2023 Legislative Session Comes to an End

The 2023 Legislative Session ended on Monday, May 8. Lawmakers worked nearly non-stop (especially in the closing days). In the end, lawmakers debated 617 bills, 311 in the House and 306 in the Senate. Several of these bills were top priorities for Secure PERA. You can review all of the bills we followed plus our positions here.

SB23-056 is on its way to the Governor’s desk. The bill by Sen. Chris Kolker and Rep. Shannon Bird makes an additional $14.5 million direction distribution to PERA. This funding will help to chip away at PERA’s unfunded liability. The Governor has until June 7 to act on the bill (sign or veto). If no action is taken, the bill becomes law by default. Once it is law, the funding will transfer to PERA.

Earlier this session, legislators defeated HB23-1176 (in legislative speak, it was “postponed indefinitely”). The bill by Rep. Don Wilson would have require PERA to implement a DC plan for the School Division and allow anyone hired after Jan 1, 2024 to participate. Proponents said the bill was needed to help recruit new teachers and staff, especially to help recruit people to teaching from other professions. Secure PERA has long fought to maintain PERA as a defined benefit plan. While the State and Local divisions have defined contribution programs, the school division never has had one. Now with the added complication of the auto-adjust provision to keep PERA on track, any efforts to divert new employees out of the defined benefit program contributes to the unfunded liability for all participants. We were happy to see this bill defeated.

Unfortunately, HB23-1016, Temporary Tax Credit for Public Service Retirees, did not pass. This bill was intended to help provide a limited amount of relief to retirees who receive a public pension. High rates of inflation and small to no annual COLA increases have taken a big toll on retirees. However, advocates could not overcome the $120 million price tag for the bill in a very tight budget year. Despite Rep. Shannon Bird’s ongoing advocacy for the bill, the bill “died on the calendar” as it did not pass the House Appropriations Committee.

Several other bills related to PERA were also unsuccessful. Two bills focused on PERA’s investing strategies. HB23-1092 by Rep. Rod Bockenfeld, would have prohibited PERA from using environmental, social or governance (ESG) strategies to direct their funding. SB23-016, by Sen. Chris Hansen, focuses on the reduction of greenhouse gases and within the bill, requires PERA to include climate related risks in their annual Investment Stewardship Report.

Lawmakers also postponed a bill (SB23-104) to allow Denver Public Schools to reduce their employer contribution amount. While they are allowed to do this under the law that merged the former DPS retirement system into PERA, there was great concern about the impact of this reduction on the whole pension system. Lastly, a bill (HB23-1144) that would have put new limitations on how pension benefits are managed in divorce was also defeated.

Our 2023 endorsements for the PERA Board of Trustees

This month, PERA members will elect new representatives to the PERA Board of Trustees, the governing body of PERA. If you are a PERA member in a division with an election, you will receive ballot information in the mail from PERA. The deadline to vote is May 31, 2023.

For more information about the process, plus details about the candidates, visit PERA’s website.

As we do every year, Secure PERA shared questionnaires with candidates for the PERA Board and reviewed all questionnaires returned to us. We are excited to see high interest in serving on the PERA Board and dedication to protecting the long-term viability of the pension system. In reviewing the questionnaires, several candidates rose above the rest and earned our endorsement.

Local Division – Trina Ruhland

Trina Ruhland is a Deputy County Attorney in Boulder County. She was appointed last year to fill a vacancy on the PERA Board in the Local Division. In her time on the PERA Board, she has developed a passion for the work of PERA and the Board. In addition to her legal background, Ms. Ruhland has a background in data analysis, a degree in mathematics and a strong personal interest in retirement planning and investment. Under PERA rules, trustees who are appointed to fill a vacancy must run for election the year following their appointment.  We believe Ms. Ruhland deserves a full term as a Trustee.

From Ms. Ruhland’s Questionnaire: “Members expect–and need to know–that their retirement future with PERA is secure even through down markets and unpredictable and unprecedented times. First and foremost, PERA must maintain the highest level of service in investing and protecting members’ retirement and ensuring the financial stability of the PERA fund. Second, PERA needs to continue to develop effective and transparent communication with its ever-increasingly diverse membership.  However, this also offers PERA a big opportunity: with new technologies at our disposal and a culture change in how we communicate remotely, we may have more ability than ever to connect with and engage our membership.”

