0% for any year. Employers will be required to make payment of the required matching amount within five business days of the employee’s payroll date. In addition, the employer shall remit the difference between the required matching contribution and the current required OPERS employer contribution rate. If remittances are not made through the Office of Management and Enterprise Services (OMES), they can be made through and electronic funds transfer or placed in a bank account from which OPERS can debit the amount due.
- Investment discretion
The OPERS Board will contract with one or more business entities to create a range of investment choices for participants. Participants will have investment discretion over all employee contributions, employer matching funds, and the gains or losses on those amounts within the available investment options offered. These options will be substantially similar to those offered in the SoonerSave plan. The Board will give due consideration to investment options that provide guaranteed lifetime income.
- Administrative costs
At least monthly, each employer will be required to pay to OPERS an amount to reimburse the cost of administration of the defined contribution system, as determined by the OPERS Board. Each year, the OPERS Board shall certify to OMES the determined amount of administrative costs of the defined contribution system, which will be required to be paid for by each participant.
Participants will always be 100% vested in their employee contributions, and the gains or losses on those contributions. Employees are vested with respect to employer contributions at 20% per year until becoming 100% vested after five full years. If an employee leaves participation before becoming fully vested in the employer matching funds, those nonvested amounts may be used to offset administrative costs.
- Vested rights
No alteration, amendment or repeal of this Act shall affect the then-existing rights of participating employees. Benefits are not subject to executions, garnishment or attachment and not assignable. Funds in the DC plan can be divided in domestic relations cases.
Employees participating in the defined contribution system will not be permitted to also participate in the Oklahoma State Employees Deferred Compensation and Savings Incentive Plans commonly referred to as “SoonerSave” and, accordingly, will not qualify for the $25 match in SoonerSave.
SB 2120 (Sen. Rick Brinkley)
Effective November 1, 2015
Senate Bill 2120 expands the list of excluded participants in the new defined contribution system created in HB 2630 to include any employees of a county, county elected officials, county hospital, city or town, conservation district, circuit engineering district, and any public or private trust in which a county, city or town participates and is the primary beneficiary.
This bill also permits any person first licensed by the Department of Rehabilitation Services as a vending operator or managing operator on or after November 1, 2015, to be eligible for participation in the defined contribution system.
The bill excludes participants in the defined contribution system from receiving the $105.00 monthly health insurance subsidy paid by OPERS.
The OPERS staff has prepared this summary of 2012 pension legislation for our members. The 2012 session of the Oklahoma Legislature adjourned on May 25, 2012. This was a relatively light year, in terms of legislation directly impacting OPERS and our members. In this legislative update, we focus on three bills signed into law by Governor Mary Fallin.
House Bill 2321
Rounding of service credit eliminated for new members
HB 2321 eliminates rounding of service credit for members who joined OPERS on or after November 1, 2012. The bill states the number of years of credited service used in calculating retirement benefits shall be based on actual years and months of credited service without rounding up or down. Members who joined OPERS prior to November 1, 2012, are not impacted by this new provision.
House Bill 2322
Step-Up Program offered to elected officials
Last year, Senate Bill 794 provided that newly elected officials after November 1, 2011, are subject to the same contribution rates and benefit computation factors as state and local government members of OPERS. This year, HB 2322 went further to allow elected officials to begin participating in the “Step-Up” Program just as state and local government members are allowed to do. The Step-Up program allows members to pay an additional contribution, currently 2.91%, for an increased benefit computation factor of 2.5%.
House Bill 2939
I.T. consolidation and participation in the Oklahoma Teachers’ Retirement System
This bill affects a relatively small number of members impacted by the 2011 Information Technology Consolidation and Coordination Act. HB 2939 provides state employees who are (or were) members of the Teachers’ Retirement System of Oklahoma and are transferred pursuant to the Information Technology Consolidation and Coordination Act may elect to continue their participation in the Teachers’ Retirement System of Oklahoma in lieu of participating in OPERS.
Any transferred employee who wishes to make this election must do so in writing within thirty (30) days of the effective date of this act. If a transferred employee who has already begun participating in OPERS elects to return to the Teachers’ Retirement System, OPERS will transfer the service credit and contributions to the Teachers’ Retirement System for any credit that accrued after the initial transfer. The election to continue or return to participation in the Teachers’ Retirement System is irrevocable and effective until the employment with the Office of State Finance is terminated.
For more detailed information on these and other bills before the Legislature, please visit the Oklahoma State Legislature’s Bill Search page. Simply enter the bill number and you will gain access to a wealth of information, including the full text of the bill, amendments, actions taken, and voting history. We hope you find this information helpful in tracking the activity of retirement legislation.
