
<p>Retirement insights from a Colorado PERA perspective</p>



<p></p>


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


<p>The PERA Board of Trustees met in Denver on Jan. 20 for its first meeting of 2023.</p>



<p>Trustees discussed the 2023 PERA-related legislative landscape, continued work on the Board’s strategic vision for the future, and heard updates from PERA staff.</p>



<h4 class="wp-block-heading"><strong>Legislative update</strong></h4>



<p>The 2023 legislative session kicked off earlier this month, and the Board’s agenda included discussing recently introduced legislation pertaining to PERA.</p>



<p>One such bill, <a href="https://leg.colorado.gov/bills/sb23-056" target="_blank" rel="noreferrer noopener">SB23-056</a>, would require the state to make an additional payment of $35,050,000 to PERA. That amount, in addition to the amount included in <a href="https://peraontheissues.com/colorado-lawmakers-pass-bill-making-up-225m-payment-to-pera/" target="_blank" rel="noreferrer noopener">HB22-1029</a> from last year, is meant to fully recompense PERA for the state’s <a href="https://www.copera.org/recap-of-pera-boards-january-2023-meeting" target="_blank" rel="noreferrer noopener" class="broken_link">direct distribution payment of $225 million</a>, missed in 2020. The Trustees support efforts to increase funding to PERA.</p>



<p>Two other bills concern PERA’s investments: <a href="https://leg.colorado.gov/bills/sb23-016" target="_blank" rel="noreferrer noopener">SB23-016</a> would require the PERA Board to adopt a proxy voting policy that ensures any voting decisions align with the state’s greenhouse gas emission reduction goals, as well as require PERA to include in its annual <a href="https://www.copera.org/investment-stewardship" target="_blank" rel="noreferrer noopener"><em>Investment Stewardship Report</em></a> a description of climate-related investment risks, impacts and strategies. <a href="https://leg.colorado.gov/bills/hb23-1092" target="_blank" rel="noreferrer noopener">HB23-1092</a> would require PERA staff to make investment decisions solely on financial factors and would prohibit consideration of social, political, or ideological interests. The PERA Board opposes efforts to restrict PERA’s investment options or compel PERA to invest in a way that prioritizes a policy outcome over fiduciary duties.</p>



<p><a href="https://peraontheissues.com/2023-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">Click here</a> for a regularly updated list of PERA-related bills and their status.</p>



<h4 class="wp-block-heading"><strong>Strategic planning</strong></h4>



<p>The Board continued its yearlong process of developing a new strategic plan that will guide the work of the PERA Board and staff for the next half-decade. The plan’s goals will build on PERA’s mission and vision statements: To provide retirement security for our members while ensuring the sustainability of the fund, and to innovate and build on a tradition of service by being a trusted partner in order to meet the changing needs of our diverse membership.</p>



<p>The Board will continue working on a draft plan throughout the year, with the goal of adopting a new strategic plan for 2024 through 2029 by the end of the year.</p>



<h4 class="wp-block-heading"><strong>Market and portfolio update</strong></h4>



<p>Chief Investment Officer/ Chief Operating Officer Amy C. McGarrity provided the Board with a market and portfolio update, in which she presented details on economic conditions and PERA’s investments.</p>



<p>While McGarrity did not have final details on PERA’s investment performance in 2022, she noted that markets had a rough year in 2022, ending the year with broadly negative returns.</p>



<p>As an investor in most markets, PERA can expect it is not immune from market downturns. As a long-term, perpetual investor, PERA remains strategically invested in the markets with the goal of earning a return over decades, McGarrity said. In fact, PERA’s most recent 30-year rate of return (through Dec. 31, 2021), which reflects many market ups and downs, is 9.0% (annualized, gross-of-fees).</p>



<blockquote class="wp-block-quote">
<p><strong>RELATED:</strong> <a href="https://peraontheissues.com/staying-the-course-peras-approach-to-market-volatility/" target="_blank" rel="noreferrer noopener">Staying the Course: PERA’s Approach to Market Volatility</a></p>
</blockquote>



<p>Full audited details on PERA’s investment performance for the year will be available with PERA’s <em>Annual Comprehensive Financial Report, </em>released in June.</p>



