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Member, Beacon International Group, Ltd.
DENVER—Legislation that would shore up the finances of the state Public Employee Retirement Assn. is awaiting Colorado Gov. Bill Ritter's signature after passing the Colorado House by a 36-29 vote.
The governor has 10 days to act on S.B. 1, which the Colorado Senate approved Feb. 1 in a 25-10 vote and the state House left unchanged when it approved the bill Tuesday.
Among other things, the legislation would raise the retirement age from 55 to 60 for all but school district employees for those hired after Jan. 1, 2011. It also would require employees to complete at least 30 years of service instead of 25 before being eligible for full retirement benefits.
The new retirement age for school district employees would be raised to 58 from 50 or 55 for new hires after Jan. 1, 2017, and they would have to have at least 30 years of service.
All PERA members would continue to be permitted to retire at the current younger ages, but they would receive reduced benefits as part of the effort to shore up PERA's finances.
The bill also would increase contributions from school district employers by 1.5% of payroll and contributions from school district employees by 2.5% of salary. All other state employers that are members of PERA would pay another 2% of payroll, while their employees would pay an additional 2% of their salaries.
The bill would reduce cost-of-living increases from the current 3.5% to 2% in 2011, with no increase this year.
PERA's assets fell from $41.4 billion in December 2007 to $29.5 billion in July 2009 because of the economic crisis and stock market downturn, according to a July 2009 report to the Legislative Audit Committee. As a result, PERA faces $27.5 billion in unfunded liabilities, the report stated.