(1) (a) There is hereby
created the pension review commission, referred to in this section as the
commission. Beginning in the first regular session of the seventy-second general
assembly, the commission shall be comprised of five senators, three of whom are
appointed by the president of the senate and two of whom are appointed by the
minority leader of the senate, and five representatives, three of whom are
appointed by the speaker of the house of representatives and two of whom are
appointed by the minority leader of the house of representatives. The chair shall be
designated by the speaker of the house of representatives in odd-numbered years
and by the president of the senate in even-numbered years. The vice-chair shall be
appointed by the speaker of the house of representatives in even-numbered years
and by the president of the senate in odd-numbered years. Members of the
commission shall receive the same per diem allowance authorized for other
members of the general assembly serving on interim study committees and actual
expenses for participation in meetings of the commission. Staff services for the
commission and the pension review subcommittee created pursuant to subsection
(3) of this section shall be furnished by the state auditor's office, the legislative
council, and the office of legislative legal services. The state auditor, with the
approval of the commission, may contract for services deemed necessary for the
implementation of this article 51.1.
(b) The terms of members appointed or reappointed by the speaker, the
minority leader of the house of representatives, the president, and the minority
leader of the senate shall expire on the convening date of the first regular session
of each general assembly, and all subsequent appointments and reappointments
shall be made as soon as practicable after such convening date. The person making
the original appointment or reappointment shall fill any vacancy by appointment for
the remainder of an unexpired term. Members appointed or reappointed by the
speaker, the minority leader of the house of representatives, the president, and the
minority leader of the senate shall serve at the pleasure of the appointing authority
and shall continue in office until the member's successor is appointed.
(2) The commission shall study and develop proposed legislation relating to
funding of police officers' and firefighters' pensions in this state and benefit
designs of such pension plans. In addition, the commission shall study and develop
proposed legislation relating to the public employees' retirement association. The
commission study of police officers' and firefighters' pensions and of the public
employees' retirement association shall include a review of, and the proposed
legislation may include, among other subjects, the following, as applicable:
(a) Normal retirement age;
(b) Payment of benefits prior to normal retirement age;
(c) Service requirements for eligibility;
(d) Rate of accrual of benefits;
(e) Disability benefits;
(f) Survivors' benefits;
(g) Vesting of benefits;
(h) Employee and employer contributions;
(i) Postretirement increases;
(j) Creation of an administrative board;
(k) Creation of a consolidated statewide system;
(l) Coordination of benefits with other programs;
(m) The volunteer firefighter pension system;
(n) The provisions of articles 30, 30.5, and 31 of title 31; and
(o) The provisions of article 51 of this title 24.
(3) (a) There is hereby created the pension review subcommittee. The
subcommittee shall consist of fourteen members appointed as follows:
(I) The speaker of the house of representatives, the minority leader of the
house of representatives, the president of the senate, and the minority leader of the
senate shall each appoint one legislator whom he or she has appointed to serve on
the pension reform commission to also serve on the subcommittee;
(II) The speaker of the house of representatives and the president of the
senate shall both appoint two people from the community with experience or
knowledge of investment management, corporate or public finance, compensation
and benefit systems, economics, accounting, pension administration, or actuarial
analysis;
(III) The minority leader of the house of representatives and the minority
leader of the senate shall both appoint two people from the community with
experience or knowledge of investment management, corporate or public finance,
compensation and benefit systems, economics, accounting, pension administration,
or actuarial analysis;
(IV) The governor shall appoint one person from the community with
experience or knowledge of investment management, corporate or public finance,
compensation and benefit systems, economics, accounting, pension administration,
or actuarial analysis; and
(V) The state treasurer shall appoint one person from the community with
experience or knowledge of investment management, corporate or public finance,
compensation and benefit systems, economics, accounting, pension administration,
or actuarial analysis.
(b) The chair of the subcommittee shall be designated by the speaker of the
house of representatives in odd-numbered years and by the president of the senate
in even-numbered years. The vice-chair of the subcommittee shall be appointed by
the speaker of the house of representatives in even-numbered years and by the
president of the senate in odd-numbered years. The chair and vice-chair shall be
designated from the legislative members of the subcommittee.
(c) The nonlegislative members of the subcommittee shall serve without
compensation from the general assembly.
