There is further to go in building the solvency of the Colorado public employee pension system and one way to accomplish that is through more cautious investment practices, says state Treasurer Walker Stapleton (R). Stapleton, reelected in November, made his comments in a Jan. 4 interview on Colorado Public Radio (CPR).
In his first term, Stapleton made some changes to strengthen the system’s finances, including lowering the system’s estimated rate of return on its investments, which said could lead to assumptions that are too high and to underfunding. Even with those steps, he said the system can meet approximately 65% of its obligations and he remains concerned about its long-term health.
Stapleton said that he would like fund managers to be conservative in the way they invest the plan’s funds. He likened more risky approaches to investing pension plan funds to a “shell game”; instead, he argued, “let's get to a realistic, conservative investment assumption and then properly fund the plan so that we're not creating in accounting terms what is called a deferred liability.”
In his first term, Stapleton made some changes to strengthen the system’s finances, including lowering the system’s estimated rate of return on its investments, which said could lead to assumptions that are too high and to underfunding. Even with those steps, he said the system can meet approximately 65% of its obligations and he remains concerned about its long-term health.
Stapleton said that he would like fund managers to be conservative in the way they invest the plan’s funds. He likened more risky approaches to investing pension plan funds to a “shell game”; instead, he argued, “let's get to a realistic, conservative investment assumption and then properly fund the plan so that we're not creating in accounting terms what is called a deferred liability.”
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