Retirement insights from a Colorado PERA perspective

A distant view shows a mountainous landscape with sloping peaks, green trees in the foreground, and a cloudy sky above.

The first session of the 71st Colorado General Assembly ended on Wednesday, May 12. Six bills affecting PERA were introduced, two of which passed and are awaiting review before being sent to the governor. Three bills, all of which were opposed by the PERA Board of Trustees, failed in the House Committee on State, Veterans, &amp; Military Affairs. Another bill the PERA Board did not have the opportunity to vote on failed in the Senate Committee on Finance. A summary of that legislation is below.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



<a href="http://leg.colorado.gov/bills/hb17-1265">House Bill 17-1265</a>



PERA Judicial Division Total Employer Contribution



Concerning an increase in the total employer contribution for employers in the Judicial Division of the Public Employees&#8217; Retirement Association.



Summary:&nbsp;The Judicial Division Amortization Equalization Disbursement (AED) was capped at 2.20% in 2010. The Supplemental Amortization Equalization Disbursement (SAED) was capped at 1.50% in 2010. This bill would increase the AED and SAED to 3.4% each beginning in 2019 and increase each disbursement rate by .4% every year thereafter until they cap at 5% in 2023.



Sponsors:&nbsp;<a href="http://leg.colorado.gov/legislators/kc-becker" target="_blank" rel="noreferrer noopener">Rep. KC Becker</a>&nbsp;(D-Boulder) and&nbsp;<a href="http://leg.colorado.gov/legislators/dan-nordberg" target="_blank" rel="noreferrer noopener">Rep. Dan Nordberg</a>&nbsp;(R-Colorado Springs)&nbsp;|&nbsp;<a href="http://leg.colorado.gov/legislators/andy-kerr" target="_blank" rel="noreferrer noopener">Sen. Andy Kerr</a>&nbsp;(D-Lakewood) and&nbsp;<a href="http://leg.colorado.gov/legislators/kevin-priola" target="_blank" rel="noreferrer noopener">Sen. Kevin Priola</a>&nbsp;(R-Henderson)



Status: Passed by the legislature, pending review by the governor.



PERA Board position:&nbsp;Support



<hr class="wp-block-separator has-alpha-channel-opacity"/>



<a href="http://leg.colorado.gov/bills/hb17-1176" target="_blank" rel="noreferrer noopener">House Bill 17-1176</a>



PERA Retirees Employed By Rural School Districts



Concerning an extension of the employment after retirement limitations for retirees of the public employees&#8217; retirement association employed by a rural school district after retirement.



Summary:&nbsp;The bill modifies the current PERA employment after retirement provisions for certain retirees hired by an employer in the school division if:



<ul>
<li>The employer that hires the service retiree is a rural school district as determined by the department of education based on certain criteria and the school district enrolls 6,500 students or fewer in kindergarten through 12th grade;</li>



<li>The school district hires the service retiree for the purpose of providing classroom instruction or school bus transportation to students enrolled by the district or for the purpose of being a school food services cook; and</li>



<li>The school district determines that there is a critical shortage of qualified teachers, school bus drivers, or school food services cooks, as applicable, and that the service retiree has specific experience, skills, or qualifications that would benefit the district.</li>
</ul>



Sponsors:&nbsp;<a href="http://leg.colorado.gov/legislators/jon-becker" target="_blank" rel="noreferrer noopener">Rep. Jon Becker</a>&nbsp;(R-Fort Morgan) and&nbsp;<a href="http://leg.colorado.gov/legislators/barbara-mclachlan" target="_blank" rel="noreferrer noopener">Rep. Barbara McLachlan</a>&nbsp;(D-Durango) |&nbsp;<a href="http://leg.colorado.gov/legislators/jerry-sonnenberg" target="_blank" rel="noreferrer noopener">Sen. Jerry Sonnenberg</a>&nbsp;(R-Sterling)



Status:&nbsp;Passed by the legislature, pending review by the governor.



