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.

State lawmakers convened at the Capitol Building in Denver on January 8 to begin the 75th Colorado General Assembly. Over the course of 120 days, legislators will introduce and debate hundreds of bills that could become law.



As in past legislative sessions, a handful of those bills will be related to PERA and its members. We caught up with PERA Director of Public &amp; Government Affairs Michael Steppat ahead of the new session to get his perspective on what to expect.



<h2 style="color:#00793a;" class="wp-block-heading has-dartmouth-green-color has-text-color has-medium-font-size">What role does the State Legislature play in PERA?</h2>



While the PERA Board of Trustees is responsible for administering benefits and overseeing PERA’s investments, the Colorado General Assembly is responsible for many other aspects of PERA, such as contribution rates, benefit levels, providing oversight through various legislative committees, and setting the amount of the annual benefit increases that retirees receive.



It’s important to make sure lawmakers understand how PERA works and how legislation can potentially affect our funding progress. The majority of time spent in the weeks leading up to the start of the new session involves meeting with legislators and other stakeholders on PERA-related issues and potential legislation for the upcoming session.



<h2 style="color:#00793a;" class="wp-block-heading has-dartmouth-green-color has-text-color has-medium-font-size">How does the recent election impact PERA?</h2>



Due to term limits for state legislators in Colorado and just natural turnover, the previous election cycle and futures cycles include many individuals being elected for the very first time. This means it is an ongoing process to educate lawmakers on PERA-related issues. As is the case with most public policy issues, there are very few who are experts right out of the gate in every aspect of an issue and this is especially true with a state retirement system. There will certainly be incoming lawmakers with experience in finance or investments or actuarial science, but it is not common for someone to have experience in all aspects of a pension plan like PERA.



A primary focus, both year-round and following a recent election, is to meet with and educate lawmakers. To get a good sense of how quickly the state legislature turns over, just look at how many legislators are still part of the General Assembly who voted on Senate Bill 200 in 2018—it’s fewer than a dozen out of 100 total legislators.



<h2 style="color:#00793a;" class="wp-block-heading has-dartmouth-green-color has-text-color has-medium-font-size">We already have an idea of some of the PERA-related legislative issues lawmakers will be looking at this year. Can you tell us more about that?</h2>



Legislative work doesn’t only happen while the General Assembly is in session—throughout the summer and fall, various “interim” (the period when the legislature is not in regular session) committees meet and begin work on studying issues and drafting bills for the next session. This past September, the Pension Review Commission drafted two bills related to PERA.



The first, known as Bill A (until it is given a bill number after being officially introduced), is identical to a <a href="https://leg.colorado.gov/bills/sb24-044" target="_blank" rel="noreferrer noopener">bill from last session</a> that would provide a temporary tax credit for PERA retirees to reduce the impact of inflation. The second, Bill B, would codify into state law certain reporting practices the PERA Board already performs on a regular basis and would modify the cadence of those reports.



READ MORE: <a href="https://www.copera.org/pera-on-the-issues/state-lawmakers-pursuing-two-pera-related-bills-in-2025" target="_blank" rel="noreferrer noopener">State Lawmakers Pursuing Two PERA-Related Bills in 2025</a>



In addition, there’s been discussion at the Capitol regarding a potential <a href="https://www.axios.com/local/denver/2024/11/13/pinnacol-privatize-polis-colorado" target="_blank" rel="noreferrer noopener">”conversion” of the State’s share of Pinnacol Assurance</a>, which is currently the State’s workers’ compensation insurer, after the proposal was included as part of the Governor’s budget request to the General Assembly last month. The proposed conversion has two main aspects related to PERA that were both included in the budget request. The first is that if Pinnacol becomes a private entity, then it cannot continue to be part of PERA both for current and future employees, and it would have to disaffiliate from PERA. The second involves using the proceeds from the sale of Pinnacol to offset the State’s $225m ‘direct distribution’ payment to PERA in future years.



<h2 style="color:#00793a;" class="wp-block-heading has-dartmouth-green-color has-text-color has-medium-font-size">Aside from PERA-related topics, what are some other legislative priorities lawmakers will likely be pursuing this year?</h2>



A top priority for the Legislature this session will be <a href="https://www.axios.com/local/denver/2024/12/02/colorado-budget-writers-warn-cuts-2025" target="_blank" rel="noreferrer noopener">coming up with a balanced budget</a>. When Gov. Jared Polis submitted his budget proposal to the Joint Budget Committee, it included nearly $700 million in cuts to fill a projected funding gap. The Legislature ultimately develops the State budget, and they may have different ideas for how to make up the shortage, so we’ll be closely monitoring as that process plays out to see if there are implications to PERA.



