New legislative oversight body added
under SB 200 provides additional avenue for PERA transparency
The Pension Review Subcommittee, established by Senate Bill
18-200, met for the first time on Friday, July 12. The Subcommittee was formed
to expand the Police Officers’ and Firefighters’ Pension Review Commission and
create a subcommittee within the commission to oversee PERA.
SB 18-200 directed the commission to study, review, and propose legislation related to the funding of police offers’ and firefighters’ pensions in the state and benefit designs of such pension plans and must also study and may develop proposed legislation relating to PERA. The commission is comprised of 10 members: five Senators and five Representatives.
As covered previously in PERA
on the Issues, four different legislative committees have oversight
responsibility of PERA. These reporting committees include the Legislative
Audit Committee, Joint Finance Committee, Joint Budget Committee, and Pension
Review Commission.
The Pension
Review Subcommittee was tasked specifically with making recommendations to
the Commission regarding PERA. The July 12 meeting began with an overview of
the Subcommittee’s
responsibilities and charge from legislative staff. PERA staff then presented
to the subcommittee members on a number of topics, with particular focus on the
2018 financials. Questions from the Subcommittee covered a range of topics
including the rate of return assumption, asset allocation, and the progress of
the Board’s current Asset Liability Study. Board Chairman Timothy M. O’Brien
and Treasurer Dave Young joined the panel as well to respond to questions from
Subcommittee members.
This newly-formed oversight subcommittee is comprised of four legislators and 10 appointed members of the public. Requirements for serving as an appointed member include experience or knowledge of investment management, corporate or public finance, compensation and benefit systems, economics, accounting, pension administration, or actuarial analysis.
In addition, each subcommittee member is required to attend
certain meetings each year, as follows:
- At least one PERA Board meeting;
- The Legislative Audit Committee meeting review
of PERA’s annual
actuarial valuation; and - The State Measurement for Accountable,
Responsive, and Transparent (SMART) Government Act hearing of the Joint Finance
Committee when it reviews PERA.
The Pension Review Subcommittee’s next scheduled meeting is
Monday, August 12 and the Pension Review Commission will meet for the first
time during the 2019 interim session on Monday, September 9.
PERA staff will continue to work with legislative staff and
members of all reporting committees to provide education regarding the
importance of ensuring retirement security for PERA’s membership.
Actuarial valuationAn annual assessment of a pension plan’s finances and membership. This forms the backbone of the plan’s annual financial report.Asset allocationAn investor’s mix of stocks, bonds, and other investments. PERA’s strategic asset allocation is set by the PERA Board of Trustees.
