A summary of proposed legislation affecting Colorado PERA. Check back often for new bills and updated status reports. Last updated: May 21, 2018.
Active Bills
Senate Bill 18-200
(Note: the summary below reflects the bill as it was passed out of the House on May 2, 2018, and does not reflect the changes made to the bill by the conference committee and approved by the House and Senate on May 9, 2018. An updated summary and a comparison between the final version and previous versions, along with the Board’s proposal, will be available soon.)
Modifications To PERA To Eliminate unfunded liability./strong>
Summary (applies to the reengrossed version of this bill as introduced in the second house): The public employees’ retirement association (PERA) provides retirement and other benefits to employees of the school districts, state, local governments, and other public entities across the state. The bill makes changes to the hybrid defined benefit plan administered by PERA with the goal of eliminating, with a high probability, the unfunded actuarial accrued liability of each of PERA’s divisions and thereby reach a 100% funded ratio for each division within the next 30 years. The bill modifies benefits, ensures alignment of contributions and benefits, and makes other modifications as follows:
Highest Average Salary (HAS): Currently, for a PERA member who is not in the judicial division of PERA, the member’s HAS is based on an average of the highest annual salaries associated with 3 periods of 12 consecutive months of service with a base year. For a PERA member who is in the judicial division of PERA, the member’s HAS is based on an average of the highest annual salaries associated with 12 consecutive months of service. For all new PERA members hired on or after January 1, 2020, who are not in the judicial division, and for all existing PERA members who do not have 5 years of service credit as of January 1, 2020, who are not in the judicial division, the bill modifies the HAS calculation to be based on an average of the highest annual salaries associated with 5 periods of 12 consecutive months of service with a base year. For all new PERA members hired on or after January 1, 2020, who are in the judicial division, and for all existing PERA members in the judicial division who do not have 5 years of service credit as of January 1, 2020, the bill modifies the HAS calculation to be based on an average of the highest annual salaries associated with 3 periods of 12 consecutive months of service with a base year.
Definition of salary: The bill modifies the definition of salary for new hires as of July 1, 2019, by including amounts deducted from pay pursuant to a cafeteria plan or a qualified transportation plan in the definition of salary. In addition, the bill includes unused sick leave converted to cash payments in the definition of salary for all members.
Contribution increases: The bill increases the employee contribution rate by 2.0%, phased-in over three years. Beginning July 1, 2019, the bill will increase employee contributions by 0.75%, followed by another 0.75% increase on July 1, 2020, and finally a 0.50% increase on July 1, 2021. The bill also increases the employer contribution rate by 0.25% beginning on July 1, 2019, except for the Local Government employers.
Termination of affiliation: Employers assigned to the PERA local government division may terminate affiliation with PERA upon application to the PERA board. The bill clarifies that any employer that ceases operations or ceases to participate in PERA for any reason is deemed to have terminated its affiliation with PERA and is required to fully fund its share of the unfunded liability. The bill further clarifies that the PERA board will determine the amount of such payments and that such determinations are appealable through PERA’s administrative review process. Additionally, employees with less than five years of service credit will now be able to keep an account at PERA, rather than having their accounts automatically moved to a replacement plan.
Direct distribution: The bill modifies current statute to allow for a direct distribution from the state treasury to PERA of $225 million annually.
Expands state trooper definition to include certain other public safety officers: This bill adds certain public safety officers (such as sheriffs, detention officers, and corrections officers) who become members of PERA on or after January 1, 2020 to the definition of “state trooper,” applying the higher state trooper contribution rate, lower age and service credit retirement eligibility, and immediate disability eligibility for on-the-job injuries to these other public safety officers.
Automatic contribution and annual increase amount changes: The bill specifies the circumstances under which the member and employer contribution rates, the direct distribution and the annual increase percentage for retirement benefits can be adjusted so the fund remains within the target of paying off the unfunded liability.ithin 30 years. The bill specifies that the yearly adjustments can be up to one-quarter of one percent on the annual increase percentage, one-half of one percent on the employee and employer contribution percentages and the direct distribution may increase by $25 million or decrease by $20 million. The bill places limits on how much the annual increase,contribution rates and the direct distribution can be adjusted. Automatic adjustments could begin as early as July 1, 2020.
Service retirement eligibility for new members: For non-state trooper members who begin employment on or after January 1, 2020, the bill increases the age and service requirements for full-service retirement benefits to age 64 with a minimum of 30 years of service, age 65 with a minimum of 5 years of service, and any age with a minimum of 35 years of service. For non-state trooper members who begin employment on or after January 1, 2020, the bill increases the age and service requirements for reduced service retirement to age 55 with a minimum of 25 years of service and age 60 with a minimum of 5 years. For new state trooper members who begin employment on or after January 1, 2020, the bill increases the age and service requirements for full-service retirement benefits to age 55 with 25 years of service, age 65 with 5 years of service, or any age with 35 years of service. For new state trooper members who begin employment on or after January 1, 2020, the bill increases the age and service requirements for reduced service retirement to age 50 with 20 years of service.
Cost of living adjustment (COLA) for all retirees, members, and inactive members: Currently, the annual COLA for benefit recipients who began membership prior to January 1, 2007, is 2%. For the years 2018 and 2019, the bill reduces the COLA to 0%. For each year thereafter, the bill changes the COLA to 1.50%, unless it is adjusted pursuant to the automatic adjustment provisions explained above. In addition, the bill requires benefit recipients to wait 36 months or three years (depending on when they became members) after benefits commence before receiving their first COLA if they had not received a COLA on or before May 1, 2018.
Defined Contribution (DC) choice expansion: New members in the Local Government Division and certain classified employees of state colleges and universities in the State Division on or after January 1, 2019 will have a choice between joining the PERA hybrid defined benefit plan or the PERAChoice DC plan.
Defined Contribution (DC) supplement: Employers whose employees choose to participate in the DC plan will pay the DC supplement in order to offset any increases in PERA liabilities created by members who would otherwise have participated in the hybrid defined benefit plan.
Public pension legislative oversight committee: Expands the existing Police Officers’ and Firefighters’ Pension Reform Commission to include oversight of PERA and creates a subcommittee exclusively focused on PERA. The 14-member subcommittee will include four legislators appointed from the Commission and 10 appointed external experts from relevant industries.
