TOWN HALL: Bills challenge public-sector privileges (poll)

Once upon a time, not long ago, conservatives and other limited-government types were treated like crackpots for suggesting reforms to public-employee retirement pensions. Today, the looming financial fiasco they warned of has become apparent to most. No one is laughing today.

In 2010, Colorado’s Independence Institute headed up a project called the Citizens’ Budget. The budget was composed of research, analysis and recommendations by leading economists and expert researchers. The 170-page document recommended a variety of ways in which politicians could close the state budget gap without raising taxes or causing unreasonable hardships.

Upon its release, The Gazette’s editorial board suggested that legislators use it to solve a litany of problems. The 2011 session came and went, business as usual, with barely a mention of the Citizens’ Budget.

Things have changed. This year, the document has led directly to three bills intended to save Colorado’s disastrously underfunded Public Employees Retirement Association.

Today, some public employees enrolled in PERA are eligible to retire as early as age 55. They don’t qualify for Medicare until they are 65, so PERA pays each qualifying retiree a $230-a-month health care benefit. The benefit becomes more expensive as health care goes up. After the retiree qualifies for Medicare, it continues at $115 per month.

A bill inspired by the Citizens’ Budget and carried by Rep. Christ Holbert, R-Parker, would cap the health benefit for early retirees at $230 a month and eliminate health care payments for retirees who have reached the age of eligibility for Medicare. The bill has not been assigned a number yet.

Senate Bill 119, inspired by the Citizens’ Budget and carried by Sen. Tim Neville, R-Littleton, would force the board of directors of PERA to adjust benefits in order to “maintain the long-term actuarial soundness of each trust fund.”

“Today, the PERA board tells state government to get the money it needs,” said Penn Pfiffner, a former state legislator, economics professor and lead author of the Citzens’ Budget research and writing. “This bill says they have to adjust benefits accordingly. Once taxpayers have made their contribution, it will be up to PERA to make it work. We would no longer be responsible for how PERA handles the money.”

Senate Bill 82, inspired by the Citizens’ Budget and carried by Sen. Ted Harvey, R-Highlands Ranch, would increase the age at which new public employees would be eligible for retirement benefits. Today, some new hires can count on retiring at age 58, while young private-sector employees cannot qualify for Social Security until age 68. The bill would make the age limit for PERA benefits the same as for Social Security benefits.

Do you support major reforms for Colorado Public Employees' Retirement Association (PERA)? Vote in poll to the right. Must vote to see results.

“We are paying for some public employees to retire a decade earlier than those in the private sector,” Pfiffner said. “What’s good enough for ordinary taxpayers ought to be good enough for those who are paid by taxpayers.”

Thanks and congratulations to Pfiffner, Ben DeGrow, Linda Gorman, Mark Hillman, Dennis Polhill, Barry Poulson and others at the Independence Institute for taking the initiative to recommend improvements to state government’s fiscal management. These and other bills this session have been inspired by your work. We hope legislators will continue to study the Citizens’ Budget and work toward turning these bills into laws.

That's our view. What's yours? Please initiate or join in a Facebook discussion below, and vote in poll to the upper right.

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