{"id":478,"date":"2026-06-08T10:35:52","date_gmt":"2026-06-08T10:35:52","guid":{"rendered":"https:\/\/coloradorelocationreport.com\/?p=478"},"modified":"2026-06-08T10:35:52","modified_gmt":"2026-06-08T10:35:52","slug":"as-retiree-pensions-shrank-colorado-pera-paid-its-staff-millions-of-dollars-in-bonuses","status":"publish","type":"post","link":"https:\/\/coloradorelocationreport.com\/?p=478","title":{"rendered":"As retiree pensions shrank, Colorado PERA paid its staff millions of dollars in bonuses"},"content":{"rendered":"
\n

In 2022, the Colorado state pension fund had its worst year since the Great Recession, losing $9.8 billion.<\/p>

Read more Where Alex Kelloff and Dwayne Romero stand on the issues in Colorado\u2019s 3rd Congressional District primary<\/a><\/p>\n

The losses were so large, they set the Colorado Public Employees\u2019 Retirement Association\u2019s finances back for years, digging a hole that the pension is only now starting to climb out of.<\/p>\n

But in the aftermath, PERA\u2019s investment managers took home some of their largest bonuses ever.<\/p>\n

On average, PERA\u2019s investment staff more than doubled their take-home pay, earning bonuses of $299,000 \u2014 the equivalent of tacking an extra 124% onto their salaries.<\/p>\n

Nine investment officials received more than $400,000 each in annual incentive payments that are supposed to reward good performance. Two people tripled their salaries through the incentives.<\/p>\n

All followinga year in whichPERA\u2019s investments faltered badly.<\/p>\n

PERA\u2019s board of trustees has adopted an aggressive compensation policy to attract financial sector talent and keep its investment staff from leaving for better pay. The practice has become increasingly common across the country, pension experts say, as public sector retirement systems struggle to compete with endowments and private investment firms for employees.<\/p>\n

But while many of PERA\u2019s counterparts put limits on how much their investment staff can earn, Colorado\u2019s pension board has imposed few constraints, setting pay targets well above its peers.<\/p>\n

Some employees will reap the rewards for life; under Colorado law, incentive pay counts toward their future retirement benefits.<\/p>\n

In an interview with The Colorado Sun, top PERA officials defended the practice, saying the bonuses more than pay for themselves. Over the last decade, PERA\u2019s 8.3% investment return ranks in the top 10% of public pensions. And, pension officials say, if they outsourced more of their investments to private firms, it would cost far more than doing it in-house. found that outside investment management can cost pensions three times more than using their own staff.<\/p>\n

\u201cOur mission is to provide retirement security for our members, and so that means we need to recruit and retain the talent necessary to run PERA according to best practices,\u201d Andrew Roth, PERA\u2019s executive director, told The Colorado Sun in an interview. \u201cFrom the investment program perspective, that means we have to attract and retain talented individuals who are able to outperform the market.<\/p>\n

\u201cWe could turn the investment program over to the private sector to run for us; we\u2019d pay about $80 million a year more,\u201d Roth said. \u201cIn order to retain the talent we have, I view our compensation program as a financial safeguard for our retirees and for our members.\u201d<\/p>\n

But critics see a disconnect between how PERA pays its staff and the grim financial reality faced by the people it serves. Since 2010, PERA has gone through two rounds of benefit cuts and contribution hikes to try to close a $29 billion funding gap. In that time, retired state workers, school teachers and bus drivers have lost 21% of their pensions\u2019 value to inflation, according to .<\/p>\n

For the average PERA retiree making $39,000 a year from their pension, that\u2019s the equivalent of a $8,000 pay cut.<\/p>\n

The public workforce faces financial strain of its own. Colorado teachers and state workers have long earned less than their counterparts in other states \u2014 something lawmakers have tried to address by increasing K-12 funding and installing a new pay plan for the state workers\u2019 union. But the state budget crisis is threatening to stop both efforts in their tracks.<\/p>\n

\u201cThe teachers, the janitors, all the people that contribute to this \u2014 they are struggling. They don\u2019t get raises. They don\u2019t get awards for doing their jobs,\u201d Eunice Botchway, a PERA board member, said at a meeting in December. \u201cAs a trustee, what do I tell the teachers that are struggling?\u201d<\/p>\n

Meanwhile, the amount PERA sets aside for employee bonuses has ballooned from $4.6 million in 2018 to $11.7 million \u2014 and it\u2019s set to rise again this year to $13.1 million, after the board approved a 13% increase in November.<\/p>\n

Hilary Glasgow, who leads the state workers\u2019 union, called the bonuses \u201cinsane\u201d \u2014 especially at a time the state is slashing healthcare, affordable housing and childcare programs.<\/p>\n

\u201cThis is not just an affront to public employees, to state employees or teachers, all of the county workers who pay into PERA,\u201d Glasgow told The Sun. \u201cThis is an affront to taxpayers across the board, that this is how their money is being used: to give big bonuses to wealthy investment bankers, who are doing it under the guise of public service.\u201d<\/p>\n

Bonuses grow in good years and bad\u00a0<\/h2>\n

PERA has offered incentive pay since at least 2003, according to pension system documents. But it wasn\u2019t until the last decade that it became such a large component of the investment staff\u2019s compensation.<\/p>\n

The outsized growth has led to scrutiny at the state Capitol. Last year, lawmakers passed a bill to require PERA to publicly disclose the incentive payments on its website for the first time. But the data it published was limited to 2025, and didn\u2019t include employee names.<\/p>\n

Through open records requests, The Sun obtained the last six years of employee compensation data, PERA\u2019s internal policies on bonus pay and 10 years of budget documents. PERA would not provide payroll data prior to 2020, citing technological constraints caused by a change in its accounting software.<\/p>\n

Of the 38 people who managed PERA\u2019s investments since 2020, 18 doubled their salaries through incentives, The Sun\u2019s analysis found. Eight more earned a 90% bonus on top of their base pay. And everyone on the investment team met enough of their goals to earn some incentive pay, if eligible.<\/p>\n

The average bonus payout per employee rose dramatically to $294,000 last year from $187,000 in 2020.<\/p>\n