Investment program oversight: PERA may share private equity and real estate investment details in an executive session of the legislative members of the Subcommittee unless confidentiality provisions of contracts prohibits such disclosure.
Sponsors: Sen. Jack Tate, Sen. Kevin Priola, and Sen. Cheri Jahn | Majority Leader KC Becker and Rep. Dan Pabon
Status: Awaiting action from the Governor. (Passed conference committee and re-passed by the House and Senate on May 9, 2018.)
Inactive Bills
House Bill 18-1111
Modifications To PERA Board Of Trustees
Summary: Reconfigure the PERA Board of Trustees and allow Trustees access to member and retiree information.
This bill would change the existing 16-member Board of Trustees as follows:
- Eliminate four member-elected positions;
- Eliminate one elected Trustee from the State Division (lowering from three to two Trustees in this Division, one of whom is from Higher Ed);
- Eliminate three elected Trustees from the School Division (lowering from four to one Trustee in this Division);
- Require the member-elected positions to be at least 20 years from retirement eligibility (the DPS seat would not be modified to have this requirement);
- Replace the eliminated positions with four Trustees appointed by the Governor, with Senate confirmation, bringing the total of Governor-appointed Trustees to seven. These appointees may not be PERA members or retirees. Of the seven appointees, no more than four shall be from the same political party.
- Eventually, the seven appointed Trustees must be comprised of professionals with ten years of experience in the following fields:
- One professional in investment fund management,
- One professional in accounting and a CPA,
- One professional in securities law and a licensed attorney in Colorado,
- One professional in tax law and a licensed attorney in Colorado,
- One professional in pension management,
- One professional in actuarial analysis and a certified actuary, and
- One professional who is a certified financial planner accredited by a nationally recognized accreditation agency.
In addition to composition changes, the bill would also authorize a Trustee to review all records or information within the custody and control of PERA.
The bill defines information requests to include: “salary and benefit information that is contained in records of members, former members, inactive members, DPS members, DPS retirees, benefit recipients, and their dependents; except that, in fulfilling a request for records or information by a trustee pursuant to this section, the executive director of the association and the board shall not provide any other information that is designated as confidential pursuant to Section 24-51-213.”
Sponsors: Rep. Justin Everett | Sen. Tim Neville
Status: Postponed indefinitely (House State, Veterans, and Military Affairs 2/14/18)
PERA Board Position: Opposed.
Hybrid defined benefitPERA’s Defined Benefit (DB) Plan is “hybrid” in that it combines features of a traditional DB plan with some of the features of defined contribution (DC) plans, such as portability.ColaAcronym for cost-of-living adjustment; a type of annual adjustment meant to prevent a person from losing buying power due to inflation.ActuaryA highly skilled mathematician who helps pension plans, insurance companies, and other financial institutions plan for the future based on historical and anticipated data.Unfunded liabilityThe difference between the projected amount of money needed to pay benefits earned to date and the amount of money currently available to pay those benefits.Unfunded liabilityThe difference between the projected amount of money needed to pay benefits earned to date and the amount of money currently available to pay those benefits.Postponed indefinitelyA motion that halts all further consideration of a bill. In practice, this means the bill has failed.Defined benefitAlso known as a pension, this is a type of pooled retirement plan in which the plan promises to pay a lifetime benefit to the employee at retirement. The plan manages investments on behalf of members, and the retirement benefit is based on factors such as age at retirement, years of employment and salary history.Defined benefitAlso known as a pension, this is a type of pooled retirement plan in which the plan promises to pay a lifetime benefit to the employee at retirement. The plan manages investments on behalf of members, and the retirement benefit is based on factors such as age at retirement, years of employment and salary history.Defined contributionA type of individual retirement plan in which an employee saves a portion of each paycheck (along with a potential employer match) and invests that money. The employee’s retirement benefit is based on their account balance at retirement. A 401(k) is a type of defined contribution plan.Private equityA type of investment in which investors purchase shares of a company that is not traded on a public stock exchange.
I oppose this. Way too much control by the head politician of the state. Everett and Neville need to be voted out
I strongly object to loosing PERA voices on OUR board and have them replaced with by a politician. All we have to do is sit back look at the lack of production at all levels of government. It is our money and it should be our people that oversee what happens to our funds. I, for one, do not trust having my retirement money controlled by someone with a political agenda.
I agree with your exact sentiments.
Politicians have their own agengas, which I believe have little to do with the wellbeing of people’s livelihoods and future of our
lives to grow a better tomorrow in this country. It’s not about money for us, though it is needed and necessary to live, it’s about principals, security, trust, honesty, which is very much lacking today in many aspects of our government.? And, it’s about our future in this country, and for the future of our precious children.
I agree with you 1000%!!!
I also agree 100%.
I agree no career politicians.they have little to no interest in what’s best for the people in Pera .they have proven time and time again to be not trustworthy.enough to manage a simple check book.much less Pera retieries money
In HB 18-1111 it certainly looks to me like the governor would be running the shots with the 16-member PERA Board of Trustees–replacing 4 member-elected positions with governor-appointees. I’m not really comfortable with giving the governor more control over PERA. A good thing that this one’s postponed indefinitely.
I agree 100%!!! Do not give so much control to the state government what they are going to do with our retirement. Asking for major trouble!!!
It is thoughtless and reprehensible to consider legislation which would dramatically change the board of directors of the PERA retirement program. Why would we endanger the past performance of one of the best retirement systems for public employees in existence.
Colorado state employees, police officers, judges, and teachers give their time, effort, careers, life, and money to a system which promised a retirement for public service.
I believe it is deplorable for any legislative body to consider themselves more responsible for the future of “Our” retirement future than the existing PERA Board of Directors. The system to date, has worked well. Despite the severe downturn of 08-09 recession, they have invested soundly. Some changes have been suggested, by the present Board, to maintain a constant flow of revenue without an abrupt change of PERA Board of Directors. House Bill 18-1111 threatens to destroy what has worked for over 50 years.
