An Act
ENROLLED SENATE
BILL NO. 1589 By: Weaver of the Senate
and
Stinson of the House
An Act relating to the Oklahoma Law Enforcement
Retirement System; amending 47 O.S. 20 21, Sections 2-
305.2 and 2-308.2, which relate to deferred option
plans and actuary services for the system; modifying
requirement for certification of certain interest
rate; conforming language; modifyin g requirements for
determination of employ er contributions; and
providing an effective date .
SUBJECT: Oklahoma law enforcement retirement
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 47 O.S. 2021, Section 2 -305.2, is
amended to read as follows:
Section 2-305.2. A. In lieu of terminating employment and
accepting a service retirement pension pursuant to Section 2-305 of
this title, any member of the Oklahoma Law Enforcement Retirement
System who has not less than twenty (20) y ears of participating
service and who is eligible to receive a service retirement pension
may make an irrevocable election to pa rticipate in the Oklahoma Law
Enforcement Deferred Option Plan and defer the receipts of benefits
in accordance with the provisi ons of this section.
B. For purposes of this sect ion, participating service shall
include service credit recognized pursuant to paragraphs (c) and (d)
of Section 2-307, subsection B of Section 2 -307.2, and Sections 2 -
ENR. S. B. NO. 1589 Page 2
309.1, 2-309.2, 2-309.3, 2-309.4, 2-309.5 and 2-309.6 of this title
but for eligibility purposes only.
C. The duration of participation in the Oklahoma Law
Enforcement Deferred Option Plan for a member shall not exceed five
(5) years. Participation in the Oklahoma Law Enforcement Deferred
Option Plan must begin the f irst day of a month and end on the last
day of the month. At the conclusion of a member's participation in
the Oklahoma Law Enforcement Deferred Option Plan, the member shall
terminate employment as a member of the Oklahoma Law E nforcement
Retirement System, and shall start rece iving the member's accrued
monthly retirement benefit from the System. Such a member may
continue to receive in-service distributions of such member 's
accrued monthly retirement benefit from the System if the member is
reemployed by a state agency only if such reemployment is in a
position not covered under the System.
D. When a member begins participation in the Oklahoma Law
Enforcement Deferred Option Plan, the contribution of the member
shall cease. The employer contributions s hall continue to be paid
in accordance with Section 2-304 of this title. Employer
contributions for members who elect the Oklahoma Law Enforcement
Deferred Option Plan shall be credited equally to the Oklahoma Law
Enforcement Retirement System and to the member's Oklahoma Law
Enforcement Deferred Option Plan account. The monthly retirement
benefits that would have been payable had the member elected to
cease employment and receive a service retirement shall be paid into
the member's Oklahoma Law Enforceme nt Deferred Option Plan account.
E. 1. A member who participates in this plan shall be eligible
to receive cost of living increases.
2. A member who participates in this plan shall earn interest
at a rate of two percentage poin ts below the rate of retur n of the
investment portfolio of the System, but no less than the actuarial
assumed interest rate as certified by the actuary in the yearly
evaluation report of the actuary . The actuarial assumed interest
rate shall be seven and five-tenths percent (7.5%) until the Board
amends the actuarial assumed interest rate prospectively by
resolution. The interest shall be credited to the individual
account balance of the member on an annual basis.
ENR. S. B. NO. 1589 Page 3
F. A member in the Oklahoma Law Enforcem ent Deferred Option
Plan shall receive, at the opt ion of the member:
1. A lump-sum payment from the account equal to the option
account balance of the member, payable to the member;
2. A lump-sum payment from the account equal to the option
account balance of the member, payable to the annuity provider which
shall be selected by the member as a result of the research and
investigation of the member; or
3. Any other method of payment if approved by the Board.
Notwithstanding any other provision contained herein to the
contrary, commencement of distributi ons under the Oklahoma Law
Enforcement Deferred Option Plan shall be no later than the time as
set forth in paragraph 7 of Section 2 -300 of this title.
If a member meets the definition of disability as defi ned in
paragraph 11 of Section 2-300 of this title by direct reason of the
performance of the member's duties, the payment from the account
shall be an in-line-of-duty disability payment.
G. If the member dies during the period of participation in the
Oklahoma Law Enforcement Defe rred Option Plan, a lump -sum payment
equal to the account balance of the member shall be paid to the
designated beneficiary as defined in paragraph 17 of Section 2 -300
of this title, or if there is no designated beneficiary or the
designated beneficiary pr edeceases the member, to the estate of the
member. If such member was receiving, or eligible to recei ve, an
in-line-of-duty disability pension pursuant to subsection E or F of
Section 2-305 of this title at the time of death, pay ment of the
account balance shall be an in-line-of-duty disability payment.