Retiree Division – Timothy O’Brien

Timothy O’Brien is a veteran member on the PERA Board. He has represented the Retiree Division since 2011 and previously served as an active member in the State Division from 1984-1995. Mr. O’Brien brings his accounting and audit expertise to the PERA Board. After retiring as the Colorado State Auditor in 1995, Mr. O’Brien continued working in non-PERA positions and currently serves as the Denver Auditor. We appreciate Mr. O’Brien’s commitment to serve on the Board and recommend him for another term.

From Mr. O’Brien’s Questionnaire: “All PERA Board Members are fiduciaries.  That means that we must act solely in the interest of the members and benefit recipients. We must act for the exclusive purpose of providing benefits and defraying reasonable expenses incurred in performing such duties required by state law.  I represent all active, inactive, and retired members of PERA.”

School Division – Eunice Botchway

Eunice Botchway is a special education teacher. She has also been endorsed by the Colorado Education Association. An educator for more than a decade, Ms. Botchway currently works in Aurora Public Schools and previously worked in the Cherry Creek School District. Ms. Botchway is dedicated to ensuring transparency and ensuring trust with the defined benefit system and ensuring the long-term solvency of PERA. We believe Ms. Botchway will be a strong addition to the PERA Board.

From. Ms. Botchway’s questionnaire: “The biggest challenge facing PERA in the coming years is the shortage of teachers, how to address the exit of educators, and how that may affect the PERA Funds. The most significant opportunity for the PERA board is to rally contributors to have a collaborative conversation while gathering ideas from members to help solve teacher shortages and any other issues that may be facing PERA.”

Secure PERA Announces 2022 Candidate Endorsements

Secure PERA is proud to announce our bi-partisan endorsements for the November 2022 election. These candidates earned our endorsement based on their positions on PERA. Below you will find their websites so you can learn more about the candidates, volunteer for them and donate. Due to redistricting, legislative districts have changed. You can find out more about these new districts on the Colorado General Assembly Website.

 

OfficeDistrictCandidateWebsite
TreasurerDave Youngwww.daveyoungforcolorado.com
State Senate3Nick Hinrichsenwww.nickforcolorado.com
State Senate7Janice Richwww.janicerichforcolorado.com
State Senate8Dylan Robertsdylanroberts.org
State Senate8Matt Solomonsolomonforcolorado.com
State Senate11Tony Exumtonyexum.com
State Senate15Janice Marchmanwww.janiceforcolorado.com
State Senate20Lisa Cutterwww.cutterforcolorado.com
State Senate22Jessie Danielsonwww.jessiedanielson.com
State Senate24Kyle Mullicakylemullica.com
State Senate25Faith Winterwww.faithwinter.com
State Senate27Tom Sullivansullivanforcolorado.com
State Senate30Kevin Van Winklevanwinkleforcolorado.com
State Senate34Julie Gonzaleswww.julieforcolorado.com
State House2Steven Woodrowwww.woodrowforco.com
State House3Meg Froelichwww.froelichforcolorado.com
State House4Serena Gonzales-Gutierrezserenaforcolorado.com
State House5Alex Valdezwww.valdezforcolorado.com
State House6Elisabeth Eppswww.elisabethepps.com
State House7Jennifer Baconwww.electjenniferbacon.com
State House9Emily Sirotawww.emilyforcolorado.com
State House10Junie Josephwww.junie4colorado.com
State House11Karen McCormickkarenforco.com
State House12Tracey Bernetttraceybernett.com
State House13Julie McCluskiemccluskieforco.com
State House16Stephanie Vigilwww.stephanievigil.com
State House18Mark Snyderwww.snyderforcolorado.com
State House19Jennifer Parentiwww.parentiforcolorado.com
State House21Mary Bradfieldwww.marybradfield.com
State House23Monica Duranwww.monicaduran.com
State House24Lindsey Daughertywww.lindseyforcolorado.com
State House25Tammy Storywww.story4co.com
State House26Meghan Lukenscampaign.meghanlukens.com
State House27Brianna Titonewww.briannaforco.com
State House28Shelia Liederwww.liederforcolorado.com
State House29Shannon Birdwww.shannonbirdforcolorado.com
State House30Chris Kennedywww.kennedy4co.com
State House32Dafna Michaleson Jenetdafnaforcolorado.com
State House33William Lindstedtwww.williamforcolorado.com
State House36Mike Weissmanwww.mikeweissman.com
State House37Ruby Dicksonrubyforcolorado.com
State House38David Ortizwww.davidortizcolorado.com
State House40Naquetta Rickswww.ricks4co.com
State House41Iman Jodehwww.imanforcolorado.com
State House46Tisha Maurotishamauroforpueblo.com
State House49Judith Amabilejudyamabile.com
State House50Mary Youngmaryyoungforcolorado.com
State House51Hugh McKeanmckeanforstatehouse.com
State House52Cathy Kippcathykipp.com
State House53Andrew Boeseneckerandrewforcolorado.com
State House55Damon Daviswww.damonjdavis.com
State House55Rick Taggartwww.rickfor55.com
State House57Perry Willvoteperrywill.com
State House59Barbara McLachlanbarbaramclachlan.com
State House61Eliza Hamrickelizaforcolorado.com