PERA Board position:&nbsp;Oppose



<hr class="wp-block-separator has-alpha-channel-opacity"/>



<a href="http://leg.colorado.gov/bills/hb17-1114" target="_blank" rel="noreferrer noopener">House&nbsp;Bill 17-1114</a>



State Treasurer&#8217;s Authority To Access PERA Information



Concerning the authority of the State Treasurer to access information kept by the Public Employees’ Retirement Association in the Treasurer’s capacity as a member of the Board of Trustees of the Association.



Summary:&nbsp;The bill requires the PERA Board and its Executive Director to provide to the Treasurer of the State of Colorado the ability to review all records and information retained by PERA upon request. The request can’t be denied for any reason.&nbsp;The State Treasurer is responsible for any reasonable costs, beyond de Minimis expenses, and the information or records shall not be used for personal reasons by the Treasurer.



Sponsors:&nbsp;<a href="http://leg.colorado.gov/legislators/justin-everett" target="_blank" rel="noreferrer noopener">Rep. Justin Everett</a>&nbsp;(R-Littleton) and&nbsp;<a href="http://leg.colorado.gov/legislators/jack-tate" target="_blank" rel="noreferrer noopener">Sen. Jack Tate</a>&nbsp;(R-Centennial)



Status:&nbsp;Postponed Indefinitely&nbsp;(<a href="http://leg.colorado.gov/committees/state-veterans-and-military-affairs/2017-regular-session" target="_blank" rel="noreferrer noopener">State, Veterans, &amp; Military Affairs</a>&nbsp;3/1/17)



PERA Board position:&nbsp;Oppose



<hr class="wp-block-separator has-alpha-channel-opacity"/>



<a href="http://leg.colorado.gov/bills/sb17-113" target="_blank" rel="noreferrer noopener">Senate Bill 17-113</a>



Cap Employer Contribution Rates For PERA



Concerning a requirement that the total employer contribution rates for Public Employees’ Retirement Association employers in the 2018 calendar year are the maximum total employer contribution rates for future calendar years.



Summary:&nbsp;The bill requires that for the calendar year beginning January 1, 2018, and for each calendar year thereafter, the total of the employer contribution, the AED, and the SAED for any employer will not exceed the total contribution rates for the 2018 calendar year pursuant to current law.



Sponsors:&nbsp;<a href="http://leg.colorado.gov/legislators/tim-neville" target="_blank" rel="noreferrer noopener">Sen. Tim Neville</a>&nbsp;(R-Littleton) and&nbsp;<a href="http://leg.colorado.gov/legislators/justin-everett" target="_blank" rel="noreferrer noopener">Rep. Justin Everett</a>&nbsp;(R-Littleton)



Status:&nbsp;Postponed Indefinitely&nbsp;(<a href="http://leg.colorado.gov/committees/state-veterans-and-military-affairs/2017-regular-session" target="_blank" rel="noreferrer noopener">State, Veterans, &amp; Military Affairs</a>&nbsp;3/1/17)



PERA Board position:&nbsp;Oppose



<hr class="wp-block-separator has-alpha-channel-opacity"/>



<a href="http://leg.colorado.gov/bills/sb17-158" target="_blank" rel="noreferrer noopener">Senate Bill 17-158</a>



Modify Composition Of PERA Board Of Trustees



Concerning modifications to the composition of the Board of Trustees of the Public Employees&#8217; Retirement Association.