It is important to note PERA benefits come out of the trust funds reserved for paying those benefits, which are funded through contributions from employees and their employers as well as investment returns.



<h2 style="color:#00793a;" class="wp-block-heading has-dartmouth-green-color has-text-color has-medium-font-size">At the federal level, a new Congress is just getting underway. What can we expect in Washington, DC?</h2>



The beginning of the year will be busy for Congress. The House and Senate convened on January 3, and President Trump will be sworn in for his second term on January 20. Then, Congress will begin confirmation hearings for Trump’s various nominees. With Republicans controlling the White House and both chambers of Congress, we can expect to see the party try to push through many of its legislative priorities on issues such as immigration, trade, and regulation. One policy issue at the federal level which does often impact PERA more than many others is changes to healthcare policy and we will continue to monitor what, if any, proposals come forward in that respect.



<h2 style="color:#00793a;" class="wp-block-heading has-dartmouth-green-color has-text-color has-medium-font-size">In the final days of the last Congress, legislators took the historic step of approving a bill to repeal Social Security’s Windfall Elimination Provision (WEP) and Government Pension Offset (GPO), and President Biden has since signed the bill into law. What’s the latest on that issue?</h2>



Congress had been trying to repeal or modify WEP and GPO for decades without success, but the political environment was just right to make it happen at the end of 2024. We were encouraged to see legislators take action to improve the retirement security of public employees and we’ll be watching closely to see how the repeal of those two federal provisions unfolds.



There’s still a lot we don’t know at this point—it’s unclear what the implementation of the Social Security Fairness Act will look like, and the Social Security Administration has yet to release any details. As written the bill should apply to Social Security benefits paid in 2024, so some retirees may be owed additional benefit payments, but we don’t yet know when that might happen.



<h2 style="color:#00793a;" class="wp-block-heading has-dartmouth-green-color has-text-color has-medium-font-size">What do you recommend to anyone who wants to get involved in the legislative process?</h2>



I always tell people the most important thing they can do is contact their&nbsp;<a href="https://leg.colorado.gov/legislators" target="_blank" rel="noreferrer noopener">legislators</a>&nbsp;about issues that are important to them. In addition, the General Assembly&nbsp;<a href="https://leg.colorado.gov/" target="_blank" rel="noreferrer noopener">website</a>&nbsp;has lots of great information. You can listen to&nbsp;<a href="https://leg.colorado.gov/content/committees" target="_blank" rel="noreferrer noopener">committee meetings</a>, view&nbsp;calendars, review the&nbsp;<a href="https://leg.colorado.gov/bills" target="_blank" rel="noreferrer noopener">status of a bill</a>, and sign up to testify at committee meetings.



And of course the biweekly <a href="https://www.copera.org/pera-on-the-issues/subscribe" target="_blank" rel="noreferrer noopener">PERA On The Issues&nbsp;newsletter</a> will have up-to-date information on any legislation that affects PERA.

What to Expect from the 2025 Legislative Session

The Colorado General Assembly wrapped up its legislative work in May, but there’s still plenty of activity happening at the State Capitol.



Every year in between legislative sessions, PERA appears before various legislative committees that oversee PERA and its financial health. It’s an important part of the ongoing review and oversight of PERA and an opportunity to engage with the legislators who can have a direct impact on PERA and its members.



While lawmakers won’t be introducing bills between now and January, they may begin work on new PERA-related legislation they intend to introduce in the next session.



Here’s a look at what to expect this summer and into the fall.



<blockquote class="wp-block-quote">
RELATED: <a href="https://peraontheissues.com/what-roles-do-the-general-assembly-and-board-play-at-pera/" target="_blank" rel="noreferrer noopener">What Roles Do the General Assembly and Board Play at PERA?</a>
</blockquote>



<h2 class="wp-block-heading">Pension Review Subcommittee</h2>



The state legislature created the Pension Review Subcommittee in 2018. It’s a subcommittee of the Pension Review Commission, which oversees PERA and the state’s police and firefighter pensions. The Pension Review Subcommittee is charged with reviewing PERA’s financial health and making recommendations to the larger Commission. The Subcommittee comprises four state lawmakers as well as 10 appointed members of the general public with financial experience or knowledge.



The Subcommittee held its first meeting of the year on July 17. Interim Executive Director and Chief Investment Officer Amy C. McGarrity and Public and Government Affairs Manager Michael Steppat gave the Subcommittee an update on PERA’s 2022 financial results and answered questions from Subcommittee members.



The Subcommittee may continue to hold meetings throughout the interim period, with PERA to provide information and answer questions as needed.