 

The PERA Pay Back

In 2020, while facing a $3.3 billion budget deficit due to the COVID pandemic, the General Assembly cut its $225 million direct contribution to PERA. This annual contribution is required under SB18-200 to make up for the state’s past underfunding of PERA. Later that year, as revenue returned, the General Assembly restored funding for many of programs and projects that it had to cut, except for the $225 million direct contribution for PERA. When PERA posted a 17.4% rate of return for 2020, the loss of the $225 million was exacerbated.

Fast forward to this fall, the Pension Review Commission, which oversees the Fire and Police Pension Association (FPPA) and PERA, approved a bill draft that would pay back that missed 2020 contribution plus lost earnings for a total of $303.57 million. This direct contribution would be in addition to the $225 million direct contribution required for 2022. The bill draft is set to be bipartisan and carried by Representatives Shannon Bird and Shane Sandridge and Senators Chris Kolker and Kevin Priola.

The bill draft isn’t official yet. It must be approved by the Legislative Council of the General Assembly, an oversight committee comprised of party leadership that reviews all legislation developed by interim committees such as the Pension Review Commission. If the Legislative Council approves the bill draft, it will be introduced in the 2022 session starting in January.

Secure PERA’s top priorities for 2022 are ensuring the state makes it annual $225 million direct contribution and pays back the missed 2020 direct contribution.

Why is this important? The state’s direct contribution is a critical component of the plan to reach full funding by 2040. In addition to increases in employee and employer contributions and reduction in the COLA for retirees, the state committed in SB18-200 to make this annual contribution. Without this annual contribution, there will be more adjustments that will be needed, and public employees and retirees will have to carry that burden.

Strong Returns for 2020, but Auto-Adjust Still Triggered

This month, PERA released its 2020 Comprehensive Annual Financial Report, also known as the “CAFR”. The CAFR provides a full summary of how PERA and its investments performed each year and the overall funded status of the pension plan. It is released every June.

Despite the tumultuous year, PERA’s rate of return for 2020 was 17.4%. This is significantly higher than the 7.25% assumed rate of return that PERA uses for its benchmarking and future planning.

Even with this high rate of return, employee and employer contributions rates will increase and retirees’ annual increase will drop again starting in July 2022. That’s because last November, PERA adjusted some of their main assumptions, namely that PERA participants are living longer than expect and the workforce has not increased as previously assumed. These changes have such an impact on the long-term costs of PERA that last year’s rate of 17.4% could not offset them. Therefore, the auto-adjust provision will get triggered to put PERA’s funded status back on track.

According to PERA’s CAFR, the number of years, or projected amortization period, that it will take until each division is fully funded increased from where it was in 2019. With the implementation of an auto-adjust provision, the amortization period improves as detailed in this chart.

Division2018201920202020 (with AA)
State28222320
School34242622
Local Government2914118
Judicial211287
Denver Public Schools171187

Starting in July 2022, employee and employer rates will increase by 0.5% and the annual increase for retirees will decrease by .25%. The following chart from PERA’s 2020 CAFR details the changes.

The continued auto-adjustments, particularly after two years of double-digit rates of returns, highlight the challenges that continue to face PERA – primarily past years of government underfunding the pension. The state legislature’s decision to not make its 2020 contribution of $225 million is the most recent example. PERA’s actuaries noted that the loss of this contribution meant a $990 million long-term loss to the pension overall due to not having the investment returns or compounding interests that the $225 million would have generated over time. The Colorado Sun covered the board meeting and issue here.