Summary:&nbsp;The bill modifies the composition of the board by:



<ul>
<li>Eliminating one elected member trustee position from the state division;</li>



<li>Eliminating 2 elected member trustee positions from the school division;</li>



<li>Requiring at least one elected member from both the state division and the school division to be at least 20 years from retirement eligibility; and</li>



<li>Adding 3 more trustees appointed by the governor and confirmed by the senate who are not PERA members or retirees and who are experts in certain fields to replace the eliminated elected member trustee positions.</li>
</ul>



Sponsors:&nbsp;<a href="http://leg.colorado.gov/legislators/jack-tate" target="_blank" rel="noreferrer noopener">Sen. Jack Tate</a>&nbsp;(R-Centennial) and&nbsp;<a href="http://leg.colorado.gov/legislators/dan-nordberg" target="_blank" rel="noreferrer noopener">Rep. Dan Nordberg</a>&nbsp;(R-Colorado Springs)



Status:&nbsp;Postponed Indefinitely&nbsp;(<a href="http://leg.colorado.gov/committees/state-veterans-and-military-affairs/2017-regular-session" target="_blank" rel="noreferrer noopener">State, Veterans, &amp; Military Affairs</a>&nbsp;3/15/17)



PERA Board position:&nbsp;Oppose



<hr class="wp-block-separator has-alpha-channel-opacity"/>



<a href="http://leg.colorado.gov/bills/sb17-185" target="_blank" rel="noreferrer noopener">Senate Bill 17-185</a>



District Attorney Salary Compensation And PERA



Concerning the compensation of attorneys working in the office of a district attorney.



Summary:&nbsp;The bill allows the boards of county commissioners of the counties within a judicial district, in consultation with the district attorney, to make a one-time irrevocable election to require an assistant district attorney to become a member of the Public Employees&#8217; Retirement Association&#8217;s defined benefit plan. In such case, the state would pay 80% and the counties would pay 20% of the employer contribution for an assistant district attorney.



Sponsors:&nbsp;<a href="http://leg.colorado.gov/legislators/bob-gardner" target="_blank" rel="noreferrer noopener">Sen. Bob Gardner</a>&nbsp;(R-Colorado Springs) and&nbsp;<a href="http://leg.colorado.gov/legislators/matt-gray" target="_blank" rel="noreferrer noopener">Rep. Matt Gray</a>&nbsp;(D-Broomfield)



Status:&nbsp;Postponed Indefinitely&nbsp;(<a href="http://leg.colorado.gov/committees/finance/2017-regular-session-0" target="_blank" rel="noreferrer noopener">Finance</a>&nbsp;3/16/17)



PERA Board position: No position taken

2017 Legislative Session Wrap-Up

New website launched: PERAtour.org



PERA is kicking off a <a href="https://www.copera.org/changing-demographics-market-conditions-addressed-peratour" class="broken_link">statewide outreach initiative</a> with 12 meetings in nine locations statewide, and a new dedicated <a href="https://www.copera.org/changing-demographics-market-conditions-addressed-peratour" target="_blank" rel="noreferrer noopener" class="broken_link">website</a>. The purpose of the meetings, and the in-person and online conversations to follow, is to open up a factual conversation about PERA’s financial health and risk profile.



Recent changes to external conditions have increased PERA’s risk level for retirees, members, taxpayers, and communities around Colorado. Risk is related to the plan’s ability to withstand a catastrophic economic event such as the 2008-2009 recession. The risk profile increases along with the plan’s vulnerability to a major economic downturn. To remain sustainable, it is important that PERA remain resilient and able to withstand major ebbs and flows of the market.



Among the factors influencing PERA’s funded status are a population living longer and a financial market yielding lower returns on investments. Between 2000 and 2014, life expectancy of the PERA population increased by around one year to the age of 78. While that may not sound like a big gain, the impact is much greater increases when considered for the entirety of the PERA membership.



While PERA has achieved a 9.5 percent return on investments over a 35-year time period, the last several years have been more challenging. In 2015, (the latest year for which PERA has audited financial returns), PERA earned a 1.5 percent return on investments. Despite the lower absolute number, that return was still above the benchmark for the fund. That said, the next few decades may not yield the same type of returns as experienced in the past, thus the Board has lowered the expected rate of return to account for those expectations.



Since its founding in 1931, PERA has had to adapt as new circumstances and situations emerge. PERA’s prior experience has shown that the time to plan for any changes is before a crisis hits. While PERA is in a very different situation than in 2008, the time to act is now.