As a PERA member whom is nearing the end of my years with CDOC I heartily agree with Mr. Robison. I have paid into PERA for over 20 years. While working with some of the most difficult humans god has seen fit to place in Colorado. It is a fact that people who work over 20 years in Corrections live on an average 15 years less than most people. So I will be lucky to collect over 10 years of payments from PERA. Of course I hope to prove the statistics wrong. What I am trying to say is, I am looking forward to retirement and hope not to spend it wondering whether the government I spent over 20 years supporting is going to honor their commitment to support
me. Leave PERA alone.
HB 18-1111 could make PERA into the political football of the future, even more so than now. I sense too many money “managers” with their fingers in the pot and possible ulterior private motives.
No way. If the state governor can put more of his democrat money thieves in our office then eventually they would take all our money for the general fund and we’d be penniless. The state has no rights to our money but they have wanted it for years. We were guaranteed 3% raises and other things that have already been taken from us due to idiots and we don’t need more of them. Everett and Neville need to get out of our pockets and stop being a dictator and socialist.
I must agree with J Todd. Liberals have been trying to rob our retirement for years. If they succeed, it will turn out the same as Social Security, the liberals will dip in to our funds and never pay it back. PERA is our retirement that we payed into and was promised to us as public employees. Many of the benefits that we were promised have already been altered in the name of people that did not contribute to our funds. These same people need to back off. It is not the fault of the public employees that retirement packages outside of ours have failed because of mismanagement in the private sector.
It is interesting that people in the private sector think that they are entitled to the benefits that we have so carefully nurtured throughout our careers.
Bob, it’s the liberals fault? Seriously? It’s Walker Stapleton, a Republican conservative who is the biggest threat to our PERA retirement. Read up on it a little.
Amy McCintock is absolutely correct. Walker Stapleton has been advocating for these very changes for years, and in fact he sued the PERA board to gain access to individual information. Nationally, it’s also conservatives, including Americans for Prosperity (Koch brothers) who are attacking public pensions. See this link for unfounded hyperbole (https://americansforprosperity.org/public-pensions-underfunded-unaffordable/)
I agree that Stapleton is a great threat to Petra. This has been his agenda forever.
That is a threat to PERA!
Bob:With all due respect I don’t think that you or Todd or getting the right info on PERA. It’s the Repubs who want to destroy it esp.Scott Walker Stapleton!
Yes, Stapleton is rich but he wants to take away or whittle away our retirements anyway. Also Rosen hurts us a lot. He goes along with Stapleton. They are both rich people who are not caring about the fact that many of us who retired long ago really have to pinch pennies, yet those two guys don’t care. It is the republicans this time who are the ones who are enemies of PERA.
It’s interesting you didn’t notice that the sponsors of this bill are both Republicans. Usually they aren’t called liberals. Please do your homework on issues
Hate to disagree with you, Bob. But as a staunch conservative and registered Republican, I have to say it is the conservative Republicans who care more about a positive business climate for Colorado than they do PERA members — in particular those of us who are already retired and living on fixed incomes. I disagree with liberals on almost every topic, but this is one where some conservatives (the ones with the loudest mouthpieces) have got it all wrong.
What have you been smoking Bob and Jann??? You have it 180 degrees backwards, it has quite clearly been the Republicans who have caused this, they have been OPENLY and aggressively working to destroy PERA for decades, it’s a matter of record. Try reading the actual history of this repugnant self-serving effort by the Republican party instead of blindly lashing out. It was the Republicans who STOLE our GUARANTEED 3% annual COLA, we had a CONTRACT… I WANT MINE BACK!
So what is the logic in accessing personal records? If the actuary needs statistick why can’take they retrieved as an anonymous demographic (i.e age groups,avg. Years of service etc.) Why as Walker Stapleton and other keep trying to push this? The state already has all payroll information and what is deducted for pension, taxes , other benefits.. how does this help analysis to figure out investment so that that pera get funded back to sustainable levels? And to have a governor be able to appoint trustees? Geeze every time we get a new governor every department or agency has to deal with the new political appointees visions and changes to those respective department’s responsibilities. In our regular day work. Having constant political appointees changed out and managing the pension every 4 years? Doesn’t sound like good objective non partisan management to me.
NO! You have access to enough of our information already. Why on earth would you need information on our dependents? Enough!
This misguided and feeble attempt to take over PERA’s board of trustees is nothing more than dirty politics and a way to remove control of PERA from employees and retirees and then be able to begin the process of dismantling PERA. Comments by Jann Todd are off base and it is the Republicans in office, like Rep. Justin Everett and Tim Neville, that want to break PERA and steal its funds for their ilk’s benefit and use. This is yet another attack on PERA and if Walker Stapleton would ever become governor we would have relentless attacks on PERA and severe cut backs to PERA with negative impacts to its current and future employees and retirees. PERA is not in any danger of going under as the State, unlike private businesses, won’t be going bankrupt and will continually have employees contributing to PERA, paying for the bulk of future retirement funding. Yes we need to be prudent in our investment strategies and future payouts, but if the State is truly concerned about the financial health of PERA it needs to honor past financial commitments it promised PERA and never fulfilled. Small and prudent tweaks to PERA funding and smart investments will make PERA fully funded into the future without damaging commitments to employees and retirees.
It was Bill Owens and HIS legislative body that made the mess in the first place. PERA was OVER-funded, so they lowered the retirement age to 50 with 30 years service over PERA’s solid objections. They didn’t fund their share fully. THEY placed PERA at risk and ignored all the warnings PERA gave about the damage this was going to cause to PERA’s funded status and endanger the plan for PERA’s work force. Some people just don’t give up – and an arrogant legislature has been trying for all these years to blame PERA for the mess they made. Makes me sick. I know. I was there.
You hit the nail on the head P. Williams. It was the State Legislature that got us into this mess so unless they can come up with a bill to replace the legislative decision making process I’m opposed. They make bad decisions, underfund PERA, and have replaced the Step and Grade system with the constantly unfunded “merit pay system” that leaves current employees mostly at the bottom of the pay grade. Then they wonder why PERA is underfunded and want to put the entire burden for relief on employees and retirees. Gotta wonder!
