DU Strategic Issues Program

December 16, 2010

Colorado PERA’s Mission StatementTo promote long-term financial security for our membership while maintaining the stability of the fund.

www.copera.org l 303-832-9550 l 1-800-759-PERA (7372) l 1301 Pennsylvania Street, Denver

0

50,000

100,000

150,000

200,000

250,000

Total: 472,436

PERA MembershipOctober 31, 2010

State School Local Gov't Judicial DPS Total

Benefit Recipients 32,204 49,728 4,996 291 6,265 93,484

Active Members 57,517 120,121 17,264 314 13,819 209,035

Inactive Members 58,763 92,537 17,133 12 1,472 169,917

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PERA Financial Recap

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Colorado PERA Without DC plansIn billions

Beginning Balance January 1, 1985 $4.5

Employer Contributions 11.8

Member and other contributions 11.9

Investment Income 35.9

Benefit and refund payments (30.7)

Administrative Expenses (0.5)

Ending Balance December 31, 2009 $32.9

Investment Asset AllocationDecember 14, 2010

Global Stocks59.5%

Alternative Investments

8.4%

Cash & Short Term1.0%

Fixed Income22.2%

Real Estate6.8%

Opportunity Fund2.1%

$37.7 Billion Market Value

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PERA Assets vs. Liabilities Market Value as of December 31 for each year

19911992

19931994

19951996

19971998

19992000

20012002

20032004

20052006

20072008

2009$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

Assets Liabilities

In B

illi

on

s

6

School Division Actuarial Projection

December 31, 2009, Valuation Results 7

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40

Pessimistic Return (6.50%)

0.692303872959287

0.648573329608519

0.590834677131216

0.593076506464711

0.582863560965863

0.573355176087003

0.564185222511081

0.555407952365016

0.546676484632772

0.538052162566062

0.528920992437281

0.519167824215043

0.508983515553383

0.498413575490918

0.487463237285267

0.47617488009646

0.464388838057628

0.452296616618143

0.439982050267245

0.427480695830334

0.414871612448256

0.402034483803738

0.389311325699151

0.376844491309642

0.364773887681627

0.353232587119747

0.3421498016342

0.332046558311695

0.323230414402768

0.31599367505116

0.310600182654632

Expected Return (8.00%)

0.692303872959287

0.650697712662632

0.597760544649386

0.607264301503083

0.606628706345326

0.607032422550005

0.608155800702652

0.610090839182676

0.612539718944421

0.615609957181929

0.618738222428745

0.621889375114924

0.625277729252664

0.629001379654929

0.633124792300316

0.63775604690738

0.642868865250701

0.648684565541545

0.655367665946459

0.663044274274819

0.671887278699463

0.681980040682099

0.693670801259945

0.707197851913314

0.722808433559169

0.740762547431099

0.76127373113704

0.784798170381617

0.811700894350566

0.842354456085313

0.877119706783627

Optimistic Return (9.50%)

0.692303872959287

0.652907417419061

0.604838516769332

0.621814262774354

0.631189511259954

0.642244453759287

0.654736331837529

0.668829144523157

0.684313476882508

0.701387111417136

0.719587312133886

0.739019236207647

0.759980839808745

0.782693275320475

0.807359492747687

0.83424205575793

0.863562108049553

0.89567379843102

0.930947007603542

0.969738236845081

1.01246856199149

1.05963219274246

1.07939654334744

1.10106604297425

1.12469982689852

1.15036491058981

1.17824851806122

1.20845887356889

1.24114465487734

1.27646514839194

1.31459045578675

2008 Projection

0.637010107525961

0.568113965078657

0.501791853668141

0.492429260991696

0.482832769560567

0.472229247023601

0.460308745055406

0.447033178846613

0.432335858278294

0.416147472179161

0.398399135530075

0.379026099052709

0.357942730314066

0.335039817350984

0.310172510432163

0.283206722068659

0.253986399218917

0.222357847096294

0.188120135914922

0.151038822086802

0.110893063581764

0.067457531423800

6

0.020510069072095

7

0 0 0 0 0 0 0 0

10%

30%

50%

70%

90%

110%

130%

Pessimistic Return (6.50%) Expected Return (8.00%) Optimistic Return (9.50%) 2008 Projection

Year Beginning

Fu

nd

ed

R

atio

%

Senate Bill 10-001Shared Sacrifices

Modifies annual increase or “COLA” Increases member/employer contribution rates Increases retirement age (Rule of 90 with minimum

age 60 for new hires in 2017) Includes funding corridor between 90 percent and

103 percent Actuaries state that projections show full funding

achieved under current assumptions

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PERA’s Economic Engine

$3 billion in benefits paid annually 93,000 retirees – 90 percent Colorado residents 2.7 percent of the State’s wage income 20,000 jobs created $2,885 average monthly benefit paid $186 million in State and local tax receipts

$315 million in Colorado investments One in 13 Coloradans is a PERA member

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Source: Pacey Economics Group

Benefit Recipients in ColoradoDecember 31, 2009 –72,998

Moffat194

Rio Blanco154

Garfield552

Mesa2,926

Delta702

Montrose794

San Miguel46

Dolores33

Montezuma457 La Plata

916

San Juan

8

Ouray70

Routt244

Jackson31

Larimer5,638

Weld3,877

Logan540

Sedgwick69

Phillips77

Morgan590

Washington105

Yuma220

Adams4,058

Arapahoe6,319

Kit Carson157

Cheyenne39

Kiowa39

Prowers317

Bent97

Baca96

Las Animas457

Lincoln126

Elbert276

El Paso8,884

Pueblo5,286

Otero514

Crowley85

Grand223

Boulder4,800

Eagle202

Pitkin86

Gunnison280

Saguache72

Archuleta136

Conejos225

Costilla91

Huerfano210

Custer111

Alamosa431

Rio Grande294

Mineral16

Hinsdale10

Fremont1,574

Park192

Teller367

Douglas2,360

Chaffee577

Lake111

Summ

it

170

Clear Creek175

Gilpin 64

Je

ffe

rso

n8

,961

Broomfield739

Denver5,209

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PERA Recipient Payments as a Percentage of Wage Income

Metro Denver: 1.9%

Northern Colorado:

4.9%

Eastern Colorado: 8.8%

Pueblo/Southern Mountains:

13.5%

Southwest Mountain:

4.7%

Western Colorado: 4.7% Mountain:

2.1%

San Luis Valley: 11.6%

Colorado Springs:

3.5%

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State of Colorado Total: 2.7%

Source: Pacey Economics Group, 2008 data

PERA’s DC Plans

Plan Who’s Eligible Participants(As of

September 30, 2010)

Assets(As of

September 30, 2010)

401(k) All PERA members and retirees

74,350 $1.78 billion

PERA DC State employees hired in 2006 or later

Community College employees hired in 2008 or later

3,355 $47 million

457 State employees and employees in some school districts

18,221 $423 million

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