<h4 class="wp-block-heading"><strong>Chair/vice chair election</strong></h4>



<p>The Board concluded its meeting by voting on Board officers. &nbsp;Current Chair <a href="https://peraontheissues.com/meet-the-new-chair-of-peras-board/" target="_blank" rel="noreferrer noopener">Marcus Pennell</a> and Vice Chair <a href="https://peraontheissues.com/meet-the-new-vice-chair-of-peras-board-2/" target="_blank" rel="noreferrer noopener">Suzanne Kubec</a> were both re-elected to new two-year terms.</p>



<p>Four positions on the Board <a href="https://peraontheissues.com/candidacy-open-for-four-pera-board-seats-in-2023/" target="_blank" rel="noreferrer noopener">are up for election this year</a>, and candidacy is now open for those seats.</p>



<p>The next scheduled meeting of the Board of Trustees will take place on March 24, 2023.</p>


Recap of PERA Board’s January 2023 Meeting


<p>In late December, Congress passed a <a href="https://www.congress.gov/117/bills/hr2617/BILLS-117hr2617enr.pdf" target="_blank" rel="noreferrer noopener">$1.7 trillion spending bill</a> to keep the government funded through September. Included in that bill, now signed into law by President Biden, was a package of retirement-related reforms collectively known as the SECURE 2.0 Act.</p>



<p>SECURE 2.0 builds on the original SECURE Act from 2019, which aimed to improve access to retirement savings for all Americans.</p>



<p>There are nearly 100 provisions in SECURE 2.0. While most of them aren’t particular to public defined benefit plans like Colorado PERA, many of them could affect public sector workers and retirees who have money saved in a defined contribution account like a 401(k) or 457 plan.</p>



<p>Here are some of the major provisions included in the legislation and what they mean.</p>



<h4 class="wp-block-heading"><strong>Automatic enrollment in 401(k) plans</strong></h4>



<p>One of the biggest changes resulting from SECURE 2.0 will be automatically enrolling workers in their employer’s 401(k) plan starting in 2025. Unless they opt out, eligible employees will automatically contribute at least 3 percent of each paycheck to their retirement account, and that amount will increase by 1 percent each year until it reaches at least 10 percent (but not more than 15 percent). The mandatory 401(k) auto-enrollment provision will not apply to government plans like Colorado PERA.</p>



<h4 class="wp-block-heading"><strong>Student loan matching on retirement accounts</strong></h4>



<p>This provision is aimed at people who aren’t saving for retirement because they’re paying off student loans and can’t afford both. Beginning in 2024, employers will be allowed to match a worker’s student loan payments and deposit that money into their 401(k) or 457 plan account.</p>



<h4 class="wp-block-heading"><strong>Emergency savings accounts</strong></h4>



<p>Many Americans lack a dedicated savings account for emergency expenses and often end up tapping into their retirement savings to pay for unexpected costs. Under this provision, employers will be able (but not required) to automatically enroll workers in an emergency savings plan, with employees contributing no more than 3 percent of their salary on a Roth basis. The first four withdrawals from the account each year will be exempt from any fees or charges solely on the basis of such withdrawals.</p>



<h4 class="wp-block-heading"><strong>Changes to required minimum distributions (RMDs)</strong></h4>



<p>Under current law, retirees are required to start taking withdrawals (required minimum distributions, or RMDs) from retirement accounts like 401(k)s when they reach a certain age. The previous SECURE Act raised that age to 72 in 2019. SECURE 2.0 raises the age to 73 as of Jan. 1, 2023 (retirees who turned 72 in 2022 and already began taking RMDs will need to continue taking their RMDs). The RMD age will then rise to 75 in 2033. SECURE 2.0 also reduces the penalty for failing to take RMDs from 50 percent to 25 percent.</p>



<h4 class="wp-block-heading"><strong>New allowable distributions</strong></h4>



<p>Several provisions of SECURE 2.0 lay out new circumstances under which a person can withdraw money from their retirement account(s) before they’re retired without facing a penalty. The new rules allow for penalty-free withdrawals for personal or family emergencies (one distribution up to $1,000 per year), in domestic abuse cases (the lesser of $10,000, indexed for inflation, or 50 percent of the participant’s account), to pay for long-term care insurance (up to $2,500 per year) and for terminally ill patients.</p>



