On November 15th the PERA Board of Trustees voted to lower the expected rate of return to 7.5% instead of leaving it at the 8% that the Secure PERA Coalition and all of the expert consultants that the board hired had recommended. We don’t yet know what this means for all of the numbers of PERA but what we do know is that PERA is and still remains on the right track to being funded. The changes we made with Senate Bill 1 back in 2010 are still working and we have to let them continue to work. As of December 31, 2012 PERA had reduced their unfunded liability by $9 billion thanks to sacrifices of its retirees and members – 90% of that reduction was funded by retirees and members!
While the reduction in the expected rate of return was not recommended by the experts the media has decided that this was a very good move. You can read the Denver Post editorial supporting this change here.
As soon as we know what this change to the expected rate of return may mean for members and retirees we will let you know – the actuaries are still running the numbers!