RBS No. 1631
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STATE OF OKLAHOMA
1st Session of the 60th Legislature (2025)
COMMITTEE SUBSTITUTE
FOR
SENATE BILL 172 By: Bullard of the Senate
and
Wolfley of the House
COMMITTEE SUBSTITUTE
An Act relating to retirement; amending 11 O.S. 2021,
Sections 49-100.9 and 50-105.4, which relate to the
Oklahoma Firefighters Pension and Retirement System
and the Oklahoma Police Pension and Retirement
System; allowing the Oklahoma Firefighters Pension
and Retirement Board and the Oklahoma Police Pension
and Retirement Board to approve cost -of-living
adjustment under certain circumstances; amending 20
O.S. 2021, Section 1108, which relates to the Uniform
Retirement System for Justices and Judges; allowing
the Board of Trustees of the Oklahoma Public
Employees Retirement System to approve cost -of-living
adjustment under certain circumstances; amending 47
O.S. 2021, Section 2 -303.1, which relates to the
Oklahoma Law Enforcement Retirement System; allowing
the Oklahoma Law Enforcement Retirement Board to
approve cost-of-living adjustment under certain
circumstances; amending 70 O.S. 2021, Section 17 -
106.1, which relates to the Teachers’ Retirement
System of Oklahoma; allowing Board of Trustees of the
Teachers’ Retirement System of Oklahoma to approve
cost-of-living adjustment under certain
circumstances; amending 74 O.S. 2021, Section 905,
which relates to the Oklahoma Public Employees
Retirement System; allowing Board of Trustees of the
Oklahoma Public Employees Retirement System to
approve cost-of-living adjustment under certain
circumstances; updating statutory language; updating RBS No. 1631
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statutory references; and making lan guage gender
neutral.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 11 O.S. 2021, Se ction 49-100.9, is
amended to read as follows:
Section 49-100.9. A. The Oklahoma Firefighters Pension and
Retirement Board shall discharge their duties with respect to the
Oklahoma Firefighters Pension and Retirement System solely in the
interest of the participants and beneficiaries and:
1. For the exclusive purpose of:
a. providing benefits to participa nts and their
beneficiaries, and
b. defraying reasonable expenses of administering the
System;
2. With the care, skill, prudence, and diligence under t he
circumstances then prevailing that a prudent person acting in a like
capacity and familiar with such matters would use in the conduct of
an enterprise of a like character and with like aims;
3. By diversifying the investments of the System so as to
minimize the risk of large losses, unless under the circumstances it
is clearly prudent not to do so; and
4. In accordance with the laws, documents and instruments
governing the System. RBS No. 1631
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B. The State Board may procure insurance indemnifying the
members of the State Board from personal loss or accountability from
liability resulting from a member ’s action or inaction as a member
of the State Board.
C. The State Board may establish an investment committee. The
investment committee shall be composed of not more than five (5)
members of the State Board appointed by the chairman of the State
Board. The committee shall make recommendations to the full State
Board on all matters related to the choice of custodians and
managers of the assets of the System, on the e stablishment of
investment and fund management guidelines, and in planning future
investment policy. The committee shall have no authority to act on
behalf of the State Board in any circumstances whatsoever. No
recommendation of the committee shall h ave effect as an action of
the State Board nor take effect without the approval of the State
Board as provided by law.
D. The Board shall retain qualified investment managers to
provide for the investment of the monies of the System. The
investment managers shall be chosen by a solicitation of proposals
on a competitive bid basis pursuant to standards set by the State
Board. Subject to the overall investment guidelines set by the
State Board, the investment managers shall have full discretion in
the management of those monies of the System allocated to the
investment managers. The State Board shall manage tho se monies not RBS No. 1631
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specifically allocated to the investment managers. The monies of
the System allocated to the investment managers shall be actively
managed by the investment managers, which may include selling
investments and realizing losses if such action is considered
advantageous to longer term return maximization. Because of the
total return objective, no distinction shall be made for management
and performance evaluation purposes between realized and unrealized
capital gains and losses.
E. Funds and revenues for investment by the investment managers
or the State Board shall be placed with a custodian selected by the
State Board. The custodian shall be a bank or trust company
offering pension fund master trustee and master custodial services
and any related custodial agreement or trust agreement is
incorporated herein by reference. The custodian shall be chosen by
a solicitation of proposals on a competitive bid basis pursuant to
standards set by the State Board. In compliance with the investment
policy guidelines of the State Board, the custodian bank or trust
company shall be contractually responsible for ensuring that all
monies of the System are invested in income-producing investment
vehicles at all times. If a custodian bank or trust company has not
received direction from the investment managers of the System as to
the investment of the monies of the System in specific investment
vehicles, the custodian bank or trust company shall be contractually
responsible to the State Board for investing the monies in RBS No. 1631
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appropriately collateralized short -term interest-bearing investment
vehicles. Any assets of the System may be invested in a collective
investment fund or group trust that satisfies the requirements of
Revenue Ruling 81-100, as further amended by Revenue Ruling 2004 -67,
Revenue Ruling 2008-40, and Revenue Ruling 2011 -1, and as
subsequently amended by future guidance. Each such collective
investment fund or group trust is adopted, with respect to any
monies invested therein, as part of the System , its trust, and
custodial account and each such declaration of trust or trust
agreement and related adoption, participation, investment
management, subtrust or other agreements, as amended from time to
time, with respect to any monies invested therein, are incorporated
by reference into the System, its trust agreement(s) or custodial
agreement(s), upon approval by the State Board.
