The Denver Post reports that under his bill, state employees would contribute one percent of future raises to shore up funds for the state’s largest public employee pension plan. “Over three years, that will be a $75 million influx into PERA,” Owen said.
Owen said his bill is backed by the governor and the state treasurer and will reduce PERA’s $11 billion shortfall more quickly and equitably than the bill backed by PERA that is expected to be introduced this week, according to the Post.
In addition to requiring the contribution from future raises, the Owen bill:
- raises the retirement age of new hires to 60 and requires the PERA board to propose benefit reductions for them if the pension plan falls below 90% of the funds it needs to meet future obligations.
- creates a framework for determining when the plan is actuarially unsound. If that occurs for three years, board members would be replaced.
- replaces PERA’s existing 16-member board of trustees with an 11-member board consisting of four working PERA members, a PERA retiree, four gubernatorial appointees with financial expertise, the state treasurer and the state auditor.
- requires PERA to hire an internal auditor and appoints the state attorney general to advise the board instead of PERA’s in-house counsel.
The bill incorporates recommendations from a special commission appointed by the former state treasurer (See CO Special Commission Makes PERA Recommendations), as well as recommendations from PERA (See Colorado PERA Issues Funding Reform Proposal ).