Colorado § 31-31-819 - Funding of death and disability benefits.

§ 31-31-819. Funding of death and disability benefits.

(1) For members who die or are disabled on or after January 1, 1980, the death and disability benefits provided to any member pursuant to this part 8 is paid for by state money transferred to the fire and police members' benefit investment fund created by section 31-31-301 (1)(a), subject to the limitations imposed by this section. Money in the disability and death benefits trust fund created by section 31-31-821 shall not be used for any purpose other than the payment of the death and disability benefits established by this part 8.

(2) The board shall submit an annual actuarial valuation report dated January 1 of the year in which the report is submitted, regarding the benefit liabilities accrued under this part 8 to the state auditor, the legislative audit committee, and the joint budget committee of the general assembly, together with any recommendations concerning such liabilities as accrued.

(3) (a) To ensure that there is sufficient money to pay death and disability benefits for members hired before January 1, 1997, the state treasurer shall issue warrants to the fire and police pension association on July 1, 2022, and July 1, 2023, in an amount equal to six million six hundred fifty thousand dollars for each warrant and on July 1, 2025, and every July 1 thereafter through July 1, 2059, in an amount equal to two million fifty thousand dollars for each warrant. The warrant issued on July 1, 2022, is to be paid from the general fund, and the remaining warrants are to be paid from the death and disability payment cash fund created in subsection (3)(b) of this section. The board shall deposit this money in the statewide death and disability trust fund created in section 31-31-821.

(b) (I) The death and disability payment cash fund is created in the state treasury. The fund consists of money transferred to the fund in accordance with subsections (3)(b)(II) and (3)(b)(III) of this section. In accordance with section 24-36-114 (1), the state treasurer shall credit all interest and income derived from the deposit and investment of money in the fund to the general fund. The state treasurer shall use the money in the fund for the warrants issued on July 1, 2023, July 1, 2025, and every July 1 thereafter through July 1, 2059, in accordance with subsection (3) of this section.

(II) On July 1, 2022, the state treasurer shall transfer six million six hundred fifty thousand dollars from the general fund to the death and disability payment cash fund created in subsection (3) of this section.

(III) On July 1, 2025, and every July 1 thereafter through July 1, 2059, the state treasurer shall transfer two million fifty thousand dollars from the general fund to the death and disability payment cash fund created in section (3)(b)(I) of this section.

(4) For each member hired on or after January 1, 1997, who is eligible for the death and disability coverage provided by this part 8, a contribution shall be made to the death and disability account in the fund for the year 2021 in an amount not greater than three percent of the member's salary. Thereafter, the board, based on an annual actuarial valuation, may adjust the contribution rate every year, but in no event may the adjustment for any one-year period exceed two-tenths of one percent of the member's salary. Any employer and any local pension board or authority shall provide such information as may be required by the board in order to complete the annual actuarial valuations. The actuary appointed by the board may use either the entry age-normal cost method or the aggregate cost method for purposes of the study required by this subsection (4). Any unfunded accrued liability shall be funded over a period not to exceed thirty years. The actuarial study shall not include any consideration of a cost of living adjustment to benefits awarded to members who are occupationally disabled. Payments shall be made by the employer and are due no later than ten days following the date of payment of salary to the member. The payments required by this section are subject to interest if not submitted when due. Any decision regarding whether the contribution required by this subsection (4) are assessed against the employer or the member, or shall in some manner be assessed jointly against the employer and the member, will be made at the local level using the usual process for determining employee benefits. If it is not already part of the usual process for determining employee benefits, the employer shall confer with the employees or their representative prior to making a determination on how the contribution will be assessed.

Source: L. 2026: Entire part R&RE, (SB 26-039), ch. 37, p. 176, § 1, effective August 12.

Editor's note: This section is similar to former § 31-31-811 as it existed prior to 2026.

ANNOTATION

Annotator's note. Since § 31-31-819 is similar to § 31-30-1014 as it existed prior to the 1996 amendment that relocated parts 3 through 10 of article 30, a relevant case construing the provisions of that section has been included in the annotations to this section.

As "gatekeeper" of state moneys, fund's administrative board must insure that employers maintain a level of annual contributions to pay earned benefits to present and future plan members and see that no state moneys are used to fund a continuation of full rank escalation benefits after January 1, 1980. Pueblo v. Fire and Police Pension Ass'n, 827 P.2d 597 (Colo. App. 1992).

Ample and competent evidence supported the decision of fund's administrative board that city had elected to continue rank escalation benefits after January 1, 1980. Pueblo v. Fire and Police Pension Ass'n, 827 P.2d 597 (Colo. App. 1992).