F. By November 1, 1988, and prior to August 1 of each year
thereafter, the State Board shall develop a written investment plan
for the System.
G. The State Board shall compile a quarterly financial report
of all the funds of the System on a fiscal year basis. The report
shall be compiled pursuant to uniform reporting standards prescribed
by the Oklahoma State Pension Commission for all state retirement
systems. The report shall include several relevant measures of
investment value, including acquisition cost and current f air market
value with appropriate summaries of total holdings and returns. The RBS No. 1631
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report shall contain combine d and individual rate of returns of the
investment managers by category of investment, over periods of time.
The State Board shall include in the quart erly reports all
commissions, fees or payments for investment services performed on
behalf of the State Board. The report shall be distributed to the
Governor, the Oklahoma State Pension Commission, the Legislative
Service Bureau, the Speaker of the H ouse of Representatives and the
President Pro Tempore of the Senate.
H. After July 1 and before December 1 of each year, the State
Board shall publish widely an annual report presented in simple and
easily understood language pursuant to uniform reporting sta ndards
prescribed by the Oklahoma State Pension Commission for all state
retirement systems. The report shall be submitted to the Governor,
the Speaker of the House of Representatives, the President Pro
Tempore of the Senate, the Oklahoma State Pensio n Commission and the
members of the System. The annual report shall cover the operation
of the System during the past fiscal year, including income,
disbursements, and the financial condition of the System at the end
of the fiscal year. The annual report sha ll also contain the
information issued in the quarterly reports required pursuant to
subsection G of this section as well as a summary of the results of
the most recent actuarial valuation to include total assets, total
liabilities, unfunded liability or over funded status, contributions
and any other information deemed relevant by the State Board. The RBS No. 1631
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annual report shall be written in such a manner as to permit a
readily understandable means for analyzing the financial condition
and performance of the Sys tem for the fiscal year.
I. Effective July 1, 2000, the State Board is hereby authorized
to do all acts and things necessary and proper to carry out the
purpose of the System and to make the least costly amendments and
changes, if any, as may be neces sary to qualify the System under the
applicable sections of the Internal Revenue Code of 1986, as
amended.
J. 1. The Board may approve a two percent (2%) cost -of-living
adjustment, pursuant to the schedule prescribed by this subsection
for persons who have r eceived benefits from the System for one or
more years. The Board may only approve a cost -of-living adjustment
when the System’s funded ratio, according to the latest annual
actuarial valuation, exceeds the percentage as prescribed in
paragraph 2 of this subsection. The funded ratio shall be
maintained on a rolling average for not less than three (3) years .
Provided, a cost-of-living adjustment shall not be granted if the
adjustment would cause the funding ratio of the System to drop below
the percentage which authorized the adjustment.
2. Except as provided in paragraph 1 of this subsection, a
cost-of-living adjustment may be approved by the Board if the funded
ratio of the System exceeds eighty percent (80%). Subsequent cost -
of-living adjustments may be approved each time thereafter that the RBS No. 1631
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System’s funded ratio increases by five percent (5%) from the
percentage which authorized the previous cost -of-living adjustment.
SECTION 2. AMENDATORY 11 O.S. 2021, Section 50 -105.4, is
amended to read as follows:
Section 50-105.4. A. The Oklahoma Police Pension and
Retirement Board shall discharge their duties with respect to the
Oklahoma Police Pension and Retirement System solely in the interest
of the participants and beneficiari es and:
1. For the exclusive purpose of:
a. providing benefits to participants and their
beneficiaries, and
b. defraying reasonable expenses of administering the
System;
2. With the care, skill, prudence, and diligence under the
circumstances then prevailing that a prudent person acting in a like
capacity and familiar with such matters would use in the conduct of
an enterprise of a like character and with like aims;
3. By diversifying the investments of the System so as to
minimize the risk of large loss es, unless under the circumstances it
is clearly prudent not to do so; and
4. In accordance with the laws, documents and instruments
governing the System.
B. The State Board may procure insurance indemnifying the
members of the State Board from personal loss or accountability from RBS No. 1631
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liability resulting from a member ’s action or inaction as a member
of the State Board.
C. The State Board may establish an investment committee. The
investment committee shall be composed of not more than five (5)
members of the State Board appointed by the chairman of the State
Board. The committee shall make recommendations to th e full State
Board on all matters related to the choice of custodians and
managers of the assets of the System, on the establishment of
investment and fund management guidelines, and in planning future
investment policy. The committee shall have no authority to act on
behalf of the State Board in any circumstances whatsoever. No
recommendation of the committee shall have effect as an action of
the State Board nor take effect without the approval of the State
Board as provided by law.