(4) The subcommittee shall review the items specified in subsection (2) of
this section as they relate to the public employees' retirement association, as
applicable. In addition, the subcommittee shall:
(a) (I) Study the provisions of article 51 of this title 24 and make necessary
recommendations to the commission or the public employees' retirement
association;
(II) Determine the necessity of continuing the direct distribution to the public
employees' retirement association pursuant to section 24-51-414;
(III) Suggest to the public employees' retirement association enhancements
that the association could make to the annual analysis that it conducts pursuant to
Senate Bill 14-214, enacted in 2014, to determine whether the association's model
assumptions are meeting targets and achieving sustainability;
(IV) Review the annual actuarial valuation of the public employees'
retirement association and make comments as necessary to the association
regarding the actuarial valuation; and
(V) Make recommendations to the board of trustees of the public employees'
retirement association regarding assumptions, funding policy, reporting practices,
or other operational policy.
(b) Review semi-annually the overall financial health of the public
employees' retirement association, including the levels of benefits, its sources of
funding, and its overall financial viability based on both the assumptions of the
association board of directors and the requirements of the governmental
accounting standards board. The subcommittee may request that the association
provide general financial reporting based on assumptions for economic and
investment factors, including, but not limited to, inflation, economic growth,
employment growth, and rate of return, that differ from board assumptions. If the
subcommittee determines that the association's board of directors is using
assumptions that are too conservative or too aggressive, the subcommittee shall
request that the association adjust its assumptions accordingly.
(c) Review annually the calculated normal costs that will cover current
pension benefits and the share of contributions going to cover the unfunded liability
of the public employees' retirement association;
(d) Review semi-annually the planned reduction of the unfunded liability of
the public employees' retirement association. If full funding will not be achieved by
2048, the subcommittee shall make additional recommendations to the
commission, the joint budget committee, and the general assembly to achieve full
funding by 2048. If, upon that review, the subcommittee determines that the
association does not have at least a sixty-seven percent likelihood of achieving full
funding by 2048, then the association shall provide recommendations to the
subcommittee for policy changes that would return the association to fully funded
status by 2048. Notwithstanding section 24-1-136 (11)(a)(I), the subcommittee shall
annually report to the general assembly regarding whether or not the association is
on track to achieve full funding by 2048 and if not, the corrective actions
recommended by the subcommittee or the association to rectify the shortfall.
(e) Annually report in writing to the citizens of Colorado regarding whether
or not the public employees' retirement association is on track to achieve full
funding by 2048 and if not, the corrective actions recommended by the
subcommittee or the association to the general assembly to rectify the shortfall.
Such communication shall be made in a manner that is clear, concise, and
accessible to laypeople. This communication shall quantify the net present value of
any funding deficit on a per citizen basis. For example, fifty billion dollars on five
million five hundred thousand people equals nine thousand ninety dollars per
person. The certified annual financial report shall not serve as this communication.
(f) After full funding is achieved, make recommendations to the commission,
the joint budget committee, and the general assembly during each legislative
session regarding changes to the plan to maintain full funding;
(g) Ensure the public employees' retirement association board is
administering the association as mandated and make recommendations for the
association board structure as warranted; and
(h) Every four years, within three months of the release of the periodic
actuarial audit of the association conducted or caused to be conducted by the
board of the public employees' retirement association in 2026 and every four years
thereafter pursuant to section 24-51-204 (12), commission an independent review of
the economic and investment assumptions used to model the public employees'
retirement association financial situation. The subcommittee shall use experts
other than those already working on behalf of the association and shall ensure that
the experts review the findings from the most recent periodic actuarial audit of the
association conducted pursuant to section 24-51-204 (12).
(5) Each member of the subcommittee shall be required to:
(a) Attend at least one meeting per year of the board of trustees of the
public employees' retirement association;
(b) Attend the hearing of the legislative audit committee when the
committee reviews the annual actuarial valuation that the public employees'
retirement association is required to submit to the legislative audit committee
pursuant to section 24-51-204 (7); and
(c) Attend the State Measurement for Accountable, Responsive, and
Transparent (SMART) Government Act hearing of the joint finance committee
pursuant to part 2 of article 7 of title 2 when the joint finance committee reviews
the public employees' retirement association.
(6) Repealed.
(7) (a) Notwithstanding any provision of this section, the commission and the
subcommittee shall not meet during the 2025 interim and legislative members of
the subcommittee are not required to attend the meetings and hearings specified in
subsection (5) of this section during the 2025 interim. If a legislative member of the
subcommittee attends a meeting or hearing specified in subsection (5) of this
section during the 2025 interim, the legislative member is not entitled to per diem
compensation. The subcommittee is not required to comply with the review and
reporting requirements set forth in subsection (4) of this section during the 2025
interim.
(b) This subsection (7) is repealed, effective July 1, 2026.