<a href="https://www.copera.org/changing-demographics-market-conditions-addressed-peratour" class="broken_link">PERAtour</a>, a statewide conversation, will visit nine areas of the state and host 12 public meetings with members and stakeholders between now and the end of June, with plans to continue the conversation in the fall. PERA staff will address the current situation and engage participants in discussion about guiding principles and potential changes.



The feedback from these meetings and conversations, as well as ideas from policymakers and other stakeholders, will be consolidated and reviewed by the PERA Board of Trustees to inform any deliberations about changes to the PERA plan design. All members, retirees, taxpayers, and interested citizens are invited to join in this very important conversation.



<ul>
<li>Visit <a href="https://www.copera.org/changing-demographics-market-conditions-addressed-peratour" target="_blank" rel="noreferrer noopener" class="broken_link">peratour.org</a> to follow the tour, explore the issues, and find a community meeting.</li>



<li>Attend an in-person community meeting—no reservations are needed.</li>



<li>Get in touch—PERA is here to listen. Email peratour@copera.org, or call the dedicated PERAtour phone number at 720-213-7970.</li>
</ul>



PERA issues impact not just our members and retirees, but <a href="https://www.copera.org/changing-demographics-market-conditions-addressed-peratour" class="broken_link">communities across Colorado</a>. Given the significant footprint of PERA, it is important to have a variety of voices involved in a conversation about potential changes to the plan that will ensure PERA can maintain a sustainable retirement for Colorado’s public employees.

Changing demographics, market conditions addressed in PERAtour

Colorado PERA is embarking on an effort to inform and listen to members, retirees, employers, and taxpayers about reducing PERA’s risk profile while maintaining a <a href="https://www.copera.org/retirement-roundup-best-places-retire" class="broken_link">sustainable retirement</a> for Colorado’s public employees and strengthening the <a href="https://www.copera.org/changing-demographics-market-conditions-addressed-peratour" class="broken_link">Colorado economy</a>. Two telephone town hall meetings have been scheduled for members and retirees, followed by 12 community meetings statewide.



This engagement effort follows the regular and rigorous <a href="https://www.copera.org/impact-assumption-changes" class="broken_link">review process</a> of PERA’s actuarial assumptions started last year, when the PERA Board adopted new mortality tables to reflect longer life expectancies, and lowered the expected investment rate of return to better reflect anticipated market conditions. Although PERA remains stable and solvent, able to pay all benefits in perpetuity, these changing economic and demographic conditions have extended the period until PERA reaches full-funded status, increasing the risk facing members, taxpayers, and Colorado.



Additional information:



<ul>
<li><a href="https://content.copera.org/actuarial-impact-analysis/">The Impact of Assumption Changes</a></li>



<li><a href="https://www.copera.org/telephone-town-halls-community-outreach-tour-announced" class="broken_link">Actuarial Impact Analysis</a></li>



<li><a href="https://www.copera.org/actuarial-impact-analysis" class="broken_link">More on the Impact of Assumption Changes</a></li>
</ul>



Telephone Town Hall



To ensure PERA remains resilient and built for future generations of Colorado public employees, the telephone town hall will start the conversation about PERA’s funded status and how demographic and economic changes influence overall risk. Greg Smith, PERA Executive Director, will hold an interactive telephone town hall meeting to talk about:



<ul>
<li>The external conditions influencing PERA’s funded status</li>



<li>The community outreach tour</li>



<li>Ways to join the conversation</li>
</ul>



On April 27, retirees (at 2:00 p.m.) and active members (at 7:00 p.m.) will automatically be called and able to participate in the town hall. More information is available <a href="https://www.copera.org/telephone-town-hall-frequently-asked-questions-3-2" class="broken_link">here</a>. A recording of both calls will be available following the telephone town halls.