<h2 class="wp-block-heading">Legislative Audit Committee</h2>



The Legislative Audit Committee is next up, with a meeting scheduled for Aug. 7.



Every year, the state hires an independent auditor to audit PERA’s financial data and internal controls of the most recent <a href="https://peraontheissues.com/pera-board-releases-2022-annual-report/" target="_blank" rel="noreferrer noopener">Annual Comprehensive Financial Report</a>.&nbsp;The outside auditor will present its findings at the Legislative Audit Committee’s meeting. PERA staff will join PERA’s actuarial consultants at the meeting to discuss the plan’s finances and answer any questions.



<h2 class="wp-block-heading">Pension Review Commission</h2>



PERA also appears before the Pension Review Commission in between legislative sessions. The Commission has the responsibility of overseeing PERA and proposing legislation that could affect the plan and benefits. For example, the Pension Review Commission drafted bills in recent years to <a href="https://peraontheissues.com/2023-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">make up the state’s missed 2020 payment</a> of $225 million to PERA.



In addition to the various interim oversight committees, the legislature’s Joint Budget Committee and House and Senate Finance Committees hold annual meetings to discuss PERA’s finances. Those meetings are expected to take place prior to and immediately following the start of the next General Assembly, respectively. 



PERA On The Issues will be following the various interim activities and reporting on any noteworthy developments. Be sure to <a href="https://peraontheissues.com/subscribe" target="_blank" rel="noreferrer noopener">subscribe to our biweekly newsletter</a> to stay updated

PERA Oversight Underway at State Capitol Between Legislative Sessions

In our recent quiz about PERA benefits, there was one question that seemed to trip a lot of people up, and it had to do with the PERA Board of Trustees:



Which of the following is the PERA Board of Trustees responsible for setting?



<ul>
<li>A: Employee and employer contribution rates</li>



<li>B: Annual benefit increase amounts</li>



<li>C: Benefit eligibility requirements</li>



<li>D: All of the above</li>



<li>E: None of the above</li>
</ul>







The correct answer is E: None of the above. While the Board is tasked with overseeing PERA operations, it isn’t directly responsible for setting many of the benefits that members receive.



PERA governance and operations are split between three main entities: The state legislature, the PERA Board, and PERA staff.



<h2 class="wp-block-heading">The legislature and state law</h2>



The state legislature established PERA as an instrumentality of the state in 1931. PERA and its benefits continue to be governed under Title 24, Article 51 of the Colorado Revised Statutes, also known as <a href="https://copera.org/pera-law-2024" target="_blank" rel="noreferrer noopener">PERA Law</a>.



State statute lays out in detail the various provisions that determine who receives PERA benefits, when, and how much they receive, including:



<ul>
<li>Contribution amounts</li>



<li>How service credit can be accrued and purchased</li>



<li>Benefit options and eligibility</li>



<li>Annual benefit increases</li>
</ul>







Because the legislature is responsible for setting benefits, any changes to PERA benefits must also happen at the State Capitol. Change happens when lawmakers bring forth a bill, which then makes its way through the <a href="https://www.youtube.com/watch?v=WLOeY1h1TFo" target="_blank" rel="noreferrer noopener">legislative process</a> with a majority vote in the House and Senate, along with the governor’s signature. Neither the Board nor PERA staff have the power to change any of the provisions set in statute.



The legislature also conducts routine oversight of PERA. Various legislative panels meet regularly with PERA leadership and staff, including the Legislative Audit Committee, the House and Senate Finance Committees, the Joint Budget Committee, the Pension Review Commission and the Pension Review Subcommittee.



<h2 class="wp-block-heading">The PERA Board of Trustees</h2>



The <a href="https://www.copera.org/about/board-and-leadership" target="_blank" rel="noreferrer noopener">PERA Board</a> is made up of 16 members: three Trustees appointed by the Governor and confirmed by the Senate; four members from the School Division; three members from the State Division; one member from the Local Government Division; one Judicial Division member; two PERA retirees; a non-voting representative from the DPS Division; and the State Treasurer as an ex officio, voting member. As fiduciaries, the Board has a responsibility to act in the best interests of PERA members.



While the legislature sets benefits and other important plan provisions, the PERA Board is responsible for administering those benefits and overseeing PERA operations and management. The Board’s <a href="https://www.copera.org/about/board-of-trustees" target="_blank" rel="noreferrer noopener">Governance Manual</a>, which adheres to best practices in public pension governance, defines these responsibilities. They include:



<ul>
<li>Setting rules and policy for PERA administration</li>



<li>Establishing organizational priorities and strategies</li>



<li>Overseeing PERA’s investment program</li>
</ul>







The Board also reviews and releases various important reports each year. That includes the <a href="https://copera.org/annual-report" target="_blank" rel="noreferrer noopener">Annual Comprehensive Financial Report</a> (ACFR), which provides details about PERA’s financial status, funded status and membership statistics. The ACFR will be available following the Board’s June meeting.



