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Supreme Court takes on challenge to PERA reforms

The Colorado Supreme Court on Monday agreed to consider an appeal in a long-running lawsuit that challenges 2010 reforms to the Public Employees’ Retirement Association.

The lawsuit, Justus et al v. State and PERA, was filed after the 2010 legislature passed a comprehensive overhaul of PERA, including a provision that allowed reduction of the annual cost-of-living increases paid to retirees.

The pension system covers all Colorado teachers and a wide variety of state, higher education and local government employees.

The case has followed the usual winding path through the courts. A Denver district judge ruled in favor of PERA in 2011, but the plaintiffs took the case to the Colorado Court of Appeals later that year. The appeals court set a legal standard for reduction of pension benefits and sent the case back to the district court. The state and PERA appealed to the supreme court last year.

The high court agreed to consider the issues of the legal standard set by the Court of Appeals and of whether retirement benefits can be reducd.

The PERA reform, known as Senate Bill 10-001, was crafted by a coalition of interest groups and both political parties and easier passed the legislature. But its provisions have been under fire ever since, both by some retirees in their lawsuit and by legislative Republicans, who so far have been unsuccessful in changing the law.