Community Outreach Tour



Beginning in May and into June, PERA will conduct a statewide community outreach tour to engage all stakeholders in conversations about the issues and gather input on options to adapt PERA to a growing Colorado and changing environment. No reservation is required and everyone is invited to attend.



Aurora



June 1 | 6:00 p.m.



Summit Event Center,&nbsp;411 Sable Boulevard



Boulder



May 31 | 6:00 p.m.



Boulder JCC,&nbsp;6007 Oreg Avenue



Colorado Springs



May 4 | 2:00 p.m. and 6:00 p.m.



Colorado Springs Marriott,&nbsp;5580 Tech Center Drive



Denver



May 15 | 2:00 p.m. and 6:00 p.m.



PPA Event Center,&nbsp;2105 Decatur Street



Durango



June 7 | 6:00 p.m.



Holiday Inn &amp; Suites,&nbsp;21636 Highway 160 West



Fort Collins



May 18 | 2:00 p.m. and 6:00 p.m.



Lincoln Center,&nbsp;417 W Magnolia Street



Grand Junction



June 5 | 6:00 p.m.



Clarion Inn,&nbsp;755 Horizon Drive



Greeley



May 8 | 6:00 p.m.



Island Grove Event Center,&nbsp;421 N 15th Avenue



Pueblo



May 11 | 6:00 p.m.



Pueblo Convention Center,&nbsp;320 Central Main Street


<div class="wp-block-image">
<figure class="alignleft"><a href="https://content.copera.org/pera-signal-light-divisions-orange-mean/"><img decoding="async" src="https://content.copera.org/telephone-town-halls-community-outreach-tour-announced/"PERA Tour" class="wp-image-1411"/></a></figure></div>

Telephone Town Halls and Community Outreach Tour Announced

In light of the PERA Board adopting <a href="https://www.copera.org/actuarial-impact-analysis" class="broken_link">changes in economic and demographic assumptions</a>, the PERA Board of Trustees received updated information from their actuaries regarding the length of time it will take to become fully funded, and the impact of various options to reduce the risk to PERA members and the system. It is important to note that all major Divisions are stable, solvent, and able to pay all benefits in perpetuity, but the changing conditions have resulted in <a href="https://content.copera.org/actuarial-impact-analysis/">amortization periods</a> that exceed the Board’s policy of 30 years.



Any benefit and contribution changes to Colorado PERA require a majority vote in both houses of the General Assembly and the Governor’s signature. While the Board has not made any decisions on recommendations for changes, the Board believes it is prudent to start looking at what options exist to shorten the amount of time it takes to become fully funded.



The PERA Board takes very seriously its fiduciary responsibility to all members and retirees, and will continue to provide factual information and data to inform conversations and decision-making. PERA will be leading stakeholders through a process to discuss its funded status and explore options related to contribution and benefit changes. <a href="https://peraontheissues.com/wp-content/uploads/2017/01/Stakeholder-Outreach-Agenda-1.pdf">This process</a> will take place over the next year so there will be plenty of opportunities to get involved. The following presentation was delivered to the Board on January 20 and explores three scenario categories, each with multiple variables, and the expected change to the current amortization period if adopted. Categories include:



<ul>
<li>Contribution changes</li>



<li>Plan design</li>



<li>Economic experience</li>
</ul>



The presentation may be viewed <a href="https://peraontheissues.com/wp-content/uploads/2017/01/Actuarial-Impact-Analysis-Presentation-1.pdf">here</a>.



Review The Impact of PERA’s Assumption Changes <a href="https://content.copera.org/actuarial-impact-analysis/">fact sheet</a>.



We look forward to engaging all stakeholders in the coming year and welcome your comments below.

Actuarial Impact Analysis

PERA addresses new economic and demographic realities.



The PERA Board of Trustees met on Friday, January 20, and received updated information from their actuaries regarding the trust funds’ amortization period, or the amount of time it will take for each division trust to become fully funded. This action follows the regular and rigorous review process started late last year when the Board adopted new mortality tables to reflect longer life expectancies, and lowered the expected rate of return to better reflect anticipated market conditions.



