STATEMENT OF BASIS AND PURPOSE
Amendments and Additions to Rules of the
Public Employees’ Retirement Association
October 19, 2007

1.	Rule 1.20 F.(1)  is being amended to clarify how unused accrued leave payments will be credited when the individual receives a payout at termination of their employment.  This amendment is a codification of PERA’s existing longstanding policy. 

2.	Rule 1.20 F.(3) is being added to clarify when performance or merit payments will be considered salary for PERA purposes. This addition is a codification of PERA’s existing longstanding policy.

3.	Rule 1.20 F.(4) is being added to clarify that PERA salary does not include amounts excluded from gross income under a cafeteria plan defined in Internal Revenue Code Section 125 plan or under a qualified transportation fringe benefit program defined in Internal Revenue Code Section 132. This addition is a codification of PERA’s existing interpretation of its statutory definition of salary.

4.	Amendments to Rule 2.15 (employer assignments) are being added to reflect additional employer affiliations.

5.	Rule 16.10 C. is being amended to accommodate the new retirement plan selection choice that is being given to employees who commence employment with a community college on or after January 1, 2008.  

6.	Rule 16.10 D. is being added to specify which community colleges are included in the choice legislation that gives employees the choice of the PERA Defined Contribution Plan or the PERA Defined Benefit Plan if hired on or after January 1, 2008.  

7.	Rule 16.10 G. is being amended to accommodate the new choice that is being given to employees who commence employment with a community college on or after January 1, 2008.  

8.	Rule 16.10 J. is being added to clarify what it means to have a year of membership in the PERA Defined Benefit plan in order to determine if the member is eligible to elect to transfer to the PERA Defined Contribution plan in years 2-5 of their membership.

9.	Rule 16.10 K. is being added to define what the term 12 month break in membership means for purposes of Rule 16.10 J.

10.	 Rule 16.20 A. is being amended to accommodate the new choice that is being given to employees who commence employment with a community college on or after January 1, 2008 and to clarify that if no election is made within 60 days of commencing employment, the employee will automatically become a member of the PERA Defined Benefit plan.  

11.	 Rule 16.20 C. is being added to specify that an employee of a community college may become a participant in the PERA 401(k) plan upon commencement of employment.

12.	 Rule 16.20 F. is being added to specify which retirement plan the employee will be in if he or she terminates employment prior to the expiration of the 60 days from commencement of employment and no choice has been made.

13.	 Rule 16.30 B. is being amended to specify again that years of  
 membership in the Defined Benefit plan for the purpose of the transfer to  
 the Defined Contribution option shall be determined in accordance with  
 Rule 16.10 J.

14.  Rule 16.30 E. is being amended to change the cost for reestablishing a 
member contribution account to be consistent with the cost to reinstate a    
member contribution account under the Defined Benefit plan.  The cost to   
reinstate a refunded account changed for post January 1, 2007 members 
to include one percent of the member’s highest average salary which will  
be allocated to the annual increase reserve.

15.   Rule 16.95 E. is being amended to clarify that a state employee who is a 
   participant in the state Defined Contribution plan will have the choice  
   between the PERA Defined Contribution plan or the PERA Defined     
   Benefit plan if they are hired by a community college on or after January   
  1, 2008 and have not been in either of the two plans during the previous  
  12 months.

16.	Rule 16.95 F. is being added to clarify which retirement plan a community college employee will be in if they were employed by a community college during the previous 12 months.

17.	Rule 16.95 G. is being added to clarify which retirement plan a state employee will be in if they were employed by the state during the previous 12 months.

18.	Rule 16.95 H. is being added to clarify which retirement plan a state employee will be in if they have not been employed by the state in the last twelve months but have been a member of the PERA Defined Contribution Plan in the last twelve months. 

19.	Rule 16.95 I. is being added to clarify which retirement plan a community college employee will be in if they have not been employed by a community college in the last twelve months but have been a member of the PERA Defined Contribution Plan in the last twelve months.

Colorado PERA Rules
Effective January 1, 2008

Colorado Public Employees’ Retirement Association 
Board of Trustees
Mark J. Anderson, Chair, City of Colorado Springs
Sara R. Alt, Vice Chair, Retiree, Golden
Susan Beeman, Pueblo School District 60
James Casebolt, Colorado Court of Appeals
Howard M. Crane, Governor-appointed member
Carol Hoglund, Aims Community College
Cary Kennedy, State Treasurer
Tamela Long, Colorado State Patrol
Maryann Motza, Colorado Department of Labor and Employment
Scott Murphy, Littleton Public Schools
Susan G. Murphy, Governor-appointed member
Amy L. Nichols, Aurora Public Schools
Scott L. Noller, Colorado Springs School District #11
Lynn E. Turner, Governor-appointed member
Carole Wright, Retiree, Denver

Meredith Williams
Executive Director

David Maurek
Chief Operating Officer

Jennifer Paquette
Chief Investment Officer

Gregory W. Smith
General Counsel

Colorado Public Employees’ Retirement Association 
1300 Logan Street
Denver, Colorado  80203
www.copera.org

Statement of Basis and Purpose
In accordance with its duty to administer the Colorado Public Employees’ Retirement Association, the Board of Trustees has the authority to adopt and revise Rules in accordance with 24-51-204(5), Colorado Revised Statutes (C.R.S.).