<h2 class="wp-block-heading">PERA staff</h2>



While the legislature and Board establish policy and rules, PERA staff are responsible for administering plan benefits and managing day-to-day operations. PERA currently employs more than 300 people who work every day to meet the goals set out in the Board’s <a href="https://content.copera.org/wp-content/uploads/2024/05/strategic-plan.pdf" target="_blank" rel="noreferrer noopener">strategic plan</a>. Some of those duties include:



<ul>
<li>Processing employee and employer contributions</li>



<li>Managing PERA’s investments</li>



<li>Distributing retirement payments and other benefits</li>



<li>Member communications and education</li>
</ul>







Providing retirement and other benefits to more than 700,000 members is a big job, and it’s one we take seriously. The state legislature, PERA Board, and PERA staff all play important roles in making sure Colorado’s public employees will be able to receive reliable retirement income today and for generations to come.

What Roles Do the General Assembly and Board Play at PERA?

On Jan. 9, state lawmakers will convene at the Capitol in Denver for the 74th Colorado General Assembly. Over the course of the 120-day legislative session, lawmakers will introduce hundreds of bills that could ultimately change state law.



This year’s General Assembly will include dozens of new legislators. PERA’s Public &amp; Government Affairs Manager Michael Steppat will be helping those legislators get up to speed on all things PERA as the new session begins. We sat down with Steppat to discuss the upcoming session.



<h2 class="wp-block-heading has-medium-font-size">For those who aren’t familiar, can you explain your role at PERA and at the State Capitol?</h2>



I represent PERA at the Capitol. I monitor and report on legislative activity, build and maintain relationships with legislators and other stakeholders, and oversee lobbying efforts. I also serve as the liaison for legislative committee staff.



<h2 class="wp-block-heading has-medium-font-size">Tell us about some of the changes at the Capitol this year and the outreach you’ve been doing.</h2>



There are more than 30 new legislators at the statehouse this year, which is a large number even in a state like Colorado that has term limits. There have also been changes of leadership on some of the committees that provide PERA oversight. It will be important to make sure lawmakers understand how PERA works and the importance of recent legislation related to PERA.



In the days leading up to the start of the new session, I’ve been reaching out to all the newly elected legislators to introduce myself and let them know I’ll be a point of contact to help them with any questions and provide information as the session unfolds.



<h2 class="wp-block-heading has-medium-font-size">Why does PERA monitor and engage in the legislative process?</h2>



While the PERA Board of Trustees is responsible for administering benefits and overseeing PERA’s investments, the Colorado General Assembly is responsible for many other aspects of PERA, such as contribution rates, benefit levels, and the amount of the annual benefit increases that retirees receive.



PERA staff provide regular updates to the legislature so lawmakers can make informed decisions on issues that affect our members.



<h2 class="wp-block-heading has-medium-font-size">The legislative session is a busy time, but you’re active at the Capitol year-round. What kind of activities have taken place since the last legislative session?</h2>



There’s a lot of important work that happens after a session ends and before the next one begins. PERA leaders and staff routinely meet with and report to various legislative bodies that oversee PERA’s operations and financial health. Those groups include the legislature’s Joint Budget Committee and Joint Finance Committee, as well as the Pension Review Commission and the Pension Review Subcommittee.



In between sessions, there are also meetings held with various lawmakers and PERA stakeholders with an interest in PERA and the issues that can affect our members and retirees. PERA, its benefits, and legislative changes over the years can be a lot to learn, but it’s our goal to help educate stakeholders without overwhelming them.



<h2 class="wp-block-heading has-medium-font-size">What’s your advice for people who want to advocate for a particular bill or outcome at the legislature?</h2>



The most important thing people can do is contact their&nbsp;<a href="https://leg.colorado.gov/legislators" target="_blank" rel="noreferrer noopener">legislators</a>&nbsp;about issues that are important to them. In addition, the General Assembly&nbsp;<a href="https://leg.colorado.gov/" target="_blank" rel="noreferrer noopener">website</a>&nbsp;has lots of great information. You can listen to&nbsp;<a href="https://leg.colorado.gov/content/committees" target="_blank" rel="noreferrer noopener">committee meetings</a>, view&nbsp;calendars, review the&nbsp;<a href="https://leg.colorado.gov/bills" target="_blank" rel="noreferrer noopener">status of a bill</a>, and sign up to testify at committee meetings.