<h4 class="wp-block-heading"><strong>Retirement account lost-and-found</strong></h4>



<p>For workers who have held multiple jobs throughout their careers and left behind retirement accounts, it can be a challenge to find and claim those old accounts. It can be similarly difficult for plan administrators to find account holders who may have moved or changed names. This provision creates a nationwide database of retirement plans under the Department of Labor, allowing account holders to more easily find the contact information for plan administrators and claim their old accounts.</p>



<p><a href="https://www.help.senate.gov/imo/media/doc/secure_20sectionbysection.pdf" target="_blank" rel="noreferrer noopener">Click here</a> for a more detailed section-by-section explanation of each of the provisions in SECURE 2.0.</p>


What’s in SECURE 2.0?


<p><em>The 2023 Colorado General Assembly commenced January 9 and will continue for 120 days.</em></p>



<p><em>Below you’ll find summaries of proposed legislation affecting Colorado PERA. The status of each bill will be updated regularly.</em></p>



<p class="has-text-align-right">Last updated: June 7, 2023</p>



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



<h2 class="wp-block-heading"><a href="https://leg.colorado.gov/bills/sb23-056" target="_blank" rel="noreferrer noopener">SB23-056</a></h2>



<h3 class="wp-block-heading">Compensatory Direct Distribution To PERA</h3>



<p><strong>Summary:</strong> Requires the state to make an additional payment to PERA in an amount equal to $35,050,000 that, along with the payment required under <a href="https://peraontheissues.com/colorado-lawmakers-pass-bill-making-up-225m-payment-to-pera/" target="_blank" rel="noreferrer noopener">HB22-1029</a>, is meant to fully recompense PERA for the cancellation of a previously scheduled July 1, 2020, direct distribution of $225 million. The source of funds identified for this payment is the balance of the <a href="https://peraontheissues.com/2021-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">PERA payment cash fund</a>, with any remaining amount coming from the state&#8217;s general fund.</p>



<p><strong>Sponsors:</strong> <a href="https://leg.colorado.gov/legislators/chris-kolker" target="_blank" rel="noreferrer noopener">Sen. Chris Kolker</a>, <a href="https://leg.colorado.gov/legislators/shannon-bird" target="_blank" rel="noreferrer noopener">Rep. Shannon Bird</a></p>



<p><strong>Status: </strong>Passed; Gov. Jared Polis signed into law on June 2.</p>



<h2 class="wp-block-heading"><a href="https://leg.colorado.gov/bills/sb23-016" target="_blank" rel="noreferrer noopener">SB23-016</a></h2>



<h3 class="wp-block-heading">Greenhouse Gas Emission Reduction Measures</h3>



<p><strong>Summary:</strong> Would require the PERA Board to adopt a proxy voting policy that ensures any voting decisions align with the state’s greenhouse gas emission reduction goals, as well as require PERA to include in its annual <a href="https://www.copera.org/investment-stewardship"><em>Investment Stewardship Report</em></a> a description of climate-related investment risks, impacts and strategies. </p>



<p><strong>Sponsors:</strong> <a href="https://leg.colorado.gov/legislators/chris-hansen" target="_blank" rel="noreferrer noopener">Sen. Chris Hansen</a>, <a href="https://leg.colorado.gov/legislators/karen-mccormick" target="_blank" rel="noreferrer noopener">Rep. Karen McCormick</a>, <a href="https://leg.colorado.gov/legislators/emily-sirota" target="_blank" rel="noreferrer noopener">Rep. Emily Sirota</a></p>



<p><strong>Status:</strong> The Senate Finance Committee amended the bill Feb. 21 to remove the section pertaining to PERA&#8217;s proxy voting policy. Gov. Jared Polis signed the bill into law on May 11.</p>



<h2 class="wp-block-heading"><a href="https://leg.colorado.gov/bills/hb23-1092" target="_blank" rel="noreferrer noopener">HB23-1092</a></h2>