Contents
Rule 1: Definitions 	Page 1
Rule 2: Administration	Page 2
Rule 3: Membership	Page 21
Rule 4: Contributions	Page 22
Rule 5: Service Credit	Page 25
Rule 6: Service Retirement	Page 28
Rule 7: Disability Benefits	Page 30
Rule 8: Benefit Options	Page 38
Rule 9: Survivor Benefits	Page 38
Rule 10: Increase in Benefits	Page 41
Rule 11: Employment After Retirement	Page 41
Rule 12: Health Care Program	Page 43
Rule 13: Life Insurance Program	Page 45
Rule 14: Voluntary Investment Program	Page 46
Rule 15: Domestic Relations Orders (DROs)	Page 47
Rule 16: Defined Contribution Plan	Page 49

Rule 1: Definitions
Rule 1 defines certain terms used in the Rules, and further defines certain terms defined in Article 51, Title 24, C.R.S.

Unless otherwise stated, the terms and phrases contained in these rules shall have the same meaning as specified in Article 51 of Title 24, C.R.S.

1.20 Terms Used in Rules
Terms used in the Rules shall have the meaning specified:
A. Foreign employer means a person or an entity that is formed under the laws of a jurisdiction outside the United States or its Territories.
B. Pay pattern means the frequency of periodic salary payments.
	(1) Academic pay pattern means salary is paid over a period of at least 8 months but less than 12 months.
	(2) Seasonal pay pattern means salary is paid over a period of 1 to 11 months as determined by work available.
	(3) Traditional pay pattern means salary is paid over a period of 12 months.
C. Noncovered employment means public or private employment with an employer in the United States, its territories, or any foreign country for which no PERA service credit was earned. Qualified service and non-qualified service shall be determined in accordance with the Internal Revenue Code, and the Internal Revenue Service Rules and Regulations.
D. Retroactive salary means salary for previous periods of employment for which payment was delayed or the rate of pay subsequently changed. Retroactive salary payments shall be considered earned in the months for which the salary should have been paid, had no delay or subsequent rate change occurred.
E. Qualified Children
(1) Natural children means those biological children of a member who are conceived prior to the date of death of the member and are born within the normal gestation period after the date of the death of the member. 
(2) Adopted children means those for whom a petition for adoption was filed in court prior to the date of the death of the member and such petition is diligently pursued to the entry of the final decree of adoption.
F. Salary
(1)  Accrued Leave Payments

     (a)  Payments by an employer in satisfaction of amounts owed for accrued but unused leave, other than sick leave shall be treated as PERA salary pursuant to 24-51-101(42), C.R.S.,, if the following criteria are met:
•	The payment by the employer of the accrued leave is made in a lump sum at the termination of the member’s employment or in periodic payments after severing employment not at the election of the member. Periodic payments must be made over consecutive pay periods and for a period not to exceed the amount of service credit awarded in association with the payment. In the event that periodic payments are made, a single benefit adjustment will be made at the end of the payment period;
•	The accrued leave payments are paid at a rate not to exceed the member’s most recent rate of pay; and
•	The payment is for accrued leave earned by the member pursuant to an established employer policy or employment contract and not as a result of a retroactive grant or an award by the employer.
     
      (b)  If each of the above criteria are met, consistent with longstanding PERA practice, the accrued leave payment will be treated as salary in calculating service credit and highest average salary for retirement by applying the payment over the number of months as determined by the member’s most recent monthly rate of pay.  Additional service credit for these months will be included in the retirement benefit calculation.  These months may also be used in the highest average salary calculation.

      (c)  Salary includes an annual lump sum payment of accrued leave, other than sick, paid because the individual has accrued in excess of the maximum accumulation allowed by the employer’s established leave policy. 

(2)  Fringe Benefits

	Salary does not include employer provided fringe benefits converted to cash payments in lieu of employer payment for the fringe benefits.

(3)  Performance or Merit payments

       Performance or merit payments are payments made pursuant to a written plan or policy which are in addition to regular salary or which replace regular salary increases in recognition of sustained employee performance over the evaluation period. In order for performance or merit payments to be treated as PERA salary pursuant to 24-51-101(42), C.R.S., the Association must have determined that the following criteria have been met:

•	The payment must be for performance and is made pursuant to a written plan adopted by the employer which identifies which employees are covered by the plan;

•	The written plan specifies objective criteria under which employees may participate in the plan and receive payments pursuant to the plan; and 

•	The written plan specifies the payments to be made under the plan or the method for determining the payments made under the plan.

(4)  Contributions under Internal Revenue Code Section 125 and 132

	Salary shall not include amounts excluded from gross income under a cafeteria plan defined in Internal Revenue Code Section 125, or under a qualified transportation fringe benefit program defined in Internal Revenue Code Section 132(f)(4), so long as such deductions are made in equal periodic deductions through the year.

G.  Highest Average Salary
(1)	In calculating Highest Average Salary, the Association shall sort the three periods of twelve consecutive months of service credit in chronological order.
(2)	For a member who was a member, inactive member, or retiree on December 31, 2006, and who has an effective date of retirement on or after January 1, 2009 and has more than 36 months of earned service credit and less than 48 months of earned service credit, the Highest Average Salary shall be calculated using the highest annual salaries associated with three periods of twelve consecutive months of service credit and no annual base salary shall be used.
(3)	For a member who was not a member, inactive member or retiree on December 31, 2006, and who has more than 36 months of earned service credit and less than 48 months of earned service credit, the Highest Average Salary shall be calculated using the highest annual salaries associated with three periods of twelve consecutive months of service credit and no annual base salary shall be used.