The OPERS staff has prepared this summary of 2013 pension legislation for our members. The following is a description of new legislation affecting active and retired members of the Oklahoma Public Employees Retirement System (OPERS). The implementation of the legislation may initiate new policies, rules, and procedures in the coming months.
HB 1325 (Rep. Randy McDaniel and Sen. Rick Brinkley)
Effective April 26, 2013
“Final Average Salary” expanded from three to five years for new members
Changes the definition of “Final Average Salary” for members who join on or after July 1, 2013. This is the salary number used in the final retirement benefit calculation. New OPERS members will have their salary averaged over the highest five of the last ten years instead of three years in current law.
Administrative changes for data reporting, probate waivers and death benefit payments
The bill requires participating employers to provide salary and other information for retiring members no later than the fifteen day of the month of retirement. This will help OPERS speed up the retirement process. The bill also increases the amount that OPERS can pay a deceased member’s heirs without requiring that the estate be probated. It also allows OPERS to pay the final benefit of a deceased member to the named beneficiary before paying the estate of the member.
HB 1477 (Rep. Kim David and Sen. Jason Murphy)
Effective November 1, 2013
OPERS Board makeup
Legislation last year inadvertently removed the Director of Human Capital Management of OMES (formerly the OPM Administrator) from the OPERS Board. This bill puts the Director of HCM back on the board, as well as allows the Corporation Commission member of the board to send a designee in his or her place.
SB 847 (Sen. Clark Jolley & Rep. Scott Martin)
Effective August 30, 2013
Pension Stabilization Revolving Fund
Under this bill, surplus funds over and above those going to the State’s “Rainy Day Fund” will go into a revolving fund. The Legislature may appropriate any such funds to pension systems with a funded ratio below 90%. Priority will be given to the lowest funded pension systems. Other Legislative Proposals There was much discussion of the idea of consolidating the administration of the state retirement systems, which included OPERS and plans for teachers, state law enforcement, and municipal police and firefighters. The discussion was about having a single governing board and a single, consolidated administrative staff for all state retirement plans. There was no discussion of literally combining the underlying funds. However, there was never a bill introduced or acted upon on this topic. Another bill would have created an optional Defined Contribution plan for new OPERS members from and after July 1, 2014. The measure was HB 2077 that passed the House and Senate but was vetoed by Governor Fallin on May 13, 2013.
The OPERS staff has prepared this summary of 2011 pension legislation for our members. There were no bills passed in the Legislature that would affect active members. The bills only affect future new employees of OPERS-participating agencies, or future members of the judicial retirement system (URSJJ).
“Pension reform” has been a topic of much interest in the state and local media in 2011. As a result of this coverage, we have received numerous phone calls from concerned active members asking whether the retirement benefits they currently have could be changed as a result of the bills summarized below.
Legislators have consistently advised OPERS staff that there are no plans to change benefits for current members of OPERS or URSJJ. However, there was a bill that could have a potential impact on retirees. This legislation concerns how the Legislature considers Cost of Living Adjustments (COLAs) and how they are funded.
Senate Bill 794
Changes to Retirement Age Requirements and Changes to Participation by Elected Officials
The retirement age for all OPERS members hired on or after November 1, 2011, was increased to age 65. Members hired on or after November 1, 2011, must also be at least age 60 to retire with 90 points. These members may retire with full, unreduced benefits from OPERS when the sum of their age and years of service in OPERS equals 90 or more and they are at least 60 years of age.
The vesting period for elected officials first elected on or after November 1, 2011, was increased to eight years of elected or appointed service. The retirement age for newly elected officials was increased to age 65 with eight years of elected or appointed service, or age 62 with 10 years of elected or appointed service. Newly elected officials will also contribute at the same rate and have their benefits calculated using the same computation factor as other state and local government employees.
Senate Bill 840
Clarification on Administrative Hearings and Appeals
Existing law requires suits against OPERS be brought in Oklahoma County. SB 840 provides clarification on appeals to administrative decisions by the OPERS Board. This bill brings the OPERS hearing procedures in line with the Administrative Procedures Act including the appointment of hearing examiners.
House Bill 1010
Changes to Retirement Age Requirements for Judicial Members
The retirement age for judges whose judicial service begins on or after January 1, 2012, has increased to age 67 (previously age 65) with eight years of judicial service, or age 62 (previously age 60) with 10 years of service. This bill becomes effective January 1, 2012.
House Bill 2132
Changes to Funding of Cost of Living Adjustments
Cost of living adjustments (COLAs) for retired OPERS members must be passed by the Legislature. COLAs are no longer considered “non-fiscal retirement bills” in the Oklahoma Pension Legislation Actuarial Analysis Act. This means COLAs must now be funded by the Legislature before they can be passed into law. This bill became effective August 25, 2011.