And of course the PERA On The Issues biweekly&nbsp;<a href="https://www.peraontheissues.com/subscribe" target="_blank" rel="noreferrer noopener">newsletter</a>&nbsp;will be up-to-date on any legislation that affects PERA. We also encourage people to sign up for the PERA Ambassadors newsletter.

Preparing for the 2023 Colorado Legislative Session

Editor&#8217;s note: Gov. Jared Polis signed this bill into law on June 7, 2022.



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



With just hours left in the legislative session, Colorado lawmakers gave final approval to a bill that will make up the state’s missed 2020 payment of $225 million to PERA.



The bill, <a href="https://leg.colorado.gov/bills/hb22-1029" target="_blank" rel="noreferrer noopener">HB22-1029</a>, now heads to Gov. Jared Polis for his signature.



Lawmakers&nbsp;<a href="https://peraontheissues.com/pera-related-legislation-sent-to-governor/" target="_blank" rel="noreferrer noopener">enacted legislation</a>&nbsp;to forego the $225 million direct distribution payment to PERA in 2020 during the early stages of the COVID-19 pandemic, when the General Assembly cut billions of dollars from the state budget. The state automatically resumed payments in 2021 — additional legislation would be required for the state to forego any future payments — but did not make up 2020’s payment.



Pending the governor’s signature on the bill, PERA will receive $380 million from the state. That amounts to a restoration of the missed $225 million direct distribution plus a prepayment of a portion of future direct distributions to PERA.



PERA will also receive 2022’s direct distribution of $225 million on July 1.



The $380 million will come from a cash fund the legislature <a href="https://peraontheissues.com/2021-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">set up in 2021</a>&nbsp;solely for future payments to PERA.



The bill was one of four PERA-related bills that lawmakers passed this session. For details on the other bills, vist <a href="https://www.copera.org/pera-on-the-issues" target="_blank" rel="noreferrer noopener">PERA on the Issues</a>.

Colorado Lawmakers Pass Bill Making Up $225M Payment to PERA

Update (May 11, 2022): This bill has passed. 



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



A bill that would make up the state’s missed 2020 payment of $225 million to PERA has begun making its way through the state legislature.



The Pension Review Commission, a legislative interim committee that is charged to study and develop proposed legislation concerning pension plans in the state, <a href="https://peraontheissues.com/legislative-committee-seeks-to-make-up-missed-225m-payment-to-pera/" target="_blank" rel="noreferrer noopener">made a recommendation</a> for this bill to be introduced in the 2022 legislative session. It was introduced early in the session, but did not move forward until the state budget had been finalized.



The House Finance Committee on Monday voted 9-1 to move the bill, <a href="https://leg.colorado.gov/bills/hb22-1029" target="_blank" rel="noreferrer noopener">HB22-1029</a>, forward to the House Appropriations Committee for further consideration.



Lawmakers&nbsp;<a href="https://peraontheissues.com/pera-related-legislation-sent-to-governor/" target="_blank" rel="noreferrer noopener">enacted legislation</a> to forego the $225 million payment to PERA in 2020 during the early stages of the COVID-19 pandemic, when the General Assembly cut billions of dollars from the state budget. The state automatically resumed payments in 2021 — additional legislation would be required for the state to forego any future payments — but did not make up 2020’s payment.



HB22-1029 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.



The bill originally called for the payment to come from the state’s general fund until the actual funding source had been identified. The bill’s sponsors added an amendment to instead use money from a cash fund the state <a href="https://peraontheissues.com/2021-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">set up in 2021</a> solely for future payments to PERA. That fund currently has a balance of $380 million, which legislative staff has <a href="https://coloradosun.com/2022/02/09/pera-investment-cash-fund-pay-back/" target="_blank" rel="noreferrer noopener">recommended distributing to PERA</a> sooner rather than later.



The House Appropriations Committee is expected to consider HB22-1029 later this week and if approved, it will head to the House floor for discussion and vote before moving to the Senate. PERA On The Issues will continue to monitor legislative activity on this bill.



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 put PERA on a path to full funding.&nbsp;Also included in Senate Bill 200 was the&nbsp;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.



Bill sponsor Rep. Shannon Bird referenced Senate Bill 200 and the state’s commitment to PERA when urging her fellow committee members to vote in favor of the bill.



“Our economy has rebounded and economic activity in Colorado is now exceeding even pre-pandemic levels,” Bird said. “In light of our greatly improved financial position, we now have the opportunity to make things right and hold ourselves accountable for our responsibilities under Senate Bill 200. Because when we suspended our payment in 2020, PERA lost $225 million and it also lost all investment returns those dollars would have brought in.”