Rule 2: Administration
Rule 2 assigns affiliated employers to one of the four divisions, sets procedures for administrative review of Board decisions, describes the requirements for regular and special meetings of the Board of Trustees and general meetings of the Association, defines a quorum, describes the election of Board members and officers, and specifies the actuarial methods and assumptions used by the Association.

2.10 Affiliated Employers
Whenever any state agency, its political subdivisions, any school district, any public entity or court becomes affiliated with the Association, the Board shall assign it and its employees to either the State Division, School Division, the Local Government Division or the Judicial Division.

2.15 Employer Assignments
A. State Division
(1) Within the State Division, one group shall be designated Institutions of Higher Education, and the other shall be designated Agencies and Instrumentalities.
(A) The Institutions of Higher Education group of the State Division shall consist of the following employers and their employees and any other institutions of higher education established subsequent to the adoption of the Rules:
Adams State College 
Aims Community College 
Arapahoe Community College
Auraria Higher Education Center 
Aurora Community College 
Colorado Mountain College 
Colorado Northwestern Community College 
Colorado School of Mines 
Colorado State University 
Colorado State University at Pueblo 
Commission on Higher Education 
Denver Community College 
Fort Lewis College 
Front Range Community College 
Lamar Community College 
Mesa State College 
Metropolitan State College of Denver 
Morgan Community College 
Northeastern Junior College 
Otero Junior College
Pikes Peak Community College
Pueblo Vocational Community College
Red Rocks Community College
State Board for Community Colleges and Occupational Education
Trinidad State Junior College
University of Colorado
University of Northern Colorado
Western State College
(B) The Agencies and Instrumentalities group of the State Division shall consist of the following employers and their employees and any other state agency or instrumentality established subsequent to the adoption of the Rules:
CollegeInvest
Colorado Association of School Boards
Colorado Association of School Executives
Colorado College Access Network
Colorado Council on the Arts
Colorado High School Activities Association
Colorado Water Resources & Power Development Authority
CoverColorado
Department of Agriculture
Department of Corrections
Department of Education
Department of Health Care Policy and Financing
Department of Human Services
Department of Labor and Employment
Department of Law
Department of Local Affairs
Department of Military and Veterans Affairs
Department of Natural Resources
Department of Personnel and Administration
Department of Public Health and Environment
Department of Public Safety
Department of Regulatory Agencies
Department of Revenue
Department of State
Department of the Treasury
Department of Transportation
Fire and Police Pension Association
General Assembly
Joint Budget Committee
Judicial Department
Legislative Council
Office of the District Attorneys
Office of the Governor
Office of Legislative Legal Services
Office of the Lieutenant Governor
Office of the State Auditor
Pinnacol Assurance
Public Employees’ Retirement Association
School for the Deaf and the Blind
Special District Association of Colorado
State Historical Society

B. The School Division shall consist of the following affiliated employers and their employees and any other school district established and affiliated subsequent to the adoption of the Rules:
Adams County
Adams 12 Five Star Schools
Adams County School District 14
Bennett School District 29J
Brighton School District 27J
Mapleton School District 1
Strasburg School District 31J
Westminster School District 50

Alamosa County
Alamosa County School District Re-11J
Sangre de Cristo School District Re-22J

Arapahoe County
Adams-Arapahoe School District 28J
Byers School District 32J
Cherry Creek School District 5
Deer Trail School District 26J
Englewood School District 1
Littleton School District 6
Sheridan School District 2

Archuleta County
Archuleta County School District 50 Jt

Baca County
Campo School District RE-6
Pritchett School District RE-3
Springfield School District RE-4
Vilas School District RE-5
Walsh School District RE-1

Bent County
Las Animas School District RE-1
McClave School District RE-2

Boulder County
Boulder Valley School District RE2
St. Vrain Valley School District RE1J

Chaffee County
Buena Vista School District R-31
Salida School District R-32(J)

Cheyenne County
Cheyenne County School District Re-5
Kit Carson School District R-1

Clear Creek County
Clear Creek School District RE-1

Conejos County
North Conejos School District RE1J
Sanford School District 6J
South Conejos School District RE 10

Costilla County
Centennial School District R-1
Sierra Grande School District R-30

Crowley County
Crowley County School District RE-1

Custer County
Custer County Consolidated School District C-1

Delta County
Delta County School District 50(J)

Dolores County
Dolores County School District Re No. 2

Douglas County
Douglas County School District Re 1

Eagle County
Eagle County School District Re 50

Elbert County
Agate School District 300
Big Sandy School District 100J
Elbert School District 200
Elizabeth School District C-1
Kiowa School District C-2

El Paso County
Academy School District #20
Calhan School District RJ1
Cheyenne Mountain School District 12
Colorado Springs School District 11
Edison School District 54 Jt
Ellicott School District 22
Falcon School District 49
Fountain School District 8
Hanover School District 28
Harrison School District 2
Lewis-Palmer School District 38
Manitou Springs School District 14
Miami/Yoder School District 60 Jt
Peyton School District 23 Jt
Widefield School District 3

Fremont County
Canon City School District Re-1
Cotopaxi School District Re-3
Florence School District Re-2

Garfield County
Garfield School District 16
Garfield School District Re-2

Roaring Fork School District Re-1

Gilpin County
Gilpin County School District Re-1

Grand County
East Grand School District 2
West Grand School District 1

Gunnison County
Gunnison Watershed School District Re1J

Hinsdale County
Hinsdale County School District Re-1

Huerfano County
Huerfano School District Re-1
La Veta School District Re-2

Jackson County
North Park School District R-1

Jefferson County
Jefferson County School District R-1

Kiowa County
Eads School District Re-1
Plainview School District Re-2

Kit Carson County
Arriba-Flagler Consolidated School District No. 20
Bethune School District R-5
Burlington School District Re-6J
Hi-Plains School District R-23
Stratton School District R-4

