WILL COLORADO SPRINGS STIFF COLORADO PERA FOR $61 MILLION AND FORCE THOSE COSTS ONTO OTHER COLORADO MUNICIPALTIES? MORE LITIGATION COMING FOR COLORADO PERA. Here are a few excerpts from a Gazette Telegraph article regarding the upcoming (August 28) Colorado Springs election on the question of the proposed Colorado Springs Memorial Hospital lease: “This week, registered voters in Colorado Springs should get a ballot asking a simple question: ‘Shall the City of Colorado Springs be authorized to lease the Memorial Health System to the University of Colorado Health system?’” “Q: What is that $185 million for pensions about? A: Two years ago, the state’s Public Employees Retirement Association told Memorial that it would owe $246 million for future retiree liabilities if it were to leave the system. Later estimates pegged that number significantly lower, but PERA still says whoever owns Memorial will have to pay up to exit the system. City Attorney Chris Melcher maintains that since Memorial has always paid its dues to PERA in full, the city’s actual liability should be zero — no different, he argues, than Memorial would pay if a single employee left the system. It may take litigation to resolve the dispute, but if the city can bring the final bill in for less than $185 million, it will keep the difference.” (My comment: The ability to read should be a minimum qualification for a city attorney’s position.) “Q: What happens to Memorial employees’ pension plans? A: UC Health would switch employees to a new defined benefit pension plan it’s setting up. Memorial employees will have the same retirement plan as employees at other UC Health hospitals. UC Health has outlined what the retirement plan will look like, but hasn’t provided final details to employees.” “Those plans ran aground in January 2011, though, when PERA told Memorial it would cost $246 million to leave the pension system. Dr. Larry McEvoy, then Memorial’s CEO, said such a huge bill would cripple an independent Memorial before it even got started. Memorial’s leaders tried to negotiate with PERA through the summer of 2011, but made no headway.” Link to the full Gazette Telegraph article: http://www.gazette.com/articles/registered-142694-deal-simple.html (My comment: Memorial Health System is a local government affiliate member of Colorado PERA. I think this measure will be supported by Colorado Springs voters and the City will fight out the level of PERA obligations in court. Colorado Springs will attempt to force all other members of the Local Government Division to eat this $61 million debt [probably higher right now.] How will the PERA Board of Trustees handle this matter? It appears to be their fiduciary duty to ensure that the PERA trust funds are made whole; however, we have seen that the PERA trustees have a peculiar understanding of their fiduciary duty. If Colorado Springs is successful in dumping its PERA obligations, perhaps other municipalities would like to dump their PERA obligations. It amazes me the extent to which Coloradan elected officials will go to avoid public sector debts, first Colorado PERA, and now the City of Colorado Springs. This will be very interesting litigation to follow. It bears on the nature of vested PERA member benefits.) Here is current Colorado law addressing termination of PERA affiliation: “Any political subdivision within the state of Colorado or any public agency created by such a political subdivision that is an employer affiliated with the association pursuant to the provisions of section 24-51-309 and that is assigned to the local government division may make application to the board to terminate the affiliation of the employer with the association. The application shall be made by submitting to the board an ordinance or resolution that has been adopted by the governing body of the employer and that has been approved by at least sixty-five percent of the employees of the employer who are members. Such employee members of the employer shall be notified in writing of the provisions of section 24-51-321 prior to a vote on an ordinance or resolution to terminate the affiliation of the employer with the association. All applications for termination of affiliation shall comply with the requirements set forth in this section, and, except as otherwise provided in this part 3, all applications meeting such requirements shall be approved by the board. Applications which do not meet the requirements of this section shall not be approved by the board. Upon approval of such application, the effective date of termination of affiliation shall not occur earlier than sixty days or later than ninety days after the date upon which such application is submitted to the board.” (My comment: Has Memorial Hospital submitted the resolution required in Colorado law? Were Memorial employee members notified of the proposed termination of affiliation? Did 65% of Memorial employees approve the plan? Has the Colorado Springs City Attorney even read this statute or the germane case law? What is the opinion of the Colorado Municipal League on this matter?) Here are some statements from the group opposing the Memorial lease: “If the lease is allowed, more than five thousand employees will cease to be eligible to contribute to Public Employees' Retirement Association of Colorado (PERA), the public pension fund for most state and school employees in Colorado. This may be devastating to PERA's future funding of all retirees in our community.” “Employee Health Care and Retirement benefits change on October 1, 2012. Employees as of October 1st (or when MHS is formally taken over) will no longer be employees of Memorial and therefore will no longer be entitled to contribute to their PERA accounts or carry the same health care benefits. While there does not appear to be many concrete answers on this issue it could mean: “- Employees vested in PERA may not transfer that status over to the new retirement plan.” Here is the website for the group opposing the Memorial Hospital lease: http://ourcityourcare.com/ Here’s a link to the group supporting the Memorial Hospital lease plan: http://greatcitygreatcare.com/ Here’s a Gazette Telegraph editorial in favor of the proposal: http://www.gazette.com/opinion/memorial-142699-health-ballots.html Here is a link to the Colorado PERA local government PERA affiliation guide: http://www.copera.org/pdf/5/5-22.pdf Visit saveperacola.com or Friend Save Pera Cola on Facebook to learn more about the Colorado General Assembly’s attempt to breach pension contracts.