The legislature has until May 11 to finish its work on any pending legislation and adjourn the current session.



For the latest on this and other PERA-related bills, <a href="https://peraontheissues.com/2022-proposed-legislation-status/" target="_blank" rel="noreferrer noopener">visit PERA on the Issues</a>.

Bill to Make Up Missed $225M Payment to PERA Moving Through Legislature

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







Last updated: June 8, 2022



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



<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>



Bill summary: 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.



Sponsors: <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>



Bill status: Signed into law.



Position: As fiduciaries, the PERA Board supports restoring the missed direct distribution.



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



<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>



Bill summary: 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.



Sponsors: <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>



Bill status: Signed into law.



Position: 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.



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



<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>



Bill summary: 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.



Sponsor: <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>



Bill status: Signed into law.



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



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<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>



Bill summary: 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.



Sponsors: <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>



Bill status: Signed into law.



Position: 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.

2022 Proposed Legislation Status

The Colorado General Assembly wrapped up the 2021 legislative session in June, but legislative work has continued in the ensuing months at the Capitol. Some of that work over the summer and fall involved committees that conduct routine oversight into Colorado PERA and its operations.



PERA and its Board of Trustees appreciate the value of rigorous review and transparency, so staff regularly engage with these legislative panels to provide updates on PERA’s finances, answer questions and listen to feedback from lawmakers and others. Summaries of those activities are included below.



<h2 class="wp-block-heading">Legislative Audit Committee</h2>



The <a href="http://leg.colorado.gov/committees/legislative-audit-committee/2021-regular-session" target="_blank" rel="noreferrer noopener" class="broken_link">Legislative Audit Committee</a> met in August to hear an update on PERA’s financial status and receive the results of an independent audit of PERA’s <a href="https://content.copera.org/wp-content/uploads/2024/07/pera-annual-comprehensive-financial-report-2020.pdf" target="_blank" rel="noreferrer noopener">Comprehensive Annual Financial Report</a>. The Committee heard from PERA Executive Director Ron Baker, Chief Investment Officer Amy C. McGarrity, external auditors, and actuarial consultants.



The auditors gave PERA’s annual report a clean audit with no significant issues or outstanding recommendations.



<h2 class="wp-block-heading">Pension Review Commission and Pension Review Subcommittee</h2>



The legislature’s <a href="http://leg.colorado.gov/committees/pension-review-subcommittee/2021-regular-session" target="_blank" rel="noreferrer noopener" class="broken_link">Pension Review Subcommittee</a>, which was established as part of the PERA reforms of Senate Bill 200 in 2018, consists of legislators and members of the public with expertise in topics such as accounting, economics and investment management.



At its Sept. 10 meeting, the Subcommittee voted to draft 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. The Subcommittee forwarded that bill to the <a href="http://leg.colorado.gov/committees/pension-review-commission/2021-regular-session" target="_blank" rel="noreferrer noopener" class="broken_link">Pension Review Commission</a>, which then forwarded the draft to <a href="http://leg.colorado.gov/committees/pension-review-commission/2021-regular-session" target="_blank" rel="noreferrer noopener" class="broken_link">Legislative Council</a> for review. In November, the Legislative Council voted to approve the bill, clearing the way for it to be introduced in the upcoming legislative session, which begins in January.



The Pension Review Subcommittee also conducted an independent review of the actuarial assumptions PERA uses in its financial calculations and reporting. Based on that review, the Subcommittee made three recommendations to the PERA Board regarding PERA’s funding policy and Signal Light methodology and reporting.



At its November meeting, the Board discussed the recommendations in detail and heard from PERA staff as well as PERA’s actuarial consultants. Following the discussion, the Board decided to draft a letter to the Pension Review Subcommittee responding to the recommendations. In the letter, the Board stated it agrees with the Subcommittee that there’s a need for clearer communication in the Signal Light report and the Board will consider implementing changes in future versions of the report. The Board also said it will consider making changes to PERA’s funding policy when it undertakes its planned review of the policy in 2023.



<h2 class="wp-block-heading">Joint Budget Committee</h2>



On Dec. 9, PERA Executive Director Ron Baker and Chief Investment Officer Amy C. McGarrity appeared before the <a href="http://leg.colorado.gov/committees/joint-budget-committee/2021-regular-session" target="_blank" rel="noreferrer noopener" class="broken_link">Joint Budget Committee</a> for that panel’s annual hearing on PERA. Baker and McGarrity provided the Committee with updates on a number of topics — including PERA’s finances and membership, results of <a href="https://peraontheissues.com/2020-experience-study-preparing-for-a-secure-future/" target="_blank" rel="noreferrer noopener">2020’s actuarial experience study</a>, and market performance in 2021 — and answered questions from committee members.