The new amortization periods increased between 14 years to 31 years, depending on the Division. This increase is on top of the approximately 40-year amortization periods that existed at the end of 2015. The new projections show that PERA is able to pay benefits over the extended time period, but may not be able to withstand a significant market downturn (like in 2008-2009). Changes in demographics (people are living longer) and economics (expected market returns) have extended the period until PERA reaches full-funded status, increasing the risk facing members, taxpayers, and Colorado.



<blockquote class="wp-block-quote">
All major Divisions are stable, solvent, and able to pay all benefits in perpetuity. While economic and demographic conditions have changed, this is not 2009 and PERA is not running out of money.
</blockquote>



The amortization period of the Judicial Division is much longer than other divisions. It is expected legislation will be introduced this year to address the Judicial Division’s funded status. The Judicial Division is PERA’s smallest member division with 700 active, inactive, and retired members.



The continued health of PERA is vital for the security of our members and the economic stability of communities throughout Colorado. To ensure PERA’s sustainability, the PERA Board has directed staff to embark on an effort to educate and engage a range of stakeholders on the topic of PERA’s funded status and what might be done to improve it. This effort will take place during the course of the year and there will be ample opportunities for members, policy makers, taxpayers and others to participate. More information will be forthcoming.



<ul>
<li>See the <a href="https://content.copera.org/actuarial-impact-analysis/">previous PERA on the Issues article</a> on the impact of assumption changes.</li>



<li><a href="https://peraontheissues.com/wp-content/uploads/2017/01/Stakeholder-Outreach-Agenda-1.pdf">Stakeholder Outreach Agenda</a></li>
</ul>



Important terms for understanding PERA’s amortization period:



<ul>
<li>Amortization period – the time it will take to achieve 100 percent funded status.</li>



<li>Solvent – the trusts have enough money to pay benefits throughout the amortization period.</li>



<li>Insolvent – the trusts are projected to be depleted in the future.</li>



<li>Exhaustion – same as insolvent; the trusts are projected to be depleted in the future.</li>
</ul>



PERA on the Issues posts are written and compiled by the staff of Colorado PERA under the direction of Executive Director Greg Smith and the PERA Board of Trustees. We encourage you to comment with your thoughts and feedback.

More on the Impact of Assumption Changes

Colorado PERA Chief Investment Officer Jennifer Paquette was named a finalist in the <a href="https://www.copera.org/colorado-pera-chief-investment-officer-honored" class="broken_link">Chief Investment Officer 2016 Industry Innovation Awards</a>. She was among several Chief Investment Officers honored at a recent event in New York City. Finalists and winners were chosen by the CIO editorial team in conjunction with an advisory board of former and current CIOs.



Public Defined Benefit Plan $15 Billion to $100 Billion Finalists



Colorado Public Employees’ Retirement Association (Jennifer Paquette)



Employees Retirement System of Texas (Tom Tull)



Healthcare of Ontario Pension Plan (Jim Keohane)



Iowa Public Employees’ Retirement System (Karl Koch)



Ontario Municipal Employees’ Retirement System (Michael Latimer)



Public Employees’ Retirement System of Nevada (Stephen Edmundson)



“Being named as a finalist serves as welcome recognition of the great investment team and program at Colorado PERA which I have been honored to lead over the years,” said Jennifer Paquette. “Being chosen as a finalist is a memorable moment in my career at PERA.”



<a href="https://content.copera.org/colorado-pera-chief-investment-officer-honored/">Paquette has announced her retirement</a> from PERA in early 2017. A nationwide search is underway for her replacement.