D. The State Board shall retain qualified investment managers
to provide for the investment of the monies of the System. The
investment managers shall be chosen by a solic itation of proposals
on a competitive bid basis pursuant to standards set by the State
Board unless the State Board deems it necessary and prudent to do
otherwise to fulfill its fiduciary responsibility. Subject to the
overall investment guidelines se t by the State Board, the investment
managers shall have full discretion in the management of those
monies of the System allocated to the investment managers. The
State Board shall manage those monies not specifically allocated to RBS No. 1631
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the investment managers. Th e monies of the System allocated to the
investment managers shall be actively managed by the investment
managers, which may include selling investments and realizing losses
if such action is considered advantageous to longer term return
maximization. Because of the total return objective, no distinction
shall be made for management and performance evaluatio n purposes
between realized and unrealized capital gains and losses.
E. Funds and revenues for investment by the investment managers
or the State Board shall be placed with a custodian selected by the
State Board. The custodian shall be a bank or trust company
offering pension fund master trustee and master custodial services
and any related custodial agreement or trust agreement is
incorporated herein by reference. The custodian shall be chosen by
a solicitation of proposals on a competitive basis pursu ant to
standards set by the State Board. In compliance with the investment
policy guidelines of the State Board, the custodian bank or trust
company shall be contractually responsible for ensuring that all
monies of the System are invested in income -producing investment
vehicles at all times. If a custodian bank or trust company has not
received direction from the investment managers of the System a s to
the investment of the monies of the System in specific investment
vehicles, the custodian bank or trust company shall be contractually
responsible to the State Board for investing the monies in
appropriately collateralized short -term interest-bearing investment RBS No. 1631
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vehicles. Any assets of the System may be invested in a collective
investment fund or in a group trust that satisfies the requirements
of Rev. Rul. Revenue Ruling 81-100, as further amended by Rev. Rul.
Revenue Ruling 2004-67, Rev. Rul. Revenue Ruling 2008-40, and Rev.
Rul. Revenue Ruling 2011-1, and as subsequently amended by future
guidance. Each such collective investment fund or group trust is
adopted, with respect to any monies invested therein, as part of the
System, its trust, and custodial account and each such declaration
of trust or trust agreement and related adoption, participation,
investment management, subtrust or other agreements, as amended from
time to time, with respect to any monies invested therein, are
incorporated by refer ence into the System, its trust agreement(s) or
custodial agreement(s), upon approval by the State Board.
F. By November 1, 1988, and prior to August 1 of each year
thereafter, the State Board shall develop a written investment plan
for the System.
G. After July 1 and before November 1 of each year, the State
Board shall publish widely an annual report presented in simple and
easily understood language pursuant to uniform reporting standards
prescribed by the Oklahoma State Pension Commission for all stat e
retirement systems. The report shall be submitted to the Governor,
the Speaker of the House of Representa tives, the President Pro
Tempore of the Senate, the Oklahoma State Pension Commission and the
members of the System. The annual report shall cover the operation RBS No. 1631
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of the System during the past fiscal year, including income,
disbursements, and the financial condition of the System at the end
of the fiscal year. The annual report shall also contain a summary
of the results of the most recent actuarial v aluation to include
total assets, total liabilities, unfunded liability or over funded
status, contributions and any other information deemed relevant by
the State Board. The annual report shall be written in such a
manner as to permit a readily understandabl e means for analyzing the
financial condition and performances of the System for the fiscal
year.
H. The State Board shall adopt a cost of living cost-of-living
adjustment actuarial assumption in its annual actuarial valuation
report.
I. 1. The Board may approve a two percent (2%) cost -of-living
adjustment, pursuant to the schedule prescribed by this subs ection
for persons who have received benefits from the System for one or
more years. The Board may only approve a cost -of-living adjustment
when the System’s funded ratio, according to the latest annual
actuarial valuation, exceeds the percentage as prescribed in
paragraph 2 of this subsection. The funded ratio shall be
maintained on a rolling average for not less than three (3) years.
Provided, a cost-of-living adjustment shall not be granted if the
adjustment would cause the funding ratio of the System to drop below
the percentage which authorized the adjustment. RBS No. 1631
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2. Except as provided in paragraph 1 of this subsection, a
cost-of-living adjustment may be approved by the Board if the funded
ratio of the System exceeds eighty percent (80%). Subsequent cost -
of-living adjustments may be approved each time thereafter that the
System’s funded ratio increases by five percent (5%) from the
percentage which authorized the previous cost -of-living adjustment.
SECTION 3. AMENDATORY 20 O.S. 2021, Section 1108, is
amended to read as follows:
Section 1108. A. The Board of Trustees of the Oklahoma Public
Employees Retirement System shall ha ve the responsibility for
management of the Uniform Retirement System for Justices and Judges
and the State Oklahoma Judicial Retirement Fund. All benefits
payable under The the Uniform Retirement System for Justices and
Judges, refunds of contributio ns and overpayments, purchases or
investments under the law, and all expenses in connection with the
System shall be paid from the Oklahoma Judicial Retirement Fund.
The State Oklahoma Judicial Retirement Fund shall be invested and
managed in the same manner as now or hereinafter provided by law for
the investment and management of funds belonging to the Oklahoma
Public Employees Retirement System. The Uniform Retirement System
for Justices and Judges shall be an instrumentality of the State of
Oklahoma this state. The System shall be vested with the powers and
duties specified in this act Section 1101 et seq. of this title and
such other powers as may be necessary to enable it, its officers, RBS No. 1631
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employees, and agents to carry out fully and effectively the
purposes and intent of this act Section 1101 et seq. of this title .
