(1) As used in this section, unless the context otherwise requires:
(a) Blended total contribution amount means:
(I) Prior to July 1, 2030, the weighted average of the total amounts paid by
the employer and the member to the association for the state, school, local
government, and judicial divisions pursuant to sections 24-51-401 (1.7) and 24-51-411, and the amount the association receives pursuant to section 24-51-414, but
shall not include the portion of the employer contribution remitted to the health
care trust fund pursuant to section 24-51-208 (1)(f) and (1)(f.5) and the portion of
the employer contribution remitted to the annual increase reserve.
(II) Beginning July 1, 2030, the weighted average of the total amounts paid by
the employer and the member to the association for each of the five divisions
pursuant to sections 24-51-401 (1.7) and 24-51-411, and the amount the association
receives pursuant to section 24-51-414, but shall not include the portion of the
employer contribution remitted to the health care trust fund pursuant to section
24-51-208 (1)(f) and (1)(f.5) and the portion of the employer contribution remitted to
the annual increase reserve.
(b) Blended total required contribution means:
(I) Prior to July 1, 2030, the weighted average of the total of the association's
reported actuarially determined contribution rates and member contribution rates
of the state, school, local government, and judicial division trust funds.
(II) Beginning July 1, 2030, the weighted average of the total of the
association's reported actuarially determined contribution rates and member
contribution rates of the five division trust funds.
(c) Weighted average means the proportion of unfunded actuarial accrued
liability attributable to each division reported as of the most recent valuation date.
(2) Beginning July 1, 2019, and each July 1 thereafter, employer contribution
rates, member contribution rates, annual increase amounts, and the direct
distribution amount shall remain unchanged until such time as changes are
required pursuant to this section.
(3) When the blended total contribution amount is less than ninety-eight
percent of the blended total required contribution, the following adjustment shall
occur:
(a) The annual increase percentage determined pursuant to sections 24-51-1002 and 24-51-1009 (4)(a) shall be reduced by up to one-quarter of one percent,
but at no time will the annual increase percentage be reduced to equal less than
one-half of one percent, except as provided in sections 24-51-1002 (1.5) and 24-51-1009 (1.5);
(b) The employer contribution rate will be increased by up to one-half of one
percent, but at no time will the employer contribution rate be increased to exceed
the employer contribution rates under section 24-51-401 (1.7)(a)(V), plus two
percent;
(c) The member contribution rate will be increased by up to one-half of one
percent, but at no time will the member contribution rate be increased to exceed
the member contribution rates under section 24-51-401 (1.7)(a)(IV), plus two
percent; and
(d) The amount of the direct distribution pursuant to section 24-51-414 will
be increased by up to twenty million dollars, but at no time will the amount of the
direct distribution exceed two hundred twenty-five million dollars in a fiscal year.
(4) The adjustment in subsection (3) of this section shall be determined by
the association, shall be equally apportioned among the annual increases, the
employer contributions, the member contributions, and, if applicable, the direct
distribution amount, and shall be the maximum yearly adjustment allowed unless
an adjustment less than the maximum adjustment is sufficient to bring the blended
total contribution amount to one hundred three percent of the blended total
required contribution. In no event shall a yearly adjustment cause the blended total
contribution amount to exceed one hundred three percent of the blended total
required contribution. The adjustment shall be made once in any calendar year and
shall not exceed the maximum yearly amounts indicated in subsections (3)(a), (3)(b),
(3)(c), and (3)(d) of this section.
(5) In the event any one of the four component parts of the adjustment as
outlined in subsection (3) of this section has reached its total maximum, then no
further adjustment shall be made to that component. Only the adjustments to the
other three components shall continue as specified in subsections (3) and (4) of this
section, even if the fully required adjustment to bring the blended total contribution
amount to one hundred three percent of the blended total required contribution is
not achieved.
(6) When the blended total contribution amount is greater than or equal to
one hundred twenty percent of the blended total required contribution, the
following adjustment shall occur:
(a) Subject to sections 24-51-1002 (1.5) and 24-51-1009 (1.5), the annual
increase percentage determined pursuant to sections 24-51-1002 and 24-51-1009
(4)(a) shall be increased by up to one-quarter of one percent, but at no time will the
annual increase percentage be greater than two percent, except as provided in
section 24-51-1009.5;
(b) The employer contribution rate will be reduced by up to one-half of one
percent, but at no time will the employer contribution rate be less than the
employer contribution rates under section 24-51-401 (1.7)(a)(I) for the state, school,
local government, and judicial divisions and the employer contribution rates under
section 24-51-401 (1.7)(a)(V) for the Denver public schools division;
(c) The member contribution rate will be reduced by up to one-half of one
percent, but at no time will the member contribution rate be less than the member
contribution rates under section 24-51-401 (1.7)(a)(I); and
(d) The amount of the direct distribution pursuant to section 24-51-414 will
be reduced by up to twenty million dollars in a fiscal year.
(7) The adjustment in subsection (6) of this section shall be determined by
the association, shall be equally apportioned among the annual increases, the
employer contributions, the member contributions, and, if applicable, the direct
distribution amount, and shall be the maximum yearly adjustment allowed unless
an amount lower than the maximum adjustment is necessary to keep the blended
total contribution amount equal to one hundred three percent of the blended total
required contribution. In no event shall a yearly adjustment cause the blended total
contribution amount to fall below one hundred three percent of the blended total
required contribution. The adjustment shall be made once in any calendar year and
shall not exceed the maximum yearly amounts specified in subsections (6)(a), (6)(b),
(6)(c), and (6)(d) of this section.
(8) The adjustments pursuant to this section shall be determined based on
the blended total contribution amount and blended total required contribution as
reported in the annual actuarial valuation report required under section 24-51-204
(7) and shall be effective July 1 of the next calendar year. The first adjustment
pursuant to this section shall not occur before July 1, 2020.