Let us not forget 17 or so years ago when PERA was considered to be overfunded, the employer contribution to PERA was reduced to 10% from 12%. Now it is 10.15%? Who’s interest are best being served?
Dear Mr. Post,
To clarify, the statutory employer contribution rate is 10.15%. However, there is also the Amortization Equalization Disbursement (AED) that is paid by employers (4.5% in the School Division, 5% in the State Division). For details, please see this fact sheet: https://www.copera.org/sites/default/files/documents/5-123.pdf
You are absolutely correct. I was there too. The Republicans endangered PERA and could not foresee that there would ever be any hard times again. They wouldn’t even wait few years but Owens created Matchmaker which gave $20 to $35!monthly to employees. Stupid, stupid, stupidity
I am a retiree and I agree with 95% of the eight comments posted so far
I don’t object to adding one or two appointed financial professionals to the Board of Trustees, but this bill goes too far by eliminating four elected representatives AND limiting the elected representatives to people who are at least 20 years from retirement eligibility. That severely narrows the field of potential PERA members who will be qualified to serve on the board. This bill appears to be a ‘foot in the door’ for those whose ultimate goal is to transform PERA to a defined contributions plan, or to dismantle it entirely.
State government needs to stay out of PERA. They have put the you know what to the state employees already now our retirement.
This is just sad
PERA has Walker Stapleton already on the board. The need for a complete restructuring of the PERA management reeks of his meddling. If it weren’t for good ol’ Bill Owens, PERA wouldn’t be in the predicament it is currently in. HB-18-1111 needs to go down in a ball of flames — just like Everett and Neville next election.
you are very correct. Bill Owens is majorly responsible for the pera situation. when the legislature voted to not match employee 401 contributions overwhelmingly, he vetoed the bill…401 K was matched when pera couldn’t afford it and now we have this mess
This proposes far too many political members.
Why any politician or their appointee is allowed on the Board in the first place is beyond me… Maybe if the state started making their full contributions, then they could have one. And PERA Board and staff should have lobbied for more employee and retiree representation on the board in exchange for our “shared sacrifice” in 2010’s SB-001 !
I strongly agree! Keep the politicians OUT of PERA!! They will eventually destroy it.
P Williams is correct. Owens robbed PERA to balance the state because PERA was flush. BUT PERA also forgave part of the debt owed and that also hurt retirees and employees. So what to do??? Pay close attention to whom you vote for and what they will do with our pension. We all worked too hard to allow our voices to not be heard. It’s an election year so remember your voice cannot be heard if you ignore voting and then complain they took your pension. One vote one voice, so vote then work with your officials to keep our pension strong and safe!!
State government’s hands need to stay out of PERA’s retirement fund. They would rob Peter to pay Paul and there would be nothing left for retirees. Same as California, the Federal government with social security , and government period!
18-1111 Is just another way for state government to take our retirement money out of our control and til take what we’ve worked for years to live on. We didn’t get pay raises regularly for years on end were mandated to take days without pay to save state when it had problems keeping its doors open now yet again who is it trying to get to pay the price? Us !! We were promised a raise not anything substantial but enough to keep inflation in place and us to be ok not swinging in champagne but to be able to live on meager means now these government hacks want private access to information that’s none of their business and if we stay strong and stay together we will overcome but we have to stop backsliding giving them percentages here and there as it will lead us to poverty and they have no cares as long as their budget is what they want it to be! 18-1111 should never pass as if they get control we lose our retirement, our homes, our lively hood!!! If they want to take money let them trim it from the top money makers! Let them take a 5% pay cut for 3 years or how ever long it will take to get them out of the bind they are in and let it affect their bottom line along with the once a month mandatory 4 days off and along with mandatory like we had to from the top 15% percent wage earners let them carry the load. We’ve been doing it for years now it’s their turn stop robbing us blind!!! All of us depend upon these funds to live off of as it’s all we have!!! And if you’re disabled like me these funds are my everything for me so taking my retirement funds are everything and if you take the little 3% we were given which was originally 5% and now they want to make it 1% we will end up being in poverty levels instead of being taken care of like we took care of our state all the years we gave! All because of greedy government personnel who can’t honor their budgets and expect as they have in past years employees and retirees to pay for their inability to pay for their lack of control to do reasonable contracts and stay in reasonable rates for their costs! No seats should be given to these people and we shouldn’t surrender our rights to our employer as they shouldn’t have rights to our personal information they have all the information that they need to make the credible decisions based by Human Resources documents and all the data supporting the questions they ask but they need no data that gives names or private information. If we had all of their information would they object you bet!!! Are they so will to live by what they want us to give up?? Bet not!! If and only if they make it so we get 5% increases each year in perpetuity and leave our funds alone allow our funds to grow and to still get the financial funding it should be given they don’t Take or allowed to restructure Pera in anyway or to dismantle it in essence if they are given no authority no power and no access to private information then they can look but if they can harm it hurt us take from us or make changes that would create thousands of state employees homeless and poverty stricken Then I say NO NO NO FIGHT 18-1111 MAKE ALL YOU KNOW AWARE THEY ARE TRYING TO MAKE POVERTY STRICKEN RETIREES AND EMPLOYEES after Years of taking no wage increases and mandatory days without pay this is the Thank you we receive!!! So not right!!
We are stronger together as one unified CO-PERA!!! In a time of growing social inequity and misinformation, always question the so-called reasoning for modifying a truly wonderful Public Employee Retirement Pension Plan!
Regarding comments by Jann Todd and Bob Coleman, both of you could not be more wrong on your comments. It is the Democrats in the Legislature that have saved PERA from dangerous proposals by Republican legislators for many, many years. The “liberals” have literally saved our retirement plan from Republican ruination. Thanks for your comments but you need to put the blame where it belongs, the Republicans (ie. Walker Stapleton, et al) who seem to be proposing harmful legislation and trying so hard to screw our plan. Sorry, but we need to elect more Democrats to the legislature to save our plan. When you vote for irresponsible Republicans, you are literally voting against your secure retirement.
VERY bad idea. Politicians cannot be trusted! They try this tactic every year or two.
This bill is really destructive. Public employees and their employers who put money into this fund must continue to have a say in how the program works. Could this bill even be constitutional?
