You can read Senate Bill 1 in its entirety here.
But, if you want the summary version here it is:
In 2009 the Coalition began meeting with PERA and state legislators to talk about ground breaking legislation that would help correct the downward trajectory of PERA’s fiscal stability following the market crash of 2008. Colorado was one of the first states in the Country to aggressively take on this type of reform effort.
The coalition continued negotiating changes into the start of 2010 and the ground breaking legislation was introduced with bi-partisan Senate leaders on the first day of the session. This bill became known as Senate Bill 1.
When the Coalition approached this bill we wanted to make sure that no sacrifices were taken unnecessarily and that the sacrifice was shared between the employers, employees and retirees. Originally the plan was referred to at the 2-2-2 Plus plan. In very simplistic terms - retirees reduced their COLA payment to 2%, employers increased their contributions by 2% and employees increased their contribution by 2%.
The Coalition eventually agreed to support a modified version of this plan with the plus containing many different reforms.
The changes are too numerous and detailed to mention on this call so if you are wondering how any of these changes may affect you were urge you to call PERA at 303-832-9550 or 1-800-759-7372, or check the SB 1 information on the PERA Web site at copera.org.
In summary, some of the biggest pieces of Senate Bill 1 are as follows. Remember that changes in SB 1 impact different members differently (based on your date of hire and your age), so not all of these changes apply to all members and retirees.
- For retirees
- The amount of the annual COLA increase will be 2 percent per year unless PERA has a negative investment year, at which point the annual increase for the three years following that negative return will be the lesser of 2 percent or the average of the monthly CPI-W for the preceding calendar year. Indications are that the COLA paid in July 2012 will be 2%.
- If you were eligible to retire after Jan 1, 2011 you now must collect your benefit for a year before you are eligible for a COLA increase.
- If you work after retirement the rules have changed
- For employees
- The rate you and your employer pay will be increased differently depending where you work and what year it is.
- Changes were made that effect your account (refunds or rollovers) if you should leave PERA-covered employment.
- Several changes were made to when you are eligible to retire. Because these changes vary depending on when you are hired and what division you work for we encourage you to check with PERA regarding your specific circumstances.
We encourage you to talk with PERA about your specific circumstances. We can’t stress enough that this bill is very complicated and affects everyone differently so please call PERA to discuss your circumstances before making any conclusions.
The bottom line is this – Senate Bill 1 puts PERA back on track to long-term sustainability and efforts to derail this comprehensive, first-in-the-nation piece of legislation must be defeated.