1. The Board shall distribute the corpus and income of the
System to the members and their beneficiaries in accordance with the
System’s law. At no time prior to the satisfaction of all
liabilities with respect to members and their beneficiaries shall
any part of the corpus and income be used fo r, or diverted to,
purposes other than the exclusive benefit of the members and their
beneficiaries.
2. The Board may not engage in a transaction prohi bited by
Section 503(b) of the federal Internal Revenue Code of 1986, as
amended.
3. The Board shall be responsible for the policies and rules
for the general administration of the System, subject to the
provisions of this act Section 1101 et seq. of this title. Except
as specifically provided in this act, the Uniform Retirement System
for Justices and Jud ges shall generally be managed in the same
manner as now or hereinafter provided by law or by rule for the
management of the Oklahoma Public Employees R etirement System.
4. The Board shall establish rules for the administration of
the System and for the transaction of its business consistent with
law, which rules shall be promulgated in compliance with the
Administrative Procedures Act. RBS No. 1631
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5. The Board may adopt all necessary actuarial tables to be
used in the operation of the System as recommended by the ac tuary
and may compile such additional data as may be necessary for
required actuarial valuation calculations.
6. All decisions of the Board as to quest ions of fact shall be
final and conclusive on all persons except for the right of review
as provided by law and except for fraud or such gross mistake of
fact as to have effect equivalent to fraud.
7. Any person who shall knowingly make any false stat ement, or
who shall falsify or permit to be falsified any record necessary for
carrying out the intent of this act Section 1101 et seq. of this
title for the purpose of committing fraud, shall be guilty of a
misdemeanor, and upon conviction shall be punished b y a fine not
exceeding Five Hundred Dollars ($500.00) or by imprisonment for not
exceeding one (1) year. Should any error in any records of the
Uniform Retirement System for Justices and Judges result in any
member or beneficiary receiving more or les s than he or she would
have been entitled to receive had the records been correct, the
Board shall correct s uch error, and, as far as practicable, make
future payments in such manner that the actuarial equivalent of the
benefit to which such member or benefici ary was entitled shall be
paid, and to this end, may recover any overpayments.
B. The Board of Trustees of the Oklahoma Public Employees
Retirement System shall compile a quarterly financial report of all RBS No. 1631
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the funds of the State Oklahoma Judicial Retirement Fund on a fiscal
year basis. The report shall be compiled pursuant to uniform
reporting standards pre scribed by the Oklahoma State Pension
Commission for all state retirement systems. The report shall
include several relevant measures of investment val ue, including
acquisition cost and current fair market value with appropriate
summaries of total holdings and returns. The report shall contain
combined and individual rate of returns of the investment managers
by category of investment, over periods of time. The Board of
Trustees shall include in the quarterly reports all commissions,
fees or payments for investment services performed on behalf of the
Board of Trustees with respect to the State Oklahoma Judicial
Retirement Fund. The report shall be dist ributed to the Governor,
the Oklahoma State Pension Commission, the Legislative Service
Bureau, the Speaker of the House of Representatives and the
President Pro Tempore of the Senate. In lieu of compiling and
distributing the quarterly report, the Bo ard may provide the Pension
Commission with direct access to the same data from the custodian
bank for the System.
C. There is hereby created the Retirement Medical Benefit Fund .
The fund shall to be maintained as a subaccount of the State
Oklahoma Judicial Retirement Fund. The Retirement Medical Benefit
Fund is composed of all assets which may be contributed to this
subaccount to pay the retirement system ’s portion of the monthly RBS No. 1631
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retiree health insurance premium benefit described by Section 1316.2
of Title 74 of the Oklahoma Statutes. All such allocated assets and
any earnings thereon in the Retirement Medic al Benefit Fund shall be
held for the exclusive purpose of providing retiree medical
benefits. The Retirement Medical Benefit Fund is to be administere d
in accordance with the requirements of Section 401(h) of the
Internal Revenue Code of 1986, as amended , from time to time. The
Board of Trustees may promulgate such rules as are necessary to
implement the funding and administration of the fund pursu ant to the
provisions of this subsection.
D. After July 1 and before December 1 of each year, the Board
of Trustees of the Oklahoma Public Employees Retirement System shall
publish widely an annual report presented in simple and easily
understood language pur suant to uniform reporting standards
prescribed by the Oklahoma State Pension Commission for all state
retirement systems. The report shall be submitted to the Governor,
the Speaker of the House of Representatives, the President Pro
Tempore of the Senate, the Oklahoma State Pension Commission and the
members of the System. The annual report shall cover the operation
of the System during the past fiscal year, including income,
disbursements, and the financial condition of the System at the end
of the fiscal year. The annual report shall also contain the
information issued in the quarterly reports required pursuant to
subsection B of this section as well as a summary of the results of RBS No. 1631
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the most recent actuarial valuation to include total assets, total
liabilities, unfunded liability or overfunded status, contributions
and any other information deemed relevant by the Board of Trustees.
The annual report shall be written in such a manner as to permit a
readily understandable means for analyzing the financial c ondition
and performance of the System for the fiscal year.
E. The Board shall adopt a cost of living cost-of-living
adjustment actuarial assumption in its annual actuarial valuation
report.
