{"data":{"id":"us-ok/okla.-stat.-tit.-70-70-17-207","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 70, § 70-17-207","heading":"Initial and additional funding surcharges – Benefits","body":"not considered salary, fringe benefits or compensation – Allocation\n\nof assets – Calculation of liability.\n\nA. Participating institutions establishing an alternate\n\nretirement plan pursuant to this act shall pay an initial funding\n\nsurcharge, and if applicable an additional funding surcharge to the\n\nTeachers’ Retirement System of Oklahoma in an amount to amortize the\n\nunfunded accrued liability of the members of the participating\n\ninstitutions in the System.\n\nB. The initial funding surcharge is intended to ensure\n\namortization of the unfunded accrued liability of the participating\n\ninstitutions over a period of thirty (30) years or the amortization\n\nperiod of the System. The initial funding surcharge shall equal two\n\nand one-half percent (2.5%) of the regular annual compensation of\n\nthe electing employees and the eligible employees, who are not\n\nparticipating in the System but who would have been mandated to\n\nparticipate in the System under the laws and rules applicable to the\n\nSystem in effect on June 30, 2004. The initial funding surcharge\n\nbut not the additional funding surcharge, if any, shall remain in\n\neffect until the earlier of June 30, 2034, or the June 30th of the\n\nyear in which the unfunded accrued liability of the participating\n\ninstitutions is reduced to zero.\n\nC. In addition to the initial funding surcharge described\n\nabove, the participating institutions shall pay to the System an\n\nadditional funding surcharge, if required, in an amount necessary to\n\nprovide for amortization of the unfunded accrued liability of the\n\nparticipating institutions over the applicable amortization period\n\nof thirty (30) years, or the amortization period of the System, if\n\nlonger. The additional funding surcharge shall be reviewed and\n\nadjusted in subsequent years based on changes in the assets and\n\nliabilities of the membership in the System of the participating\n\ninstitutions. The additional funding surcharge shall be determined\n\nby the Board of Trustees of the System and the participating\n\ninstitutions pursuant to the separate agreement of understanding\n\nprovided in subsection H of this section. Any change in the\n\nadditional funding surcharge indicated to be necessary by the annual\n\nactuarial valuation shall be adopted by the Board of Trustees of the\n\nSystem provided that such change shall become effective on July 1 of\n\nthe year following such annual valuation and the participating\n\ninstitutions shall be notified by the System no later than January 1\n\nof such year. Provided, the additional funding surcharge determined\n\nfor any year shall not be greater than an additional funding\n\nsurcharge determined under the separate agreement of understanding\n\nbut using the “individual entry age normal cost method” as described\n\nin Revenue Procedure 2000-40, Approval 8, to determine the normal\n\ncost/normal cost percentage of the participating institutions.\n\nD. Any payments made to the Teachers’ Retirement System of\n\nOklahoma pursuant to this section shall not be considered as salary,\n\nfringe benefits or compensation due to the eligible employee or\n\nelecting employee for the purpose of meeting any legislative or\n\ncontractual obligation of the employer of such person.\n\nE. To determine the amount of assets of the participating\n\ninstitutions at any point in time after June 30, 2003, the\n\nparticipating institutions shall have allocated to such institutions\n\nFive Hundred Ninety-two Million Nine Hundred Seventy-four Thousand\n\nTwo Hundred Sixty-four Dollars ($592,974,264.00) of the assets of\n\nthe Teachers’ Retirement System of Oklahoma which reflects their\n\nportion of assets in the System as of June 30, 2003, plus future\n\nemployer and employee contributions including service purchases\n\nattributable to the participating institutions and its members, nine\n\nand forty-one hundredths percent (9.41%) of all federal and state\n\nfunding received by the System during the applicable year and other\nhe Teachers’ Retirement System of Oklahoma which reflects their\n\nportion of assets in the System as of June 30, 2003, plus future\n\nemployer and employee contributions including service purchases\n\nattributable to the participating institutions and its members, nine\n\nand forty-one hundredths percent (9.41%) of all federal and state\n\nfunding received by the System during the applicable year and other\n\nassets contributed to the System allocable to the participating\n\ninstitutions subject to the limitations in this subsection, earnings\n\non investments less distributions and expenses allocable to the\n\nparticipating institutions. Provided, the allocation of nine and\n\nforty-one hundredths percent (9.41%) of federal and state funding\n\nreceived by the System to the participating institutions shall not\n\nexceed the unfunded accrued liability and shall remain in effect\n\nuntil the earlier of June 30, 2034, or when the unfunded accrued\n\nliability of the participating institutions is reduced to zero.\n\nHowever, if for any applicable year during the thirty-year\n\namortization period commencing July 1, 2004, there is any unfunded\n\naccrued liability allocable to the participating institutions in the\n\nSystem, then the allocable percentage of federal and state funding\n\nshall be nine and forty-one hundredths percent (9.41%) but not\n\nexceed the unfunded accrued liability. Provided further, after the\n\nexpiration of such thirty-year amortization period, the allocation\n\nof federal and state funding to the participating institutions for\n\nany year shall equal the percentage of all such federal and state\n\nfunding received by the System determined by dividing the actuarial\n\naccrued liability of the participating institutions by the actuarial\n\naccrued liability of the System, and such methodology to determine\n\nsuch allocation shall be made for all years thereafter.\n\nF. After June 30, 2004, the liabilities associated with the\n\nmembers of the participating institutions participating in the\n\nTeachers’ Retirement System of Oklahoma shall be determined on a\n\nseparate basis, reflecting the level of benefits based on the\n\nactuarial methods and assumptions used by the System as applied to\n\nthe participating institutions under this act.\n\nG. The actuarial methods and assumptions applicable to the\n\nparticipating institutions in determining an allocable share of\n\nassets, liabilities and associated costs as provided in this act\n\nshall be reviewed at least every five (5) years.\n\nH. The Board of Trustees of the Teachers’ Retirement System of\n\nOklahoma and the participating institutions shall enter into a\n\nseparate agreement of understanding which details the procedures to\n\nbe applied to implement the required review and subsequent\n\nadjustments to the assets, liabilities and the additional funding\n\nsurcharge attributable to the participating institutions or the\n\nactuarial methods or assumptions applied to determine the\n\nappropriate share of assets and liabilities applicable to the\n\nparticipating institutions. Except as otherwise provided in this\n\nact, the Board of Trustees of the System shall be the final\n\nauthority to determine all actuarial methods or assumptions to be\n\nused by the System and all such actuarial methods or assumptions\n\nshall be applied on a sound actuarial basis and on a uniform, fair\n\nand consistent basis which methods and assumptions reflect the\n\nactual experience of the members of the participating institutions.","path":["OK Code","Title 70"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os70.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"4ce6ca0ec24e022a6550c2824cbd8df04c77db5b79a655b93df7d4ca4c9079e4","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-70-70-17-206","next":"us-ok/okla.-stat.-tit.-70-70-17-208"},"notice":"GroundRules: Original legal text. Not legal advice."}