Absolutely Not! We need to purge the state government for whom we all worked for and contributed to. Re-elect no one from now on! We must demand not expect from our elected officials who need to be reminded that they are “public servants” and they “work for us” and we will not be subjugated by their “political whims and schemes”.
Has anyone at PERA asked Walker why he wants, or feels entitled to, confidential personal information?
They can and will legislate. That’s understood. That’s their expertise and duty. But I would very strongly object to loosing our voices on our board. They were not elected to sit on boards. They were elected to legislate. They should not get into the weeds. And they should not bring their agendas into our retirements. They need to do their jobs, and stay out of the PERA Board. Elected politicians spend the majority of their time merely wheeling and dealing and scheming for how to keep their party in power for the next election; they don’t actually do much other than earmark money for their own agendas. And that mentality cannot be a part of the board that oversees the retirement funds of people who worked for that retirement and count on that retirement. People who work for and pay into the PERA fund, and who may even have some expertise in managing investments – and are chosen by member elections – should be the ones to oversee PERA’s policies and provisions. Not political appointees.
The legislator who came up with this was obviously confusing who should be on an in-house executive committee with who should be on the PERA Board. In any other organization these kinds of positions would be department heads or contract consultants. The Board is supposed to provide overall supervision and direction or add unique expertise such as the inclusion of the State Treasurer who manages the daily investment of the General Fund and money held custodially.
I have my own suggestion that would go a long way toward guaranteeing the long-term stability of PERA. Simple. Have the legislature provide the funding that was their obligation to invest that they have held back for far too many years now and insure that they will continue to provide it in the future. I for one am sick and tired of Walter Stapleton railing about how mismanaged PERA is while spouting out of the other side of his mouth that the legislature should withhold future funding and doing all that he can to stack the board against the members of PERA.
No way! Far to much government control, do not take what little voice we have.
Like so many who have responded, this underhanded play for a take over of PERA by Republicans is disgusting. PERA is running just fine and does so because it has the input of it’s members and continues to make modifications so that it can keep it’s obligations now and in the future. Instead of always being on the defensive with the likes of Walter Stapleton and his cronies, maybe we should all vote out as many hypocritical politicians as we can…especially the two sponsors of this bill. We can not allow PERA to continue to be a political football. It’s fine to respond to these types of announcements through PERA, but I think it’s time for more aggressive action against these politicians. What kinds of bills can we sponsor that would prevent unwarranted interference into PERA’s structure by politicians? What media campaigns can we mount to bring to light the underhanded strategies of these politicians?
What is it to those two sponsors anyway? Why are they wasting theirs and other’s time with a foolhardy proposal to lessen PERA representation on the Board?
I want add that most Republicans have overtly committed to lowering taxes, and they signed promises never to raise taxes. Stapleton and the Republicans are going to exaggerate the taxpayers’ burden to support PERA. We need to remind our friends and neighbors that when most teachers and State employees accept, throughout much of their careers, somewhere between $30,000 and $75,000, adding the $5-15,000 addition contributions to the compensation creates a fair, middle class lifestyle. Most employees bring a higher level of educational completion and an outstanding work ethic. Republicans demonize the working class. That’s what we are up against. But … PERA operates on employee and employer contributions plus the investments’ performance. After the Great Recession (2018), and because of some mistakes made during the late 1990s by the Republicans running the State government (including the Matchmaker IRA program and the lower pricing to purchase years of service) when we were fully funded, we do need to support ways to bolster the “bottomline.” $48 billion sounds like a lot, but if we have a few subpar years (or disastrous ones), that trough of funds will not have what is needed to meet commitments to us. And the public will be in no position to bail us out during severe economic downturns. We don’t need a change of Board representation, but we all need to understand the math of our pension program.
Senate Bill 18-200 places an undue burden on retirees. It will reduce and freeze the Cost Of Living Adjustment (COLA) to zero in 2018 and 2019. Thereafter, the COLA will forever be reduced to a maximum potential increase of 1.25 % per year beginning in 2020. Encourage your legislators to oppose the provision of this bill that freezes and then reduces the potential COLA’s. This provision will result in a substantial reduction in the lifetime value of our Annuities.
The provision in SB 18-200 for a legislative oversight committee is also a bad idea. Mr. Santo (above) reminds us of the “shared sacrifice” in 2010’s SB-001 where we took a similar hit to the COLA. In 2010 we were told that SB 01 was the big fix needed for the long term solvency. Eight years later PERA apparently recognizes that solution was short sighted (because we are living too long?). This new plan will keep the fund whole for the next 30 years. Sure it will.
The proposed 2018 legislation is another version of the same problem and it will be the 2nd significant cut to retirees’ incomes in 8 years. At this rate, we can look forward to complete elimination of COLA’s by 2026. In each case PERA pushes, and the legislature blesses, this concept of the need for retirees to share the pain to resolve PERA’s and the legislature’s poor planning and investment practices. Its just wrong to cut COLA’s of people who are living on fixed incomes. Legislators who need to have that explained to them ought not to be overseeing PERA. PERA board members who don’t get that should be replaced.
One particular part of the SB 18-200 situation bothers me–the portion under “Employers/State” that says,
“The State of Colorado will contribute $225 million directly to PERA in 2018-2019….(This payment will be made directly to PERA instead of to the employers and then increasing their contribution rates to ensure 100% of the dollars go to PERA)”
That sounds rather like a bailout. Does it sound that way to you? It sounds like something the private sector could point to & say that PERA hurts the general budget of Colorado by needing this cash infusion in order to survive. Can someone please help me understand this?
Ruthie,
This direct distribution would go to paying off the unfunded liabilities of the State and School Division trusts. You may recall that there is a contribution deficiency that has contributed $4.6 billion to PERA’s $32 billion unfunded liability. For details, please see this PERA on the Issues post: https://peraontheissues.com/index.php/2017/12/26/sources-of-peras-unfunded-liabilities/
Paul, I agree with your comments about the reduced COLA and voiced my opinion when they asked PERA members for their comments months ago. I believe the TRUE cost of living continues to rise at a much higher rate than 3%. For example, the little social security that I receive, more continues to be taken out for Medicare each year.