<h2 class="wp-block-heading">What’s ahead in 2022</h2>



The Colorado General Assembly will convene to kick off the 2022 legislative session on Jan. 12. PERA On The Issues will keep track of any proposed legislation that pertains to Colorado PERA, including the draft bill to make up the state’s missed 2020 payment of $225 million, and provide updates throughout the session. If you haven’t already, <a href="https://www.copera.org/pera-on-the-issues/subscribe" target="_blank" rel="noreferrer noopener">subscribe to our newsletter</a>.

PERA Oversight Continues Between Legislative Sessions

Below you&#8217;ll find summaries of proposed legislation affecting Colorado PERA. The status of each bill will be updated regularly. 



Any position the Colorado PERA Board takes on a bill will be reflected below as soon as it becomes available.



Last updated: Aug. 31, 2021



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<h2 class="wp-block-heading"><a href="https://leg.colorado.gov/bills/sb21-228" target="_blank" rel="noreferrer noopener">SB 21-228</a></h2>



Bill Title: PERA Public Employees Retirement Association Payment Cash Fund



Concerning the creation of the PERA payment cash fund to be used for future payments to the public employees&#8217; retirement association, and, in connection therewith, making an appropriation.



Bill Summary: The bill creates the PERA payment cash fund (fund) and appropriates $380 million from the general fund to the fund for the 2020-21 state fiscal year. The state treasurer is required to use the money in the fund for the $225 million direct distribution payment to PERA on July 1, 2022, subsequent direct distributions, and any of the state&#8217;s employer contributions or disbursements.



Sponsors: <a href="https://leg.colorado.gov/legislators/chris-hansen" target="_blank" rel="noreferrer noopener">Sen. Chris Hansen</a> and <a href="https://leg.colorado.gov/legislators/dominick-moreno" target="_blank" rel="noreferrer noopener">Sen. Dominick Moreno</a>, <a href="https://leg.colorado.gov/legislators/julie-mccluskie" target="_blank" rel="noreferrer noopener">Rep. Julie McCluskie</a> and <a href="https://leg.colorado.gov/legislators/kim-ransom" target="_blank" rel="noreferrer noopener">Rep. Kim Ransom</a>



Bill Status: Signed into law by Gov. Polis on May 4, 2021



Bill History: 



<ul>
<li>May 4: Signed by the Governor</li>



<li>April 5: Introduced in Senate</li>



<li>April 6: Passes Senate Appropriations Committee with <a href="https://s3-us-west-2.amazonaws.com/leg.colorado.gov/2021A/amendments/SB228_L.001.pdf" target="_blank" rel="noreferrer noopener">amendment</a></li>



<li>April 8: Passes Senate second reading </li>



<li>April 9: Approved by Senate, introduced in House</li>



<li>April 13: House Committee on Appropriations refers unamended to Committee of the Whole</li>



<li>April 14: Passes House second reading</li>



<li>April 15: Approved by House</li>
</ul>



PERA Board position: The PERA Board did not take a position on this bill.



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<h2 class="wp-block-heading"><a href="http://leg.colorado.gov/bills/HB21-1246" target="_blank" rel="noreferrer noopener">HB 21-1246</a></h2>



Bill Title: PERA Public Employees&#8217; Retirement Association Divestment From Fossil Fuel Companies



Concerning divestment action by the public employees&#8217; retirement association against companies financially involved with fossil fuel companies.



Bill Summary: The bill would require the PERA Board to create an exclusion list of all direct investments PERA has in fossil fuel companies.



Within 6 months after completing the exclusion list, the Board would be required to determine whether divestment from the companies on the exclusion list complies with the Board&#8217;s fiduciary obligations. If the Board determines that divestment from any company on the exclusion list does not comply with its fiduciary obligations, the Board will remove the company from the exclusion list.



If the Board determined that divestment from any company on the exclusion list does comply with its fiduciary duty, the Board would be required to divest from those companies on the exclusion list. And the Board would be required to cease new direct investments in any company that is a fossil fuel company.



Beginning one year after the effective date of the bill, the Board would be required to ensure that no money or assets of the fund are invested in an indirect investment vehicle unless the Board is satisfied that such indirect investment vehicle is unlikely to have in excess of 2% of its assets directly or indirectly invested in fossil fuel companies.



The Board would be required to issue periodic reports to the members of the pension review commission of the General Assembly outlining all actions taken to comply with the requirements of the bill.