Lake County
Lake County School District R-1

La Plata County
Bayfield School District 10Jt-R
Durango School District 9-R
Ignacio School District 11 Jt

Larimer County
Park School District R-3
Poudre School District R-1
Thompson School District R-2J

Las Animas County
Aguilar Reorganized School District 6
Branson Reorganized School District 82
Hoehne Reorganized School District 3
Kim Reorganized School District 88
Primero Reorganized School District 2
Trinidad School District 1

Lincoln County
Genoa/Hugo School District C-113
Karval School District Re 23
Limon School District Re 4J

Logan County
Buffalo School District Re-4
Frenchman School District Re-3
Plateau School District Re-5
Valley School District Re-1

Mesa County
De Beque School District 49 Jt
Mesa County Valley School District 51
Plateau Valley School District 50

Mineral County
Creede Consolidated School District 1

Moffat County
Moffat County School District Re No.1

Montezuma County
Dolores School District RE 4A
Mancos School District Re-6
Montezuma-Cortez School District Re 1

Montrose County
Montrose County School District Re-1J
West End School District Re-2

Morgan County
Brush School District Re-2 (J)
Fort Morgan School District Re-3
Weldon Valley School District Re-20 (J)
Wiggins School District Re-50 (J)

Otero County
Cheraw School District 31
East Otero School District R1
Fowler School District R4J
Manzanola School District 3J
Rocky Ford School District R2
Swink School District 33

Ouray County
Ouray School District R-1
Ridgway School District R-2

Park County
Park County School District Re-2
Platte Canyon School District 1

Phillips County
Haxtun School District Re-2J
Holyoke School District Re-1J

Pitkin County
Aspen School District 1

Prowers County
Granada School District Re-1
Holly School District Re-3
Lamar School District Re-2
Wiley School District Re-13 Jt

Pueblo County
Pueblo City School District 60
Pueblo County Rural School District 70

Rio Blanco County
Meeker School District RE1
Rangely School District RE4

Rio Grande County
Del Norte School District C-7
Monte Vista School District C-8
Sargent School District Re-33J

Routt County
Hayden School District Re 1
South Routt School District Re 3
Steamboat Springs School District Re 2

Saguache County
Center Consolidated School District 26 Jt
Moffat School District 2
Mountain Valley School District Re 1

San Juan County
Silverton School District 1

San Miguel County
Norwood School District R-2J
Telluride School District R-1

Sedgwick County
Julesburg School District Re 1
Platte Valley School District Re3

Summit County
Summit School District Re 1

Teller County
Cripple Creek-Victor School District Re-1
Woodland Park School District RE-2

Washington County
Akron School District R-1
Arickaree School District R-2
Lone Star School District 101
Otis School District R-3
Woodlin School District R-104

Weld County
Ault-Highland School District Re-9
Briggsdale School District Re-10
Eaton School District Re-2
Fort Lupton School District Re-8
Gilcrest School District Re-1
Greeley School District 6
Johnstown-Milliken School District Re-5J
Keenesburg School District Re-3
Pawnee School District Re-12
Platte Valley School District Re-7
Prairie School District Re-11
Windsor School District Re-4

Yuma County
Idalia School District RJ-3
Liberty School District J-4
Wray School District RD-2
Yuma School District 1

Boards of Cooperative Educational Services (BOCES)
Centennial Board of Cooperative Educational Services
East Central Board of Cooperative Educational Services
Expeditionary Learning School Board of Cooperative Educational Services
Grand Valley Board of Cooperative Educational Services
Mountain Board of Cooperative Educational Services
Northeast Board of Cooperative Educational Services
Northwest Colorado Board of Cooperative Educational Services
Pikes Peak Board of Cooperative Educational Services
Rio Blanco Board of Cooperative Educational Services
Santa Fe Trail Board of Cooperative Educational Services
South Central Board of Cooperative Educational Services
Southeastern Board of Cooperative Educational Services
Uncompahgre Board of Cooperative Educational Services
Ute Pass Board of Cooperative Educational Services

Boards of Cooperative Services (BOCS)
San Juan Board of Cooperative Services
San Luis Valley Board of Cooperative Services
Southwest Board of Cooperative Services

Vocational Schools
Delta-Montrose Area Vocational School
San Juan Basin Technical College

Other
Colorado Consortium for Earth and Space Science Education

C. Local Government Division
The Local Government Division shall consist of the following affiliated employers and their employees and any other entity of local government or public agency other than state that elect to affiliate with the Association:

