HB1026 expands retirement and savings options within the Colorado Public Employees’ Retirement Association (PERA). The bill would allow members to purchase service credit not only for prior public or private employment that was not covered by PERA, but also for certain periods of unemployment after age 21, subject to documentation and other conditions. It also clarifies and updates rules for purchasing service credit tied to noncovered time, including limits for nonqualified service and restrictions on using purchased credit for disability and survivor benefit eligibility.
The bill further broadens PERA’s voluntary savings offerings. It requires PERA’s voluntary investment program and deferred compensation plan to include both pre-tax and Roth contribution options, and it extends access to the deferred compensation plan to employees of affiliated employers. The measure also makes conforming changes to how contributions are handled, transferred, and treated for tax purposes, and it updates related definitions and trust fund allocation provisions.
Impact
HB1026 would amend multiple sections of Colorado’s PERA statutes, primarily in Title 24, Article 51, to expand the types of service credit members may buy and to modernize voluntary retirement savings plan options. It would affect PERA members, retirees, affiliated employers, and employees eligible to participate in PERA-administered savings plans. The bill also adjusts how purchased service credit payments are allocated to the health care trust fund and updates rules governing deferred compensation and voluntary investment contributions, including Roth treatment and employer participation requirements.
Sentiment
The bill appears to have generally favorable support in the legislature, as reflected by repeated committee approvals and strong floor votes in both chambers. It advanced through House Finance, House Appropriations, Senate Finance, and Senate Appropriations with comfortable margins, and the Senate Appropriations Committee recommended it for the consent calendar. Final passage votes were also positive, though not unanimous, indicating broad support with some reservations.
Contention
The main points of contention likely concern the fiscal and actuarial effects of allowing additional service credit purchases and expanding plan options, as well as the administrative burden on PERA and affiliated employers. Some legislators may have been concerned about the cost of purchasing unemployment-related service credit, the impact on trust fund accounting, or the requirement that employers offer the deferred compensation plan and Roth/pre-tax options. The recorded nays on floor votes suggest there was some opposition, but the bill’s committee history indicates these concerns did not prevent passage.