While the financial condition of a large Colorado state employees retirement fund isn't on as solid of ground as many would like, reports of its demise are misleading, according to Colorado Public Employees' Retirement Association.
In fact, officials from the organization responsible for the fund's management say the fund's financial status has improved since last year.
"The impact of (new revenue sources) coming means we'll be fully funded by 2050," said Katie Kaufmanis, communications director for PERA. "Our assets on hand should match our liabilities."
PERA provides retirement and other benefits to employees of more than 390 government agencies and public entities, including Moffat County School District.
PERA serves more than 380,000 active and retired Colorado public employees. It is one of the largest pension plans in the United States, according to rankings provided by Pension and Investment Magazine.
While enrolled in the program, employees do not earn Social Security, thereby making the state's retirement plan the primary retirement source for members.
PERA is currently facing a funding gap of $12.5 billion.
The fund returned 9.8 percent in 2005, above its targeted benchmark, 8.5 percent, raising its assets to $34.2 billion. However, its liabilities are estimated at $46.8 billion. Liabilities are measured by benefits owed to members of the plan.
Kaufmanis said new legislation dictates that an additional 6 percent more in contributions will be funneled into PERA throughout the next six years. Also, benefit changes for new hires in 2007 will positively affect the fund's finances, she said.
The Moffat County School District is one of the largest agencies in Craig that offers PERA and has a significant interest in the program's future viability, said Mike Brinks, school district finance director.
"We're keeping an eye on it," Brinks said. "We're very interested in what's going on."
The district has paid an extra 1/2 percent into the PERA fund this year, which equates to $60,000.
Like Colorado PERA, Brinks said doomsday media reports regarding the fund's demise have been overblown.
"It's a very large number, but by no means is PERA broke," Brinks said.
An economic downturn in 2001, coinciding with the collapse of companies such as MCI and Enron, caused a significant downturn in the PERA fund, Brinks said.
"It put a dent in the amount of assets," he said.
A PERA fund manager visited Craig several months ago to discuss the fund's financial status, Brinks said. It drew employees from both the school district and other state agencies.
Brinks said the school district continues to monitor the PERA accounts.
He also said the fund has gradually begun to repair itself after downtrodden years and will continue to do so as the market improves.