Colorado PERA Chief Investment Officer Honored

PERA’s Trustees have a duty to act as <a href="https://www.copera.org/2018-board-election-underway" class="broken_link">fiduciaries</a> for members by law when fulfilling their responsibilities. The complex nature of managing a $44 billion investment fund and administering benefits for over 500,000 members means the Trustees must establish rules of governance to ensure that each decision is made in the best interests of PERA’s members and benefit recipients. The PERA Board of Trustees adopted a <a href="https://peraontheissues.com/wp-content/uploads/2016/09/GovernanceManual9-17-1.pdf" target="_blank" rel="noreferrer noopener">Governance Manual</a>&nbsp;to provide a sound framework for the Board’s mandate to set policy and oversee the programs and operations of PERA.



The National Conference on Public Employee Retirement Systems (<a href="http://www.ncpers.org/Files/2012_ncpers_best_governance_practices.pdf">NCPERS</a>) and the Government Finance Officers Association (GFOA), two leading associations in the public pension field, both encourage having a governance manual. The GFOA <a href="http://www.gfoa.org/sites/default/files/CORBA_GOVERNANCE_OF_PUBLIC_EMPLOYEE_POSTRETIREMENT.pdf">asserts</a> that “a good governance structure establishes the framework for effective plan administration.”



An <a href="https://www.copera.org/peras-best-practices-governing-44-billion-fund" class="broken_link">article</a> from the <a href="http://www.sustainablefinancialmarkets.net/">Network for Sustainable Financial Markets</a> regarding pension fund governance cites a study showing that “good governance is associated with increased returns.” The study found that pension funds that are better governed outperformed poorly governed funds by 2.4 percent during a period preceding 2003.



PERA’s Governance Manual was first developed in 2001 and is updated on a regular basis as changes in governance standards change. At the time, PERA was one of the first public retirement systems to adopt an overarching, comprehensive governing document. The PERA Board is a policy board, meaning that decisions about the everyday operations of PERA are delegated to the professional staff at PERA – whether it is the investment of the trust fund dollars, or the administration and provision of benefits – under the policy guidelines set forth by the Board of Trustees.



The manual includes charters for the Board, committees of the Board, officers of the Board, and the Executive Director. The charters describe the roles and responsibilities of these decision-making bodies that are involved in the governance and management of PERA. By incorporating various requirements from PERA’s governing statutes and rules, the Board is sure to comply with its fiduciary duties required by law.



The manual also includes governance polices adopted by the Board regarding communications, education, ethical conduct, and performance evaluation. These policies provide specific guidance to the Board and senior management on how they are to undertake their duties, and set out the expectations of the Board concerning its own conduct and that of individual Trustees.



If you would like to learn more about the policies that guide the operation of and decision-making for PERA, we invite you to explore the <a href="https://peraontheissues.com/wp-content/uploads/2016/09/GovernanceManual6-16-1.pdf">Governance Manual</a>. Additional policies and documents that assist the PERA Board and staff in fulfilling their duties may be found in the <a href="https://www.copera.org/good-governance-is-standard-practice-for-colorado-pera" class="broken_link">Colorado PERA Statement of Investment Policy</a>, the <a href="https://www.copera.org/despite-changes-in-accounting-standards-pera-remains-on-track" class="broken_link">Colorado PERA Defined Benefit Pension Plan Funding Policy</a>, the <a href="https://content.copera.org/peras-best-practices-governing-44-billion-fund/">Total Compensation Philosophy Statement</a>, and the Board’s <a href="https://www.copera.org/pera-board-of-trustees-updates-divestment-policy-statement" class="broken_link">Statement on Divestment</a>.



Colorado PERA provides retirement and other benefits to more than 547,000 current and former teachers, State Troopers, corrections officers, snow plow drivers, and other public employees who provide valuable service to all of Colorado. PERA is a vital and stable contributor to Colorado’s economy, distributing $3.7 billion in 2015 to retirees who live in Colorado. PERA is one of Colorado’s best investments.