House Bill 2177
State Voluntary Buyout Offer Extension
In May 2010, the State Legislature created the Voluntary Buyout Reimbursement Revolving Fund to provide budget relief to state agencies and provide reimbursement to state agencies that offered voluntary buy-out benefits to retirement-eligible employees. The deadline for state agencies to apply for these funds was originally June 30, 2011. HB 2177 extended the deadline for application to June 30, 2012.
House Bill 2363 and Senate Bill 1442
These two companion bills implemented the statewide “Voluntary Buyout Offers” to state employees. Together they provide an incentive for eligible state employees to retire. With $22 million provided in SB 1442, agencies will be able to use these funds to pay retiring employees a $5,000 cash payment, the equivalent of their next longevity, and the cash equivalent of the cost of 18 months of health insurance for the member. The Governor signed HB 2363 April 28, 2010 and SB 1442 on April 29, 2010.
House Bill 3128
This bill permits OPERS’ death benefit beneficiaries to assign the $5,000 retiree death benefit to funeral homes. The bill has a November 1, 2010 effective date.
Senate Bill 1579
This bill has several provisions. The bill takes OPERS and the Teachers Retirement System out of the Merit System prospectively. It also expands the service credit for furloughed state employees to include employees of the House, Senate and the court system. The Governor signed the bill into law on June 8, 2010.
Senate Bill 1580
This bill will keep state agency employer contributions at 15.5% for FY 2011 when existing law would have increased the rate to 16.5%. The 16.5% rate is not scheduled to begin until July 1, 2011. The Governor signed the bill with an emergency clause effective June 11, 2010.
Senate Bill 1889
This bill was OPERS’ request bill and contained the following changes:
- It adds the word “retiree” to defined terms. Any time you see the words “retiree” or “retirant” in statute, they will mean the same thing.
- The bill also lowers the number of retirement options for elected officials from 6 to 2. New elected officials will only be able to choose between a 1.9% retirement multiplier and a 4% multiplier.
- A clarifying amendment was made to our “retiree return to work” statute. Now the one-year return to work limitation begins when a member leaves employment; not at retirement.
The bill also included several sections that affected the URSJJ.
- Amendments eliminated a lot of old language that was necessary when the URSJJ was formed.
- The retirement application procedure has changed. The applications are filed with the Court Administrator and the URSJJ without going through the Governor. The Court Administrator notifies the Governor instead.
- Retired judges’ benefits will only be suspended if the judge goes back on the state bench. This amendment will permit retired judges to be appointed or elected to various positions, or simply be employed, without losing their pensions.
- Another amendment removes the power of the OPERS Board of Trustees to raise or change contribution rates. The statutory contribution rates will remain. The Board must update state leaders about the actuarial condition of the URSJJ which it already does in practice. The Governor signed the bill with an emergency clause on June 10, 2010.
Senate Bill 899
This bill amends 51 O.S. § 24.1 dealing with the loss of public officials’ positions and pensions if they are convicted of certain crimes. Under prior law, state officers and employees could lose their state pensions if the crime amounted to a “violation of the oath of office” of that official. This provision was removed and replaced by identifying specific crimes that will forfeit an official’s pension. Felony crimes such as bribery, forgery, perjury and campaign-related offenses are all specifically identified. In addition, other felony crimes related to the official’s office or employment will trigger a forfeiture. The procedure followed by the retirement system when receiving notice of a conviction or plea of guilt to one of these crimes is spelled out. When the system receives such notice, the pension of that individual is suspended with the right of an appeal to the system. The Governor signed the bill on April 21, 2009.
Senate Bill 212
This bill deletes the mandatory requirement that the URSJJ never fall below a 100% funded ratio. Instead, a target of “at or near” a 90% funded ratio is adopted, coupled with the preservation of the Board’s ability to adjust contribution rates. The bill makes the contribution rate setting power of the Board more flexible. Under prior law, once the URSJJ has a funded ratio below 100%, the Board had to set a very high employer contribution rate. It had to be high enough to get the funded ratio back to 100% in a single fiscal year. Under the revised law, the Board and staff can work toward achieving the setting and collecting of the actuarially determined employer rate over a period of time. The Governor signed the bill on June 1, 2009.
House Bill 1254
This bill was a spending bill for the Court System. It provides in Section 9 that $6 million in the Supreme Court’s Management Information System’s fund, may be used to pay employer contributions to the URSJJ. The Governor signed the bill on June 2, 2009.