Adams and Jefferson County Hazardous Response Authority
Alamosa Housing Authority
Arapahoe Park and Recreation District
Aurora Housing Authority
Baca Grande Water & Sanitation District
Beulah Water Works District
Black Hawk-Central City Sanitation District
Blanca-Fort Garland Metropolitan District
Boulder County
Boulder County Public Trustee’s Office
Boxelder Sanitation District
Brush Housing Authority
Carbon Valley Park & Recreation District
Castle Pines Metropolitan District
Castle Pines North Metropolitan District
Center Housing Authority
Central Colorado Water Conservancy District
City of Alamosa
City of Boulder
City of Colorado Springs
City of Fort Morgan
City of Las Animas
City of Lone Tree
City of Manitou Springs
City of Pueblo
City of Wray
City of Yuma
Collbran Conservancy District
Colorado District Attorneys’ Council
Colorado First Conservation District
Colorado Health Facilities Authority
Colorado Housing and Finance Authority
Colorado Library Consortium
Colorado School District Self-Insurance Pool
Colorado Springs Utilities
Columbine Knolls-Grove Metropolitan Recreation District
Costilla Housing Authority
County Technical Services 
Crown Mountain Park & Recreation District
Cunningham Fire Protection District
Douglas County Housing Partnership
Douglas Public Library District
Durango Fire and Rescue Authority
East Cheyenne Groundwater Management District
East Larimer County Water District
Eaton Housing Authority
Elbert County Library District
Elizabeth Park and Recreation District
Estes Valley Public Library District
Forest Lakes Metropolitan District
Fremont Conservation District
Fremont Sanitation District
Garfield County Housing Authority
Grand Valley Fire Protection District
Green Mountain Water and Sanitation District
GVR Metropolitan District
Housing Authority of Arriba
Housing Authority of the County of Adams
Housing Authority of the Town of Limon
Lamar Housing Authority
Lamar Utilities Board
Left Hand Water District
Longmont Housing Authority
Longs Peak Water District
Louisville Fire Protection District
Meeker Cemetery District
Meeker Regional Library District
Meeker Sanitation District
Memorial Health System 
Montrose Fire Protection District
Montrose Recreation District
Monument Sanitation District
Morgan Conservation District
Morgan County Quality Water District
Mountain View Fire Protection District
Mountain Village Metropolitan District
Mountain Water and Sanitation District
Niwot Sanitation District
North Carter Lake Water District
North Chaffee County Regional Library
Northeast Colorado Health Department
Northeastern Colorado Association of Local Governments
Park Center Water District
Pine Drive Water District
Prowers Conservation District
Pueblo City-County Health Department
Pueblo Library District
Pueblo Transit Authority
Rampart Regional Library District
Rangely Regional Library District
Red Feather Mountain Library District
Red, White & Blue Fire Protection District
Republican River Water Conservation District
Rifle Fire Protection District
Rio Blanco Fire Protection District
Rio Blanco Metropolitan Recreation & Park District
Rio Blanco Water Conservancy District
Routt County Conservation District
Sable-Altura Fire Protection District
San Luis Valley Development Resources Group
San Luis Valley Water Conservancy District
San Miguel County Public Library District
San Miguel Regional and Telluride Housing Authority
Scientific and Cultural Facilities District
Sheridan Sanitation District #1
Soldier Canyon Filter Plant
Steamboat II Water and Sanitation District
St. Vrain Sanitation District
Tabernash Meadows Water and Sanitation District
Town of Alma
Town of Bayfield
Town of Crawford
Town of Dinosaur
Town of Eckley
Town of Estes Park
Town of Firestone
Town of Lake City
Town of Lochbuie
Town of Mountain Village
Town of Platteville
Town of Rico
Town of Rye
Town of Seibert
Town of Silver Plume
Town of Timnath
Tri-County Health Department
Upper Colorado Environmental Plant Center
Walker Field, Colorado, Public Airport Authority
Washington-Yuma Counties Combined Communications Center
Weld County Department of Public Health and Environment
West Greeley Conservation District
Western Rio Blanco Metropolitan Recreation and Park District
White River Conservation District
Windsor-Severance Library District
Wray Housing Authority
Yuma Housing Authority
Y-W Well Testing Association

D. Judicial Division
The Judicial Division shall consist of judges elected or appointed to positions in the following courts and any court established subsequent to the adoption of the Rules:
1st-23rd District Court
24th District-Denver Probate Court
25th District-Denver Juvenile Court
Adams County Court
Alamosa County Court
Arapahoe County Court
Archuleta County Court
Baca County Court
Bent County Court
Boulder County Court
Broomfield County Court
Chaffee County Court
Cheyenne County Court
Clear Creek County Court
Conejos County Court
Costilla County Court
Court of Appeals
Crowley County Court
Custer County Court
Delta County Court
Denver County Court
Dolores County Court
Douglas County Court
Eagle County Court
Elbert County Court
El Paso County Court
Fremont County Court
Garfield County Court
Gilpin County Court
Grand County Court
Gunnison County Court
Hinsdale County Court
Huerfano County Court
Jackson County Court
Jefferson County Court
Kiowa County Court
Kit Carson County Court
Lake County Court
La Plata County Court
Larimer County Court
Las Animas County Court
Lincoln County Court
Logan County Court
Mesa County Court
Mineral County Court
Moffat County Court
Montezuma County Court
Montrose County Court
Morgan County Court
Otero County Court
Ouray County Court
Park County Court
Phillips County Court
Pitkin County Court
Prowers County Court
Pueblo County Court
Rio Blanco County Court
Rio Grande County Court
Routt County Court
Saguache County Court
San Juan County Court
San Miguel County Court
Sedgwick County Court
Summit County Court
Supreme Court
Teller County Court
Washington County Court
Weld County Court
Yuma County Court

Rule 16: Defined Contribution Plan
16.10 Terms 

A. Defined Contribution Plan means the Association’s defined contribution plan established pursuant to 24-51-1501, C.R.S., as a component of the 401(k) Plan. The Defined Contribution Plan is a separate trust fund within the 401(k) Plan. The Defined Contribution Plan is a profit-sharing plan intended to satisfy the requirements of Section 401(a) of the Internal Revenue Code.