Sponsors: <a href="http://leg.colorado.gov/legislators/emily-sirota" target="_blank" rel="noreferrer noopener">Rep. Emily Sirota</a> and <a href="http://leg.colorado.gov/legislators/sonya-jaquez-lewis" target="_blank" rel="noreferrer noopener">Rep. Sonya Jaquez Lewis</a>



Bill Status: Postponed indefinitely



Bill History: 



<ul>
<li>March 25: Introduced in House</li>



<li>March 19: Postponed indefinitely by House Finance Committee</li>
</ul>



PERA Board Position: Per the Board’s Statement on Divestment, PERA serves the singular purpose of ensuring the retirement security of Colorado’s current and former public servants. Global issues are difficult to prioritize and proper recourse falls beyond the duty of the retirement system. PERA opposes divestment efforts unless such opposition is inconsistent with its fiduciary duty and recommends the legislature thoughtfully consider such proposals with caution and fiduciary care.



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<h2 class="wp-block-heading"><a href="http://leg.colorado.gov/bills/HB21-1136" target="_blank" rel="noreferrer noopener">HB 21-1136</a></h2>



Bill Title: Judicial Division Retirees Temporary Judicial Duties Compensation



Concerning modifications to the policies governing judicial division retirees returning to temporary judicial duties.



Bill Summary: Retired judges may currently perform judicial duties for 60 or 90 days with written permission from the chief justice of the Colorado Supreme court. This bill would allow retired judges to do the same for 20, 30, 60, or 90 days per year. In addition, under current law a retired judge must enter into the agreement prior to retirement or within thirty days prior to the retirement anniversary in the next five years of retirement. This bill would remove that limitation.



Sponsors: <a href="http://leg.colorado.gov/legislators/kerry-tipper" target="_blank" rel="noreferrer noopener">Rep. Kerry Tipper</a> and <a href="http://leg.colorado.gov/legislators/terri-carver" target="_blank" rel="noreferrer noopener">Rep. Terri Carver</a>



Bill Status: Signed into law by Gov. Polis on May 4, 2021 



Bill History: 



<ul>
<li>May 4: Signed by the Governor</li>



<li>April 26: Senate passes on third reading</li>



<li>April 23: Senate passes on second reading</li>



<li>April 23: Senate Appropriations Committee refers to Committee of the Whole</li>



<li>April 14: Senate Judiciary refers unamended to Senate Appropriations Committee</li>



<li>April 9: Introduced in Senate</li>



<li>April 8: Passed by House</li>



<li>April 7: House passes with <a href="https://s3-us-west-2.amazonaws.com/leg.colorado.gov/2021A/amendments/HB1136_L.001.pdf" target="_blank" rel="noreferrer noopener">amendments</a></li>



<li>April 5: House Appropriations Committee refers to Committee of the Whole with <a href="https://s3-us-west-2.amazonaws.com/leg.colorado.gov/2021A/amendments/HB1136_J.001.pdf" target="_blank" rel="noreferrer noopener">amendments</a></li>



<li>March 1: Introduced in House</li>
</ul>



PERA Board Position: The PERA Board does not have a position on this bill.



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<h2 class="wp-block-heading" id="block-aed2a52c-4dde-4844-bab2-cc1c9c9133a8"><a href="https://leg.colorado.gov/bills/hb21-1213" target="_blank" rel="noreferrer noopener">HB 21-1213</a></h2>



Bill Title: Conversion Of Pinnacol Assurance



Concerning the conversion of Pinnacol Assurance from a political subdivision of the state into a stock insurance company owned by a mutual insurance holding company.



Bill Summary: This bill would convert Pinnacol Assurance, which provides workers’ compensation insurance, into a private company. As part of this conversion, Pinnacol would disaffiliate from PERA and make a payment to PERA to cover its portion of PERA’s liabilities. Current Pinnacol employees would become inactive PERA members after the disaffiliation date but would be eligible for future benefits. Current PERA retirees who were employed by Pinnacol are not affected by this bill.



Sponsors: <a href="https://leg.colorado.gov/legislators/matt-soper" target="_blank" rel="noreferrer noopener">Rep. Matt Soper</a>



Bill Status: Postponed indefinitely 



Bill History: 



<ul>
<li>March 22: Postponed indefinitely by the House State, Civic, Military, &amp; Veterans Affairs Committee</li>



<li>Introduced March 5</li>
</ul>



PERA Board Position: The PERA Board holds that all disaffiliations should be treated the same and the methodology used to determine the cost for disaffiliation should align with the framework provided by the general assembly under current statute.



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