PERA’s Best Practices – Governing a $44 Billion Fund

Colorado PERA has been named Best Public Pension Plan by the <a href="https://www.copera.org/colorado-pera-named-best-public-pension-plan" target="_blank" rel="noreferrer noopener" class="broken_link">2016 Markets Choice Awards</a>, hosted by <a href="http://marketsmedia.com/" target="_blank" rel="noreferrer noopener">Markets Media</a>.



PERA was recognized for its innovation and leadership among public pension funds, drawing accolades from market experts for being ahead of most of its public pension peers in trading, technology, and market structure savvy.



The Markets Choice Awards recognize excellence among the firms and individuals that are the lifeblood of financial markets, including exchanges, sell-side desks, institutional buy-side investors, hedge funds, and technology providers. Winners were selected through a digital voting process at marketsmedia.com, interviews with senior market participants, and consultation with Markets Media’s Advisory Board.



“As fiduciaries for public employees whose investment horizons can span many decades, we are truly long-term investors,” said PERA Executive Director Gregory W. Smith.&nbsp; “Our results over the past five and ten years are evidence of our ability to manage for long-term performance. We appreciate that our strategic approach and consistent returns are being recognized by market leaders,” he added.



<blockquote class="wp-block-quote">
“We consider opportunity and innovation in the context of what we think is going to be valuable in the long term, not just what is popular today,” added PERA Chief Investment Officer Jennifer Paquette.&nbsp;<a href="http://marketsmedia.com/pioneering-pension/" target="_blank" rel="noreferrer noopener">Read</a> the profile of Ms. Paquette in the July 2014 issue of MarketsMedia.
</blockquote>



PERA currently invests in five primary asset classes of global equity, fixed income, private equity, real estate, and an <a href="https://www.copera.org/asset-class-in-depth-real-estate" class="broken_link">opportunity fund</a> that is comprised of investments that do not fit into the other asset classes.

Colorado PERA Named Best Public Pension Plan

Public retirement associations join elected officials, state and local governments to oppose pension requirements within Puerto Rico Assistance Act.



A broad coalition including public pension advocates, state and local government associations, employer groups, and elected officials has come out against proposed federal legislation, the <a href="https://www.copera.org/puerto-rico-and-pensions" target="_blank" rel="noreferrer noopener" class="broken_link">Puerto Rico Assistance Act of 2015</a> (S. 2381), because of a heavy burden the Act would place on public pensions.



Though the Act is primarily focused on unique concerns affecting Puerto Rico, it contains provisions that would impose a federal mandate on state and local government retirement systems that is not warranted and has not been requested.



The provisions included within the Act that would impact retirement systems “are conflicting, administratively burdensome and costly,” the coalition wrote to Senate Majority Leader Mitch McConnell.



Further, the groups wrote, “the provisions are not germane to the underlying legislation, nor do they protect benefits, save costs or improve retirement system funding.”



As the letter from the coalition explains, state and local government pensions have taken significant steps to strengthen their pensions and be sustainable over a long-term time horizon.



“Since 2009, every state has made changes to pension benefit levels, contribution rate structures, or both,” the letter says.



Read the <a href="https://peraontheissues.com/wp-content/uploads/2016/02/PPN-Letter-to-McConnell-on-S-2381-1.pdf" target="_blank" rel="noreferrer noopener">coalition’s letter</a> and review a fiscal fact sheet about state and local governments.



See also <a href="https://www.copera.org/puerto-rico-and-pensions" class="broken_link">Five Years After the Great Recession, PERA Continues Progress Toward Full Funding</a> to learn more about changes implemented by Colorado PERA since 2010.

Puerto Rico and Pensions?

A recent study of retirement plan design shows Colorado PERA is more efficient and uses dollars more effectively than other types of plans in use today.&nbsp;Three simple charts summarize the findings.



Read the <a href="https://www.copera.org/independent-report-finds-pera-efficient-and-effective" target="_blank" rel="noreferrer noopener" class="broken_link">Gabriel, Roeder, Smith &amp; Company report</a> on PERA’s income replacement in retirement efficiency and cost effectiveness.

Tag Archives: