Legislation containing the Board’s recommendations introduced as Senate Bill 18-200
The Colorado PERA Board of Trustees today directed staff to continue to serve as a resource to the General Assembly as it considers Senate Bill 18-200, introduced on March 7 in the Colorado State Senate. Sponsors of the bill are Sen. Jack Tate (R-Centennial), Sen. Kevin Priola (R-Henderson), Sen. Cheri Jahn (I-Wheat Ridge), House Majority Leader KC Becker (D-Boulder), and Rep. Dan Pabon (D-Denver).
SB 18-200 represents a comprehensive package of reforms designed to reduce the overall risk profile of the plan and improve PERA’s funded status. Many of the Board’s recommendations, including employer and employee contribution increases and modifications to the annual increase paid to retirees, were included in the legislation. Also included in the bill was the Board’s recommendation to incorporate an automatic adjustment mechanism that would keep the fund on a path to full funding in 30 years.
“This legislation follows through on many of the recommendations from the PERA Board,” said Timothy M. O’Brien, Chairman of the PERA Board of Trustees. “The bill reflects the Board’s desire to preserve the Defined Benefit system, address PERA’s funding, and share the responsibility of cost among members, employers, and retirees.”
The bill differs from the Board’s recommendations in a few areas. Contribution increases from members and employers would start earlier and be phased in over time. The legislation also would increase the number of years in the highest average salary (HAS) calculation to seven for new hires in 2020, and reduce the annual increase paid to retirees from 2 percent to 1.25 percent.
Beyond the Board’s recommendations, SB 18-200 also includes additional provisions to expand access to PERA’s Defined Contribution plan among all new hires, and to establish a new legislative oversight committee.
“PERA will continue to support the legislative process and serve as a resource to policy makers,” O’Brien concluded. “More than 580,000 PERA members are counting on legislative action this session to ensure PERA’s long-term sustainability.”
A document comparing the PERA Board’s recommendations with SB18-200 is available here.