<h3 class="wp-block-heading">Limitating Use of State Money</h3>



<p><strong>Summary:</strong> Would require PERA staff to make investment decisions solely on financial factors and would prohibit consideration of social, political, or ideological interests. The PERA Board opposes efforts to restrict PERA’s investment options or compel PERA to invest in a way that prioritizes a policy outcome over fiduciary duties.</p>



<p><strong>Sponsor:</strong> <a href="https://leg.colorado.gov/legislators/rod-bockenfeld" target="_blank" rel="noreferrer noopener">Rep. Rod Bockenfeld</a></p>



<p><strong>Status:</strong> Postponed indefinitely</p>



<h2 class="wp-block-heading"><a href="https://leg.colorado.gov/bills/sb23-104" target="_blank" rel="noreferrer noopener">SB23-104</a></h2>



<h3 class="wp-block-heading">Denver Public Schools Division Employer Contribution Reduction</h3>



<p><strong>Summary:</strong> Would reduce the employer contribution rate of the Denver Public Schools Division of PERA from 10.4% to 7.15% of salary. The PERA Board opposes reductions in contributions while PERA has unfunded liabilities.</p>



<p><strong>Sponsors:</strong> <a href="https://leg.colorado.gov/legislators/james-coleman" target="_blank" rel="noreferrer noopener">Sen. James Coleman</a>, <a href="https://leg.colorado.gov/legislators/chris-hansen" target="_blank" rel="noreferrer noopener">Sen. Chris Hansen</a>, <a href="https://leg.colorado.gov/legislators/jennifer-bacon" target="_blank" rel="noreferrer noopener">Rep. Jennifer Bacon</a></p>



<p><strong>Status:</strong> Postponed indefinitely</p>



<h2 class="wp-block-heading"><a href="https://leg.colorado.gov/bills/hb23-1144" target="_blank" rel="noreferrer noopener">HB23-1144</a></h2>



<h3 class="wp-block-heading">Public Employees&#8217; Retirement Association Defined Benefit Plan Payments To Ex-Spouse</h3>



<p><strong>Summary: </strong>This bill seeks to make changes in state law regarding the division of PERA Defined Benefit Plan benefits in legal separation or dissolution of marriage or civil union actions. Parties to these actions in Colorado may enter into an agreement allocating a portion of the PERA Defined Benefit Plan benefits to the retiree’s former spouse.&nbsp; The bill would terminate benefits to the former spouse of a PERA retiree if the former spouse remarries.</p>



<p><strong>Sponsor:</strong> <a href="https://leg.colorado.gov/legislators/regina-english" target="_blank" rel="noreferrer noopener">Rep. Regina English</a></p>



<p><strong>Status:</strong> Postponed indefinitely</p>



<h2 class="wp-block-heading"><a href="https://leg.colorado.gov/bills/hb23-1176" target="_blank" rel="noreferrer noopener">HB23-1176</a></h2>



<h3 class="wp-block-heading">PERA Defined Contribution Plan School Personnel</h3>



<p><strong>Summary:</strong> Would create a new &#8220;flexible defined contribution plan&#8221; for new members of PERA&#8217;s School and Denver Public Schools divisions. The plan would be separate from the existing PERA Defined Contribution (DC) Plan, which is available to State and Local Government division employees, and would offer members the ability to elect their contribution rates. The PERA Board opposes the bill as introduced because of the costs associated with the proposal and the inability for PERA to administer such a plan as written due to its failure to meet federal rules for governmental plans.</p>



<p><strong>Sponsor:</strong> <a href="https://leg.colorado.gov/legislators/don-wilson" target="_blank" rel="noreferrer noopener">Rep. Don Wilson</a></p>



<p><strong>Status:</strong> Postponed indefinitely</p>



<h2 class="wp-block-heading"><a href="https://leg.colorado.gov/bills/sb23-163" target="_blank" rel="noreferrer noopener">SB23-163</a></h2>



<h3 class="wp-block-heading">Colorado Parks and Wildlife Officers Classified As State Troopers</h3>



<p><strong>Summary:</strong> Would reclassify wildlife officers and parks and recreation officers employed by Colorado Parks and Wildlife as safety officers for the purpose of determining their PERA benefits.</p>



