Colorado

Jan 30, 2010 10:52 AM by Associated Press

Colorado Senate gives initial OK to pension overhaul

The Senate gave initial approval Friday to overhauling the state pension system, including cutting retiree benefits.

Backers say the measure (Senate Bill 1) will prevent the system from going broke in 20 years.

Retirees would get no cost of living increase this year and a 2 percent increase next year. The retirement age would rise from 55 to 60 and contributions would increase for both employers and employees.

Republican Sen. Nancy Spence tried but failed to protect benefits for existing retirees. Cutting their benefits accounts for half the savings lawmakers are trying to achieve.

Other GOP senators wanted to allow new workers to opt for a 401(k)-style plan but Senate President Brandon Shaffer said their contributions are also needed for the plan to work.

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