State Legislature Renews its Commitment to PERA

The Governor will soon sign the 2021-2022 state budget. Last week, the Colorado Legislature finalized its work on the $34.1 billion budget, which funds many of the programs that were cut last year, sets aside additional funds for next year, and renews the state’s commitment to the long-term viability of PERA.

This means the state will make its $225 million obligation on July 1, 2021 and already has the money set aside to pay it next year as well. These actions are being done through two bills – the “Long Bill”, SB21-205, and a companion bill, SB21-228.

Thank you to the Secure PERA members who advocated with JBC members and legislators and sent more than 2,600 emails to make this happen. Your efforts had a big impact!

Secure PERA announces its PERA Board of Trustee endorsements

Secure PERA is proud to endorse four candidates this year for the PERA Board of Trustees. PERA is managed by a 15-member Board of Trustees. Eleven of the trustees are elected by PERA participants. The others are appointed by the Governor, except for the State Treasurer, who serves on the board as part of their elected position.

Beginning May 3, PERA will send out ballots to all PERA participants who are in divisions with elections. This year, there are elections in the State, School and Retiree divisions. PERA members have until May 31 to vote.

The following candidates measured up on Secure PERA’s values and beliefs on public pensions. You can read their official PERA bios here (as well as the bios of all candidates running).

State Division
  • Brian Tapley
School Division
  • Tina Mueh
  • Marcus Pennell
Retiree Division
  • Julie Friedemann

What does the PERA Board of Trustees do? Read more about it here.

Focusing on the State’s Direct Contribution to PERA

The Colorado Legislature is hard at work this year. A top priority for Secure PERA is to ensure the state funds its $225 million direct contribution to PERA this year. This annual contribution was agreed to as part of SB18-200 to make up for the state’s past underfunding of PERA. Last year, while facing a $3.3 billion deficit, the Legislature cut the 2020 contribution.

In November, the Governor released his 2021-2022 budget request and included the $225 million direct contribution. Since then, the powerful Joint Budget Committee has been working to prepare the state budget and, thanks to the advocacy of our Secure PERA members, has pledged to include the contribution for the 2021-2022 budget.

Next up, the Joint Budget Committee will receive an updated revenue forecast for the state before finalizing the budget. After that, they will introduce the “Long Bill”, which is another name for the state budget. This year, the “Long Bill” will start in the Senate before proceeding to the House.

We will keep watch throughout the process to ensure the direct contribution is maintained. In the meantime, we encourage you to attend your legislators’ (virtual) town hall meetings and continue to ask about their support for PERA and the $225 million direct constibution. The best way to know about these events is to sign up for their newsletters. You can google your legislators to find their campaign websites and then sign up for their emails.

Colorado’s Pension Review Subcommittee

As part of SB18-200, the Legislature created the Pension Review Subcommittee to be another set of eyes on PERA. While it has no authority over PERA, it does serve to review PERA’s progress and make recommendations to the PERA Board of Trustees and to the Legislature.

The Pension Review Subcommittee is under the Pension Review Commission, which was previously called the Police Officers’ and Firefighters’ Pension Reform Commission. SB18-200 expanded the scope of the commission from overseeing just the Fire and Police Pension Association (FPPA) to also overseeing PERA and established the subcommittee.

The subcommittee is comprised of four legislators, who also serve on the commission, and ten members with external expertise. These ten members are appointed as follows:

  • The Governor appoints one member,
  • The Treasurer appoints one member,
  • The Senate President appoints two members,
  • The Senate Minority Leader appoints two members,
  • The Speaker of the House appoints two members, and
  • The House Minority Leader appoints two members.

These members must have “experience or knowledge of investment management, corporate or public finance, compensation and benefit systems, economics, accounting, pension administration, or actuarial analysis.”

What is their charge?

The Pension Review Subcommittee is tasked with reviewing PERA’s overall financial health, their actuarial assumptions and progress to reaching full funding by 2048. They can make recommendations to the commission or PERA about their analysis and ways to improve the system.

The subcommittee began its work in 2019 and then paused in 2020 due to the pandemic when all interim committees were halted for the year. In 2021, the subcommittee is taking on the task of conducting an analysis of PERA’s efforts to reach full funding by 2048. It recently contracted with GRS, a national actuarial and benefits consulting firm, to do this analysis. Work on this project is just getting started.

