The Trillion Dollar Gap: Oklahoma

Underfunded State Retirement Systems and the Roads to Reform

Oklahoma's management of its long-term pension liability is cause for serious concern and needs to improve how it handles its retiree health care and other benefit obligations. The Sooner State conducts its actuarial valuations on December 31 (rather than on June 30, the end of the fiscal year for most states). At the end of calendar year 2008, Oklahoma's pension plans were only 61 percent funded—well below the 80 percent benchmark that the U.S. Government Accountability Office says is preferred by experts—reflecting the full decline in investment returns that calendar year. However, the system has been in poor condition since at least 1997. The state has consistently failed to meet its actuarially required contributions, paying no more than 81 percent of the annual bill in any of the past 12 years. Meanwhile, Oklahoma has relatively limited long-term liabilities—about $359.8 million—for retiree health care and other benefits. But, like 19 other states, it has failed to set aside any assets to cover these obligations.

The Trillion Dollar Gap Oklahoma Pension Funding