<p><strong>Sponsors:</strong> <a href="https://leg.colorado.gov/legislators/perry-will" target="_blank" rel="noreferrer noopener">Sen. Perry Will</a>, <a href="https://leg.colorado.gov/legislators/iman-jodeh" target="_blank" rel="noreferrer noopener">Rep. Iman Jodeh</a>, <a href="https://leg.colorado.gov/legislators/mike-lynch" target="_blank" rel="noreferrer noopener">Rep. Mike Lynch</a></p>



<p><strong>Status:</strong> Passed; Gov. Jared Polis signed into law on June 6.</p>


2023 Proposed Legislation Status


<p><em>Below you’ll find summaries of proposed legislation affecting Colorado PERA. The status of each bill will be updated regularly.</em></p>



<p></p>



<p class="has-text-align-right">Last updated: June 8, 2022</p>



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<h2 class="wp-block-heading" id="hb22-1029"><a href="https://leg.colorado.gov/bills/hb22-1029" target="_blank" rel="noreferrer noopener">HB22-1029</a></h2>



<h3 class="wp-block-heading" id="compensatory-direct-distribution-to-public-employees-retirement-association">Compensatory Direct Distribution to Public Employees&#8217; Retirement Association</h3>



<p><strong>Bill summary:</strong> Lawmakers&nbsp;<a rel="noreferrer noopener" href="https://peraontheissues.com/pera-related-legislation-sent-to-governor/" target="_blank">enacted legislation</a>&nbsp;in 2020 to forego the annual $225 million payment to PERA during the height of the COVID-19 pandemic, when the General Assembly cut billions of dollars from the state budget. The state resumed payments in July 2021 but did not make up 2020’s payment. HB22-1029 calls for the state to make a payment of $380 million, which includes the $225 million plus prepayment of future direct distributions to PERA.</p>



<p><strong>Sponsors:</strong> <a href="https://leg.colorado.gov/legislators/shannon-bird" target="_blank" rel="noreferrer noopener">Rep. Shannon Bird</a>, <a href="https://leg.colorado.gov/legislators/shane-sandridge" target="_blank" rel="noreferrer noopener">Rep. Shane Sandridge</a>, <a href="https://leg.colorado.gov/legislators/chris-kolker" target="_blank" rel="noreferrer noopener">Sen. Chris Kolker</a>, <a href="https://leg.colorado.gov/legislators/kevin-priola" target="_blank" rel="noreferrer noopener">Sen. Kevin Priola</a></p>



<p><strong>Bill status:</strong> Signed into law.</p>



<p><strong>Position:</strong> As fiduciaries, the PERA Board supports restoring the missed direct distribution.</p>



<hr class="wp-block-separator"/>



<h2 class="wp-block-heading" id="hb22-1057"><a href="https://leg.colorado.gov/bills/hb22-1057" target="_blank" rel="noreferrer noopener">HB22-1057</a></h2>



<h3 class="wp-block-heading" id="public-employees-retirement-association-employment-after-teacher-retirement">Public Employees&#8217; Retirement Association Employment After Teacher Retirement</h3>



<p><strong>Bill summary:</strong> Under current law, PERA retirees are limited in how many days they can work after retirement without reducing their benefit. This bill would temporarily waive those limits for qualified service retirees working as substitute teachers in any school district while there are critical substitute teacher shortages.</p>



<p><strong>Sponsors:</strong> <a href="https://leg.colorado.gov/legislators/mary-bradfield" target="_blank" rel="noreferrer noopener">Rep. Mary Bradfield</a>, <a href="https://leg.colorado.gov/legislators/barbara-mclachlan">Rep. Barbara McLachlan</a>, <a href="https://leg.colorado.gov/legislators/rob-woodward">Sen. Rob Woodward</a></p>



<p><strong>Bill status:</strong> Signed into law.</p>



<p><strong>Position:</strong> Expanding working after retirement provisions to allow retirees to work without a reduction will increase PERA’s liabilities. As fiduciaries, pursuant to its funding policy, the PERA Board opposes legislation that increases liabilities or reduces contributions until PERA is fully funded.</p>