Senate Bill 1641
Revision to Elected Officials’ Benefits
Senate Bill 1641 becomes effective Aug. 21, 2008, and closes a benefit provision that allows non-elected service to be counted the same as elected service for retirement. Prior to the passage of this bill, any regular, non-elected member of OPERS who finished their career as an elected official, and had at least six (6) years in elected office, was able to count all of their non-elected service as if they were in office for their entire career. This may have given certain elected officials a larger pension than they actually paid for throughout their career. Members who are elected officials prior to the effective date of the bill are not affected by the change in law. Current OPERS members who are elected after the effective date will have a benefit cap of 100% of their highest annual salary that they received. Members who join OPERS after the effective date of the bill will receive a benefit consisting of two separate calculations. Non-elected years will be multiplied by 2%, and elected years multiplied by the applicable percentage selected and paid for by the member.
House Bill 3112
OPERS Retiree Cost of Living Adjustment
House Bill 3112 provides that any person receiving benefits from OPERS as of June 30, 2007, who is still receiving the benefit on July 1, 2008, will receive a 4% cost of living adjustment applied to their gross benefit amount paid beginning July 2008.
Rules Changes for Retirees Returning to Work
House Bill 3112 prevents a retiring member from returning to work with the same employer from which he or she retired for a period of one (1) year, unless electing to waive the receipt of their OPERS retirement benefit during that re-employment period.
Senate Bill 1894
Oklahoma Pension Legislation Actuarial Analysis Act (“Georgia” bill)
The bill applies to OPERS, the Judicial Retirement System and the Teachers Retirement System. The bill has three (3) prominent features. All retirement bills with fiscal impact must be introduced in odd years and voted on in even-numbered years. This can be bypassed for an “emergency” bill by a ¾ vote of each house. Each such bill must be analyzed for actuarial fiscal impact by a “Legislative Actuary.” The actuary is hired by the Legislative Service Bureau. Finally, any retirement bill with fiscal impact must contain adequate funding either through a lump-sum appropriation or an increase in contributions sufficient to pay the cost of the change. The bill permits the Legislature to grant Cost of Living Adjustments (COLAs) without following the restrictions in the bill. COLAs can be given by the Legislature as long as they do not exceed the actuarial assumption of the System. OPERS assumes it will pay a 2% COLA each year for actuarial purposes.
House Bill 1179 XX (Special Session)
OPERS Option C Retirement Benefit
Section 33 of the bill amends the “Option C” retirement benefit option in 74 O.S. § 918. Option C provides for a benefit paid to a member which is only slightly reduced from the maximum benefit. If the member dies before the passage of ten years, a beneficiary is guaranteed to receive the same payment for the remaining part of the 10 year certain period. Under current law, if a member dies before the passage of the ten year period, and the beneficiary isn’t alive or doesn’t survive for the ten year period, the estate of the member or the beneficiary receives the payment. The amendment permits OPERS to pay the present value of the payments in a lump sum so it can be distributed immediately.
OPERS Employee Contribution Rate
Section 34 amends 74 O.S. § 919.1 and makes the OPERS state employee contributions a flat 3.5%. The current rate structure of 3% on the first $25,000 of salary and 3.5% on the remainder is repealed. All state employees who earn at least $25,000 per year will only pay $125 more due to this increase.
OPERS Retiree Cost of Living Adjustment (COLA)
House Bill 1179 XX provides that any person receiving benefits from OPERS as of June 30, 2005, who is still receiving the benefit on July 1, 2006, will get a 4% increase in that benefit. The increased benefit will take effect with the payments and checks at the end of July. Retirees, disability retirees, Option C beneficiaries, and surviving joint annuitants will all get this increase. As an example, if the gross benefit was $1,000 per month, the new gross benefit will be $1,040.
Senate Bill 1112
OPERS 60-Day Notice to Retire Waiver Procedure
This amends the statute that deals with the 60-day notice required to retire from OPERS. The former law permitted the Board of Trustees to waive the notice at its discretion. The amendment will permit the Executive Director of OPERS to grant waivers of the 60-day notice “for good cause shown” as defined by the Board. The Board can still review denials of waiver requests.
Medicare Gap Benefit Change
This amends the Medicare Gap benefit statute. Under the former law, most OPERS members can select this benefit which gives them a slightly higher retirement benefit until they reach Medicare age. The member then sees an actuarially reduced benefit for the rest of his or her life to pay for the higher benefit. Under the former law, the reduction in benefits after age 65 takes place “in January of the year following the member’s 65th birthday.” The amendment starts the reduction in the “month following” the 65th birthday. The change in law will have no application to those who retired prior to the effective date of SB 1112.