Now I receive less than I did three years ago. The measly 1.25% PERA now wants to give us isn’t going to cover that nor any of the other increases in the true cost of living.
I agree with the comments posted by Mark and Paula. I wonder how many of our legislators are living on a fixed income with increases in health expenses, groceries, insurance, etc. We do not need a freeze on our COLA’s for two years. From 3% agree to on the day of retirement to 1 1/2% under the current proposal is reflective of how our politicians view all of the hard work we have given the state of Colorado in many ways.
Ronald you are so RIGHT. I to agreed to that 3% in 2002 when I retired. But it did not last long and as you all say all the prices go up and we lose, lose, lose!!. I hate to think what the road ahead will look like and how I will make ends meet. This whole mess has to stop before it is too late for all of us PERA members!
I equate cutting the cola on our PERA benefits to cutting the cola on social security. The country would go ballistic if national politicians tried to cut the social security cola. We had no choice but to be in PERA, contribute to PERA and relied in its promises. We (retirees) need to go ballistic on further cola cuts to PERA. Predictions of higher inflation upcoming make this even more paramount. If politicians take colas away or reduce them, they ain’t ever returning.
I wonder if a class action suite is feasible, since we retiree’s were promised definrd benefits upon retiring?
I appreciate the PERA employees taking the time to respond to questions/concerns. Thank you. This is a difficult time for everyone. I have two questions of my own. First, how many active PERA members are there? (i.e. how many people are currently paying 8% into the system?) Second, how many PERA retires are there currently?
Mr. Petrillo,
At the end of January 2018, there were 214,000 actively contributing members and 118,00 retirees.
There are also 254,000 members (inactive members) who no longer work for a PERA employer and have left their accounts at PERA.
Anybody who trusts politicians in this day and age is a fool
Best comment so far. I’m pretty new to PERA, but in my experience, any time a politician wants control of something that involves non-tax money, some skullduggery is afoot. PERA is NOT funded from tax revenue, and should NOT be controlled by politicians from either “side” of the aisle. PERIOD.
Why is that even a consideration?
In addition to contacting your own state senator and representative it will be helpful to contact the SB 18-200 Committee members and Bill Sponsors (links below) to express your individual opinions regarding what you don’t support or do support in this Bill..
tim.neville.senate@state.co.us,
senatorsmallwood@gmail.com,
lois.court.senate@state.co.us,
cheri.jahn.senate@state.co.us,
jack.tate.senate@state.co.us,
dan.pabon.house@state.co.us,
kpriola@gmail.com,
kcbecker.house@state.co.us,
Thanks, Paul. I am fired up. I’ve had enough of “shared sacrifices”.
Thank you Paula for the committee members contact info. This bill should not be passed. No politician should be on our board. No governor appointees. No personal information should be provided.
Just as BOTH political parties have raided Social Security over the years at the national level, both have turned their back on PERA retirees. The 2010 changes were bi-partisan, and the loss of reliable COLAs promised at time of retirement was due to a Colorado Supreme Court dominated by democrat appointees. Giving political appointees control of PERA is NOT the way to go. Until we PERA members unite in voting our self-interest over any political party affiliation, we’ll continue to suffer financially.
So, my understanding out of the Finance Committee hearing this past Tuesday was that amendments were introduced eliminating any additional State contribution towards the unfunded liability. So much for shared responsibility. The PERA Board, unless I missed it, has remained pretty quiet about this development probably because they know members will be irate. The only hope would be if the bill will be amended once again once it gets to the House. If so, it would the differences between the to House and Senate would have to be addressed in conference committee. Not good!
Yup, they only made it worse for members and benefit recipients. I wrote to everyone on the committee and not one of them provided me with the courtesy of a reply. Not expecting any help from the PERA Board. They have a twisted view of what it means to fulfill their obligation to protect the interests of members and benefit recipients.
in the early 2000’s one solution the legislature came up with was the AED and SAED which added temporary funding to PERA. The last of it expired and thus here we go again. When I started with State government the state contribution was 12%. It was lowered several times when the state was in a less than favorable position with its budget. It has never increased back to where it was when I started. They continue to get funded on the backs of retirees. The cost of living adjustment is something we need to stay caught up with rising cost of living. A mere 1 or 2% raise doesn’t keep up with the cost of living in Colorado….shame on you legislature.
Hi Debbie,
The AED and SAED, which are additional contributions, are still in effect. For more details on member and employer contribution rates, please see this fact sheet: https://www.copera.org/sites/default/files/documents/5-123.pdf
I am appalled that these state legislators (Republican sponsors of these bills) are wanting to severely and drastically change the makeup membership of the PERA Board of Directors from mostly current and former retirees to government appointed individuals who will most definitely not bave the best interests of PERA’s current and future retirees. Their motivation will be to support mostly conservative Republican state legislators and senators who want to get their hands on this historically successful retirement fund just as the feds have done with Social Security. Contrary to some of the aforementioned comments, which blame liberals and Democrats for these pending legislations, it is the Republicans led by Walker Stapleton, who want to dismantle PERA as it now stands. Nationally, it’s also conservatives, including Americans for Prosperity ( ie, the Koch brothers) who are attacking public sector pensions. Yes, prudent oversight and investment both are necessary as with any investment portfolio, but to suggest unnecessary and dangerous changes to a plan that has weathered past previous downturns in the economy quite well, is shameful and deplorable.
I agree that the politicians need to stay out of this, just look at what has happened to Social Security. That should be enough to keep politicians out.
Anyone have contacts with the media? I wonder how many PERA members remain unaware? This should be transparent.
WELL WELL WELL – THERE YOU HAVE IT. A CONSENSUS OF OPINION THAT OPPOSES POLITICIANS WITH THEIR HAND IN THE COOKIE JAR. THE FOX
TENDING THE CHICKEN HOUSE. HOW MUCH CLEARER DOES THE MESSAGE HAVE TO BE FOR YOU PEOPLE WHO ARE SUPPOSED TO BE PROTECTING THE RETIREMENT FUNDS FOR THOSE OF US WHO HAVE PAID OUR DUES. THIS IS OUT MONEY – NOT THE POLITICIAN’S MONEY. SO TAKE OFF THE DUNCE HAT FOLKS AND PAY ATTENTION YOU YOUR CONSTITUENTS- THAT’S YOUR JOB – GET IT RIGHT THE FIRST TIME. DON’T LET THE POLITICIANS ‘TRUMP’ YOUR AUTHORITY AND RESPONSIBILITY TO ALL OF US. THANKS FOR LISTENING – I THINK! .
