Further reform needed for Oklahoma's pension system
Oklahoma has been doing well economically. Take a look around and witness the many changes — the new businesses locating in Oklahoma, completion of the Devon tower and the renovated Myriad Gardens are just a few examples. We're not in this position accidentally, but because of careful, calculated planning.
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We've learned from past mistakes and are well positioned for the future. We're addressing our biggest obstacles and making smart decisions that will provide Oklahoma a solid foundation going forward. This year, we're continuing to build that foundation.
Gov. Mary Fallin is working to reform the state's tax structure. The Legislature is thoroughly reviewing the effectiveness of the state's economic development programs, and asking how our government can be better, more efficient and best serve the people it represents.
Even in the midst of this oversight and planning, one often-overlooked issue that threatens Oklahoma's long-term fiscal solvency is the state's pension system. Despite key reforms passed into law last year, the pension system still has more than $10 billion in unfunded liabilities. Indifference toward this issue is no longer an option.
Without additional reforms, we risk facing a financial crisis and eventually being forced to redirect funding from core government services to address that debt. This will ultimately negatively affect every Oklahoman in one way or another.
During the 2011 legislative session, Rep. Randy McDaniel led pension reform efforts in the House, calling for the funding of cost-of-living (COLA) increases, noting that the failure to do so was a primary reason the state's pension liability had doubled over the last decade. The enactment of a law requiring adequate funding for COLAs dramatically lowered the state's more than $16 billion unfunded pension liability. Additional reforms, such as The Pension Funding Accountability Act, helped to further reduce the pension debt.
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