F. 1. The Board may approve a two percent (2%) cost -of-living
adjustment, pursuant to the schedule prescribed by this subsection
for persons who have received benefit s from the System for one or
more years. The Board may only approve a cost -of-living adjustment
when the System’s funded ratio, according to the latest annual
actuarial valuation, exceeds the percentage as prescribed in
paragraph 2 of this subsection. The funded ratio shall be
maintained on a rolling average for not less than three (3) years.
Provided, a cost-of-living adjustment shall not be grant ed if the
adjustment would cause the funding ratio of the System to drop below
the percentage which authoriz ed the adjustment.
2. Except as provided in paragraph 1 of this subsection, a
cost-of-living adjustment may be approved by the Board if the funded
ratio of the System exceeds eighty percent (80%). Subsequent cost -
of-living adjustments may be approved each time thereafter that the RBS No. 1631
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System’s funded ratio increases by five percent (5%) from the
percentage which authorized the previous cost -of-living adjustment.
SECTION 4. AMENDATORY 47 O.S. 2021, Section 2 -303.1, is
amended to read as follows:
Section 2-303.1. A. The Oklahoma Law Enforcement Retirement
Board shall discharge its duties with respect to the Oklahoma Law
Enforcement Retirement System solely in the interest of the
participants and beneficiaries and:
1. For the exclusive purpose of:
a. providing benefits to participants and their
beneficiaries, and
b. defraying reasonable expenses of administering the
System;
2. With the care, skill, prudence, and diligence under the
circumstances then prevailing that a prudent person ac ting in a like
capacity and familiar with such matters would use in the conduct of
an enterprise of a like character and with like aims;
3. By diversifying the investments of the System so as to
minimize the risk of large losses, unless under the circumstances it
is clearly prudent not to do so; and
4. In accordance with the laws, documents and instruments
governing the System.
B. The Board may pro cure insurance indemnifying the members of
the Board from personal loss or accountability from liability RBS No. 1631
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resulting from a member ’s action or inaction as a member of the
Board.
C. The Board may establish an investment committee. The
investment committee shall be composed of not more than five (5)
members of the Board appointed by the president of the Board. The
committee shall make recommendations to the full Board on all
matters related to the choice of custodians and managers of the
assets of the System , on the establishment of investment and fund
management guidelines, and in planning future investment polic y.
The committee shall have no authority to act on behalf of the Board
in any circumstances whatsoever. No recommendation of the committee
shall have effect as an action of the Board nor take effect without
the approval of the Board as provided by law.
D. The Board shall retain qualified investment managers to
provide for the investment of the monies of the System. The
investment managers shall be chosen by a solicitation of proposals
on a competitive bid basis pursuant to standards set by the Board.
Subject to the overall investment guidelines set by the Board, the
investment managers shall have full discretion in the management of
those monies of the System allocated to the investment managers.
The Board shall manage those monies not specifically allocated to
the investment managers. The monies of the System allocated to the
investment managers shall be actively managed by the investment
managers, which may include selling investments and realizing losses RBS No. 1631
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if such action is considered advantageous to longer term return
maximization. Because of the total return objective, no distinction
shall be made for management and performance evaluation purposes
between realized and unrealized capital gains and losses.
E. All assets of the System shall be held in trust for the
exclusive purpose of providing benefits for the members and
beneficiaries of the System, including defraying reasonable expenses
of administering the System, and shall not be encumbered for or
diverted to any other purposes. Funds and reven ues for investment
by the investment managers or the Board shall be placed with a
custodian selected by the Board. The custodian shall be a bank or
trust company offering pension fund master trustee and master
custodial services, and any related custodial agreement or trust
agreement is incorporated herein by reference. The custodian shall
be chosen by a solicitation of proposals on a competitive bi d basis
pursuant to standards set by the Board. In compliance with the
investment policy guidelines of the Board, the custodian bank or
trust company shall be contractually responsible for ensuring that
all monies of the System are invested in income -producing investment
vehicles at all times. If a custodian bank or trust company has not
received direction from the investment managers of the System as to
the investment of the monies of the System in specific investment
vehicles, the custodian bank or trus t company shall be contractually
responsible to the Board for investing the monies in appropriately RBS No. 1631
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collateralized short-term interest-bearing investment vehicles. Any
assets of the System may be invested in a collective investment fund
or in a group trust pr ovided the investment in such collective
investment fund or group trust is in compliance with the provisions
of Rev. Rul. Revenue Ruling 81-100, as further amended by Rev. Rul.
Revenue Ruling 2004-67, Rev. Rul. Revenue Ruling 2008-40, and Rev.
Rul. Revenue Ruling 2011-1, or any successor ruling, regulation, or
similar pronouncement. Each such collective inv estment fund or
group trust is adopted with respect to any monies invested therein,
as part of the System, its trust and custodial agreement, and the
provisions of such trust agreement or such declaration of trust and
related adoption, participation, investment management, subtrust or
other agreements, as amended from time to time, with respect to any
monies invested therein, are incorporated by refer ence into the
System, its trust agreement(s) or custodial agreement(s), upon
approval by the Board.
F. Prior to August 1 of each year, the Board shall develop a
written investment plan for the System.
G. The Board shall compile a quarterly financial report o f all
the funds of the System on a fiscal year basis. The report shall be
compiled pursuant to uniform reporting standards prescribed by the
Oklahoma State Pension Commission for all state retirement systems.
