October 11, 2022
These highlights are a summary of topics discussed and actions taken by the COAERS Board.
Legislative Proposal Update
During its September meeting, the Board received a report on the development of pension legislation for the 88th Legislative Session. Staff reported on efforts since the June 2022 Board meeting, including the status of the draft legislation, and the timeline of action items leading up to the 88th Legislative Session.
Actuary Report on Cost-of-Living Adjustment for 2023
At the September meeting of the Board, the COAERS actuary provided the annual recommendation on the feasibility of a cost-of-living adjustment (COLA) for 2023. Based on the Pension Review Board funding requirements for retirement systems, the Board’s Funding Policy, and the System’s current funded status, the actuary concluded that the thresholds are not currently being met to support the consideration of a COLA. In their recommendation, the COAERS actuary concluded that the System should grant neither a COLA nor an additional payment at this time. While Trustees expressed concerns that the System was not in a position to grant a COLA, the Board voted to approve the actuary recommendation.
The Board received an educational presentation on the System’s upcoming Asset/Liability Study. The study is a tool that analyzes the retirement system’s key financial drivers – Investment Policy, Contribution Policy, and Benefit Policy. The Investment Policy Statement requires the Board to conduct an Asset/Liability Study at least every five years, or when there have been material changes to the contribution or benefit policy. While the next study would have been conducted in 2023, the Board believes it important to conduct this study now, ahead of the 88th Legislative Session, to model the effects of the agreed-to legislative framework to demonstrate the impact of the legislative proposal on the longterm financial sustainability of the System. For up to date information and COAERS news, visit www.coaers.org.