Politicians need to stay OUT OF THIS, & the FREEZE on COLA is unacceptable — there should be at LEAST a 1% raise each year – which is well below the Cost of Living increases we see in daily life!!
No bonuses for management!!! Keep state politicians out of our retirement!!
Another promise gone. For many of us, we endured low wages because of the promises of a good retirement. When politicians enter the picture their goal will not be the protection of the earned benefits of those they represent but to keep their jobs, destroy our future. Politicians need to stay away from our promised and earned benefits before we loose everything. The COLA benefits have continued to be reduced or frozen as the cost of living continues to increase. Please revieve and modify this bill to include at least two to three PERA board members.
I am totally opposed to this legislation. As a retired teacher, I have seen too many ballots and initiatives aimed at shoring up education. The state passed the Recreational Marijuana Bill with the understanding that the majority of the taxes would go to public education. That has not happened. The state passed 1C with the undertstanding that the monies would go to public education. The state passed to adopt PARCC testing because funds would be given to public education. All of these were passed in good faith. The legislature then did a “shell game” tactic to move in and out funds so that public education in fact did NOT receive the funding the votors thought they were voting on. PERA then becomes the target because it now has the legislature serving on the board and has only created further problems to funding and keeps adding to that. Now because of the work they have done and continue to propose, Colorado is faced with a serious teacher shortage and this legislation only adds another nail to the coffin of shoring up the deficit.. I am appalleed that we ontinue to let the legislature deplete this program without looking at how they have continued to contribute to the problems in funding the very core of the future of our great state. They should be ashamed of the way they continue to mismanage the monies placed in their hands to govern.
This proposal is nuts. Will people ever learn?
I cannot believe that PERA members would ever consider leaving their money in the hands of politicians. For years they have been wanting to take our money and do with it as they please. This is ridiculous for us to even put up with this. They need to keep their hands out of our pockets!
What this legislation will do , if passed, will encourage members to take the full cash payout. These politicians have been trying to gain control over PERA for years and eventually they will. Taking a cash payout properly invested gives me a chance to control my destiny,rather than depending on PERA and politicians to DO THE RIGHT THING with our money. Historically, not encouraging.
I agree with what is being said in the majority of comments. I DO NOT SUPPORT elected officials representing my interests. Appointees by a governor always have agendas that do not reflect the best interests of PERA retirees. No on this.
I personally am an out of state benefit recipient at his time . However if I were back in Colorado and a voting resident I would be calling my legislative representatives relentlessly. The SB18-200 Senate Finance Committee revisions are absurdly autocratic and formulated to assume control of the PERA fund. The “Auto Adjustment ” and the “Increase Employer Contribution” provisions (virtually zero dollars for the State) suggested by the Senate Finance Com. indicates the State of Colorado is unwilling to share in the burden of reform and maintenance. However, there is no doubt that they will jump at the chance to obtain control of the plan and the funds as supported by numerous previous years of introduced legislation to acquire control of the fund. Finally the Committee’s suggestion of a “Legislative Pension Oversight Committee” usurps the already reduced self governing authority that PERA has had in previous years. This is apparent upon review of implemented legislative changes to the PERA retirement plan over the last few decades.
I’ll never forget sitting in a PERA meeting at the Doubletree when a man got up and said adamantly how wrong it was to cut the COLA. He had seen PERA beneficiaries have to go on Welfare in the 1980s because they couldn’t make ends meet. I keep writing to the legislators, would you rather pay us dignified money through our PERA or would you rather pay it through Welfare. Either way, you’ll may have to pay. Our battle cry should be PERA or Welfare!
Leave my benefits alone…I was looking forward to my first COLA this July. Can’t get my Social Security Benefit either, because they call it a windfall. Give what was promised and stop moving the target. Those who have no vested interest should not have decision making voices. Don’t ask me to like less or agree to it…
Geraldine, have you checked with Social Security to get an official estimate of how much benefit you might be eligible for?
If she paid into Social Security, she should be eligible for something. Nonetheless, she is right is the sense that even after paying into Social Security for many years before beginning PERA employment, my SS will be significantly reduced because of the Windfall Elimination Provision.
As I read these commments I find it interesting that so many members are quick to point fingers as well as blame politicians for the current state of affairs our pensions are in. One only needs to recognize that when pointing to someone three fingers are returning to the accuser. As I recall, continued increases in benefits and COLA were at the insistenance of PERA members and supported by our appointed board members. Generally speaking private pensions are much less lucrative and Social Security is certainly nominal for most recipients. So, now the golden goose cannot produce the amounts needed to get PERA on a sound footing and our esteemed members expect Colorado taxpayers to produce the next golden egg. I expect that most mature PERA members did what the average employee does: Save for retirement while working thus I would be surprised that any member would be defined as destitute! A final note, while Social Security now requires a minimum age of over 66 years for full benefits PERA members may retire years earlier incurring much greater retirement costs to PERA compliments of PERA board and political support sought by PERA members. So I close by suggesting that those with the loudest voices to cry PERA a river while I hope that PERA can become financially sound for present and future retires. It’s just basic economics folks!
Finally, one post that actually makes sense instead of this extremely long litany of woe is us and how criminal it is to change anything to our extremely lavish plan. News Alert: there are very, very few retirement plans out there that award benefits of 100% of HAS plus a annual COLA.
I am a PERA member and I’m glad to see the reform package to address PERA’s underfunded status. I think it’s okay to change the makeup of the board too, because the current format wasn’t really working – I’m saying that because the last set of reforms didn’t do enough to address the underfunding. I’m a liberal but I think there are some good ideas for reform on both sides. When you’re trying to get something accomplished it’s not a blame game. Those who are worried should have a little faith in the system.