In December of last year, PERA released its 2020 “Experience Study”. This study is done every four years and is used to set the actuarial assumptions, which are the underlying factors that affect PERA’s projections. The subcommittee’s review will include an analysis of this study, PERA’s overall assumptions and their projections.

You can learn more about the Pension Review Subcommittee on the Colorado Legislature’s website, including who serves on the Subcommittee now and their meeting information.

Secure PERA Announces 2020 Endorsements

Secure PERA is proud to announce our bi-partisan endorsements for the November 2020 election. Below you will find their websites so you can learn more about the candidates, volunteer for them and donate.

Office

District

Candidate

Website

State Senate

8

Bob Rankin

www.votebobrankin.com

State Senate

10

Randi McCallian

randiforcolorado.com

State Senate

14

Joann Ginal

joannginal.org

State Senate

19

Rachel Zenzinger

www.rachelforcolorado.com

State Senate

21

Dominick Moreno

www.dominickmoreno.com

State Senate

23

Sally Boccella

www.sallyforcolorado.com

State Senate

25

Paula Dickerson

www.paulaforcolorado.com

State Senate

26

Jeff Bridges

www.bridgesforcolorado.com

State Senate

27

Chris Kolker

www.kolkerforcolorado.com

State Senate

28

Janet Buckner

janetbuckner.com

State Senate

33

James Coleman

colemanforcolorado.com

State House

3

Meg Froelich

www.froelichforcolorado.com

State House

4

Serena Gonzales-Gutierrez

serenaforcolorado.com

State House

5

Alex Valdez

www.valdezforcolorado.com

State House

6

Steven Woodrow

www.woodrowforco.com

State House

9

Emily Sirota

www.emilyforcolorado.com

State House

10

Edie Hooton

www.ediehooton.com

State House

11

Karen McCormick

karenforco.com

State House

12

Tracey Bernett

traceybernett.com

State House

13

Judith Amabile

judyamabile.com

State House

14

John Foley

foleyforhd14.org

State House

17

Tony Exum

www.tonyexum.com

State House

18

Mark Snyder

www.snyderforcolorado.com

State House

20

Terri Carver

terricarver.org

State House

21

Mary Bradfield

www.marybradfield.com

State House

21

Liz Rosenbaum

www.lizrosenbaum.com

State House

22

Mary Parker

parkerforcolorado.com

State House

23

Chris Kennedy

www.kennedy4co.com

State House

24

Monica Duran

www.monicaduran.com

State House

25

Lisa Cutter

www.cutterforcolorado.com

State House

26

Dylan Roberts

www.dylanroberts.org

State House

27

Brianna Titone

www.briannaforco.com

State House

29

Lindsey Daugherty

www.lindseyforcolorado.com

State House

31

Yadira Caraveo

caraveoforcolorado.com

State House

33

Matt Gray

www.matthewgray.us

State House

34

Kyle Mullica

kylemullica.com

State House

35

Shannon Bird

www.shannonbirdforcolorado.com

State House

36

Mike Weissman

www.mikeweissman.com

State House

37

Caroline Cornell

www.carolineforcolorado.com

State House

37

Tom Sullivan

sullivanforcolorado.com

State House

38

David Ortiz

www.davidortizcolorado.com

State House

39

Ian Chapman

www.ianchapmancohd39.com

State House

40

Naquetta Ricks

www.ricks4co.com

State House

42

Dominique Jackson

jacksonforcolorado.com

State House

43

Kevin Van Winkle

vanwinkleforcolorado.com

State House

43

Jennifer Mitkowski

www.jennforcolorado.com

State House

46

Daneya Esgar

www.daneyaesgar.com

State House

47

Bri Buentello

www.bri4colorado.com

State House

48

Holly Herson

hollyfor48.com

State House

49

Yara Zokaie

www.yaraforcolorado.com

State House

50

Mary Young

maryyoungforcolorado.com

State House

52

Cathy Kipp

cathykipp.com

State House

54

Alice Marie Slaven-Emond

alicemarieforhd54.wordpress.com

State House

55

Scott Beilfuss

www.scottfor55.com

State House

57

Perry Will

 

State House

59

Barbara McLachlan

barbaramclachlan.com

State House

60

Lori Boydston

www.lorihd60.com

State House

61

Julie McCluskie

mccluskieforco.com

State House

63

Genevieve Schneider

genforhd63.com