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Based on the results of recent annual actuarial valuations of FPPA Plans, the FPPA Board of Directors approved the Funded Ratios, Contribution Rates, IRS Contribution Limits, Cost of Living Adjustments, One-Time Lump Sums, and SRA Allocations below.

The Statewide Retirement Plan

Per Colorado House Bill 22-1034, effective January 1, 2023, FPPA has merged the assets and liabilities of the Statewide Defined Benefit Plan and the Statewide Hybrid Plan into a new Plan, the Statewide Retirement Plan. Annual Rates for the Statewide Retirement Plan are displayed below.

Funded Ratio

Funded Ratio reflects a pension fund's current financial position, presenting a fund’s assets as a percentage of liabilities. It is representation of how equipped the fund is to pay out pension benefits to its current and future members.

Statewide Retirement Plan

Funded Ratio: 100.0%, effective 1/1/2023
This valuation applies to the following components:

• Defined Benefit Component
• Hybrid Defined Benefit Component
• Social Security Component

Statewide Death & Disability Plan

Funded Ratio: 81.7%, effective 1/1/2023

Colorado Springs New Hire Pension Plan

• Fire Component: 84.4%, effective 1/1/2023
• Police Component: 88.7%, effective 1/1/2023

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Contribution Rates

Statewide Death & Disability Plan

For Colorado firefighters and police officers hired on or after January 1, 1997, a percentage of each Member’s pensionable earnings is required for coverage under the Statewide Death & Disability Plan. The Employer, in conjunction with its Members, decides who actually pays the contribution.

The Statewide Death & Disability Plan contribution rate increased from 3.2% to 3.4% for the period of January 1, 2023 through December 31, 2023. This rate will increase to 3.6%, effective January 1, 2024.

Per Colorado HB 20-1044, the Board, based on the results of an annual actuarial valuation, may adjust the Statewide Death & Disability Plan contribution rate every year for members hired on or after January 1, 1997, but in no event may the adjustment for any one-year period exceed two-tenths of one percent of the member's salary.

Statewide Retirement Plan

Defined Benefit Component
Contribution rates for the Defined Benefit Component are set by state statute. Employer contribution rates can be amended by state statute or by election of both the Employers and Members. Member contribution rates can be amended by state statute or by election of the membership. Members of this Component and their Employer were contributing 8% of pensionable earnings for a total contribution rate of 16% through 2014.

Changes to Contributions Through 2030
Members elected in 2014 to increase the Member contribution rate beginning in 2015. Member contribution rates increased 0.5% annually through 2022 to a total of 12% of pensionable earnings. Member contributions will remain at 12% for the foreseeable future.

Per Colorado HB 20-1044, a similar increase in Employer contributions began in 2021. Employer contribution rates will increase 0.5% annually through 2030 to a total of 13% of pensionable earnings. The Employer contribution rate for 2023 is 9.5%, and will increase to 10.0% for 2024.

• Reentry Members to the Defined Benefit Component
  Contributions from Members and Employers of plans reentering the system are established by resolution and approved by the FPPA Board. Prior to January 1, 2021, an additional 4% continuing rate of contribution is made by the reentry group. It is a local decision on who pays the additional 4% contribution. The reentry group had a combined Member and Employer contribution rate of 20% of pensionable earnings through 2014. Per the 2014 Member election, the reentry group also had their required Member contribution rate increase 0.5% annually beginning in 2015 through 2022. Per Colorado HB 20-1044, the Employer contributions will increase by 0.5% annually through 2030.
  
  Effective January 1, 2021, the continuing rate of contribution for departments that completed the reentry process prior to 2021 is 0.2% of pensionable earnings. Those departments, by resolution, may reduce the 4% continuing rate of contribution to 0.2% effective January 1, 2021. For departments that completed the reentry process on or after January 1, 2021, the continuing rate of contribution will be set at 1.9% of pensionable earnings and will be reevaluated after two years of experience, at which point, the rate may stay the same or may be decreased.

Social Security Component
The contribution rate for Members and Employers of affiliated social security employers was 4% of pensionable earnings for a total contribution rate of 8% effective January 1, 2007 through 2014.

Per the 2014 member election, the affiliated social security group also had their required Member contribution rate increase 0.25% annually beginning in 2015 through 2022 to a total of 6% of pensionable earnings. Beginning in 2022, the Member contribution rate is 6%. Legislation passed in 2020 requires a similar increase in Employer contributions effective January 1, 2021. Employer contribution rates will increase 0.25% annually through 2030 to a total of 6.5% of pensionable earnings. The Employer contribution rate for 2023 is 4.75% and will increase to 5.0% in 2024.

Hybrid Defined Benefit and Money Purchase Components
In 2023, the required minimum contribution for the Hybrid Defined Benefit and Money Purchase Components is 16.25% of the Member’s pensionable earnings, increasing to 16.5% in 2024. Of that required minimum, a portion goes towards the Hybrid Defined Benefit Component and the remainder is contributed to the Money Purchase Component of the Plan. If a department has a higher mandatory contribution rate, any amount above the required minimum goes towards the Money Purchase Component.

Changes to Contributions Through 2030
Per Colorado House Bill 22-1034, beginning in 2023 the required minimum contribution will increase by a total of 2% over eight years, to a combined contribution rate of 18%, split evenly between Member and Employer.

