PERA employees are your friends, neighbors, and family members. In fact, over 400,000 state, school and local government employees count on the Colorado Public Employees Retirement Association for their retirement benefits.
PERA is Colorado’s most significant commitment to our active and retired public employees. However, if the status quo is maintained, PERA will be unable to pay retired employees within the next couple of decades. Like so many other institutions, PERA has not been invulnerable to the economic downturn.
This year the PERA board announced that our investments were in trouble. They asked for quick legislative action to keep the fund secure for the future. Democratic leadership in the House directed them to provide us with legislative recommendations to ensure the health and longevity of the fund. We have received those recommendations and have been working with a coalition of groups representing past, present and future PERA employees to develop strong legislation that protects the fund while also ensuring all PERA beneficiaries get a fair deal.
As House sponsor for a bill to help save PERA, I am confident that it is a fair compromise that takes all interested parties into consideration. This compromise is not perfect, as it will mandate that PERA members, both active and retired, will be required to make sacrifices. Our proposed changes to PERA will require more funding and fewer benefits.
Specifically, the bill contains the following provisions: the Cost of Living Adjustment will be reduced to an amount equal to the Consumer Price Index, with a 2% guarantee for all retirees, members, and inactive members after one year; employers will be asked to contribute an additional 2 % (1.5% for school divisions) with a reduced burden over the long run and employees will be asked to contribute an additional 2% until the fund is solvent. The age of retirement will also have to be raised for employees who have not yet vested. When the pension fund is secure once again, many of these corrective actions can be reversed.
The bill, which is sponsored in the Senate by President Brandon Shaffer and Minority Leader Josh Penry, has been passed in that body and will soon be heard in the House.
This will be a challenging session, and there will assuredly be debates where our differences are deep, but I am not afraid to fight for the rights and well being of the people of my district and the state.
Times are tough – that’s why we are cutting government just as you are tightening your belts at home. But if we allow PERA to follow its current course, the fund is simply not sustainable. That’s not acceptable to me and that’s not acceptable for the people of Colorado. I am committed to making sure PERA remains healthy for the long run so current, past and future public employees can continue to count on it when they retire.
Andy Kerr, a Democrat from Lakewood, represents District 26 in the Colorado House. EDITOR’S NOTE: This is an online-only column and has not been edited.