The report shall include several relevant measures of investment
value, including acquisition cost and current fair market value with RBS No. 1631
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appropriate summaries of total holdings and returns. The report
shall contain combined and individual rate of returns of the
investment managers by category of invest ment, over periods of time.
The Board shall include in the quarterly reports all commissions,
fees or payments for investment services performed on behalf of the
Board. The report shall be distributed to the Governor, the
Oklahoma State Pension Commi ssion, the Legislative Service Bureau,
the Speaker of the House of Representatives and the President Pro
Tempore of the Senate.
H. After July 1 and before October 31 of each year, the Board
shall publish widely an annual report presented in simple and easily
understood language pursuant to uniform reporting standards
prescribed by the Oklahoma State Pension Commission for all state
retirement systems. The report shall be submitted to the Governor,
the Speaker of the House of Representatives, the President Pro
Tempore of the Senate, the Oklahoma State Pension Commission and the
members of the System. The annual report shall cover the operation
of the System during the past fiscal year, including income,
disbursements, and the financial condition of the System at the end
of the fiscal year. The annual report shall also contain the
information issued in the quarterly reports required pursuant to
subsection G of this section as well as a summary of the results of
the most recent actuarial valuation to include total assets, total
liabilities, unfunded liability or over funded status, contributions RBS No. 1631
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and any other information deemed relevant by the Board. The annual
report shall be written in such a manner as to permit a readily
understandable means for analyzing the financial condition and
performance of the System for the fiscal year. The annual financial
statements must be audited and filed in accordance with the
requirements set forth for financial statement audits in Section
212A of Title 74 of the Oklahoma Statutes.
I. The Board may retain an attorney licensed to practice law in
this state. The attorney shall s erve at the pleasure of the Board
for such compensation as set by the Board. The Attorney General
shall furnish such legal services as may be requested by the Board.
J. All information, documents and copies thereof contained in a
member’s retirement file shall be given confidential treatment and
shall not be made public by the System without the prior written
consent of the member to which it pertai ns, but shall be subject
only to court order. Provided, the System, its employees or
attorneys, may use suc h records in defense of any action brought
against the System.
K. Effective July 1, 1999, the Board is hereby authorized to do
all acts and things nece ssary and proper to carry out the purpose of
the System and to make the least costly amendments and changes, if
any, as may be necessary to qualify the System under the applicable
sections of the Internal Revenue Code of 1986, as amended. RBS No. 1631
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L. The Executive Director and such employees of the System as
the Executive Director may designate are hereby authorized to
prepare certified copies of records of the System and every such
certified copy shall be admissible in any proceeding in any court in
like manner as the original thereof.
M. On or after July 1, 2011, the Board may permit, effective
for applicable notices, elections and consents provided or made for
a member, beneficiary, alternate payee or individual entitled to
benefits under the System, the use of electronic media to provide
applicable notices and make such elections and consents as described
in Section 1.401(a)-21 of the Income Tax Regulations.
N. The Board shall develop such procedures and may require such
information from the distributing plan a s it deems necessary to
reasonably conclude that a potential rollover contribution is a
valid rollover contribution under Section 1.401(a)(31) -1, Q&A-
14(b)(2), of the Income Tax Regulations.
O. 1. The Board may approve a two percent (2%) cost -of-living
adjustment, pursuant to the schedule prescribed by this subsection
for persons who have received benefits from the System for one or
more years. The Board may only approve a cost -of-living adjustment
when the System’s funded ratio, according to the latest annual
actuarial valuation, exceeds the percentage as prescribed in
paragraph 2 of this subsection. The funded ratio shall be
maintained on a rolling average for not less than three (3) years. RBS No. 1631
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Provided, a cost-of-living adjustment shall not be grante d if the
adjustment would cause the funding ratio of the System to drop below
the percentage which authorize d the adjustment.
2. Except as provided in paragraph 1 of this subsection, a
cost-of-living adjustment may be approved by the Board if the funded
ratio of the System exceeds eighty percent (80%). Subsequent cost -
of-living adjustments may be approved each time thereafter that the
System’s funded ratio increases by five percent (5%) from the
percentage which authorized the previous cost -of-living adjustment.
SECTION 5. AMENDATORY 70 O.S. 2021, Section 17 -106.1, is
amended to read as follows:
Section 17-106.1. A. The Board of Trustees of the Teachers ’
Retirement System of Oklahoma shall discharge their duties with
respect to the System solely in the interest of the participants and
beneficiaries and:
1. For the exclusive purpose of:
a. providing benefits to participants and their
beneficiaries, and
b. defraying reasonable expenses of administering the
System;
2. With the care, skill, prudence, and diligence under the
circumstances then prevailing that a prudent person acting in a like
capacity and familiar with such matters would use in the conduct of
an enterprise of a like character and with like aims; RBS No. 1631
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3. By diversifying the i nvestments of the System so as to
minimize the risk of large losses, unless under the circumstances it
is clearly prudent not to do so; and
4. In accordance with the laws, documents and instruments
governing the System.