B. Defined Contribution Account refers to an account containing sums transferred to the account via trustee to trustee transfer together with the contributions to the Defined Contribution Plan on behalf of the member of the Defined Contribution Plan and the earnings thereon less any distributions, any losses, and the member’s allocable portion of the costs and expenses of administering the Plan.

C. Commence Employment means the date the employee began actual performance of services for a Community College or an employer as defined in 24-52-202(5), C.R.S. and earned salary for such services regardless of when the payment occurs.

D. Community College refers to any Community College in the state system of community and technical colleges governed by the State Board for Community Colleges and Occupational Education which shall include Arapahoe Community College, Colorado Northwestern Community College, the Community College of Aurora, the Community College of Denver, Front Range Community College, Lamar Community College, Morgan Community College, Northeastern Junior College, Otero Junior College, Pikes Peak Community College, Pueblo Community College, Red Rocks Community College, Trinidad State Junior College and the Colorado Community College and occupational education system.

E. Member of the Defined Contribution Plan means an employee who elected to participate in the Defined Contribution Plan pursuant to 24-51-1503(1) or 24-51-1506(4), C.R.S., and is presently performing services for that PERA affiliated employer for salary resulting in contributions to the Defined Contribution Plan. Member of the Defined Contribution Plan also means, to the extent required, a member who is inactive but who has a Defined Contribution Account.

F. Active Participant in a state defined contribution plan established pursuant to part 2 of article 52 of title 24 means an employee who elected to participate in the state defined contribution plan pursuant to 24-51-1502(1), C.R.S. and is presently performing services for that PERA affiliated employer for compensation resulting in contributions to the state defined contribution plan.

G. For purposes of 24-51-1502(2)(a) and 1502.5, C.R.S. reference to member of the Association includes a member of the Defined Contribution Plan.

H. Except as expressly provided herein, for purposes of Part 15 of the PERA Statutes and this Rule 16, all time periods shall be determined in accordance with 2-4-108, C.R.S. 

I. Year of Membership in the Defined Contribution Plan means 12 months, not necessarily consecutive, during which contributions are made on the member’s behalf pursuant to 24-51-1505(1), C.R.S. to the Defined Contribution Plan. A Defined Contribution Plan member’s total years of membership in the Defined Contribution Plan shall be calculated by dividing the total number of months during which contributions were made on the member’s behalf to the Defined Contribution Plan by 12. Credit shall not be provided for member contributions transferred pursuant to Rule 16.30 D after an employee elects to participate pursuant to 24-51-1506(4), C.R.S. Years of membership before a 12 month break in service shall not be includable for purposes of determining a Defined Contribution Plan member’s years of membership after such 12 month break in service. Each time an election is made to participate in the Defined Contribution Plan after a 12 month break in service, the employee shall have a new Defined Contribution Account with a new vesting schedule.

J.  For purposes of 24-51-1506(4), C.R.S., year of membership in the plan means 12 months of contributions, not necessarily consecutive, with an employer as defined in 24-52-202(5), C.R.S., or a Community College.  A member’s total years of membership in the Defined Benefit Plan shall be calculated by dividing the total number of months of contributions by 12.  Years of membership before a 12 month break in membership shall not be includable for purposes of determining a member’s years of membership after such 12 month break in membership.  Each time an election is made pursuant to 24-51-1502(1) or 1503(1), C.R.S. after a 12 month break in membership, the employee shall have a new calculation for years of membership for the purposes of 24-51-1506(4), C.R.S.  Years of membership with an employer other than an employer defined in 24-52-202(5), C.R.S. or a Community College shall not count towards the calculation of years of membership pursuant to 24-51-1506(4), C.R.S.

K.  For purposes of Rule 16.10 J., reference to 12 month break in membership means 12 consecutive months for which no contributions are made on the member’s behalf to the Defined Benefit Plan with an employer defined in 24-52-202(5), C.R.S. or a Community College. 

L. 12 Month Break in Service means, except as otherwise required by federal law, 12 consecutive months for which no contributions are made on the member’s behalf to the Defined Contribution Plan.

M. Transfer Account means an account within the PERA 401(k) account containing the vested portion of the Defined Contribution Account together with any earnings thereon, less any distributions, losses and the member’s allocable portion of the costs and expenses of administering the Plan that is established if there is a 12 Month Break in Service from the Defined Contribution Plan or an election is made to become a member of the Association pursuant to 24-51-1506(1), C.R.S. and Rule 16.30 A. The Transfer Account will be an account within the PERA 401(k) account but will be subject to the same distribution and investment election rules as the Defined Contribution Account.  

16.20 Initial Election Period

A. Election to participate in the Defined Contribution Plan by an eligible employee pursuant to 24-51-1503(1), C.R.S. must be made in a manner approved by the Association. Such election must be received by the Association within 60 days from the date the employee commences employment. Such election becomes effective on the first valuation date following the receipt of the election form by the Association. For an employee of an employer as defined in section 24-52-202(5), C.R.S., if no such election is received by the Association within 60 days from the date the employee commences employment, the employee will automatically become a member of the Association unless the employee has elected to participate in a defined contribution plan established pursuant to part 2 of article 52 of title 24 within 60 days from the date the employee commences employment.  For an employee of a Community College, if no such election is received by the Association within 60 days from the date the employee commences employment, the employee will automatically become a member of the Association.

B. An eligible employee pursuant to 24-51-1502(2), C.R.S., cannot become a participant in the PERA 401(k) Plan until the employee’s election to become a member of the Defined Contribution Plan or a member of the Association is effective or the employee is determined to be a member of the Association at the conclusion of the election period specified in Rule 16.20 A.

