Colorado’s public pension system needs more money to remain viable. The Public Employees Retirement Association, or PERA, is the retirement benefit for teachers and other public employees. Right now, it’s only 58 percent funded. Senate Bill 200 is starting its journey through the legislature and it will need bipartisan support if it is going to pass.
Statehouse reporter Bente Birkeland spoke with Brian Eason of the Denver Post and Ed Sealover with the Denver Business Journal about the bill, and what’s at stake.
On the major sticking points lawmakers will need to address:
Eason: No. 1 it offers an option for folks to get into a 401(k) like plan. Currently some state employees do have that option, but this would expand it to all PERA members who are hired after 2020. Another issue is just how deep these cuts are going to be. Retirees already feel like they’ve given up a lot of money over the last seven years since the last reform effort. They’re going to be asked to sacrifice even more. Employers are going to be asked to chip in more into the fund, the Governor is going to be asked to chip in more.
Sealover: PERA’s interim director brought up one of the changes is essentially pushing up the retirement age to 65 for employees who are in the system who are under 46. He said, ‘look that’s going to get us sued because it’s unconstitutional and it’s probably a violation of the contract cause.’ You have Republicans who really want to push this forward and you have Democrats who really want to protect employee contributions.
On why this is important:
Eason: There’s about one in 10 Coloradans that are a member of PERA in some form, whether they’ve just been in PERA a few years, or a lifelong employee or retired. It’s 560,000 people, so this has serious impact.
Sealover: The need to fill this unfunded liability is taking away from transportation and education. People are getting tired of the state not spending in those areas. While ostensibly this is a problem with the state’s public pension system, this is everyone’s problem.
Capitol Coverage is a collaborative public policy reporting project, providing news and analysis to communities across Colorado for more than a decade. Fifteen public radio stations participate in Capitol Coverage from throughout Colorado.