In short, the added $73 million from the PERA cash fund and its returns simply aren’t enough to make up for shorting the next two years’ payments
By emptying the cash fund now, Governor Polis eliminates the cushion it provides for years where tax income falls short of expectations, which are likely to coincide with years of lean returns for PERA.
The long-term threats to any defined benefit retirement plan remain the same as they have always been – volatility in returns, increases in lifespan, inflation or deflation.
Towards the end of the meeting, the idea of pension obligation bonds (POBs) seemed to be gaining momentum, either to fund the missed $225 million general fund payment to PERA from 2020, or to put more money into the system to help stabilize it.
GRS also identified a problem with how losses are amortized, that is, the number of years available to pay them off.
The proposal to reduce employee contributions is puzzling, as that would have no net impact on the state budget.
Sen. Rachel Zenzinger (D-Jefferson County) said that it was possible, but unlikely, that the legislature would seek to implement all of staff recommendations.
A recent report from Channel 4’s Brian Maass that Denver has overpaid about $11 million in pension benefits over a period of 15 years brings up serious questions about the
DENVER — The Regional Transportation District (RTD) is still trying to fully fund an archaic and costly retirement system for some of its employees, costing taxpayers inside the eight-county RTD
Fresh off ramming through some of the most restrictive oil and gas legislation in the country, climate activists have set their sights on Colorado’s pension fund, demanding that the Public
Since bad years hurt more than good years help, and since greater volatility increases both the frequency and severity of bad years, volatility is the enemy of long-term solvency.
This was the fourth losing year since 2000, and PERA was reduced to noting with grim satisfaction that its benchmarks had performed at -3.6% for the year.
