Payne County budget board adopts new retirement rates, previews FY 2026-27 budget

The Payne County Budget Board unanimously approved new retirement contribution rates for county employees May 11, adopting a graduated schedule effective July 1 as the board previewed a financial picture that County Clerk Glenna Craig called the county's strongest in a decade.

Resolution 2026-01 sets the county's contribution to the Oklahoma Public Employees Retirement System at 12 percent of allowable compensation for new hires with fewer than eight years of service, with employees contributing 8 percent — a combined 20 percent total required under state statute. Employer contribution rates increase with tenure: 14 percent for employees with eight through 19 years of service and 16.5 percent for those with 20 or more years, while the employee share decreases correspondingly from 6 percent to 3.5 percent.

For hazardous duty employees — defined as county deputy sheriffs and jailers under House Bill 1068 — the county contributes 16.5 percent throughout employment. Those employees contribute 8 percent for the first 19 years and 3.5 percent at 20 or more years of service. Hazardous duty employees are not eligible for the additional Step-Up contribution option during their initial tenure period, according to the resolution.

The resolution applies only to employees hired on or after July 1. Those hired after that date will follow contribution schedules based on the policy's effective date rather than their individual hire date. Employees already on payroll will not see contribution adjustments until the next scheduled adjustment date following July 1.

Craig said OPERS attorneys requested clarifications to the language to align more closely with statute. Elected officials will continue at the 16.5 percent county / 3.5 percent employee contribution rate already in place.

All eight budget board members voted in favor.

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Budget preview

Craig also presented a 10-year budget analysis ahead of formal hearings planned for next month, telling board members the county is in its strongest fiscal position since 2016.

Combined county cash accounts stood at approximately $84.9 million as of the meeting, down from approximately $102.3 million at the start of the fiscal year on July 1, 2025. The unrestricted reserve stands at approximately $4.3 million. Craig said budget requests have climbed more than $16 million over the past 10 years, but the county has continued to build its contingency reserve alongside those increases.

"We've been real aggressive in building our contingency," Craig said. "We're the strongest that we've been in a decade."

The Sheriff's Department carries the largest proposed operational increase in the FY 2026-27 budget, reflecting three newly authorized positions and longevity adjustments. Other proposed increases include funding for a second civil assistant district attorney, emergency management capital outlay, and an increase in the Treasurer's maintenance and operations budget.

The largest proposed decrease is in general government benefits — the result of a one-time shift of employee health insurance costs to the county's self-insurance fund. Craig described the move as a strategy to ease pressure on the general fund this year but cautioned it is not repeatable annually.

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Property tax uncertainty

The discussion underscored county officials' concern about Senate Joint Resolution 39, a proposed constitutional amendment authored by Sen. Lonnie Paxton and Rep. Kyle Hilbert that heads to Oklahoma voters Nov. 3. The resolution passed the Senate 38-8 and cleared both chambers before being enrolled.

Oklahoma's constitution currently limits how fast the assessed value of real property can grow each year — homesteads and agricultural land are capped at 3 percent annually; commercial and other property at 5 percent. SJR 39, as amended on the House floor, would lower those caps beginning with the 2027 tax year: to 1.75 percent annually for homesteads and agricultural land and 4 percent for other property.

The measure also restructures the state's senior property tax freeze, which currently locks taxable value in place for qualifying homeowners 65 and older who meet income thresholds. SJR 39 would replace the full freeze with an income-tiered sliding scale. Seniors at or below their county's HUD-determined median household income would retain a complete freeze on taxable value; those above that threshold would see values begin rising again at rates ranging from 0.35 percent to 1.75 percent annually, depending on income level.

County officials said ad valorem property tax is one of the county's primary revenue sources, and a reduction in the assessment cap would constrain future revenue growth. Assessor Jason Gomez said new construction provides some counterbalance, but the net effect on county revenue remains uncertain.

"We don't know what ad valorem's going to look like," Craig said. "We're very restricted in where our money comes from."

Craig encouraged board members to be prepared to explain county finances to constituents as the ballot debate develops, noting that county revenue structures differ significantly from cities and school districts.