Two bills with a direct impact on Colorado PERA have been introduced in the state legislature, so the PERA board will meet Friday to hash out its stance on them.
The bulk of the meeting could take place behind closed doors, as the board receives “legal advice from counsel on specific legal questions regarding proposed legislation.” At the meeting’s conclusion, however, the board may take a position on the two bills.
The first, Senate Bill 17-113, would cap employer contributions at 2018 levels. One of its sponsors is Republican Sen. Tim Neville, chair of the Senate Finance Committee. According to the Denver Business Journal:
(Neville) said capping the employer contributions sends a message and would force the hand of the PERA board to make changes to lower the unfunded liability…
Neville told the DBJ that the alternative to legislation is continued handouts to PERA.
Neville’s fear, he said, is that the PERA board will come back to the legislature and ask for more money.
“They’ve come back over and over again,” he said. “I can only surmise that the PERA board feels they can come back to the legislature for a solution. I want to make sure they have a clear message that it is not the case.”
The rates now for the state division and school division is at 20.15 percent of an employer’s total payroll; for the local government division, it is 13.7 percent of an employer’s total payroll; and for the judicial division, it is 17.36 percent of an employer’s total payroll.
“The idea is if we spend 1 out of every 5 dollars in Jefferson County schools, for example, to fund teacher retirement there is not going to be enough for other educational resources – it’s not good stewardship,” Neville said.
The second bill, Senate Bill 17-158, would change the composition of the PERA board by doubling the number of governor’s appointees, with finance backgrounds, from the current three to six. The PERA board consists of 15 members.
It has been our observation at board meetings that the governor’s appointees ask sharper questions and cast a more skeptical eye on staff claims and actuarial reports than do the board members elected by the PERA membership. So this bill, championed by State Treasurer Walker Stapleton (an ex officio member of the PERA board) strikes us as a step in the right direction.