Even with last year’s legislation aimed at putting the Colorado Public Employees’ Retirement Association, or PERA, on a surer financial footing, lawmakers have introduced no fewer than four bills that would continue to reshape the state’s pension system.
However, the leader of the state Senate signaled last week that none of the more ambitious reforms will get very far in his chamber. According to Education News Colorado, Democratic Senate President Brandon Shaffer told the annual winter meeting of the Colorado Association of School Executives that three of the bills, all Republican-sponsored, will not make it out of the Senate.
“All of these eventually will go away,” said Shaffer, notably excepting the bipartisan Senate Bill76, which now has left the Senate and is scheduled for its first hearing in the House.
Last year’s compromise temporarily decreased the employer’s contribution for certain state employees while increasing the employee’s contribution. The Joint Budget Committee-backed SB 76, sponsored by Sen. Pat Steadman, D-Denver and Rep. Jon Becker, R-Fort Morgan, would extend those contribution levels for another fiscal year.
Steadman said running SB76 is regrettable but necessary in light of less palatable options.
“Nobody enjoys this bill,” said Steadman. “But, it is a better alternative than furloughs.”
Steadman said he believes tinkering with contribution levels will keep PERA on track and is the least destructive path to follow for state employees.
“None of these (other) bills are good for the PERA fund, and we have already fixed it,” said Steadman. “Let’s stay the course of keeping PERA on track.”
Senate bill 74, by Republicans Sen. Kent Lambert, of Colorado Springs, and Rep. Jim Kerr, of Littleton, would allow “employers in the school or local government division of PERA and the Denver Public Schools division of PERA” to lower the state contribution while raising the employee contribution. Those changes to the contribution levels would have to be approved by a vote of the “governing body” of the local government or school district.
House Bill 1008, also by Kerr, changes the makeup of PERA’s 15-member board to create a majority who are themselves non-PERA beneficiaries.
Republican Sen. Scott Renfroe, of Greeley, has offered up Senate Bill 127, resurrecting the debate over whether PERA should be a defined-benefit plan or a defined-contribution plan, like 401k plans common to the private sector. Renfroe’s bill effectively would phase out the defined-benefit option–long a bone of contention between Republicans and Democrats at the statehouse–requiring state employees hired after this year to be in the defined-contribution plan.
Renfroe said his bill empowers the employee to leverage control over their own retirement.
“PERA members need to have a plan in place that won’t go bankrupt in the future,” said Renfroe. “They deserve to be able to have some control over their retirement money.”
Asked about the distinct possibility of his bill and those of his colleagues meeting an early demise in the majority-Democrat Senate, Renfroe said he’s not surprised but finds it a bit off-putting.
“It’s disappointing that the leader of the Senate would make such a blanket statement about Republican PERA reform bills. It’s an abuse of power,” said Renfroe.
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