Worry for Teacher Pensions Prompts Criticism of Oklahoma Ed Funding Plan

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OKLAHOMA CITY — An Oklahoma Senate plan to fund education initiatives with money designated for teacher pensions has drawn mixed reactions in the week since Republican leaders unveiled it.

Groups representing active and retired educators, along with legislative Democrats, have opposed Senate Republicans’ idea to redirect $254 million that otherwise would supplement the Teachers’ Retirement System. GOP leaders said the pension system is in a strong position now that it’s 80% funded, and those extra funds could benefit urgent needs in public schools.

The plan wouldn’t take any money out of the Teachers’ Retirement System, and no retirees’ benefits would be reduced. It would place a $200 million limit on a yearly pension subsidy, called an apportionment, that has helped build up the retirement system over the past 23 years on top of regular state and employee contributions.

Doing so would free up $254 million — in a tight budget year — for a $2,500 teacher pay raise, extra school funding, expanded private school tax credits and more, Senate leaders said.

The thought of repurposing retirement funds, though, has drawn scrutiny from the state’s largest teacher union and a group representing retired educators.

Oklahoma Education Association President Cari Elledge equated the plan to mortgaging a teacher’s future for a salary increase today.

“We shouldn’t be having to be the ones who are funding our own raises,” she said.

Using money intended to benefit public school teachers to instead bolster private school tax credits also would be “very troubling,” she said. The Senate plan would put $25 million of the pension apportionment funds into the state budget for the Parental Choice Tax Credit, which helps families pay for private schooling.

Retirement funds shouldn’t be used to finance other budget priorities, especially when retirees haven’t had a cost-of-living increase to their benefits in six years, the Oklahoma Retired Educators Association said in a statement.

“An 80% funded ratio is meaningful progress — but it is not full funding,” the organization wrote in a public statement. “Redirecting retirement dollars now risks reversing years of hard-earned stability.”

Senate leaders didn’t rule out the possibility of a cost-of-living increase if their plan succeeds. They would need support from the House for the proposal to meaningfully advance.

House Speaker Kyle Hilbert, R-Bristow, stopped short of endorsing or rejecting the Senate idea. He said lawmakers, though, will have to someday decide what to do with the pension subsidy as the Teachers’ Retirement System inches closer to being 100% funded.

“At some point the subsidization of the pension systems, the TRS system, will need to go away,” Hilbert told reporters Thursday. “It’s just a question of is that (happening in) 2026, is that 2030, is that 2034? I think that’s the question we have to wrap our heads around as we make determinations on what is fully funded and when does that subsidy need to go away. It was never intended to be there forever.”

Much of the criticism for the funding plan stems from a misunderstanding, said Senate President Pro Tem Lonnie Paxton, R-Tuttle. He said constituents who contacted Senate Republicans believed lawmakers planned to deduct from their pension paychecks.

“My wife is a retired teacher. I don’t get to go home at night if I’m trying to draw from her pension system. That’s not what we’re doing,” Paxton said.

Senate Minority Leader Julia Kirt, D-Oklahoma City, said she heard similar fears from constituents. Her office has been “flooded with calls” since the Republicans’ announcement.

Feedback on the proposal has been full of frustration, said House Minority Leader Cyndi Munson, D-Oklahoma City.

“Pitting retired teachers against active teachers is really not a good plan,” Munson said. “It’s not a popular idea.”

Oklahoma Voice is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Oklahoma Voice maintains editorial independence. Contact Editor Janelle Stecklein for questions: [email protected].

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