B. The Board of Trustees of th e Teachers’ Retirement System of
Oklahoma may invest the assets of the System in real property owned
or to be acquired by the State of Oklahoma state. It is further
authorized to acquire, exchange, and grant any real property under
its jurisdiction as is nece ssary to carry out the investment in the
real property. The Board of Trustees of the Teachers ’ Retirement
System of Oklahoma is authorized to invest not more than ten percent
(10%) of the total value of assets of the System in connection with
such investments. Limitations on investment of the assets of the
System provided herein shall be determined as of t he date of its
making or acquisition.
C. The Board of Trustees may procure insurance indemnifying the
members of the Board of Trustees from personal lo ss or
accountability from liability resulting from a member ’s action or
inaction as a member of the Board.
D. The Board of Trustees may establish an investment committee.
The investment committee shall be composed of not more than five (5)
members of the Board of Trustees appointed by the chairman of the
Board of Trustees. The committee shall make recomme ndations to the RBS No. 1631
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full Board of Trustees on all matters related to the choice of
custodians and managers of the assets of the System, on the
establishment of investment and fund management guidelines, and in
planning future investment policy. The committee shall have no
authority to act on behalf of the Board of Trustees in any
circumstances whatsoever. No recommendation of the committee shall
have effect as an action of the Board of Trustees nor take effect
without the approval of the Board of Trustees as provided by law.
E. The Board of Trustees may retain qualified investment
managers to provide for the investment of the monies of the System.
The investment managers shall be chosen by a solicitation of
proposals on a competitive bid basis pursuant to standards set by
the Board of Trustees. Subject to the overall investment guidelines
set by the Board of Trustees, the investment managers shall have
full discretion in the management of those monies of the System
allocated to the investment managers. The Board of Trustees shall
manage those monies not specifically allocated to the investment
managers. The monies of the System allocated to the investment
managers shall be actively managed by the investment managers, which
may include selling investments and realizing losses if such action
is considered advantageous to longer term return maximization.
Because of the total return objective, no distinct ion shall be made
for management and performance evaluation purposes between realized
and unrealized capital gains and losses. RBS No. 1631
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F. Funds and revenues for investment by the investment managers
or the Board of Trustees shall be placed with a custodian selected
by the Board of Trustees. The custodian shall be a bank or trust
company offering pension fund master trustee and master custodial
services. The custodian shall be chosen by a solicitation of
proposals on a competitive bid basis pursuant to standards set by
the Board of Trustees. In compliance with the investment policy
guidelines of the Board of Trustees, the custodian bank or trust
company shall be contractually responsible for ensuring that all
monies of the System are invested in income -producing investment
vehicles at all times. If a custodian bank or trust company has not
received direction from the investment managers of the System as to
the investment of the monies of the System in specific investment
vehicles, the custodian bank or trust comp any shall be contractually
responsible to the Board of Trustees for investing the monies in
appropriately collateralized short-term interest-bearing investment
vehicles.
G. By November 1, 1988, and prior to August 1 of each year
thereafter, the Board of Trust ees shall develop a written investment
plan for the System.
H. The Board of Trustees shall compile a quarterly financial
report of all the funds of the System on a fiscal year basis. The
report shall be compiled pursuant to uniform reporting standard s
prescribed by the Oklahoma State Pension Commission for all state RBS No. 1631
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retirement systems. The report shall in clude several relevant
measures of investment value, including acquisition cost and current
fair market value with appropriate summaries of total holdin gs and
returns. The report shall contain combined and individual rate of
returns of the investment managers by category of investment, over
periods of time. The Board of Trustees shall include in the
quarterly reports all commissions, fees or payment s for investment
services performed on behalf of the Board. The report shall be
distributed to the Governor , the Oklahoma State Pension Commission,
the Legislative Service Bureau, the Speaker of the House of
Representatives and the President Pro Tempore of th e Senate. In
lieu of compiling and distributing the quarterly report, the Board
may provide the Oklahoma State Pension Commission with direct access
to the same data from the custodian bank for the System.
I. After July 1 and before December 1 of eac h year, the Board
of Trustees shall publish widely an annual report presented in
simple and easily understoo d language pursuant to uniform reporting
standards prescribed by the Oklahoma State Pension Commission for
all state retirement systems. The report sha ll be submitted to the
Governor, the Speaker of the House of Representatives, the President
Pro Tempore of the Senate, the Oklahoma State Pension Commission and
the members of the System. The annual report shall cover the
operation of the System durin g the past fiscal year, including
income, disbursements, and the financial condition of the System at RBS No. 1631
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the end of the fiscal year. The annual report shall also contain
the information issued in the quarterly reports required pursuant to
subsection H of this se ction as well as a summary of the results of
the most recent actuarial valuation to include total assets, total
liabilities, unfunded liability or over funded status, contributions
and any other information deemed relevant by the Board of Trustees.
The annual report shall be written in such a manner as to permit a
readily understandable means for analyzing the financial condition
and performance of the System for the fiscal year.
J. 1. The Board of Trustees may approve a two percent (2%)
cost-of-living adjustment, pursuant to the schedule prescribed by
this subsection for persons who have received benefits from the
System for one or more years. The Board of Trustees may only
approve a cost-of-living adjustment when the System ’s funded ratio,
according to the latest annual actuarial valuation, exceeds the
percentage as prescribed in paragraph 2 of this subs ection. The
funded ratio shall be maintained on a rolling average for not less
than three (3) years. Provided, a cost -of-living adjustment shall
not be granted if the adjustment would cause the funding ratio of
the System to drop below the percentage which authorized the
adjustment.
