The Oklahoma state legislature adjourned its 2017 legislative session on May 26. In many ways, what was remarkable about the 2017 session was how little got accomplished. For public pensions in Oklahoma, the session was largely a win, except for one bill that will likely increase meddling by politicians. Let’s take a closer look at the outcome of Oklahoma’s session.
As with many deep-red states that have been under one-party control for several years now, Oklahoma is struggling with major challenges to its economy, education system, and state budget. All of these issues are related to each other. Oklahoma’s economy is heavily dependent on the oil and natural gas sector. While this allowed the state to weather the Great Recession better than most, the state’s economy is struggling now that oil & gas are in a bust cycle.
As in other deep-red states like neighboring Kansas, Oklahoma cut taxes deeply several years ago and is now suffering a significant loss of revenue for the state. While the downturn in the economy certainly contributes to the revenue problems, it is undeniable that the tax cuts have also played a major role.
Oklahoma has also cut education funding significantly since the Great Recession. For several years now, Oklahoma has suffered from a severe teacher shortage. Class sizes have increased across the state and some school districts have cut back to a four day school week. The state has issued an unprecedented number of emergency teaching certifications in the past few years. We discussed all these issues in a report released earlier this year on the role public pensions can play in easing the teacher shortage crisis.
In the midst of all these serious issues facing the state, some ideological opponents of public pensions continue to push their harmful anti-pension agenda. Teachers, firefighters, and other public employees in Oklahoma were well-organized and vigilant this year in defending their retirement security. By standing together in solidarity, these working families were able to defeat several bad bills.
Unfortunately, one bill did pass and was signed by the governor. This legislation will add the State Treasurer to the boards of the Oklahoma Public Employee Retirement System and the Oklahoma Teacher Retirement System. Why is this a bad thing? Because the current State Treasurer is a vocal opponent of traditional pensions. It also increases the possibility of political meddling in the management and administration of the pension funds. This legislation continues a trend we’ve seen in recent years of states altering pension boards to allow for more political influence.
The 2017 legislative session will largely be remembered as one in which state legislators failed to take action to address major issues facing Oklahoma. From fixing the revenue failures that are blowing holes in the state budget to adequately funding schools and paying teachers a decent salary, Oklahoma’s legislators chose the cowardly path of inaction rather than boldly leading and coming up with solutions to the state’s problems.
Moreover, attacks on the retirement security of hard-working public employees continued and the addition of the ideologically-driven State Treasurer to the boards of the two largest public pension funds bodes ill for the future. In spite of these challenges, working people from across the state stood together to protect their pensions and demand real solutions from their political leaders, not just more of the same.