PROOF THAT COLORADO’S GOVERNMENT LIES: COLORADO PERA’S ATTEMPT TO TAKE CONTRACTED RETIREE BENEFITS. When I was young I held the belief that public service in the United States is honorable, that the United States of America was exceptional in the world, that governments in the United States, while flawed, deserved the respect of citizens. Now that I am old, I see that I was naive . . . that governmental entities in the United States will intentionally deceive to achieve their goals, and that over two centuries our soldiers have died for a country that will countenance, and even celebrate, base behavior on the part of its public sector instrumentalities. It saddens me, but if this state of affairs persists in the United States . . . Honor is dead. Some background . . . You may know that an entity of Colorado state government, Colorado PERA, is attempting to breach its public pension contracts with its retirees. Colorado PERA is attempting a retroactive taking, a “clawback” of accrued, fully-vested pension benefits that were earned by retired PERA members over decades. Colorado PERA public pension benefits include a “base benefit” that is set at retirement and a “COLA benefit” that adjusts pensions annually to compensate for inflation. The “base benefit” and the “COLA benefit” are set forth in Colorado statutes with identical force of law and legal status. In its attempt to breach retiree contracts Colorado PERA has created a contrivance. The contrivance that Colorado PERA is using is that somehow the “base benefit” is a contractual obligation, but the “COLA benefit” is not a contractual obligation, in spite of the fact that both pension benefits are set forth in law in an identical manner. What this boils down to is attempted, unabashed, theft by government. Whether or not Colorado PERA’s attempt to take fully-vested public pension benefits from PERA retirees is ultimately successful in the courts, one fact has been incontrovertibly established . . . Colorado PERA, as an instrumentality of the State of Colorado, is an organization that will lie to achieve its policy goals. This is a sad fact for the many employees of Colorado PERA, for the trustees that have served on the Colorado PERA Board of Trustees over 80 years, and for the thousands of PERA members and retirees. And now, the proof of the deceit . . . Colorado PERA has told us, in writing, that the PERA COLA benefit IS a contractual obligation of PERA . . . and then, after initiating their attempt to breach contracts, Colorado PERA has told us, in writing, that the PERA COLA benefit IS NOT a contractual obligation of PERA. Both of these statements cannot be true. Colorado PERA in a written document, to the Colorado General Assembly’s Joint Budget Committee on December 16, 2009 states that the PERA COLA benefit IS a contractual obligation of PERA: “The General Assembly cannot decrease the COLA (absent actuarial necessity) because it is part of the contractual obligations that accrue under a pension plan protected under the Colorado Constitution Article II, Section 11 and the United States Constitution Article 1, Section 10 for vested contractual rights.” Link: http://www.kentlambert.com/Files/PERA_JBC_Hearing_Responses-12-16-2009_Final.pdf Colorado PERA on page 23 of its May 6, 2011 “Reply Brief” in the pension case Justus v. State states that the PERA COLA benefit IS NOT a contractual obligation of PERA: “Plaintiffs seek to create a contract right that has never existed—an unchangeable COLA for life triggered (inconsistently) by either the date of their retirement or ‘full vesting.’” Link: http://saveperacola.files.wordpress.com/2011/06/2011-05-06-pera-defendants_-reply-in-support-of-summary-judgment.pdf That is simply unbelievable. In one document PERA writes "the contract right has never existed." In the other they write that the COLA benefit is a contractual obligation protected under the Colorado and US constitutions. When PERA writes that they need "actuarial necessity" to take the COLA benefit, they are not denying that it is a contractual obligation, in fact, it is an admission of the contractual nature of the COLA benefit. For further information regarding Colorado PERA’s attempt to take fully-vested pension benefits from retirees visit saveperacola.com or Friend Save Pera Cola on Facebook.