H. In lieu of participating in the Oklahoma Law Enf orcement
Deferred Option Plan pursuant to subsections A, B, C, D, E and F of
this section, a member may make an irrevocable elec tion to
participate in the Oklahoma Law Enforcemen t Deferred Option Plan
pursuant to this subsection as follows:
1. For purposes of this subsection, the following definitions
shall apply:
ENR. S. B. NO. 1589 Page 4
a. "back drop date" means the date selected by the member
which is up to five (5) years befor e the member elects
to participate in the Oklahoma Law Enforcement
Deferred Option Plan, but not befor e the date at which
the member completes twenty (20) years of
participating service,
b. "termination date" means the date the me mber elects to
participate in the Oklahoma Law Enf orcement Deferred
Option Plan pursuant to this subsection and the date
the member terminates employment and starts receiving
the member's accrued monthly retirement benefit from
the System. Such terminatio n has at all times
included reemployment of a memb er by a state agency,
but only in a position not covered under the System,
c. "earlier attained participating service " means the
participating service earned by a member as of the
back drop date. Earlier a ttained participating
service cannot be reduced to less than twenty (20)
years of participating service, and
d. "deferred benefit balance" means all retirement
benefits that would have been paid from the back drop
date to the termination date, and one -half (1/2) of
the employer contributions from the back drop date to
the termination date, with interest based on how the
benefit would have accumulated on a compound annual
basis as if the member had participated in the
Oklahoma Law Enforcement Deferred Option Plan pursuant
to subsections A, B, C, D and E of this section from
the back drop date to the termination date;
2. At the termination date, a member's monthly pension benefit
shall be determined based on the earlier attained participating
service and on the final average salary as of the back drop date.
The member's individual deferred option account shall be credited
with an amount equal to the deferred benefit balance; the member
shall terminate employment and shall start receiving the member 's
accrued monthly retirement benefit from the System. The m ember
shall, upon application filed with the Board, be refunded from the
ENR. S. B. NO. 1589 Page 5
fund an amount equal to the accumulated contributions the member
made to the fund from the back drop date to the termination date,
but excluding any interest. Such termination has at all times
included reemployment of a member by a state agency, but only in a
position not covered under the System. The provisions of
subsections B, C, E, F and G of this section shall apply to this
subsection; and
3. A member may participate in the Okl ahoma Law Enforcement
Deferred Option Plan pursuant to this subsection even if the member
has elected to participate in the Oklahoma Law Enforcement Deferred
Option Plan pursuant to subsections A, B, C, D, E and F of this
section. Such a member may select a back drop date which is up to
five (5) years prior to the termination date, but not before the
date at which the member completes twenty (20) years of
participating service. Such a member 's participation in the
Oklahoma Law Enforcement Deferred Option Plan may not exceed five
(5) years when combined with such a member 's prior period of
participation in the Oklahoma Law Enforcement Deferred Option Plan.
The provisions of subsections B, C, E, F and G of t his section shall
apply to this subsection.
SECTION 2. AMENDATORY 47 O.S. 2021, Section 2 -308.2, is
amended to read as follows:
Section 2-308.2. (1) A. At least once each five (5) years the
actuary shall make an actuarial investigation o f the experience of
the System, including the mortality, service and compensation
experience of members and beneficiari es. Based on the results of
such investigation the actuary shall recommend for adoption by the
Board such tables and rates as are requir ed for the operation of the
System and for the preparation of annual actuarial valuations.
(2) B. On the basis of such tables and rates as the Board shall
adopt, the actuary shall prepare an annual actuarial valuation of
the assets and liabilities of the Sys tem and certify the rates of
contribution payable by the state under the provisions of law
concerning the System.
(3) C. Subject to the funds available to the System, the
employer contributions to the System shall be determined on the
basis of the most recen t actuarial valuation, which amount shall be
ENR. S. B. NO. 1589 Page 6
calculated as the sum of the normal cost for the fiscal year plus
expected administrative expenses plus the payment required to
amortize the unfunded accrued liability by level dollar payments
over fifteen (15) years from July 1, 2014 according to the
amortization schedule recommended by the actuary and adopted by the
Board.
SECTION 3. This act shall become effective November 1, 2022.
ENR. S. B. NO. 1589 Page 7
Passed the Senate the 15th day of March, 2022.
Presiding Officer of the Senate
Passed the House of Representati ves the 19th day of April, 2022.
Presiding Officer of the House
of Representatives
OFFICE OF THE GOVERNOR
Received by the Office of the Governor this _______ _____________
day of _________________ __, 20_______, at _______ o'clock _______ M.
By: _______________________________ __
Approved by the Governor of the State of Oklahoma this _____ ____
day of _________________ __, 20_______, at _______ o'clock _______ M.
_________________________________
Governor of the State of Oklahoma
OFFICE OF THE SECRET ARY OF STATE
Received by the Office of the Secretary of State this _______ ___
day of __________________, 20 _______, at _______ o'clock _______ M.
By: _______________________________ __