Dear Ms. Flam,
There are two main reasons the PERA Board recommended legislation for 2018: members are living longer and the economic outlook is not as optimistic. These two factors increased the time it will take PERA to become fully funded beyond the 30-year goal expressed in the Board’s Funding Policy and state law.
See the Colorado PERA Defined Benefit Pension Plan Funding Policy here: https://www.copera.org/sites/default/files/documents/fundingpolicy2015.pdf
If members are living longer, doesn’t it also make sense to protect them by keeping the COLA as it is? We don’t want our retirees to be welfare recipients when they were promised a higher increase every year as a condition of their retirement. I find this reprehensible.
Find another way to do it, starting with ELIMINATING the self-serving sweetheart deals for Judicial and State Police! We had a contract, you broke it… how is that in any way fair or acceptable? I want my original COLA restored.
Christopher,
Members of the State Patrol pay a higher contribution rate to allow for earlier retirements. Judicial Division employers also pay a higher rate than State Division employers to account for their unique demographic experience (judges enter PERA at an older age, on average, than other state employees). Judges’ salaries are set in state statute so that’s why they currently have a one-year HAS. In SB 200, the HAS for new judges would be three years.
The PERA funding equation is the same for every division in that contributions plus investment income must equal benefits and expenses.
I’d like to know just what exactly the so-called politicians are paying into PERA since they made the agreement that PERA will be fully funded out of our paychecks. They don’t even pay into it so why isn’t anyone that really does pay into it have any say so? They all get their health & dental insurance paid for, their parking is paid for (whenever they actually show up in person) & they have their license plates paid for. The rest of us that work for the state do NOT make 6 figures a year & yet they (the legislation) vote down every reasonable request for a true raise for the rest of all state employees versus inflation. Then we have our pay being screwed up so it will be easier for payroll & they will take away 1/2 or our monthly wages to make this change come July just so the budget looks good for the state but the people it really affects are totally screwed. So they give us a stupid letter to creditors to asking that they allow for these “changes” but telling people to adjust to the changes & asking the creditors to allow for these changes means absolutely nothing!!! Being at my age it is not an acceptable change & I have already called my creditors to change my scheduled due dates but they will only change it if I’m paid a month ahead. REALLY???? the state is taking away 1/2 my pay per month in order for them to make it easier for payroll!!! I end up nearing bankruptcy– I am not so proud of being a state employee.
Deborah,
Legislators can elect (like other state employees) to participate in the PERA defined benefit or PERA defined contribution plan. Members in both plans contribute 8 percent of pay. PERA does not have control over the pay patterns of our employers.
So when are people going to get their heads out of their you know what and realize this is not about this republican or that democrat.Its about corrupt poli ticians that could care less about the very people they are sworn to serve. I have already been through the same crap with a private pension after working for 33 years and am now left with next to nothing. better stand up and be heard before its too late! You cannot allow government to get a strong hold or you will pay!
I have to ask, am I missing something? I don’t seem to see any positive comments on the issue. Do any PERA representatives or Politicians read these comments? Also why don’t they stop retirees from working for a PERA employer through Temporary Agency’s without PERA contributions?
Please remember what Mayor Bach did for PERA. That’s B A C. H
Dear Mr. Hill,
Yes, we read these comments and respond when we are able to provide clarification or factual information in response to questions. PERA’s legal team is aware that some employers have tried to circumvent paying contributions. PERA also reviews employer tax data to ensure compliance with Colorado statutes that govern the plan.
Thousands of teachers, allies flood Denver over funding
Not that many years ago, PERA was funded much better than it is now. What happened? Those running the show must have screwed up. An investigation into the management team needs to be started. All PERA recipients. present and future, should be wanting to know what has happened to PERA funds.
Dear Mr. Wilmoth,
Please see these PERA on the Issues posts for information related to your question:
https://peraontheissues.com/index.php/2017/12/26/sources-of-peras-unfunded-liabilities/
https://peraontheissues.com/index.php/2018/01/10/icymi-colorado-pera-board-chairman-outlines-path-to-lowering-peras-risk-profile/
https://peraontheissues.com/index.php/2017/09/22/colorado-pera-board-endorses-package-reforms/
I agree, the government has no business forcing themselves into our PERA management making changes or allowing other government departments to have a say with anything having to do with PERA. It’s wrong and should not be encouraged or allowed.
OUTRAGEOUS and UNACCEPTABLE!
We entered into a contract when I worked for the state for 21 years and then retired. I’ve already endured cuts, you’ve broke the deal we had, and now I’m looking at even MORE thievery???
I’m drawing the line in the sand… NO MORE! Start with taking away the self-serving sweetheart deals for Judicial and State Police, I’m incensed that the ones who make the highest wages, and (even more important) are charged with preserving law and JUSTICE, are the ones who are milking the system at the cost of the rank & file workers.
And… what are the PERA board members salary’s? Are the PERA Board Members actually PERA employees? It feels like the henhouse has been opened to the foxes, I don’t see you as fighting for me anymore, waaay too many concessions to the bandits over the past decade.
Christopher,
Contributions are based on a percentage of salary and are invested and used to pre-fund retirement benefits. All members and their employers pay contributions. Retirement benefits are based on HAS and amount of time working for a PERA employer.
Member-elected PERA Board members serve without pay. They are PERA members and retirees and will be participating in any changes enacted by the Colorado General Assembly. Their job as fiduciaries is to act in the best interest of the entire PERA membership. The Board has adopted a funding policy that requires action (the recommendation of legislation) when the trusts exceed a 30-year amortization period. The Colorado PERA Defined Benefit Pension Plan Funding Policy is here: https://www.copera.org/sites/default/files/documents/fundingpolicy2015.pdf
As teachers plan to descend on Colorado capitol, lawmakers propose jail for striking
While watching the evening news it was reported that the governor signed a new budget plan that included 375 million for education and state pensions. This has to be good news for PERA right? It seems to me that the representatives at the state level have had their eyes open to the fact that that over all funding for education in this state, (which yes does include the pension program), is seriously in need of some help. Will PERA be the beneficiary of any of these new budget dollars? Let’s hope so!
Tom,
In the 2018-2019 state budget, there is $225 million for a direct disbursement to PERA and the money will be used to offset the unfunded liability.