Effective January 1, 2023, the Hybrid Defined Benefit Component contribution rate is 13.9%, and will increase to 14.24% effective July 1, 2023 through June 30, 2024. After the necessary contribution is allocated to the Hybrid Defined Benefit Component, the remainder of the total contribution rate is then directed to the Money Purchase Component.

Money Purchase Component Only
The 2023 required minimum contribution for the Money Purchase Component will be 16.25%, with a minimum rate of 8.125% each for both Member and Employer. In 2024, the required minimum contribution will increase to 16.5%, with a minimum rate of 8.25% each for Members and Employers.

Colorado Springs New Hire Pension Plan

Police Component
Per the January 1, 2023 actuarial valuation, the Police Component member contribution rate is 8% of basic salary and the employer remits the remainder of the $9,630,054 annual required contribution effective 1/1/2024.

Fire Component
Per the January 1, 2023 actuarial valuation, the Fire Component member contribution rate is 10% of basic salary and the employer remits the remainder of the $5,194,423 annual required contribution effective 1/1/2024.

Statewide Money Purchase Plan

The Statewide Money Purchase Plan mandatory combined contribution rate remains set at 16% (8% member and 8% employer).

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IRS Contribution Limits

Cost of Living Adjustments

Colorado Revised Statutes provide that Cost of Living adjustments (COLAs) to statewide plans administered by FPPA are to be determined by the FPPA Board of Directors each year (with the exception of the Colorado Springs New Hire Pension plans – see below). These are sometimes referred to as Benefit Adjustments. While cost-of-living percentages from economic indicators, such as the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), are considered by the FPPA Board for setting this adjustment – there are other equally important factors which cannot be defined as cost-of-living. More importantly when making the determination of a benefit adjustment the FPPA Board must determine the amount of benefit increase the plans can sustain to ensure 100% funding of the plans. All of these factors go into the annual Board decision to establish a benefit adjustment.

Statewide Death & Disability Plan

Totally Disabled Members and their Beneficiaries
Under the Statewide Death & Disability Plan, totally disabled Members and their beneficiaries are granted a fixed 3% benefit adjustment each year on October 1. Those who commenced payment on or before October 1, 2022 had their benefit adjusted by this percentage in their October 2023 benefit payment.

Occupationally Disabled Members and their Beneficiaries and Survivors of Active Duty Members
Occupationally disabled Members and their beneficiaries and survivors of active duty Members may be granted a benefit adjustment at the discretion of the FPPA Board of Directors. The Board takes into account many factors when granting a benefit adjustment. One of those factors is maintaining the funded status of the plan (81.7% as of January 1, 2023) to ensure all benefits can be paid. The Board decided that occupationally disabled Members, their beneficiaries, and survivors of active duty Members who have been in receipt of an occupational disability benefit for at least 15 years would receive a benefit adjustment of 1.0%, effective 10/1/2023 through September 30, 2024. The benefit adjustment will remain at 0% for those in receipt of an occupational disability for less than 15 years.

Statewide Retirement Plan

Defined Benefit Component 
The Board decided that retirees and beneficiaries of the Statewide Retirement Plan would receive a benefit adjustment of 0.15% effective October 1, 2023, through September 30, 2024. This adjustment is in addition to any one-time lump sum payments described below.

Colorado Springs New Hire Pension Plan
Effective October 1, 2023 through September 30, 2024, the following Cost Of Living Adjustments are implemented for retirees of the Colorado Springs New Hire Pension Plans: payees in both the Fire Component and Police Component will receive a 3.0% COLA. The FPPA Board of Directors do not establish Cost of Living adjustments for either Colorado Springs New Hire Pension Plans. For both components of the Colorado Springs New Hire Plan, the Cost Of Living Adjustments are linked to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the previous year as defined by their plan documents.

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One-Time Lump Sum Payments

In April 2023, the Board approved a change to FPPA’s Cost of Living Adjustment policy for the Statewide Retirement Plan. This new policy allows the board to consider a non-compounding, one-time lump sum payment in years where the national inflation rate is higher than the compounding COLA that the Plan can afford. This one-time lump sum which would be in addition to any awarded compounding COLA.

The Board can now consider granting one-time lump sum payments to eligible retirees under these certain conditions:

• If the compounding COLA is less than 1%, and
• The long-term investment pool (where FPPA invests Plan assets) has achieved an average return of 6.5% over the last five years


• Then, pay a one-time lump sum that equals
  (CPI-W inflation rate  –  the compounding COLA)  x  the Member’s annual benefit

Statewide Retirement Plan

In 2022, the conditions for awarding a one-time lump sum were met. Therefore, for eligible retirees in the Statewide Retirement Plan, FPPA’s Board has approved a one-time lump sum payment equal to 8.35% of the Member’s annual benefit, which will be included in the Member’s October 2023 benefit payment. This sum was calculated by subtracting the approved compounding COLA (0.15%) from the previous year’s CPI-W inflation rate (8.5%).

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SRA Allocation Rates

Please note that a provision of House Bill 20-1044, signed April 1, 2020, required FPPA to convert existing Separate Retirement Account (SRA) balances to individual, self-directed defined contribution accounts held at Fidelity Investments® in January 2021. This conversion is now complete. More information about the changes can be found in these resources:

• Blog: Separate Retirement Accounts: What’s Changing?
• Webinar: Separate Retirement Account Updates
• SRA change information on FPPA's legislation-specific website

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