C.  An employee pursuant to 24-51-1502.5, C.R.S., may become a participant in the PERA 401(k) Plan upon commencement of employment.

D. An eligible employee shall make only a single election pursuant to 24-51-1502(1) and 24-51-1503(1), C.R.S. Such an election, once made, may not be withdrawn.

E. If member and employer contributions are made to the Association during the initial election period on behalf of an eligible employee who elects to be covered by either the state defined contribution plan pursuant to 24-51-1502(1), C.R.S. or the Defined Contribution Plan pursuant to 24-51-1503(1), C.R.S., such contributions (without interest) shall be transferred to the plan within 90 days after the eligible employee's election becomes effective.  

F. An employee of an employer as defined in 24-52-202(5), C.R.S., who is hired on or after January 1, 2006, or an employee of a Community College hired on or after January 1, 2008, who terminates his or her employment for any reason prior to the expiration of the 60 days pursuant to 24-51-1502(1) or 1503(1), C.R.S., and who has not made a choice to become a participant in a retirement plan, shall be deemed to have been a member of the Association from the date of employment to the date of termination and thereafter an inactive member of the Association. 

16.30 Additional Choice Within Years Two Through Five

A. Election to become a member of the Association pursuant to 24-51-1506(1), C.R.S. must be made in writing in a manner designated by the Association. Membership in the Association is effective on the first date of the pay period following the date the Association receives the form. Such election must be received within the second to fifth year of the employee’s current period of membership in the Defined Contribution Plan. Years of membership in the Defined Contribution Plan shall be determined in accordance with Rule 16.10 I.

B. Election to become a member of the Defined Contribution Plan pursuant to 24-51-1506(4), C.R.S. must be made in writing in a manner designated by the Association. Such election becomes effective on the first date of the pay period following the date the Association receives the election form. Such election form must be received within the second to fifth year of the employee’s membership in the Association in accordance with Rule 16.10 J.

C. For an employee who becomes a member of the Association pursuant to 24-51-1506(1), C.R.S. the vested portion of his or her Defined Contribution Account pursuant to 24-51-1505(3), C.R.S. shall be transferred into the employee’s Transfer Account. The amount of unvested employer contributions shall be forfeited pursuant to 24-51-1505(3), C.R.S.

D. An employee who elects to participate in the Defined Contribution Plan pursuant to 24-51-1503(1) or 1506(4), C.R.S., who has an existing member contribution account and is an inactive member of the Association, may either (i) elect to maintain his or her inactive member contribution account in the Association or (ii) direct that his or her member contribution account be transferred to the Defined Contribution Account; provided that after-tax contributions shall be transferred to an after-tax account in the employee’s PERA 401(k) account. If an employee elects to transfer his or her member contribution account pursuant to this subsection (ii), the Association will transfer such account within 90 days after the employee’s election becomes effective.  

E. An employee who elects to become a member of the Association pursuant to 24-51-1506(1), C.R.S. or after a 12 Month Break in Service from the Defined Contribution Plan and who has previously elected to transfer his or her member contribution account to the Defined Contribution Account pursuant to Rule 16.30 D (ii), may reestablish his or her member contribution account and corresponding service credit.  The cost to reestablish the member contribution account shall be the amount of money that was originally in the member contribution account, plus interest calculated at the actuarial investment assumption rate pursuant to PERA Rule 2.90 C, plus an amount equal to one percent of the member’s highest average salary for each month or partial month of service credit to be reestablished in accordance with 24-51-503(4), C.R.S.  An employee who elects to reestablish his or her member contribution account pursuant to this Rule 16.30 E (ii) may reestablish a portion of the account.

16.40 Investments

The investment alternatives available to a member of the Defined Contribution Plan shall be the same as those available in the PERA 401(k) Plan. In the event of a transfer from the Defined Contribution Plan to the Transfer Account, the investment alternatives designated by the member of the Defined Contribution Plan shall remain the same until changed.  

16.50 Beneficiary(ies)

A member of the Defined Contribution Plan who is also a participant in the PERA 401(k) Plan may designate different beneficiaries for each account. 

16.60 Contributions

A. The employer shall deliver all Defined Contribution Plan contributions, along with the required report to the service provider designated by the Plan Administrator within five days of the date the member of the Defined Contribution Plan is paid and consistent with the provisions of 24-51-401(1.7)(b) to (1.7)(d), C.R.S. If either the payment or the reports or both are late, interest shall be assessed and paid as specified in PERA Rule 14.30A.  

B. For purposes of deferring federal income tax imposed on salary, the employee contributions assumed and paid for by the employer shall be in lieu of paying such amounts as salary and shall be treated as employer contributions pursuant to Section 414(h)(2) of the Internal Revenue Code. For all other purposes, employee contributions assumed and paid for by the employer shall be considered employee contributions.  

C. Members of the Defined Contribution Plan shall be eligible to make tax-deferred-contributions and rollover contributions to the 401(k) Plan. 

16.70 Return to Employment

A. A Member of the Defined Contribution Plan who has elected a lifetime annuity distribution option on or after an age that distributions are exempt from penalty under Internal Revenue Code Section 72(t) shall be deemed to be a Retiree of the Association subject to the provisions of Rule 11 and 24-51-1101, et seq., C.R.S.

B. A Participant in the state defined contribution plan who has elected a lifetime annuity distribution option on or after an age that distributions are exempt from penalty under Internal Revenue Code Section 72(t) shall be subject to the provisions of Rule 11 and 24-51-1101, et seq., C.R.S.