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<h2 class="wp-block-heading" id="hb22-1087"><a href="https://leg.colorado.gov/bills/hb22-1087" target="_blank" rel="noreferrer noopener">HB22-1087</a></h2>



<h3 class="wp-block-heading" id="special-district-director-retirement-benefits">Special District Director Retirement Benefits</h3>



<p><strong>Bill summary:</strong> Special district board members are considered employees of the special district, and under current law their compensation is subject to PERA contributions as PERA members (if the special district is an employer affiliated with PERA). This bill would exclude special district board members who begin their service on or after July 1, 2022 from being eligible for membership in PERA for the service as directors.</p>



<p><strong>Sponsor:</strong> <a href="https://leg.colorado.gov/legislators/edie-hooton" target="_blank" rel="noreferrer noopener">Rep. Edie Hooton</a>, <a href="https://leg.colorado.gov/legislators/andres-pico" target="_blank" rel="noreferrer noopener">Rep. Andres Pico</a></p>



<p><strong>Bill status:</strong> Signed into law.</p>



<p><strong>Position: </strong>The PERA Board does not have a position on this bill as it has no actuarial impact on the fund.</p>



<hr class="wp-block-separator"/>



<h2 class="wp-block-heading" id="hb22-1101"><a href="https://leg.colorado.gov/bills/hb22-1101" target="_blank" rel="noreferrer noopener">HB22-1101</a></h2>



<h3 class="wp-block-heading" id="public-employees-retirement-association-service-retiree-employment-in-rural-schools">Public Employees’ Retirement Association Service Retiree Employment in Rural Schools</h3>



<p><strong>Bill summary:</strong> This bill would expand provisions, currently scheduled to repeal on July 1, 2023, that allow PERA service retirees to work full-time as a teacher, school bus driver, or school food services cook, without a reduction in benefits, for a rural school district that has determined there is a critical shortage of qualified individuals for these positions. The bill eliminates the scheduled repeal date and adds school nurses and paraprofessionals to the list of eligible employees.</p>



<p><strong>Sponsors:</strong> <a href="https://leg.colorado.gov/legislators/barbara-mclachlan" target="_blank" rel="noreferrer noopener">Rep. Barbara MacLachlan</a>, <a href="https://leg.colorado.gov/legislators/marc-catlin" target="_blank" rel="noreferrer noopener">Rep. Marc Catlin</a>, <a href="https://leg.colorado.gov/legislators/jerry-sonnenberg" target="_blank" rel="noreferrer noopener">Sen. Jerry Sonnenberg</a>, <a href="https://leg.colorado.gov/legislators/rachel-zenzinger" target="_blank" rel="noreferrer noopener">Sen. Rachel Zenzinger</a></p>



<p><strong>Bill status:</strong> Signed into law.</p>



<p><strong>Position:</strong> Expanding working after retirement provisions to allow retirees to work without a reduction will increase PERA’s liabilities. As fiduciaries, pursuant to its funding policy, the PERA Board opposes legislation that increases liabilities or reduces contributions until PERA is fully funded.</p>


2022 Proposed Legislation Status


<p>The PERA Board of Trustees met for its last meeting of 2021 on Nov. 19. The Board heard updates from PERA staff and also discussed a number of important issues, several of which are summarized below.</p>



<h4 class="wp-block-heading"><strong>2022 Board election</strong></h4>



<p>The Board approved the calendar for the 2022 Board election, when four Board seats will be up for election. They are:</p>



<ul><li>Ramon Alvarado (State Division)</li><li>Ashley M. Smith (State Division)</li><li>Guillermo Barriga (School Division)</li><li>Cheryl Pattelli (Local Government Division)</li></ul>



<p>Candidacy packets will be available for interested parties beginning in January, and the election will be held in May.</p>



<h4 class="wp-block-heading"><strong>Member contribution interest rate</strong></h4>



<p>Every year, the PERA Board sets the <a href="https://www.copera.org/members/tax-deferred-interest" target="_blank" rel="noreferrer noopener">interest rate</a> paid on Defined Benefit (DB) Plan accounts. That interest rate is set at 3 percent for 2021 and is compounded annually.</p>



