Updated with correction
The Colorado Senate on Tuesday passed a bill designed to improve the funded status of the $49 billion Colorado Public Employees' Retirement Association, Denver, and lower its overall risk, confirmed Kira Mazzola, a spokeswoman for House Majority Leader KC Becker who is co-sponsor of the bill, in an email.
Senate Bill 18-200, which was introduced on March 7, passed by a 19-16 vote. It includes automatic adjustment provisions to ensure that PERA remains on the path to full funding in 30 years. These provisions would increase employee contributions and modify the annual cost-of-living adjustment for retirees to offset any deviation from the 30-year funding time frame. PERA was 58.1% funded as of Dec. 31, 2016, according to the most recent information on the pension fund's website.
The immediate impact for current participants would be a phased-in employee contribution increase over the next few years to 11% of pay from the current 8%, starting in July 2018. The current annual COLA for participants that started receiving benefits prior to Jan. 1, 2007, is 2%. For 2018 and 2019, the bill reduces the COLA to zero. For each year thereafter, the bill changes the COLA to 1.25%.
Colorado PERA spokeswoman Katie Kaufmanis said a proposal to gradually increase the employer contribution was removed from the revised bill.
The bill would also require PERA to report to an interim legislative committee to ensure progress is being made toward full funding. This committee would also have the power to consider and recommend legislation regarding PERA to the full General Assembly.
In addition, the bill would allow new employees to choose between the PERA defined contribution plan and the hybrid defined benefit plan.
Sponsors of the bill are state Sens. Jack Tate and Kevin Priola, both Republicans; and Ms. Becker and state Rep. Dan Pabon, both Democrats.
The bill has not yet been introduced in the House, Ms. Mazzola said. After it is introduced, it will head to a House committee for a hearing.
The full text of the bill is available on the state Legislature's website.