DENVER — Leaders of the Colorado Senate have reached a tentative deal on a plan to fix the state pension fund.
The major changes to the Public Employees' Retirement Association include increasing employee and employer contributions by 2 percent and reducing cost-of-living increases for current retirees from 3.5 percent this year, capping them at 2 percent.
Senate President Brandon Shaffer and Senate Minority Leader Josh Penry told The Associated Press on Tuesday that the proposed deal offers security for state workers after their pension plan was rocked by the recent economic crisis.
Both signed on as sponsors, and they hoped to sign on as many as 20 co-sponsors. Gov. Bill Ritter is also reviewing the deal.
Several issues remain to be resolved, most revolving around age of retirement and years of service needed to get full benefits, but both men said those issues could be resolved by the time lawmakers convene for their 120-day session next week.
Shaffer said the plan represents a significant commitment to nearly 500,000 active and retired public employees, including school teachers and local government employees.
"We are all invested in PERA's ongoing success, and we want to ensure PERA continues providing for Colorado now and into the future," Shaffer said.
Penry called the agreement "historic" and said it meets his main requirements of increasing retirement age for state workers, reducing cost of living increases and reducing the impact on public school districts.
He said several members of his caucus signed on as co-sponsors to show their support for reform.
"Republicans and Democrats created this mess and Republicans and Democrats are offering a real solution on this," Penry said.
Assistant House Majority Leader Andy Kerr, D-Lakewood, said there are still some details to be worked out, but that he's confident a deal can be reached by March before new automatic increases in benefits go into effect.
Lynea Hansen, spokeswoman for the Colorado Coalition for Retirement Security representing 200,000 retired workers, said she also believes a deal can be reached by March.
Katie Kaufmanis, spokeswoman for PERA, said the board will meet in special session this week to discuss the proposal, but she expects approval as long as it meets the board's basic requirements to provide a long-term, defined benefit plan with shared responsibility for employers and employees.
The board that oversees Colorado state pensions approved a bailout plan in October to keep the troubled program from going bankrupt.
The changes must be approved by lawmakers when they return to work in January.