16.80 Forfeiture

A. Except as otherwise required by federal law, upon the earlier of (i) a 12 Month Break in Service, (ii) the distribution of the vested portion of the Defined Contribution Plan member’s Defined Contribution Account upon termination of membership in PERA, or (iii) the transfer of the vested portion of the member’s Defined Contribution Account to a Transfer Account, the person shall forfeit the portion of the Defined Contribution Account that is not vested. Forfeitures shall be used to pay Plan expenses. If required by federal law, the forfeited portion of the Defined Contribution Account without earnings shall be reinstated upon the person’s resumption of participation in the Defined Contribution Plan.

B. If a person has a 12 Month Break in Service from membership in the Defined Contribution Plan, the vested portion of the Defined Contribution Account will automatically be transferred to a Transfer Account. The amount of unvested employer contributions shall be forfeited pursuant to 24-51-1505(3), C.R.S.

16.90 Distributions Upon Termination of Employment

A. The entire vested balance of the Defined Contribution Plan member’s Defined Contribution Account shall become available for distribution as soon as administratively practicable following the date of the Defined Contribution Plan member’s termination of membership in the Association, but the distribution shall not be made earlier than the date all of the member’s contributions are credited.

B. At the election of the member of the Defined Contribution Plan and subject to procedures of the Association, the distribution may be made in the following manner:
(i) by lump sum payment of the entire vested portion of the Defined Contribution Account;
(ii) by partial distribution of an amount designated by the member of the Defined Contribution Plan;
(iii) by monthly payments in an amount designated by the member of the Defined Contribution Plan until the entire remaining Defined Contribution Account is distributed; 
(iv) by a combination of the methods specified in subsections(i) through (iii); or
(v) by purchasing with the Defined Contribution Plan member’s vested Defined Contribution Account a lifetime annuity contract from an insurance company or other authorized third party annuity provider.
Notwithstanding anything herein to the contrary, the distribution options specified in this Rule 16.90 B shall apply to the person’s Transfer Account.

C. Distributions due to death will be paid to the Defined Contribution Plan member’s beneficiary.  

D. Except as provided in Article 15 of the PERA 401(k) Plan and this Rule 16, the procedures and restrictions for distributions shall be the same as for the PERA 401(k) Plan.  

16.95 Miscellaneous

A. The Domestic Relations Order requirements in PERA Rule 15 shall be the same for the Defined Contribution Plan as they are for the remainder of the PERA 401(k) Plan.

B.  A person may retire from the Association or receive a distribution from his or her Defined Contribution Account only if he or she has terminated PERA covered employment and is no longer actively contributing to either the Defined Contribution Plan or the Association’s Defined Benefit Plan.

C.  A member of the Defined Contribution Plan may not obtain a loan from the member’s Defined Contribution Account.

D.  The lifetime annuity distribution option for members of the Defined Contribution Plan will not be provided by the Association.

E.  An employee of an employer as defined in 24-52-202(5), C.R.S. who is hired on or after January 1, 2006, and who has been an active participant in a state defined contribution plan established pursuant to part 2 of article 52 of title 24 during the 12 months prior to the date that the employee commences employment shall not be eligible to become a member of the Association or a member of the Defined Contribution Plan unless the employee becomes an employee of a Community College on or after January 1, 2008.

F.  An employee who is hired on or after January 1, 2008, by a Community College who was an employee of a Community College during the 12 months prior to the date that the employee commences employment, shall participate in the Plan that he or she was in based on the prior employment with a Community College in the last 12 months.

G.  An employee of an employer as defined in 24-52-202(5), C.R.S. who is hired on or after January 1, 2006, and who was an employee of an employer as defined in 24-52-202(5), C.R.S. during the 12 months prior to the date that the employee commences employment shall participate in the Plan that he or she was in based on the prior employment with an employer as defined in 24-52-202(5), C.R.S. during the last 12 months.

H.  An employee who commences employment with an employer as defined in 24-52-202(5), C.R.S. who has not been employed by an employer as defined in 24-52-202(5), C.R.S. in the last 12 months, but who has been a Member of the Defined Contribution Plan in the last 12 months, shall continue to be a Member of the Defined Contribution Plan upon commencement of employment with the employer as defined in 24-52-202(5).

I.  An employee who commences employment with a Community College on or after January 1, 2008, who has not been employed by a Community College in the last 12 months, but who has been a Member of the Defined Contribution Plan in the last 12 months, shall continue to be a Member of the Defined Contribution Plan upon commencement of employment with the Community College.

J.  Any person who becomes a candidate for Board election in the State Division pursuant to Part 2 of the Association’s Statutes and these Rules must disclose whether he or she is a member of the Defined Contribution Plan or a member in the Defined Benefit Plan. 

K.  Except as required by 24-51-212, C.R.S., none of the moneys, accounts, benefits, or contributions associated with a Defined Contribution Account shall be assignable either in law or in equity or be subject to execution, levy, attachment, garnishment, bankruptcy proceedings, or other legal process.

L.  A person who no longer has a Defined Contribution Account and has not elected a lifetime annuity distribution option shall not have any rights associated with the Defined Contribution Plan and cannot be a retiree of the Association.

M.  A person who has a Transfer Account may only rollover the Transfer Account to another Plan not administered by the Association if that person is no longer a member of the Association. The person shall not have the ability to rollover the Transfer Account to the PERA 401(k) Plan.

N.  In the event there is a conflict between these Rules and the Plan Document, these Rules shall govern.