<p>If a PERA member leaves PERA-covered employment and requests a refund of their DB account, they receive their contributions and any applicable employer match plus the interest earned on that balance. If that member keeps their account with PERA, however, their balance will continue to accrue interest and the member will be eligible for a lifetime monthly benefit when they reach retirement eligibility.</p>



<p>After discussing the competitiveness of the interest rate and its effectiveness in encouraging members to keep their accounts with PERA, the Board voted to keep the interest rate at 3 percent for 2022.</p>



<h4 class="wp-block-heading"><strong>Board Governance Manual update</strong></h4>



<p>As part of the regular review of its governance framework, the Board voted to approve a number of changes to its Governance Manual, which outlines policies and other guidelines for how the Board oversees PERA’s operations. Some of the updates were minor and involved updating wording to align with current Board practice. Others involved updating PERA’s <a href="https://www.copera.org/recap-of-the-pera-boards-november-2021-meeting" target="_blank" rel="noreferrer noopener" class="broken_link">mission and vision statements</a>, which underwent review in 2020, and updating the Board’s standards of professional and ethical conduct.</p>



<p>The Governance Manual is <a href="https://www.copera.org/recap-of-the-pera-boards-november-2021-meeting" target="_blank" rel="noreferrer noopener" class="broken_link">available online here</a>.</p>



<h4 class="wp-block-heading"><strong>Legislative update</strong></h4>



<p>The Board also received an update on a draft bill calling for the legislature to make up its missed $225 million payment to PERA from 2020. That bill, <a href="https://peraontheissues.com/legislative-committee-seeks-to-make-up-missed-225m-payment-to-pera/" target="_blank" rel="noreferrer noopener">which we covered previously here</a>, passed Legislative Council review on Nov. 15, clearing the way for it to be introduced in the legislative session. Lawmakers are set to begin the regular session on Jan. 12, 2022. The Board’s next meeting is scheduled for Jan. 21, 2022.</p>


Recap of the PERA Board’s November 2021 meeting


<p><em>Editor’s note: On Monday, Nov. 15, the Legislative Council voted to approve the bill, clearing the way for it to be introduced during the regular legislative session, which is set to begin on Jan. 12. PERA On The Issues will continue to monitor the bill and will provide updates regarding its status during the session.</em></p>



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<p>The Colorado General Assembly’s Pension Review Commission on Tuesday voted to recommend a bill for the 2022 legislative session that would make up the legislature’s missed $225 million direct distribution payment to PERA from July 2020.</p>



<p>Lawmakers <a href="https://peraontheissues.com/pera-related-legislation-sent-to-governor/" target="_blank" rel="noreferrer noopener">enacted legislation</a> to forego the annual $225 million payment to PERA during the height of the COVID-19 pandemic, when the General Assembly cut billions of dollars from the state budget. The state resumed payments in July 2021 but did not make up 2020’s payment.</p>



<p>The Pension Review Commission’s draft calls for the state to make a payment totaling $303.57 million — $225 million plus estimated investment gains, had the money been invested — on July 1, 2022.</p>



<p>Lawmakers recommended using money from the state’s general fund to make the payment, though committee members also suggested using money from a new cash fund the legislature established during the <a href="https://peraontheissues.com/2021-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">2021 legislative session</a>. That fund, which currently has a balance of $380 million, is meant specifically for future payments to PERA.</p>



<p>The draft bill will head next to the Legislative Council before it could be introduced in the 2022 legislative session.</p>



<p>The $225 million direct distribution to PERA is part of a package of reforms enacted under Senate Bill 200 in 2018 and is meant to help PERA pay down its unfunded liability. Also included in Senate Bill 200 was the Automatic Adjustment Provision, which will trigger increases in employee and employer contributions to PERA and reductions to annual increases for benefit recipients in July 2022.</p>


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Recap of PERA Board’s January 2023 Meeting

What’s in SECURE 2.0?

2023 Proposed Legislation Status

2022 Proposed Legislation Status

Recap of the PERA Board’s November 2021 meeting

Legislative Committee Seeks to Make Up Missed $225M Payment to PERA

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