2. Except as provided in paragraph 1 of this subsection, a
cost-of-living adjustment may be approved by the Board of Trustees
if the funded ratio of the System exceeds eighty percent (80%). RBS No. 1631
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Subsequent cost-of-living adjustments may be approved each time
thereafter that the System ’s funded ratio increases by five percent
(5%) from the percentage which authorized the previous cost-of-
living adjustment.
SECTION 6. AMENDATORY 74 O.S. 2021, Section 905, is
amended to read as follows:
Section 905. (1) A. There shall be a Board of Trustees of the
Oklahoma Public Employees Retirement System which shall consist of
fourteen (14) members as follows and all appointees shall serve
their terms at the pleasure of the appointing authority and may be
removed or replaced without cause: a member of the Corporation
Commission or the Commission ’s designee selected by the Corporation
Commission, the Director of the Office of Management and Enterprise
Services or the Director ’s designee, the State Insurance
Commissioner or the Commissioner ’s designee, the Director of Human
Capital Management of the Office of Manageme nt and Enterprise
Services, a member of the Oklahoma Tax Commission selected by the
Tax Commission, the Stat e Treasurer or the Treasurer ’s designee,
three members appointed by the Governor, one member appointed by the
Supreme Court, two members appointed by th e Speaker of the House of
Representatives and two members appointed by the President Pro
Tempore of the State Senate. One member appointed by the Governor
shall be an active member of the System. One member appointed by
the Speaker shall be an active member of the System. One member RBS No. 1631
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appointed by the President Pro Tempore shall be a retired member of
the System.
(2) B. The member of the Board of Trustees on July 1, 1988, who
was appointed by the Supreme Court shall complete the term of office
for which the member was appointed. The members thereafter
appointed by the Supreme Court shall serve terms of office of four
(4) years.
(3) C. Members of the Board of Trustees on July 1, 1988, who
were appointed by the Speaker of the House of Representatives o r by
the President Pro Tempore of the Senate shall complete their term of
office for which they were appoint ed. The initial term of office of
members appointed thereafter shall expire on January 8, 1991. The
members thereafter appointed by the Speaker of the House of
Representatives and by the President Pro Tempore of the Senate shall
serve terms of office of four (4) years.
(4) D. The initial term of office of the members appointed by
the Governor shall expire on January 14, 1991. The members
thereafter appointed by the Governor shall serve a term of office of
four (4) years which is coterminous with the ter m of office of the
office of the appointing authority.
(5) E. One of the members appointed to the Board by the
Speaker of the House of Representatives and by the President Pro
Tempore of the Senate and two members appointed to the Board by the
Governor shall: RBS No. 1631
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(a) have 1. Have demonstrated professional experience in
investment or funds management, public funds management, public or
private pension fund management or retirement system management ,;
(b) have 2. Have demonstrated experience in the banking
profession and have demonstrated professional experience in
investment or funds management ,;
(c) be 3. Be licensed to practice law in this state and have
demonstrated professional experience in commercial matters ,; or
(d) be 4. Be licensed by the Oklahoma Accountancy Board to
practice in this state as a public accountant or a certified public
accountant.
The appointing authorities, in making appointme nts that conform
to the requirements of this subsection, shall give due consideration
to balancing the appoi ntments among the criteria specified in
paragraphs (a) 1 through (d) 4 of this subsection.
(6) F. No member of the Board of Trustees shall be a lobbyis t
registered in this state as provided by law.
(7) G. Any vacancy that occurs on the Board of Trustees shall
be filled for the unexpired term in the same manner as the office
was previously filled.
(8) H. Notwithstanding any of the provisions of this section to
the contrary, any person serving as an appointed member of the Board
on July 1, 1988, shall be e ligible for reappointment when the term
of office of the member expires. RBS No. 1631
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(9) I. The Board shall elect one of its members as Chairman
chair of the Board at its annual meeting. He or she shall preside
over meetings of the Board and perform such other duties as may be
required by the Board.
(10) J. The Board shall also elect another member to serve as
Vice Chairman vice chair, and the Vice Chairman vice chair shall
perform duties of Chairman chair in the absence of the latter or
upon his or her inability or refusal to act.
K. 1. The Board may approve a two percent (2%) cost -of-living
adjustment, pursuant to the schedule prescribed by this subsection
for persons who have received benefits from the System for one or
more years. The Board may only approve a cost -of-living adjustment
when the System’s funded ratio, according to the latest annual
actuarial valuation, exceeds the percentage as prescribed in
paragraph 2 of this subsection. The funded ratio shall be
maintained on a rolling average for not less th an three (3) years.
Provided, a cost-of-living adjustment shall not be granted if the
adjustment would cause the funding ratio of the System to drop be low
the percentage which authorized the adjustment.
2. Except as provided in paragraph 1 of this subsection, a
cost-of-living adjustment may be approved by the Board if the funded
ratio of the System exceeds eighty percent (80%). Subsequent cost -
of-living adjustments may be approved each time thereafter that the RBS No. 1631
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System’s funded ratio increases by five perc ent (5%) from the
percentage which authorized the previous cost -of-living adjustment.
60-1-1631 RD 2/27/2025 9:32:52 AM